Home > Topics > Specific Strategies and Mechanisms for Facilitating Access to Innovation > Reservation of Rights for Humanitarian Uses > Editor's Summary, Implications and Best Practices

Provided they are both legal and agreed to by the parties, the terms and provisions of a contract can be almost limitless. This chapter focuses on a very important set of terms for universities granting technology licenses: the reservation of rights. These terms can be used to ensure that the licensor preserves the right to use the licensed technology to pursue educational, research, and humanitarian goals—including distribution rights in developing countries.

In essence, the terms of a license can subdivide the rights over the technology, allowing the licensor to use the technology to achieve university goals. Rights can be segmented and apportioned over different markets or economic contexts in which the technology is used (such as farm size, farm income, or income derived from a particular crop) over different income levels (for example, per capita gross domestic product) of the agents that use the technology, or over different geographic regions (by country, or by low-land or high-land agricultural systems). Of course, any combination of these divisions can be created as well. This practice can be used by technology owners, including public-sector research institutions, to maximize the application of their technology. Most importantly, if skillfully deployed, subdividing can allow both commercial and non-commercial uses of the technology to proceed in parallel. Other broad benefits of using these terms include:

• The practice is voluntary and initiated by the technology owner. It is therefore independent of any sort of policy reform and can be done at any time. Anyone can use this approach right now.
• A license can be strengthened by precisely defining exactly which rights are granted to the licensee and which are not. This provides greater clarity and leaves less room for misinterpretation and disagreement.
• The practice can protect a licensor’s core interests, such as establishing its own right to continue to use the technology for research purposes or other missions of the institution, such as education or public outreach.

A humanitarian reservation of rights clause will contain definitions of what constitutes humanitarian and commercial purposes, so as to clearly articulate how the market will be segmented between these two interests. In addition, humanitarian use will need to be defined, for example geographically (to indicate developing countries) or it may be defined based on levels of subsistence.

This chapter provides suggestions for creating explicit reservation of rights in a commercial technology license. This will ensure that institutional objectives, to support humanitarian applications of technologies that have applications to the needs of the poor, are not inadvertently compromised. Overly broad commercial licenses can lead to such loss of rights, but, as this chapter shows, these rights can be retained through the careful drafting and inclusion of humanitarian reservation of rights clauses in agreements. Furthermore, from a policy (and mission) perspective, the regular use of these clauses can be a way to clearly, and regularly, articulate the institutional commitment to provide access to technologies for the greatest public benefit. The chapter also includes several examples of language used to include humanitarian use rights in exclusive licenses.

Key Implications and Best Practices

Given that IP management is heavily context specific, these Key Implications and Best Practices are intended as starting points to be adapted to specific needs and circumstances.

For Government Policymakers

• One of the benefits of enabling public research institutions to own IP rights is that institutions can control how technology is deployed both commercially and non-commercially through the terms it builds into its licensing contracts; this includes the option of incorporating humanitarian use reservation provisions in commercial licensing contracts. These will then facilitate public sector institutional missions of providing the poor with critical advances in health and agricultural innovation.
• Other policy options are blunter, less efficient tools. For example, if public research institutions are encouraged to release results into the public domain, incentives to invest in commercial development may be destroyed and the economic development opportunity lost. Compulsory licensing leads to price ceilings that may be above the level of what would be economically feasible for humanitarian development and distribution purposes.

For Senior Management (university president, R&D manager, etc)

• The manager of a technology transfer program that is mandated simply to maximize revenues for the institution is unlikely to ever reserve rights for humanitarian use. University leaders should therefore require that the full mission of an institution be taken into account when making licensing decisions.
• Consider creating an institutional policy that standardizes the reservation of a basic set of rights on all technologies. Potential licensees are less likely to resist if they know that the terms being requested are “standard” and part of the deal in doing business with your institution.

For Scientists

• As the inventor, you can significantly influence how your technology is used. For example, you can very reasonably insist upon license terms that reserve for you the rights to continue your research using your technology. It is not a big leap from there to insist on similar terms that reserve the rights for humanitarian uses of your technology.

For Technology Transfer Officers

• The practice of reserving rights for humanitarian use may require additional work and will not probably generate licensing income. But by adding these terms you take the full mission of your institution—and your best humanitarian impulses—into account.
• Develop a series of template agreements incorporating humanitarian use reservation clauses. Work with counsel to draft these. These, then, will be readily available for use during licensing negotiations for commercial development of technologies developed at your institution.