Policy on Intellectual Property Rights

1. Introduction

a) Intellectual Property Rights (IPR) are the legal rights associated with creative and intellectual effort. They apply to patents, copyright, know-how, trademarks, new plant varieties, designs and other types of IPRs recognized under the Patent Law, Copyright Law, Trademark Law and other intellectual property (IP) laws. They protect a range of entities including literary and artistic works, computer programs, inventions, designs and marks. IP can be a valuable asset and substantial income can be generated through its successful exploitation. The University’s activities, and in particular its research activities, often give rise to the creation of valuable IP that can benefit the University, its staff and students, as well as third parties.

b) IPRs have been recognized and protected in the People’s Republic of China since 1979 and it has adopted a number of international conventions to protect IPR. The Chinese Government has also established protection of IPRs under domestic legislation and regulations that protects local and foreign IP.

c) The primary aim of this policy is to make IP available to industry and others for the public benefit, while providing recognition to individual inventors and encouraging early and appropriate dissemination of research results. The University asserts its rights to ownership of relevant IP created or devised by its staff in the normal course of their employment, except where funding agreements or local laws dictate otherwise.

d) In establishing this Policy, the University has referred to the ‘Policy on Exploitation and Commercialisation of Intellectual Property Rights’ of the University of Liverpool (UoL). As collaborative partners engaged jointly in students’ learning and in research activities, the XJTLU policy strives to harmonise the IPRs of individuals and the University within an international context.

2. Ownership of IP in relation to the University

a) Employees

i. Inventions generated during the normal course of employment:
Patentable inventions generated, created or devised by staff members of XJTLU in the normal course of their employment belong to the University. Patentable inventions generated mainly by using the University’s funds, materials, equipment, facilities, know-how and proprietary technologies also belong to the University. Patentable inventions generated by a former employee of the University within one year of his/her departure also belong to the University if such inventions were generated, created or devised during the normal course of the employee’s duties.

ii. Work commissioned by the University:
The University normally owns work commissioned, directed or organised by the University, and whose liabilities shall be assumed by the University, including complete copyright and authorship rights unless specifically exempted by prior agreement.

iii. Copyrighted work:
Copyrighted work, e.g. books, articles, lectures, and artistic works, generated in the normal course of a person’s employment belong to the person, but the University has the right of first refusal to use such copyrights. If the inventor(s) does not receive written notice from the university that XJTLU wishes to use the copyright within two weeks of informing the University of the copyrights, it shall be deemed to have declined the right to use it. The author shall not license a third person to use such work in the same way as the University uses it within two years of completion of the copyrighted work.

When exercising his/her copyrights, an author shall not infringe the interests of the University or a third person. For example, without obtaining the written consent of the University, an employee shall not release or publish any work containing technological details of a patentable invention where the University owns the right to patent.

iv. IPs other than those above-mentioned IPs generated in the normal course of a person’s employment belong to the University. Thus, in the absence of any agreements or legal provisions to the contrary, the University assumes ownership of or priority to use all IPs generated by staff during the normal course of their duties. With regard to those IPs belonging to the University, the University shall share revenue with, or give a bonus to, the inventor(s), designer(s) and author(s), and they shall retain the right of inventorship and/or authorship.

v. The University does not relinquish ownership of copyright in computer software created by an employee in the normal course of his/her duties.

vi. It is generally accepted that most academic staff wish to publish articles in learned journals or books, and as a rule, the University will preserve the rights of academic staff to publish material arising from research as they think fit. In cases where commercial exploitation of the result is a possibility, however, the University requires that publication to be withheld until appropriate protection can be put in place.

vii. Where a member of University staff has honorary or other appointments in other universities, the member of staff must ensure that there is an appropriate agreement in place between the two universities for IP ownership and exploitation.

b) Non-employees

Any IP created by visiting and honorary staff at XJTLU in the course of their honorary activities for the University belongs to the University, as if they were an employee. However, some discretion will be allowed and agreement about ownership and exploitation of IP should be reached at the time of the appointment.

c) Students

i. As part of the registration process students assign to the University any relevant IP that they generate as a consequence of their studies or research that is created by using University facilities or by participating in an academic or research program/project of the University. A student is afforded the same rights as a member of staff by assigning their ownership rights to the University, i.e. with respect to revenue sharing. Where a student is sponsored by a third party, the terms of that sponsorship may override ownership by the University and may require the student to assign IP to the sponsor.

ii. Students are encouraged to publish their research work in journals or via other media with the agreement of their supervisor and subject to IP policy of the University and any appropriate prior IP protection.

iii. Students registered for a PhD programme at XJTLU are also subject to the University of Liverpool IP Policy as they are also registered students of the University of Liverpool. However, the XJTLU policy has precedence over the University of Liverpool policy.

iv. Students registered elsewhere but whose supervisors include University employees are not subject to this Policy.

d) Third Parties

When the University enters into an agreement with a third party (or parties), the terms of that agreement must specify ownership of IP generated by University staff and students and by the external parties. In such cases, IP may be owned by the University, a third party or jointly. A lead party would normally be identified as part of the terms of the agreement and if the collaboration Is likely to produce commercially valuable IP, the terms in respect of IP must be approved by the Senior Management Team (SMT).

