Article 40 of TRIPS records the Agreement of members that some licensing practices or conditions pertaining to intellectual property rights, which restrain competition, may have adverse affects on trade and may impede the transfer and dissemination of technology. South Africa confirms this position.
Article 40.2 provides that members will not be prevented from specifying in their legislation certain practices or conditions which may constitute an abuse of intellectual property rights. Members may adopt appropriate measures to prevent or control such practices.
The South African Patents Act has the following relevant provisions:
Section 57: This section provides that any contract, insofar as it relates to a licence under a patent, shall terminate on the date on which the patent under which the licence was granted, expires, is revoked or otherwise ceases to protect the invention.
Section 90: This section provides as follows:
(1) Any condition in a contract relating to the sale of a patented article or to a licence under a patent of which the effect will be:
(a) to prohibit or restrict the purchaser or licensee from purchasing or using any article or class of articles, whether patented or not, supplied or owned by any person other than the seller or licensor or his nominee;
(b) to prohibit or restrict the licensee from using any article or process not protected by the patent;
(c) to require the purchaser or licensee to acquire from the seller, licensor or his nominee any article or class of articles not protected by the patent;
(d) to require or induce the purchaser to observe a specified minimum resale price in respect of any article or class of articles protected by the patent; or
(e) to prohibit or restrict the making, using, exercising or disposing of the invention concerned in any country in which the invention is not patented,
shall be null and void.
(2) Nothing in this section shall
(a) affect any condition in a contract whereby a person is prohibited from selling any goods other than those of a particular person; or
(b) affect any condition in a contract for the lease of or a licence to use a patented article, whereby the lessor or licensor reserves to himself or his nominee the right to supply such new parts of the patented article, other than ordinary articles of commerce, as may be required to put or keep it in repair.
No corresponding provisions appear in the Trade Marks Act, Copyright Act or Designs Act.
It should be pointed out that South Africa has a well developed common law system of unlawful competition, on the basis of which anti competitive practices may be challenged. South Africa also has on its statute book the Maintenance and Promotion of Competition Act 96 of 1979, in terms of which certain anti competitive practices may be challenged.
