Intellectual Property Code

(R.A. No. 8293) [Note: Exclude Implementing Rules and Regulations]

- Intangible property rights granted by law to owners of intellectual creations such as

inventions, designs, signs, and names used in commerce, and literary and artistic
works

PATENTS
- A patent is an exclusive right granted for an invention, which is a product or a
process that provides, in general, a new way of doing something, or offers a new
technical solution to a problem. To get a patent, technical information about the
invention must be disclosed to the public in a patent application [World Intellectual
Property Organization].

1. Patentable Vs. Non-Patentable Inventions

a. Patentable Invention
A patentable invention is any technical solution of a problem in any field of human
activity which is new, involves an inventive step and is industrially applicable. It
may be, or may relate to, a product, or process, or an improvement of any of the
foregoing [Sec. 21, RA 8293].

b. Non-Patentable Inventions
The following shall be excluded from patent protection:
1. Discoveries, scientific theories, and mathematical methods, and in the case of
drugs and medicines, the mere discovery of a new form or new property of a
known substance which does not result in the enhancement of the known efficacy
of that substance, or the mere discovery of any new property or new use for a
known substance, or the mere use of a known process unless such known
process results in a new product that employs at least one new reactant. Salts,
esters, ethers, polymorphs, metabolites, pure form, particle size, isomers,
mixtures of isomers, complexes, combinations, and other derivatives of a known
substance shall be considered to be the same substance, unless they differ
significantly in properties with regard to efficacy [Sec. 22.1, RA 8293 as amended
by RA 9502];

2. Ownership Of A Patent

Term of Patent
The term of a patent shall be 20 years from the filing date of the application.
(Sec. 54, IP Code)

Right to a Patent
 The right to a patent belongs to the inventor, his heirs, or assigns. When two (2) or
more persons have jointly made an invention, the right to a patent shall belong to
them jointly. (Sec. 28, IP Code)
First-to-File Rule
If two (2) or more persons have made the invention separately and independently of
each other, the right to the patent shall belong to the person who filed an application
for such invention, or where two or more applications are filed for the same invention,
to the applicant who has the earliest filing date or the earliest priority date. (Sec. 29,
IP Code)

3. Grounds For Cancellation Of A Patent

Any interested person may, upon payment of the required fee, petition to cancel the
patent or any claim thereof, or parts of the claim, on any of the following grounds:
1. That what is claimed as the invention is not new or patentable;
2. That the patent does not disclose the invention in a manner sufficiently clear
and complete for it to be carried out by any person skilled in the art; or
3. That the patent is contrary to public order or morality.

NOTE: Where the grounds for cancellation relate to some of the claims or parts of
the claim, cancellation may be effected to such extent only.

4. Patent Infringement
Consists of the following acts:
1. making, using, offering for sale, selling, or importing a patented product or a
product obtained directly or indirectly from a patented process; or
2. use of a patented process without the authorization of the patentee
constitutes patent infringement.

NOTE: To be able to effectively and legally preclude others from copying and
profiting from the invention, a patent is a primordial requirement. No patent, no
protection. (Pearl & Dean (Phil.) v. Shoemart, G.R. No. 148222, 2003)

There can be no infringement of a patent until a patent has been issued, since
whatever right one has to the invention covered by the patent arises alone from the
grant of patent. (Creser Precision Systems, Inc. v. Court of Appeals, G.R. No.
118708, 1998)

TRADEMARKS
Modern authorities on trademark law view trademarks as performing three distinct functions:
(1) they indicate origin or ownership of the articles to which they are attached;
(2) they guarantee that those articles come up to a certain standard of quality; and
(3) they advertise the articles they symbolize. (Mirpuri v. Court of Appeals, G.R. No.
114508, 1999)
1. Marks Vs. Collective Marks Vs. Trade Names
A name or designation may not be used as a trade name if, by its nature or the use
to which such name or designation may be put:
1. It is contrary to public order or morals;
2. It is liable to deceive trade circles or the public as to the nature of the enterprise
identified by that name; or
3. It is similar to a mark or a trade name owned by another person and its use would
likely mislead the public.