3. Governance, roles and responsibilities

a) Overall responsibility at XJTLU for oversight of IP resides with the SMT. This includes the generation of maximum societal and commercial impact of University activities through academic-focussed processes for IP identification, evaluation, management, registration and exploitation.

b) The SMT may delegate its authority for such processes to various parties across the University, including the Research Committee, Research Institutes and Heads of Departments, Schools or Centres, as appropriate. Primary delegation will be to the Research Committee.

c) The SMT has a responsibility to ensure that the exploitation of IP does not prejudice the University’s core activities of research, teaching and knowledge exchange and to ensure that the University takes account of wider strategies and policies in determining the exploitation route.

d) Proposals to establish spin-out companies may only be approved by the SMT, following endorsement by the Board of Directors. The continued involvement of the Inventor in providing ongoing or future services to any spin-out company must be governed by an appropriate agreement, for example, for provision of consultancy or research services. Responsibility for drawing up such an agreement rests with the SMT.

e) The SMT might procure the services of external IP management services to provide professional support for IP exploitation. Such a commercial arrangement will not affect the ownership rights to IP.

4. Exploitation and Commercialisation of IP

The returns from the commercialisation of University IP belong to the University. However, the University will normally share the returns with the inventor/creator using the distribution guidelines as set out below, unless the returns are so substantial that it would be inappropriate for the University not to invest a greater proportion in meeting its overall mission and vision, particularly in relation to service to society, developing higher education in China and in conducting research in areas where humanity faces severe challenges.

The SMT is responsible for collecting income from third parties in respect of exploitation of IP.

Where IP has been sold, assigned or licensed, this would usually take the form of milestone and/or royalty payments.

a) Distribution of benefits

i. Under normal circumstances, any income for distribution arising from exploitation, after recovery of eligible costs, (such as external legal fees, and distribution of any revenue sharing with the funders of the original research or third party collaborators), the surplus balance would normally be distributed as follows:

• 80% to the Inventor(s) and 20% to the department/school/centre of the Inventor(s)¹ for the first RMB1,000,000; (¹ Where it is deemed that the IP that has generated financial returns for the University was invented as part of inter-disciplinary research undertaken under the auspices of a University Research Institute, this 20% share should be distributed further between the relevant department(s) of the inventor(s) and the relevant Research Institute.)
• 50% to the Inventor(s), 20% to the department/school/centre of the Inventor and 30% for the University for income over RMB 1,000,000.

ii. The funds allocated to the Inventor(s) may, at the discretion of the Inventor, take the form of a personal payment (in which case payment will be made via the University payroll) or be paid into a nominated University account. The funds allocated to the Inventor(s) are subject to personal income tax and thus the University may withhold the tax portion according to Chinese tax law.

b) Identification of the Inventor(s)

i. Many people may be involved with the work that leads to the creation of IP and the work that is subsequently undertaken to exploit the IP. However, many of those involved will not actually be an Inventor as they have not been involved in the actual point of creation.

ii. Where more than one Inventor has created the IP, the Inventors may decide between themselves how they will share the Inventors’ distributed funds. Where the Inventors cannot agree on how the share the Inventors’ distributed funds, SMT will make the decision, taking any advice as is necessary and appropriate.

iii. People who are mainly responsible for organization, assistance and facilitation shall not be deemed to be Inventors.

c) Commercialisation

i. Where the exploitation of IP involves the creation of a spin-out company (see Section 3 above), the Inventor(s) are permitted to provide services (either as a director of the company or as an advisor) subject to the University’s Policy on Consultancy and outside normal work activities. Inventors may also be seconded to the company subject to the normal contracting and approval processes, and, in particular, that these are subject, in all cases, to the full recovery of costs (including the use of University facilities and services). In general, such companies should not operate from University premises, except under a specific licence to occupy what would normally be defined as incubator space.

ii. The University’s Conflict of Interest Policy should be complied with in all circumstances. In particular, a member of staff specifically employed to further the University’s commercial activities are not normally permitted to acquire equity in spin-out companies whilst remaining as an employee of the University.

iii. Inventors may only accept appointments to directorships of a spin-out or start-up company on approval of the relevant Head of Department/School/Centre and of SMT. Individuals taking up such appointments should fully understand their legal responsibilities and personal liabilities. As a principle, staff in senior positions and business development roles in the University should not undertake such directorships as they may be in conflict with their University role.

iv. Where the consideration for commercialisation of University IP is equity (e.g. as part of a company formation) this will be allocated on the basis of 60% to the University and 40% to the Inventor(s). The Inventor(s) will normally hold such equity in a personal capacity and will be liable for any personal taxes in such holdings.

v. Where the University receives a mixture of equity and royalties as payment for IP, the sum of both will be combined to meet the overall allocation to the Inventor, as described in Section 4(a) above.

5. Existing and Prior IP Rights of the University

When claiming and exercising his/her IP rights, members of the University shall not infringe the existing and prior IP rights of the University. For details of those existing and prior IP rights held and retained by the University, please check with the SMT.

6. Governing Law

This IP Policy and any dispute in relation to IP rights against the University shall be governed by the applicable Chinese laws and regulations.

(Last Review Date: 26-Oct-2016)