Section 23 Patents and Designs Act 1971

Section 23 of the Patents and Designs Act 1971 is about Contractual licences. It is under ‘General’ of the Act. It provides as follows:

(1) Subject to this section–
(a) a patentee or design owner may by a written contract signed by the parties
grant a licence to any person to exploit the relevant invention or design; and

(b) in the absence of any provision to the contrary in the contract, the licensee
shall be entitled to do anywhere in Nigeria in relation to the patent or design
any of the acts mentioned in section 6 or 9 this Act, as the case may be.

(2) Where a licence is granted under subsection (1) of this section–
(a) the licence shall be registered, and shall be of no effect against third parties
until registration is effected and the prescribed fee paid; and
(b) the registration shall be cancelled at the request of the licensor if the Registrar
is satisfied that the licence has been terminated.

(3) Any clause in a contract for a licence under subsection (1) of this section is null
and void in so far as it imposes on the licensee in the industrial or commercial field restrictions which do not derive from the rights conferred by the relevant patent or design or are unnecessary for the safeguarding of those rights:

Provided that-
(a) limitations concerning the scope, extent, territory or duration of the exploitation of the patent or design or the quality of the products in connection with
which the patent or design may be exploited;
(b) obligations imposed on the licensee to abstain from all acts capable of prejudicing the validity of the patent or the validity of the registration of the design;
and

(c) in the case or a patent, limitations justified by the interest of the licensor in the
technically efficient exploitation of the subject of the patent, are not restrictions of the kind mentioned in this subsection.

(4) In the absence of any provision to the contrary in a contract for a licence under
subsection (1) of this section–
(a) the grant of the licence shall not prevent the licensor from–
(i) granting further licences to other persons; or
(ii) himself exploiting the relevant patent or design;
(b) the licence shall not be assignable by the licensee; and
(c) the licensee shall not be entitled to grant further licences.

(5) Where a contract under subsection (1) of this section provides for a licensee to
grant further licences, this section shall apply in relation to any such further licence as it applies in relation to licences granted under the said subsection (1).

(6) The Minister, if he is satisfied that it is in the interest of Nigeria and its economic
development to do so, may by order in the Federal Gazette provide that contracts under subsection (1) of this section (or any specified class thereof) shall, in so far as they involve the payment of royalties outside Nigeria, be invalid without the approval of such authority as may be specified in the order.

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