Madam Speaker

Honourable Members

The Intellectual Property Rights from Publicly Financed Research and Development – or IPR - Bill is an important development in our country’s ongoing efforts to address the challenges presented by what we call the "innovation chasm". This chasm refers to the apparent gap between the local knowledge base and the extent to which this knowledge is effectively translated into commercialisable products and services within our own borders.

Over the past 15 years, our universities and science councils filed fewer than 5% of all patent applications made by South Africans. Further analysis shows that a number of patents emanating from South African institutions have since been sold to foreign companies and have typically been commercialised offshore, with very little benefit accruing to the people of our country.

Our own assessment of this has revealed that such intellectual property losses are mostly due to a lack of clarity on how intellectual property, and specifically that which is developed with public funds, should be managed and commercialised.

Given this background, the 2007 OECD Review of South Africa’s National System of Innovation has reiterated the need for South Africa to regulate the manner in which intellectual property emanating from public funds may be disposed of.

Honourable members, from the outset it is important that we recognise intellectual property as an instrument for economic growth and the improvement of the quality of life of all South Africans. It is therefore essential that we not only encourage the development of South African IP by providing public funding, but that we also manage such intellectual property to the full benefit of all the people of the Republic. 

Honourable Members, as you will recall, in the 2002 National Research and Development Strategy we proposed that South Africa’s approach to intellectual property management should:

v   draw on enabling frameworks of global best practice;

v   not place South African institutions at a disadvantage relative to international practice;

v   create a context for benefit sharing by inventors and innovators;

v   require an obligation to protect intellectual property emanating from publicly financed research and development;

v   establish the right of the state to acquire the right to use such IP in the public interest;

v   establish an acceptable framework for the disposal of IP rights, including the conditions under which the rights can be acquired internationally; and finally

v   provide for the establishment of an intellectual property fund that would fund patenting costs where this is in the national interest.

I am therefore honoured to present to you today the IPR Bill, which has all of these attributes, and will not only provide an enabling environment for intellectual property creation, protection and management, but will also support the commercialisation of IP by providing greater clarity on the ownership of IP generated through publicly financed research.

In fact, it is the specific object of the legislation that intellectual property which emanates from publicly financed research and development, should be commercialised for the benefit of our people, and should be available to South Africans and protected from appropriation.

Where this condition is not met, the legislation provides for a mechanism for the state to address this.

Through the proposed IPR legislation, we hope to provide a framework for the establishment of capacity to ensure that South African institutions are better able to identify, protect and commercialise intellectual property arising from research conducted at those institutions. 

These interventions will be supported and guided by the National Intellectual Property Management Office, which is to be established in order to implement the objectives of this legislation.

Honourable members, we have travelled a long and fruitful road towards this end. During 2006, the Policy Framework on Intellectual Property Rights from Publicly Financed Research was developed through a rigorous consultative process with all role players. The aim was to meet the obvious need for a proper policy framework and enabling legislative environment for the effective management of intellectual property that emanates from publicly financed research.

The first draft of the Bill, which was approved for public consultation by the Cabinet in May 2007, was informed by this Policy Framework. Following the publication of the first draft of the Bill in June 2007, extensive work has gone in reviewing the numerous public comments received, revising the Bill, and testing its various provisions against international best practice and the attributes set out in the National Research and Development Strategy.

An international review panel, comprising experts from South Africa, India, Canada and the USA, provided further inputs that resulted in the refinement the bill in line with global experiences and best practices.

Then, in June 2008, Cabinet approved the amended Bill.

On 29 and 30 July 2008, the Portfolio Committee on Science and Technology, in conjunction with the Select Committee on Education and Recreation, held its first round of public hearings on the IPR Bill.

I understand the rich and rigorous engagements with role players from industry, universities and science councils during these hearings further demonstrated the urgent need for a legislation of this nature in South Africa.

The hearings also revealed that over the years, South Africa has missed out on golden opportunities to create new industries that could have created sustainable jobs from the commercialisation of intellectual property emanating from publicly financed research and development, because some of our researchers and scientist acted selfishly, and allowed valuable intellectual property to leave the country.

Honourable Members, global competitiveness today is ultimately determined by the extent to which knowledge generation is harnessed as part of a concerted national effort for further development and economic growth. 

Our ability to create, and subsequently derive enduring benefits from our national knowledge base, is dependent on the extent to which we are able to effectively translate our publicly funded research and development into innovative products and services that can be commercialised for the benefit of all South Africans. This will require of us to support our knowledge generating institutions to enable them to develop sufficient capacity for the effective identification, protection and commercialisation of the knowledge generated by their researchers through public funding.

It is in this context that the IPR Bill was drafted. The Bill is intended to support higher education and other research institutions by clarifying the roles and responsibilities of various players in respect of the management of publicly financed intellectual property.

Furthermore, it is a specific intent of the Bill to ensure that the State has a right to use IP emanating from publicly financed research and development in the public interest, including healthcare. To entrench the rights of the State in this regard, appropriate walk-in rights have been included in the Bill for non-commercialisation of the IP, and where appropriate, grant third party rights to commercialise the IP in the public interest.

To conclude, may I take this opportunity to express my gratitude to the Deputy Minister, the Honourable Derek Hanekom, the Portfolio Committee, led by the Honourable Godfrey Oliphant, whose insights and interrogations have helped strengthen this piece of legislation, the Select Committee on Education and Recreation, ably led by the Honourable B J Tolo, the Director-General of Science and Technology, Dr Phil Mjwara, and the management and staff of my Department, who worked tirelessly to support the drafting of this legislation, and the protracted role player consultation processes, which had led to the drafting of the Bill before us today.

Madam Speaker, I present to the House the Intellectual Property Rights from Publicly Financed Research and Development Bill for the Second Reading Debate.

Thank you.