Licensing - Competition Law issue with grantback

A clause with the purport to assign IP over improvements back to Discloser is likely to be considered as anti-competitive in the light of:

 

Business Competition Supervisory Commission's guidelines (Regulation of Business Competition Supervisory Commission No. 2 of 2009 Concerning Guidelines for the Exemption of the Application of Law No. 5 of 2009 Concerning Prohibition of Monopolistic Practices and Unfair Business Competition against Intellectual Property Rights Related Agreements; relevant guidelines as follows: Grant back is one of provisions in a license agreement in which the licensee is required to always open and transfer information to the licensor on all improvements and developments made to the licensed product, including know-how related to the development. In analyzing if the clause concerning grant back is anti competitive nature, each party should consider such measures is preventing the licensee to advance in technology possession and contains unfair element because it legitimizes the licensor to always have the right of intellectual works which is not produced by itself. Therefore, a clause in license agreement which is containing grant back obligation, must be seen as an obvious anti-competitive clause.

Suggested alternative to grant back:

The Recipient acknowledges that any intellectual property developed as a result of the Business Collaboration shall be licensed to Discloser; and Recipient shall not disclose information relating to such intellectual property without Discloser's written consent. [Alternate -. The Recipient acknowledges that any intellectual property developed as a result of the Business Collaboration shall be jointly owned by Discloser and Recipient in equal and undivided shares; and the Recipient agrees to execute any documentation or do any act or thing reasonably necessary or desirable for the purpose of effecting the registration of such intellectual property to be protected as patent or such other form of intellectual property that Discloser designates