History

• The Paris Convention of 1883, was one of the first international treaties concerning intellectual property rights, including patents. Section A5(2) of the treaty recognized the right of each member country to enact laws providing for compulsory patent licenses to prevent abuse of patent laws.The treaty specifically identifies "failure to work" as a form of patent abuse, but does not limit the scope of compulsory licenses. In 1994, the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPs) was established and is administered by the World Trade Organization. Article 31 of the TRIPs agreement permits compulsory licensing and government use of patents, so long as certain conditions are met to protect the patent owner's rights.
  
  

U.S. Government Use

• In addition to the international treaties and agreements allowing mandatory patent licensing for government use, U.S. federal law also establishes this type licensing. Title 28 U.S.C.1498 states that federal employees are authorized to use a patent when working on government projects without seeking a license from or negotiating with the patent owner. This use also applies to private contractors working on government contracts. The patent owner is entitled to reasonable compensation for such use, but cannot prevent it.
  
  

Environmental Protection

• Federal law also allows mandatory patent licensing in order to comply with environmental laws and regulations. Anyone subject to these laws can petition the administrator of the Environmental Protection Agency for a mandatory patent license for technology that will be needed for compliance. If the administrator agrees with the need for such a license, the attorney general will obtain an order from a U.S. District Court that requires the patent owner to provide a license on the terms set by the court, including reasonable compensation.
  
  

Drugs for Treating Illnesses

• Perhaps the most controversial area of mandatory patent licensing concerns drugs for treating illnesses such as AIDS and HIV. Although widely available in western countries, these drugs are difficult to come by in developing countries. Moreover, the developing countries lack the manufacturing technology to produce these drugs even if licenses were provided. To address the issue, the TRIPs agreement was modified by declaration of the member countries to permit mandatory patent licensing in developed countries so long as the drugs produced were for export only to certain countries, typically those on the UN's list of least-developed countries.
  
  

Waiver of Mandatory Patent License

• In certain cases involving national emergency, such as a pandemic or anthrax terrorist attack, the need for a mandatory patent license may be waived in order to meet the threat to public safety.