- A trade name refers to the business and its goodwill; a trademark refers to the goods.
(Canon Kabushiki Kaisha v. Court of Appeals, G.R. No. 120900, 2000)

2. Acquisition Of Ownership
The rights in a mark shall be acquired through registration made validly in
accordance with the provisions of this law. (Zuneca Pharmaceutical v. Natrapharm,
Inc., G.R. No. 211850, 2020)

NOTE: Any person who shall procure registration in the Office of a mark by a false or
fraudulent declaration or representation, whether oral or in writing, or by any false
means, shall be liable in a civil action by any person injured thereby for any damages
sustained in consequence thereof. (Sec. 162, IP Code)

a. Concept Of Actual Use

Declaration of Actual Use Within 3 years from the filing date of the application,
the applicant or the registrant shall file a declaration of actual use of the mark
with evidence to that effect. Failure to do so shall result to a refusal of the
application or removal of the mark from the Register by the Director. (Section
124.2, IP Code)

A certificate of registration shall remain in force for ten (10) years. (Section 145,
IP Code)

b. Effect Of Registration
Administrative Confirmation Registration is only an administrative confirmation of
the existence of the right of ownership of the mark, but does not perfect such
right; actual use thereof is the perfecting ingredient. The registration of a
trademark unaccompanied by actual use thereof in the country accords the
registrant only the standing to sue for infringement in Philippine courts. (Philip
Morris v. Fortune Tobacco, G.R. No. 91332, 1993)

A certificate of registration of a mark shall be prima facie evidence of the validity

of the registration, the registrant’s ownership of the mark, and of the registrant’s
 exclusive right to use the same in connection with the goods or services and
those that are related thereto specified in the certificate. (Section 138, IP Code)

3. Well-Known Marks
The countries of the Union undertake, ex officio if their legislation so permits, or at
the request of an interested party, to refuse or to cancel the registration, and to
prohibit the use, of a trademark which constitutes a reproduction, an imitation, or a
translation, liable to create confusion, of a mark considered by the competent
authority of the country of registration or use to be well known in that country as
being already the mark of a person entitled to the benefits of this Convention and
used for identical or similar goods. These provisions shall also apply when the
essential part of the mark constitutes a reproduction of any such well-known mark or
an imitation liable to create confusion therewith. (Art. 6bis, Paris Convention)

4. Rights Conferred By Registration

The owner of a registered mark shall have the exclusive right:
1. to prevent all third parties not having the owner’s consent
2. from using in the course of trade identical or similar signs or containers for goods
or services which are identical or similar to those in respect of which the
trademark is registered 3. where such use would result in a likelihood of
confusion.

NOTE: In case of the use of an identical sign for identical goods or services, a
likelihood of confusion shall be presumed. (Sec. 147.1, IP Code)

5. Cancellation Of Registration
A petition to cancel a registration of a mark may be filed with the Bureau of Legal
Affairs by any person who believes that he is or will be damaged by the registration of
a mark under this act as follows:
1. Within 5 years from the date of registration of the mark under;
2. at any time, if the registered mark becomes the
a. generic name for the goods or services, or a portion thereof, for which it is
registered;
b. has been abandoned;
c. registration was obtained through fraud or contrary to the provisions of the
Act;
d. the mark is being used by, or with the permission of, the registrant so as to
misrepresent the source of the goods or services on or in connection with
which the mark is used.

6. Trademark Infringement
A person shall be liable for trademark infringement if, without the consent of the
owner of the registered mark, he:
 i. Uses in commerce any reproduction or colorable imitation of a registered mark or
the same container or a dominant feature thereof in connection with the sale,
offering for sale, distribution, advertising of any goods or services which is likely
to cause confusion, or to cause mistake, or to deceive;

NOTE: This includes other preparatory steps necessary to carry out the sale of any
goods or services.

ii. Reproduces or colorably imitates a registered mark or a dominant feature thereof

and applies such reproduction or colorable imitation to signs, packages, or
advertisements intended to be used in commerce upon or in connection with the
sale, offering for sale, distribution, or advertising of goods or services which likely to
cause confusion, or to cause mistake, or to deceive.

