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NEWS ARTICLE | 05 December 2020

EU recommends Member States to leave IPR ownership in public procurements with contractors

The Commission launches a new intellectual property rights action plan to support the EU's economic recovery and resilience. The action plan highlights the need to improve the conditions for companies to protect and use IPR in public procurement with a view to stimulating innovation and boosting the economy. It recommends Member States to adopt a policy that leaves IPR ownership in public procurements with contractors, unless there are overriding public interests at stake or incompatible open licensing strategies in place.

Logo of the flag of the European Union
Source: EU - Logo of the blue flag of the European Union with the yellow stars on it

In other parts of the world - such as the United States, Canada, Australia, Japan, Russia, Israel, Korea, China - the default scenario is since decades that the ownership of intellectual property rights linked to public procurements remain with the contractors, unless there are exceptional overriding public interests at stake which require tthat the IPR ownership is transferred to the public buyer. There is strong evidence that leaving IPR ownership rights with the contractors instead of transferring it to the public buyer fuels economic growth: it boosts the growth of innovative companies, including startups and SMEs, ramps up industrial commercialisation of innovative solutions and reduces the procurement cost for the public sector.

EU wide benchmarking shows thatin most European countries, the legal framework for public procurement is silent about IPR allocation and leaves it to the public buyer to define the allocation of intellectual property rights in its tender documents. As this is not always an easy task for individual buyers, eleven countries in Europe have already adopted a similar national policy on IPR allocation in public procurement as Europe's major trading partners, that leaves the IPR ownership in principle to the contractors: notably Belgium, Spain (via public procurement legislation), Finland, France, UK and Switzerland (via the general terms for government contracts), Estonia, Ireland, Luxembourg, Hungary, and Slovenia (via official guidelines).  

This practice is not always followed up by individual public buyers in these eleven countries and that other countries around Europe still lack a clear policy on IPR allocation in public procurement. Therefore the Startup Europe Summit 2019 recommendations called on the new European Commission and Member States to take action to ensure IPR ownership in public procurements in Europe are left with contractors while securing access rights for public buyers.

On 25 November 2020, the European Commission adopted a new IPR action plan for Europe to support the EU's recovery and resilience (press release - 25/11/2020) The action plan highlights the need to improve the conditions for companies to protect and use IPR in public procurement with a view to stimulating innovation and boosting the economy. It recommends Member States to leave IPR ownership in public procurements with contractors, unless there are overriding public interests at stake or incompatible open licensing strategies in place.

European open licensing rules (the public sector information directive aka the open data directive) are compatible with leaving IPR ownership with the contractors as standard practice. The directive does not apply to items that are protected by industrial property rights, nor to software and it only requires public authorities to make available for reuse certain high value datasets and documents that are not confidential or security sensitive and not protected by industrial property rights. Public buyers should also check national open licensing strategies.

The European Commission is also starting to change its own practice. The EU blockchain pre-commercial procurement is a public procurement implemented by the European Commission itself (DG CNECT), which puts into use the recommended approach of leaving IPR ownership with the contractors and keeping usage rights and some licensing rights for the contracting authority.