University inventions: the abolition of the “professor’s privilege” and other changes in the Italian Industrial Property Code

University inventions: the reform of the Italian Industrial Property Code[1] , after years of trying and waiting, abolished the so-called “professor’s privilege” in favor of a regulatory framework[2] more in line with the model of the other European countries.

The reform of the Industrial Property Code has several goals:

  • Strengthen Italy’s competitiveness,
  • Protect and safeguard industrial property,
  • Lighten administrative burdens and digitize procedures for access to industrial product protection.

The reform was included as part of the Strategic Guidelines for Industrial Property Reform and is part of the Digitalization, Innovation and Competitiveness of the Production System Mission of the Italian National Recovery and Resilience Plan.

The final version of the law, initially proposed by the Italian government in April 2022, is the result of discussions and amendments involving parliament members, stakeholders, industry experts and representatives of the Italian Patent and Trademark Office.

There are many changes to the Italian Industrial Property Code. For example, the reform simplifies and clarifies administrative procedures for granting industrial property rights and opposing trademark registration, introduces greater protection for geographical indications, and provides greater temporary protection for designs exhibited at trade shows.

Nevertheless, one of the most significant changes is the reversal of the so-called “professor’s privilege”, that is, the right of professors and researchers to the economic exploitation of inventions produced as part of their employment relationship with the university or a research organization.

To better understand the impact of the changes, we present the legal framework before and after the reform.

Pre-reform legal framework for university inventions

Inventions by employees of public universities and research institutions were governed by Article 65 of the Industrial Property Code, which was last updated in 2001[3] . This article stipulated that researchers-not the institutions with which they were affiliated-were the exclusive owners of the rights to their inventions, even when they occurred within the scope of their contractual duties. The institutions in which they worked were only due a percentage of the earnings from the exploitation of the inventions[4] .

But why this approach? Article 65 aimed to encourage and stimulate researchers to submit patent applications. The provision, however, showed some limitations.

Universities and research institutes were suffering a diversion of income, which they could have used, for example, to finance institutional activities. There was little incentive for the private industrial sector to fund public research. Members of the legal community showed some constitutional concerns with regards to the fact that there was de facto inequality between employees of public universities and research institutes and employees of other types of institutions and companies.

The interpretation of the article also raised many questions. It was unclear which professionals were included in the definition of “researcher”, as no further clarification was provided. As a result, many universities and public research institutions established their own definitions of “researcher”, often excluding doctoral students, university students, and research fellows. The provision also left a regulatory gap in case the employed researcher decided not to patent the invention, but to publish the scientific results.

For these reasons, it was felt from the outset that the provision had not achieved the desired effect and it appeared necessary to return ownership of inventions to universities and research institutions. However, despite multiple attempts by the Italian legislator, the “professor’s privilege” remained in effect until Aug. 23, 2023.

The changes introduced by the reform for university inventions

The reform overturned the “professor’s privilege” and brought Italian regulations in line with those of other Western countries.

According to the new text of Article 65, when an invention is created within the framework of a contract or employment relationship with a university[5] , the rights to the invention belong to the structure with which the inventor is affiliated (even in the case of temporary employment, within the framework of an agreement between the parties), without prejudice to the inventor’s right to be recognized as a creator.

Article 65 also clarifies that, unless otherwise agreed, the rights to an invention created by more than one person belong to all facilities involved and are divided equally.

The article, in paragraphs 2 and 3, stipulates that the inventor must disclose and communicate the subject matter of the invention to the institution concerned, otherwise he cannot file a patent application in his own name. Within six months of receiving the disclosure, the institution must file a patent application or notify the inventor of its disinterest in proceeding with the filing. If the research institute fails to file a patent application within six months or notifies the inventor during this time that it is not interested in doing so, the inventor may proceed independently to file the patent application in its own name.

Research institutions may establish technology transfer offices in charge of promoting industrial property, including encouraging collaboration with private companies (Article 65 Paragraph 4 and Article 65-bis). In response to issues in the relevant case law, research institutions also have the power to regulate how the provisions of Article 65 are applied to people who may participate in research activities. These include inventions that undergraduate students may obtain in the laboratory or as part of their studies.

Finally, paragraph 5 of Article 65 states that rights to an invention arising from the performance of research activities funded, in whole or in part, by third parties are governed by the contractual agreements between the parties, then adding that such contractual agreements must be drafted on the basis of guidelines.

These guidelines were adopted by decree of the Ministry of Enterprises and Made in Italy, in consultation with the Ministry of University and Research, on September 26, 2023, and identify specific principles and criteria to govern such contractual relationships. At the outset, the guidelines identify the contractual relationships to which they are to be applied and regulate the mandatory aspects that the parties must specify prior to the conclusion of the research contract. For example, making explicit the purpose of the collaboration, prior knowledge of the parties and the expected outcome of the commissioned research, and defining the ownership of the results. In addition, the guidelines also provide recommendations that the parties may choose to adopt in order to properly define the scope of the contract between the research facility and the funding agency, especially with regard to the generation, exploitation, and dissemination of the results of the commissioned research.

So far, the reform has been welcomed by various sectors, including academia and innovative startups. Whether the law will have the desired effect on innovation remains to be seen.

[1] Introduced by Law No. 102 of July 24, 2023

[2] Law No. 102 of July 24, 2023, amending the Industrial Property Code, came into force on August 23, 2023, followed by the issuance of subsequent implementing instruments, including, ultimately, the Interministerial Decree of September 26, which adopted the Guidelines identifying specific principles and criteria for the regulation of contractual relations between the research facility and the funding body

[3] Law 383/2001

[4] This provision was designed as an exception to the legal framework for employee inventions, under which the employer retains ownership

[5] This includes legally recognized nonpublic universities, public research institutes, and institutions for scientific hospitalization and treatment

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