NOTE: It is immaterial that there was no actual sale of goods or services using the
infringing material as long as the acts mentioned were actually committed. (Sec. 155,
IP Code)

7. Unfair Competition
A person who has identified in the mind of the public the goods he manufactures or
deals in, his business or services from those of others, whether or not a registered
mark is employed, has a property right in the goodwill of the said goods, business or
services so identified, which will be protected in the same manner as other property
rights. (Sec. 168.1, IP Code)

Trademark Infringement vs. Unfair Competition

The law on unfair competition is broader and more inclusive than the law on
trademark infringement. Trademark infringement is more limited, but it recognizes a
more exclusive right derived from the trademark adoption and registration by the
person whose goods or business is first associated with it. The law on trademarks is
a specialized subject distinct from the law on unfair competition, although the two
subjects are entwined with each other and are dealt with together in the IP Code.

COPYRIGHTS

BASIC PRINCIPLES
Copyright is not primarily about providing the strongest possible protection for copyright
owners so that they have the highest possible incentive to create more works. The control
given to copyright owners is only a means to an end: the promotion of knowledge and
learning. The goal of copyright is to promote creativity and encourage creation of works.
(ABS-CBN Corp. v. Gozon, G.R. No. 195956, 2015)

1. Copyrightable Works
a. Original Literary or Artistic Works These are original intellectual creations in the
literary and artistic domain protected from the moment of their creation
 Work of Architecture
Copyright in a work of architecture shall include the right to control the erection of any
building which reproduces the whole or a substantial part of the work either in its
original form or in any form recognizably derived from the original

NOTE: The copyright in any such work shall not include the right to control the
reconstruction or rehabilitation in the same style as the original of a building to which
that copyright relates. (Sec. 186, IP Code)

b. Derivative Works The following derivative works shall be protected by copyright:

1. Dramatizations, abridgments, translations, arrangements, adaptations, and other
alterations of literary or artistic works; and
2. Collections of literary, scholarly or artistic works, and compilations of data and
other materials which are original by reason of the selection or coordination or
arrangement of their contents. (Sec. 173.1, IP Code)

Published Edition of Work

In addition to the right to publish granted by the author, his heirs, or assigns, the
publisher shall have a copyright consisting merely of the right of reproduction of the
typographical arrangement of the published edition of the work. (Sec. 174, IP Code)

2. Non-Copyrightable Works
No protection shall extend to any:
1. Idea, procedure, system, method or operation, concept, principle, discovery or
mere data [IPSMOC-PDD];
2. News of the day and other miscellaneous facts having the character of mere
items of press information; or
3. Official text of a legislative, administrative or legal nature, as well as any official
translation thereof. (Sec. 175, IP Code)

The expression of an idea is protected by copyright, not the idea itself.

Publication or republication by the government in a public document of any

copyrighted work shall not be taken to cause any abridgment or annulment of the
copyright or to authorize any use or appropriation of such work without the consent of
the copyright owner. (Sec. 176.3, IP Code)

3. Rights Conferred By Copyright

Copyright or Economic Rights
Copyright or economic rights shall consist of the exclusive right to carry out,
authorize or prevent the following acts:

1. Reproduction of the work or substantial portion of the work;

 Reproduction
Making of 1 or more copies, temporary or permanent, in whole or in part, of a
work or a sound recording in any manner or form

2. Dramatization, translation, adaptation, abridgment, arrangement transformation

of the work; or other
3. The first public distribution of the original and each copy of the work by sale or
other forms of transfer of ownership;
4. Rental of the original or a copy of an audiovisual or cinematographic work, a work
embodied in a sound recording, a computer program, a compilation of data and
other materials or a musical work in graphic form, irrespective of the ownership of
the original or the copy which is the subject of the rental;

Rental Transfer of the possession of the original or a copy of a work or a sound

recording for a limited period of time, for profit-making purposes

5. Public display of the original or a copy of the work;

6. Public performance of the work; and

Definitions of Public Performance

a. For Non-audiovisual work – reciting, playing, dancing, acting or otherwise
performing the work, either directly or by means of any device or process
b. For Audiovisual work – showing of its images in sequence and the
making of the sounds accompanying it audible
c. For Sound recording – making the recorded sounds audible at a place or
at places where persons outside the normal circle of a family and that family’s
closest social acquaintances are or can be present

7. Other communication to the public of the work, e.g. online/Internet.

4. Ownership Of A Copyright

A person to be entitled to copyright must be the original creator of the work.

