Thursday, January 15, 2015
License Agreements with Local Companies in China and Other Asian Countries when Transferring Technology Overseas
Presented by
Representative Attorney Kenji Kuroda
Hosted by
Science & Technology Co., Ltd.
Curian (Ōimachi, Shinagawa-ku, Tokyo)

Seminar outline

Recently, many Japanese companies have been transferring their technology to China and other Asian countries. In this seminar, founding partner Kenji Kuroda, an attorney who has been active on the front line of international legal affairs for over 25 years, explains basic points and example cases of problems relating to license agreements when transferring technology to local companies in China and other Asian countries in an easy-to-understand way that is accessible to employees from outside the Legal department as well.
In this seminar, Mr. Kuroda firstly sets out the matters that a company should consider before a technology transfer. Next, he explains the major points of drafting and executing technical license agreements, which are particularly important in foreign technology transfers, with references to provisions from sample contracts. He also details the legal systems concerning technology transfers in China and other Asian countries. Finally, Mr. Kuroda discusses problem cases that often occur in practice when transferring technology to China and other Asian countries and looks at how to resolve them.

Skills and knowledge you will gain
This seminar will provide you with a thorough understanding of drafting license agreements for technology transfers to other countries. An understanding of the legal systems aimed at protecting domestic businesses in each country is important for Japanese companies, as they are frequently licensors, and you will learn about the legal systems particular to China and other Asian countries through this seminar. Further, through an introduction of several problem cases, you will find out about difficulties that Japanese companies are often involved in and ways of handling them.

Key points

  1. Fundamentals of license agreements for foreign technology transfers
    1. Points requiring care when agreeing on technology transfers
      1. Process leading to contract
      2. Types of rights that can be covered by agreements, and the methods of acquiring and transferring them
        1. Types of rights
        2. Methods of acquiring rights
        3. Methods of transferring rights
      3. Points requiring care for the party providing technology and the party receiving technology (e.g. the importance given to licenses in the business; advance investigation)
    2. Sample provisions to consider and points to note when drafting agreements
      1. Definitions
        1. Licensed rights
        2. Licensed products
        3. Territory
      2. Licenses (e.g. types of license; allowing sublicenses)
      3. Competing products (e.g. prohibiting licenses of similar technology from competitors)
      4. Scope and disclosure of technical information (e.g. identification and restriction of technical documents)
      5. Consideration (e.g. consideration; auditing; taxes)
      6. Warranties and liability (e.g. warranties and liability on completeness and on non-infringement)
      7. Improved technology (e.g. granting back)
      8. Confidentiality (e.g. clarifying the scope of confidentiality)
      9. Effective term and termination
      10. Measures at termination and other matters
      11. Effective provisions for the particular restrictions in each country
  1. Legal systems particular to various countries
    1. China
    2. Taiwan
    3. South Korea
    4. India
    5. Thailand
    6. Indonesia
    7. Vietnam
    8. Malaysia
  1. Problems that often occur in practice and ways to handle them
    1. Problems concerning royalties (e.g. refusal to pay royalties on the grounds of defects in contract registration)
    2. Leaks of confidential information (e.g. leaks of secrets by licensees; usurped applications)
    3. Problems concerning warranties and liability (e.g. pursuing liability under warranties on non-infringement and entirety)
    4. Problems concerning improved technology (e.g. requiring consideration for exploiting improved technology; requiring disclosure of improved technology)
    5. Sales outside the licensed territory (e.g. exports outside the licensed territory by the licensee’s sellers)
    6. Diversion of licensed products (e.g. diversion of products to manufacturing outsourcing vendors)
    7. Demands for continued use of technology after termination of the agreement (e.g. demands for continued use of technology based on misunderstanding of the Regulations on Administration of Import and Export of Technologies)