In our previous Newsletter issued on 19 October 2020, we discussed the first part of our look into several Memorandum Circulars (“MC[s]”) issued by the Intellectual Property Office of the Philippines (“IPOPHL”), which revised rules (“Revised Rules”) involving Intellectual Property (“IP”) in the Philippines, effective starting 05 September 2020.

The Revised Rules include: (1) Revised Rules on the Resolution of Public Performance Disputes (IPOPHL MC No. 2020-022); [1] (2) Rules on Resale Rights (IPOPHL MC No. 2020-023);[2] (3) Copyright Rules for the Government (IPOPHL MC No. 2020-024);[3] (4) Revised Rules on Copyright Registration (IPOPHL MC No. 2020-025;[4] and (5) Revised Rules on Accreditation of Collective Management Organizations (IPOPHL MC No. 2020-026).[5]

This newsletter discusses the last two Revised Rules as mentioned in the previous paragraph.

Revised Rules and Regulations on Copyright Registration and Recordation of Transfer, Assignment and License of Copyright

IPOPHL MC No. 2020-025[6] addressed the need to revise and update the existing Rules and Regulations on Copyright Registration and Deposit as contained in Office Order No. 13-171 (2013) in order to streamline and facilitate the registration of works, in relation to Section 191 of the IP Code, as amended by Section 16 of Republic Act No. 10372, providing for the registration and deposit of works with the National Library of the Philippines (“NLP”) and the Supreme Court Library. The rules and regulations shall apply to manual and online registration of copyrighted works and the recordation of deeds of assignment, transfer, and exclusive license of copyright, before the IPOPHL.[7]

The rules and regulations provided in IPOPHL MC No. 2020-25 may be adopted mutatis mutandis by the NLP and shall be without prejudice to the system of deposit of works in the field of law maintained by the Supreme Court Library.[8]

Apart from the author or creator of the work, the heir or the assignee, as the case may be, may apply for a certificate of registration in case of death of, or assignment by, the author or creator.[9] The application for registration and the payment of the filing fee therefor may be made in person or online.[10]

Copyright registration may be done through “Single Registration, or “Bulk Registration” wherein authors may apply for the registration of their works in bulk provided that: (1) The works to be registered must not be less than ten (10); (2) All the works must fall under the same category; and (3) All the works must be created by the same author or the same joint authors.[11] A certificate of registration shall be issued for each work and will be charged applicable registration fee for each work.[12]

The Bureau shall have temporary custody of all the deposited works and shall transmit the same to the NLP on a semi-annual basis. The NLP and IPOPHL shall jointly administer the copyright registration database.[13]

For Copyright Online Registration and Deposit System (CORDS), the Bureau will cause the preparation of the electronic certificate and send to the copyright holder through his official email address on record.[14] The Bureau shall employ technological protection measures to safeguard the integrity and authenticity of the electronic certificate.[15] In this case, the Bureau shall transmit the deposited works electronically to the NLP on a semi-annual basis.[16]

Lastly, IPOPHL MC No. 2020-025 provides for the process of recordation of copyright transfer, assignment or exclusive license either manually or by electronic means.[17] Similarly, a copyright recordation may be applied for either through “Single Recordation,” or through “Bulk Recordation” provided: (1) the deeds to be recorded must not be less than ten (10); and (2) the transferee, assignee, or exclusive licensee must be the same person.[18]

Revised Rules and Regulations on Accreditation of Collective Management Organizations and Similar Entities

IPOPHL MC No. 2020-026[19] revised and updated the existing Rules on Accreditation of Collective Management Organizations (CMOs), as provided in IPOPHL Office Order No. 13-173 (2013) in order to better realize the objectives thereof as well as to properly address the concerns of all stakeholders.

CMO[20] is defined as “a non-stock, non-profit organization, local or foreign, duly accredited by IPOPHL, which has for its sole and principal purpose the exercise of copyright or related rights on behalf of more than one right holder, for the collective benefit of the said right-holders.”

IPOPHL MC No. 2020-026 shall apply to the following:[21]

            (1) Entities which shall apply for accreditation as a CMO;

            (2) Any CMO established before the effectivity of the Rules and is already engaged in any or all of the functions of an accredited CMO provided that such CMO shall, within three (3) months from effectivity of the Rules, apply for accreditation, if not yet accredited by IPOPHL; and

            (3) Similar entities who, upon determination by the Bureau, engage in any of the functions of a CMO enumerated under these Rules. Such entities shall be required to apply for accreditation within three (3) months from the Bureau’s determination that they engage in the functions of a CMO.