He must have created it by his own skill, labor and judgment without directly copying
or evasively imitating the work of another [Wilson Ong Ching Kian Chuan v. CA, G.R.
130360 (2001)].

Ownership of copyrighted material is shown by proof of originality and

copyrightability. While it is true that where the complainant presents a copyright
certificate in support of the claim of infringement, the validity and ownership of the
copyright is presumed. This presumption however is rebuttable and cannot be
sustained where other evidence in the record casts doubt on the question of
ownership.

Valid copyright ownership denotes originality of the copyrighted material.

Originality means that the material was not copied, evidences at least minimum
 creativity and was independently created by the author [Olaño v. Lim Eng Co, G.R.
195835 (2016)].

5. Limitations On Copyright

Sections 203, 208 and 209 shall not apply where the acts referred to in those Sections
are related to:
1. The use by a natural person exclusively for his own personal purposes;
2. Using short excerpts for reporting current events;
3. Use solely for the purpose of teaching or for scientific research; and
4. Fair use of the broadcast subject to certain conditions [Sec. 212, RA 8293].

6. Doctrine Of Fair Use

The fair use of copyrighted work for criticism, news reporting, teaching (including
multiple copies for classroom use), research and similar purposes is not an
infringement of copyright [Sec. 185.1, RA 8293].

A privilege, in persons other than the owner of the copyright, to use the copyrighted
material in a reasonable manner without his consent, notwithstanding the monopoly
granted to the owner by the copyright. It is meant to balance the monopolies enjoyed
by the copyright owner with the interests of the public and of society

7. Copyright Infringement
The IP Code was amended to expand infringement not only to cover direct
infringement but also third-party infringement.

A person infringes a right protected under this Act when one:

a. Directly commits an infringement;
b. Benefits from the infringing activity of another person who commits an
infringement if the person benefiting:
1. Has been given notice of the infringing activity; and
2. Has the right and ability to control the activities of the other person;
c. With knowledge of infringing activity, induces, causes or materially
contributes to the infringing conduct of another [Sec. 216, RA 8293 as
amended by RA 10372].

It also includes the act of any person who at the time when copyright subsists in a
work has in his possession an article which he known, or ought to know, to be an
infringing copy of the work for the purpose of:
a. Selling, letting for hire, or by way of trade offering or exposing for sale, or
hire, the article
b. Distributing the article for purpose of trade, or for any other purpose to an
extent that will prejudice the rights of the copyright owner in the work; or
c. Trade exhibit of the article in public [Sec. 217.3, RA 8293].
BANKING LAWS
[R.A. 7653, as amended by R.A. 11211]

The section numbers hereinafter generally pertain to RA 7653, unless otherwise indicated.

1. State Policies

The State shall maintain a central monetary authority that shall:

1. Function and operate as an independent and accountable body corporate in the
discharge of its mandated responsibilities concerning money, banking and credit;
2. Enjoy fiscal and administrative autonomy, while being a government- owned
corporation - Considering its unique functions and responsibilities. [Sec. 1]

2. Creation of the Bangko Sentral ng Pilipinas

Created by the NCBA, the Bangko Sentral ng Pilipinas (BSP) is the independent
central monetary authority of the Philippines.

Capitalization of the BSP

The BSP has a capitalization of P200B subscribed by the Government.
[Sec. 2, as amended]

3. Responsibility and Primary Objective of BSP

The BSP is an independent central monetary authority, which replaced the Central
Bank of the Philippines and shares the same functions, but is a new entity altogether.

Nature of the BSP

a. A central monetary authority;

b. An independent and accountable body; and
c. A government-owned corporation that enjoys fiscal and administrative
autonomy. [Secs. 1 and 2]

Primary Objective and Other Responsibilities of the BSP

a. Primary objectives

1. To maintain price stability conducive to a balanced and sustainable economic

growth;
2. To promote and maintain monetary stability and the convertibility of the peso;
3. To promote financial stability and closely work with the National Government;
4. To oversee the payment and settlement systems in the Philippines; and
5. To promote broad and convenient access to high quality financial services
and consider the interest of the general public.

