IPR Guidelines - FAQ

Frequently Asked Questions

What are these Guidelines?

These guidelines set out the government's approach to the ownership and commercialisation of intellectual property rights (IPR) in government agencies' Information and Communications Technologies (ICT) contracts. They present agencies with three clearly defined options regarding ownership and licensing of new IPR to be created, and assist them select the most appropriate option for any given contract.

The guidelines promote economic development by:

• favouring ownership of new IPR being vested in the commercial sector, provided certain principles (such as national security) will not be compromised;
• making provision for the commercial sector to be granted a license to commercialise the IPR, when it is necessary for ownership to be vested in the government.

The guidelines also reaffirm that government agencies enter into ICT contracts primarily to receive the deliverables they have contracted for, and to use those deliverables to carry out government business. Exploitation of the IPR created, except in specific circumstances, is not a core business activity of government agencies.

The guidelines will foster the growth, innovation, capability, and sustainability of New Zealand companies within New Zealand and internationally, and support the government's theme of economic transformation.

Who do they apply to?

The guidelines can be used by all State Services agencies. They can also usefully be considered as 'best practice' by other public sector organisations.

The guidelines apply to contracts that entail the development or use of software, hardware, systems or processes, and for which significant new intellectual property is created as a result of that development or use.

Why do we need them?

Government information and communications technologies (ICT) contracts may result in new intellectual property rights (IPR). The unofficial default position for government agencies has been to own this new IPR, on the assumption that this was in the best interests of government. However, by owning the IPR, agencies may have been restricting opportunities for companies to exploit it and limiting incentives for innovation.

Other governments are recognising that IPR ownership by government is often unnecessary, and that an all-of-government usage licence would be sufficient, except where there are clear security or other reasons for retaining ownership.

What impact are they expected to have?

The guidelines aim to improve the commercial sector's accessibility to IPR by encouraging agencies to offer ownership of new IPR to the provider, and to satisfy government needs by obtaining an all-of-government usage licence.

Government agencies will benefit from sharing a consistent approach to ownership, commercialisation and licensing of IPR. The guidelines include model contract clauses to support each of the ownership/commercialisation options. These model clauses encourage a standard approach across government, thereby saving time and expense for both parties during contract negotiations.

The guidelines will:

• encourage government cooperation with the New Zealand commercial sector to develop and exploit IPR.
• assist agencies to remain focused on their core business activities.
• provide clarity for contractors at the earliest stage of a project, and potentially reduce expense and time spent by both parties negotiating the IPR.
• improve transparency in the ICT tendering process, as the agency's position on ownership and licensing of the new IPR will be documented in the Request for Proposal or Tender.

It is expected that the consistent approach resulting from government agencies following these guidelines will lead to improved business confidence.

Government ICT tenders that offer contractors improved access to the IPR resulting from the contract may be regarded as more valuable by prospective contractors and lead to better priced tenders.

When should agencies refer to the guidelines?

Agencies need to refer to the guidelines when first developing the business case for an ICT project, and choose an appropriate ownership/commercialisation option prior to issuing an RFT or RFP. This will enable suppliers to compete on a level playing field, and save a lot of time and expense for both parties during contract negotiations.

What about Open Source?

Government agencies will also retain the right, where appropriate, to allow free use of the intellectual property on open source terms. Agencies should also refer to the Guide to Legal Issues in using Open Source software v2, http://www.e.govt.nz/policy/open-source/open-source-legal2/index.html released by the State Services Commission in May 2006.

What’s not included, and why?

The guidelines do not cover IPR in ICT contracts that apply to research, as this is already dealt with by the Cabinet Guidelines for Intellectual Property from Public Service Research Contracts, http://www.morst.govt.nz/publications/govt-policy-statements/public-service-research-ip-guidelines/, released by the Ministry of Research Science and Technology in January 2004.

They also do not cover information that may be delivered as part of an ICT contract. Regulation and ownership of that information is addressed by the Privacy Act 1993 and the Policy Framework for Government-held Information.

The guidelines do not require agencies to renegotiate existing contracts or review their ownership of IPR created prior to the release of these guidelines. However, there may be other reasons, such as reuse by other agencies or jurisdictions, or unexpected commercialisation opportunities, why an agency would undertake a review, and in such cases they should use the guidelines in their decision-making.