In addition to the documentary requirements provided under IPOPHL MC No. 2020-026, CMOs or similar entities meeting all pre-qualification requirements during initial screening may apply for accreditation with IPOPHL which shall include the following:[22]

            (1) Registration as a non-stock, non-profit organization;

            (2) Membership is composed of right-holders belonging to the sector whose rights shall be managed;

            (3) The General Manager or Executive Director, as well as the heads of Documentation, Licensing, Distribution and Finance, as may be applicable shall: (a) Be free of direct or indirect conflicts of interests both with the users of works and other subject matter, and members of the CMO; (b) Have the required management or technical skill and expertise to perform their duties; and (c) Have at least sixteen (16) hours of training on copyright or any related topics relevant to the particular sector obtained from IPOPHL or other institutions offering IP courses or seminars, both local and abroad;

            (4) The CMO shall have a supervisory Board that has the duty to oversee the management of the CMO (subject to other qualifications under IPOPHL MC No. 2020-26);

            (5) Managerial, material and administrative capability of enforcing the rights of its members and to distribute collected revenues as closely as possibly according to actual use and in line with the best practice in each relevant sector;

            (6) Existence or establishment of an internal dispute resolution or any similar system providing for an effective workable process of settling disputes and grievances between or among members of the CMO and its members, related to the membership agreement or the application of the CMO distribution rules, and of settling disputes between the CMO’s members related to the registration of works or other subject matter; and

            (7) Compliance with any other reasonable requirement/s the IPOPHL may impose from time to time.

The Director shall render a decision granting or denying the application within twenty (20) days from the lapse of the period for filing third party observations or from the receipt of the last observation or comment, in accordance with the procedure as provided for in IPOPHL MC No. 2020-026.[23] The corresponding certificate shall be issued within seven (7) days after the decision granting the same.[24] Such accreditation shall be effective for a period of five (5) years from the date stated in the order granting the accreditation.[25]

Denial of accreditation shall be on the following grounds:[26] (1) Applicant does not comply with provisions of Sections 1 and 2, Rule II; (2) The applicant committed fraud or willful misrepresentation in the compliance with its documentary requirements; and (3) Such other grounds that would merit denial of the application for accreditation.

The Director may suspend, either totally or partially, the accreditation of a CMO, after giving the latter an opportunity to be heard, if any one of the following circumstances are found after accreditation:[27]

            (1) The CMO tolerated or abetted any of its Board members or officers in violating any related law, rules and regulations issued by IPOPHL;

            (2) Any of the documents or material information/data therein submitted by the CMO has been found to be false or untrue;

            (3) Failure to maintain its compliance with the provisions of Section 1 of the Rules;

            (4) Failure to engage in any of the activities under Section 1 of the Rules within one (1) year after accreditation.

            (5) Failure to observe the parameters for collection and distribution of royalties and other forms of remuneration;

            (6) Malicious breach of contract of fiduciary duty against any of its members, regarding the primary activities and duties of an accredited CMO as set out in these Rules and/ or the principles of transparency, efficiency and good governance, including the fair and proportionate representation of members in the CMO’s governing bodies;

            (7) Failure to give proper accounting to IPOPHL or to its members; or

            (8) Failure to comply with the mandatory submissions under Section 2(b) of the Rules. Once suspended, and if the CMO fails to comply with the condition/s for the lifting thereof within six (6) months from the date of suspension, an order cancelling its accreditation shall be issued.[28] Additionally, upon complaint by any interested party, the Director may also cancel the accreditation of the CMO based on the grounds of suspension.[29]

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[1] IPOPHL Memorandum Circular No. 2020-022, 3 July 2020.

[2] IPOPHL Memorandum Circular No. 2020-023, 3 July 2020.

[3] IPOPHL Memorandum Circular No. 2020-024, 3 July 2020.

[4] IPOPHL Memorandum Circular No. 2020-025, 3 July 2020.

[5] IPOPHL Memorandum Circular No. 2020-026, 3 July 2020.

[6] IPOPHL Memorandum Circular No. 2020-025, 3 July 2020.

[7] Id. Sec. 2. Rule I.

[8] Id.

[9] Id. Sec. 1, Rule II.

[10] Id. Sec. 2, Rule II.

[11] Id. Sec. 3, Rule II.

[12] IPOPHL Memorandum Circular No. 2020-025, 3 July 2020, Sec. 3, Rule II.

[13] Id. Sec. 6, Rule V.

[14] IPOPHL Memorandum Circular No. 2020-025, 3 July 2020, Sec. 4, Rule VI.

[15] Id.

[16] Id. Sec. 5, Rule VI.

[17] Id. Sec. 2, Rule VII.

[18] Id. Sec.3, Rule VII.

[19] IPOPHL Memorandum Circular No. 2020-026, 3 July 2020.

[20] Id. Sec. 2(c), Rule I.

[21] Id. Sec. 3, Rule I.

[22] Id. Sec. 1, Rule II.

[23] Id. Sec. 6, Rule II.

[24] Id. Sec. 7, Rule II.

[25]IPOPHL Memorandum Circular No. 2020-026, 3 July 2020, Sec. 10, Rule II.

[26] Id. Sec. 8, Rule II.

[27] Id. Sec. 2 Rule IV.

[28] Id. Sec. 4, Rule IV.

[29] Id.