4. Corporate Powers

The BSP is authorized:

a. To adopt, alter, and use a corporate seal which shall be judicially noticed;
 b. To lease or own real and personal property and to sell or otherwise dispose of
the same;
c. To sue and be sued; d. To do and perform ay and all things that may be
necessary or proper to carry out the purposes of the act

Moreover, the BSP may:

a. Acquire and hold such assets and incur such liabilities in connection with its
operations authorized by the provisions of the NCBA, or as are essential to
the proper conduct of such operations
b. Compromise, condone or release, in whole or in part, any claim of or settled
liability to the BSP, regardless of the amount involved, under such terms and
conditions as may be prescribed by the MB to protect the interests of the
BSP. [Sec. 5]

5. Operations of the BSP

Authority to obtain data and information

The BSP shall have the authority to request from government offices and
instrumentalities, or government-owned or controlled corporations, any data which it
may require for the proper discharge of its functions and responsibilities.

Power to Issue a Subpoena

The BSP through the Governor or in his absence, a duly authorized representative
shall have the power to issue a subpoena for the production of the books and records
for the aforesaid purpose.

Supervision and Examination

The BSP shall have supervision over, and conduct periodic or special examinations
of:

i. Banking institutions

ii. Quasi-banks

iii. Their subsidiaries engaged in allied activities

- A subsidiary is a corporation more than 50% of the voting stock of which is

owned by a bank or quasi-bank

iv. Their affiliates engaged in allied activities

- An affiliate is a corporation the voting stock of which:

▪ To the extent of 50% or less, is owned by a bank or quasi-bank; or

 ▪ Is related or linked to such institution or intermediary through common
stockholders or such other factors as may be determined by the MB.

Bank deposits and investments

Any director, officer or stockholder who, together with his related interest, contracts a
loan or any form of financial accommodation from:

1. His bank; or
2. From a bank:
a. Which is a subsidiary of a bank holding company of which both his
bank and the lending bank are subsidiaries; or
b. In which a controlling proportion of the shares is owned by the same
interest that owns a controlling proportion of the shares of his bank

i. In excess of five percent (5%) of the capital and surplus of the bank, or

ii. In the maximum amount permitted by law, whichever is lower shall be

required by the lending bank to waive the secrecy of his deposits of
whatever nature in ALL banks in the Philippines.

Monetary Board (MB); Powers and Functions

The MB is the body through which the powers and functions of the BSP are
exercised. [Sec. 6]

Powers and Functions:

a. Issue rules and regulations it considers necessary for the effective discharge of
the responsibilities and exercise of the powers vested in it;
b. Direct the management, operations, and administration of the BSP, reorganize its
personnel and issue such rules and regulations as it may deem necessary or
desirable for this purpose;
c. Establish a human resource management system which governs the selection,
hiring, appointment, transfer, promotion, or dismissal of all personnel;
d. Adopt an annual budget for and authorize such expenditures by the BSP as are
in the interest of the effective administration and operations of the BSP in
accordance with applicable laws and regulations; and
e. Indemnify its members and other officials of the BSP.

How The BSP Handles Banks In Distress

Grounds for Appointment of a Conservator

Whenever, on the basis of a report submitted by the appropriate supervising or examining

department, the MB finds that a bank or quasi- bank is:
 1. In a state of continuing inability; or
2. Unwillingness to maintain a condition of liquidity deemed adequate to protect the
interest of depositors and creditors. [Sec. 29]

Requisites for Placement of a Bank under Conservatorship

1. There must be a report submitted by the appropriate supervising or examining

department of the BSP;
2. There must be a finding that the bank or quasi-bank falls under either of the grounds
for conservatorship; and
3. The Board of Directors must be informed in writing of the order of the MB directing
conservatorship. [Sec. 29]

Rules on bank deposits and investments by directors, officers, stockholders and their
related interests

