Technology transfer is a transfer of technology ownership or technology usage rights from a technology transferor to a technology transferee. So, who has the right to transfer technology? What are subjects and forms of technology transfer? Let's explore this with NPLaw in the article below.
Technology transfer is a transfer of technology ownership or technology usage rights from a technology transferor to a technology transferee. So, who has the right to transfer technology? What are subjects and forms of technology transfer? Let's explore this with NPLaw in the article below.
I. Current situation related to technology transfer
Currently, technology transfer is a widely discussed concept and a matter of great interest, which is important for economic development worldwide, especially for countries undergoing industrialization and modernization like Vietnam.
In our country today, in general, technology transfer activities have been regulated and recorded in law, but there are still many limitations. Technology transfer between domestic enterprises is still limited, small-scale, the content of technology transfer is often incomplete, and forms of transfer are still simple.
II. Regulations related to technology transfer
1. What is technology transfer?
Pursuant to Clause 7, Article 1 of the Law on Technology Transfer 2017, technology transfer is a transfer of technology ownership or technology usage rights from the technology transferor to the technology transferee.
2. Entities with the right to the transfer technology
Pursuant to Article 7 of the Law on Technology Transfer 2017 regarding the right to transfer technology:
- A technology owner has the right to transfer technology ownership and technology usage rights.
- Organizations and individuals who have the right to use technology are allowed to transfer the use right of such a technology to other organizations and individuals with the consent of the technology owner.
The scope of transferring technology usage rights is agreed upon by the parties, including:
- Exclusive or non-exclusive use of technology;
- The right of the transferee to further transfer technology usage rights to a third party.
Thus, according to the above regulations, the technology owner is the entity with the right to the transfer technology.
3. Subjects and forms of the technology transfer
Pursuant to Article 4 of the Law on Technology Transfer 2017, subjects of technology to be transferred are as follows:
- Technologies to be transferred are one or more of the following:
+ Technical know-how;
+ Technology plans, and processes; solutions, parameters, technical drawings and diagrams; formulas, computer softwares, and data information;
+ Production rationalization solutions, and technological innovation;
+ Machinery and equipment accompanying one of the above subjects.
- In case the subject to be transferred is protected by intellectual property rights, the transfer of intellectual property rights shall be implemented in accordance with the provisions of the law on intellectual property.
Pursuant to Article 5 of the Law on Technology Transfer 2017, forms of technology transfer are as follows:
- Independent technology transfer.
- Technology transfer components in the following cases:
+ Investment project;
+ Capital contribution by technology;
+ Franchising;
+ Transfer of intellectual property rights;
+ Purchase and sale of machinery and equipment as prescribed.
- Technology transfer in other forms as prescribed by law.
- Independent technology transfer and technology transfer in the case of capital contribution by technology must be made into a contract; technology transfer in investment projects, franchising, transfer of intellectual property rights, purchase and sale of accompanying machinery and equipment, and technology transfer in other forms are expressed in the form of contracts or articles, clauses, and appendices of contracts, or investment project dossiers with the contents as prescribed.
III. Frequently asked questions about the technology transfer
1. Is the provision of technological processes and product-related drawings by a foreign company to a Vietnamese company considered as a form of technology transfer?
Based on Clause 7, Article 2 of the Law on Technology Transfer 2017, the technology transfer refers to the transfer of ownership rights or technology usage rights from the entity with the right to transfer technology to the technology transferee.
Additionally, Point b, Clause 1, Article 4 of the Law on Technology Transfer 2017 states that transferable technology includes technological plans and processes; solutions, specifications, drawings and technical diagrams; and formulas, computer software, and data information.
Based on these provisions, technological processes and product-related drawings are considered transferable technologies. Therefore, if a foreign company provides a Vietnamese company with technological processes and related drawings, it qualifies as a form of technology transfer.
2. How can technology transfer be registered?
Pursuant to Article 31 of the Law on Technology Transfer 2017, the registration process for technology transfer is as follows:
* Required dossers for technology transfer registration:
- A written request for technology transfer registration, including a commitment from all parties to ensure that the contract content complies with applicable laws.
- The original or a certified copy of the technology transfer agreement that meets legal requirements; if the contract is not in Vietnamese, a notarized or certified Vietnamese translation is required.