Any director, officer or stockholder who, together with his related interest, contracts a loan or
any form of financial accommodation from:

(1) His bank; or

(2) From a bank:
a. Which is a subsidiary of a bank holding company of which both his bank and
the lending bank are subsidiaries; or
b. In which a controlling proportion of the shares is owned by the same interest
that owns a controlling proportion of the shares of his bank
i. In excess of five percent (5%) of the capital and surplus of the bank,
or
ii. In the maximum amount permitted by law, whichever is lower shall be
required by the lending bank to waive the secrecy of his deposits of
whatever nature in ALL banks in the Philippines.
SECURITIES
R.A. No. 8799 - The Securities Regulation Code

The Securities Regulation Code (SRC) regulates public offering within the Philippines.

Sec. 2. Declaration of State Policy The State shall:

a. Establish a socially conscious, free market that regulates itself;

b. Encourage the widest participation of ownership in enterprises;
c. Enhance the democratization of wealth;
d. Promote the development of the capital market;
e. Protect investors;
f. Ensure full and fair disclosure about securities;
g. Minimize if not totally eliminate insider trading and other fraudulent or manipulative
devices and practices which create distortions in the free market.

Sec. 3. Definition of Terms. – 3.1. "Securities" are shares, participation or interests in a

corporation or in a commercial enterprise or profit-making venture and evidenced by a
certificate, contract, instruments, whether written or electronic in character. It includes:

i. Shares of stocks, bonds, debentures, notes evidences of indebtedness, asset-

backed securities;
ii. Investment contracts, certificates of interest or participation in a profit sharing
agreement, certifies of deposit for a future subscription;
iii. Fractional undivided interests in oil, gas or other mineral rights;
iv. Derivatives like option and warrants
v. Certificates of assignments, certificates of participation, trust certificates, voting trust
certificates or similar instruments;
vi. Proprietary membership or nonproprietary certificates in corporations; and
vii. Other instruments as may in the future be determined by the Commission.

Non-exempt transactions

Section 8. Requirement of Registration of Securities. –

8.1. Securities shall not be sold or offered for sale or distribution within the Philippines,
without a registration statement duly filed with and approved by the Commission. Prior to
such sale, information on the securities, in such form and with such substance as the
Commission may prescribe, shall be made available to each prospective purchaser.

Registration

General rule: Securities are prohibited to be sold or offered for sale or distribution within the
Philippines:

a) Without registration statement duly filed with and approved by SEC; and
 b) Prior to such sale, information on the securities, in such form and with such
substance as SEC may prescribe, must be made available to each prospective
purchaser.

Exceptions

a) Exempt securities [Sec. 9]

b) Exempt transactions [Sec. 10]

Sec. 8. Requirement of Registration of Securities. –

xxx

8.2 The Commission may conditionally approve the registration statement under
such terms as it may deem necessary.

8.3 The Commission may specify the terms and conditions under which any written
communication, including any summary prospectus, shall be deemed not to
constitute an offer for sale under this Section.

8.4. A record of the registration of securities shall be kept in Register of Securities in

which shall be recorded orders entered by the Commission with respect to such
securities. Such register and all documents or information with respect to the
securities registered therein shall be open to public inspection at reasonable hours
on business days.

Tender offer rule Definition

Tender Offer is a publicly announced intention by a person acting alone or in concert with
other persons to acquire:

a. Outstanding equity securities of a public company, or

b. Outstanding equity securities of an associate or related company of such
public company which controls the said public company.

Purpose of Tender Offer

Tender offer is in place to protect minority shareholders against any scheme that dilutes the
share value of their investments by:

i. Giving them the chance to exit the company under reasonable terms,
ii. Giving them the opportunity to sell their shares at the same price as those of
the majority shareholders. [Cemco Holdings, Inc. v. National Life Insurance
Company of the Philippines, supra]
MANNER OF MAKING TENDER OFFER

No tender offer shall be made unless:

a. It is open to all security holders of the class of securities subject to the tender
offer; and
b. The consideration paid to any security holder pursuant to the tender offer
shall be the highest consideration paid to any other security holder during
such tender offer. [Sec 19.9.8, 2015 SRC-IRR]