* Registration procedures:
- Within 90 days from the date of signing the technology transfer agreement, the obligated party must submit one set of dossiers to the competent state agency responsible for science and technology management to request the Certificate of Technology Transfer Registration.
Within five working days from receiving a complete application, the competent state agency will review and issue the Certificate of Technology Transfer Registration. If the request is denied, the agency must provide a written explanation stating the reasons for the refusal.
Beside, the Certificate of Technology Transfer Registration becomes effective from the date of issuance.
3. Does technology transfer through capital contribution by technology need to be registered with state authorities?
Clause 1, Article 31 of the Law on Technology Transfer 2017 stipulates the registration of technology transfer as follows: Technology transfer contracts and technology transfer components in one of the following cases must be registered with the state management agency for science and technology, except for restricted technologies that have been issued the Technology Transfer License:
- Technology transfer from abroad into Vietnam;
- Technology transfer from Vietnam abroad;
- Domestic technology transfer using state capital or budget, except for cases where the Certificate of registration of results of scientific and technological tasks has been issued.
In addition, the state encourages organizations and individuals to register technology transfer contracts that are not required to be registered as prescribed.
In summary, technology transfer through capital contribution by technology, if it falls into one of the above cases, needs to be registered with state authorities.
4. How are technologically transferred drugs classified when registering for circulation?
Clause 1, Article 10 of Circular 16/2023/TT-BYT stipulates that technologically transferred drugs when registering for circulation are classified as follows:
- Technologically transferred drugs with the same contents as pre-transfer technology drugs, including: drug formulation; production process; raw material quality standards; finished drug quality standards; and trade name;
In case the pre-transfer technology drug is a drug that has been announced by the Ministry of Health as an original biological drug, reference biological product, and technologically transferred drug has changes compared to the pre-transfer technology drug in at least one of the criteria in this point (excluding trade name changes) or other changes related to drug quality, these changes must be approved by the drug management agency of the producing country or the regulatory authority that has issued the circulation permit for such a drug or the registration establishment must provide data proving that the technologically transferred drug is equivalent in quality to the pre-transfer technology drug.
- Other technologically transferred drugs that do not fall under the above regulations.
5. Is it mandatory to register the technology transfer after signing the technology transfer contract?
Based on Clause 7, Article 2 of the Law on Technology Transfer 2017, technology transfer is the transfer of technology ownership or technology usage rights from the technology transferor to the transferee.
Pursuant to Clause 1 and Clause 2 of Article 31 of the Law on Technology Transfer 2017:
- Technology transfer contracts and technology transfer components in one of the following cases must be registered with the state management agency for science and technology, except for restricted transfer technologies that have been issued the Technology Transfer License:
+ Technology transfer from abroad into Vietnam;
+ Technology transfer from Vietnam abroad;
+ Domestic technology transfer using state capital or state budget, except for cases where the Certificate of registration of results of scientific and technological tasks has been issued.
- The state encourages organizations and individuals to register technology transfer contracts that are not required to be registered as prescribed in Clause 1 of this Article.
Thus, it is not mandatory to register technology transfer after signing the technology transfer contract, except for cases where registration is required according to the regulations mentioned above.
6. Is the transfer of a recipe protected as a trade secret considered technology transfer?
Pursuant to Article 4 of the Law on Technology Transfer 2017, the subjects of technology to be transferred are as follows:
- The technologies to be transferred are one or more of the following:
+ Technical know-how;
+ Technology plans, and processes; solutions, parameters, technical drawings and diagrams; and formulas, computer software, and data information;
+ Production rationalization solutions, and technological innovation;
+ Machinery and equipment accompanying one of the subjects specified in points a, b and c of this clause.
- In case a subject to be transferred is protected by intellectual property rights, the transfer of intellectual property rights shall be implemented in accordance with the provisions of the law on intellectual property.
Thus, the transfer of a recipe protected as a trade secret is considered the transfer of intellectual property rights, which falls under subjects of technology transfer.
IV. Legal consulting services for the technology transfer
One of the law firms providing legal services related to the technology transfer is Ngoc Phu Law Company Limited (NPLaw). By using our services, clients will receive dedicated support from highly qualified and experienced legal professionals and lawyers. If clients need assistance with the technology transfer to protect your legal rights and interests, you can contact NPLaw for timely support through the following contact information:
