Germany: Licensing Of Pharmaceuticals

Last Updated: 8 June 2001
Article by Heinz Goddar

1. Introduction

The purpose of this paper is to discuss, based on the experiences the author has made over the last few years both in his own professional activities in the field of licensing pharmaceutical know-how and patents and his involvement in Health Care Committees in both LES Germany and LES International, the following questions of interest: the role of licensing in the field of pharmaceuticals, financial elements of pharmaceutical license agreements, and legal aspects, under the general theme of which specific questions of license agreements affecting countries of the European Union (EU), like export bans, parallel imports and compulsory licenses, will be dealt with.

2. The Rising Importance Of Licensing In The Field Of Pharmaceuticals

Since more than 10 years, a distinctly rising importance of licensing in the pharmaceutical field could be observed. The number of license agreements covering pharmaceutical inventions concluded per year has increased a lot faster than the world-wide turnover of the pharmaceutical industry, so that it appears as worthwile to have a close look at the reasons for the increasing licensing activities in the pharmaceutical field, the more since in other areas of technology, possibly with the exception of software-related inventions, the discrepancy between growth of world-wide total turnover of the respective industry and increase of number of license agreements concluded per year seems to be far smaller.

2.1. Emptying Pipelines

As a general observation in pharmaceutical industry all over the world, one may duly state that a heavy demand for new drugs exists. Particularly caused by the long duration of R&D between start of research for a new drug until NDA (New Drug Approval), exceeding 10 years as nowadays estimated as an average to reach as long as 12 years (two additional years taken for NDA approval as such after finishing Phase 3 clinical study), and also because of the fact that obviously only about 10 %, i.e. one out of 10 candidates, of drugs selected from primary research and going into preclinical studies finally are approved and launched in the market place, the pipelines of at least the big global players in pharmaceutical business are no longer well filled. To fill the pipelines better based on own R&D activities, is very costly and in many instances goes beyond the capacities, if not the financial ones, then of manpower, of even big drug manufacturers. As a consequence, the big players have started, and are increasing their activities insofar steadily, to look around in the outside world in order to find new pharmaceuticals, or at least new substances which can be considered as candidates for further selection.

In this connection, it might be appropriate to mention that the terms Phase 1, Phase 2, and Phase 3 clinical studies in this paper are understood in the usual way, i.e. Phase 1 starts when the new drug is first applied to human patients in order to determine human toxicity, metabolism, absorption, elimination etc., in Phase 2 clinical studies being conducted to determine safety and performance further, including more extended investigations with patients, and Phase 3 comprising expanded trials in order to get additional information about effectiveness and safety. Looking at the overall duration from start of research to NDA approval and launch, Phases 1, 2, and 3 of clinical studies often are designated as R&D stages 3, 4, and 5, following R&D stage 1, describing the basic research until the selection of preclinical drug candidates, and R&D stage 2, determining the time from the end of R&D stage 1 until the selection of clinical drug candidates for entering clinical studies, in such scheme R&D stage 6 describing NDA and launch of the drug in the market place.

The aforementioned scheme, as well as extremely valuable considerations in relation to financial aspects to be discussed lateron, may be found in a more detailed form in an article by Motohiro Yamasaki, "Les Nouvelles" September 1996, pp. 112 - 114. The aforementioned article also describes attrition rates, as percentages, after R&D stages 1 - 6, as well as R&D times, the figures therein corresponding to the experiences in Germany, too, i.e. a duration of R&D stage 1 of about 3,5 years, duration of R&D stage 2 1,5 years with an attrition rate of 70 %, duration of Phase 1 (R&D stage 3) 1,5 years, attrition rate 70 %, duration of Phase 2 (R&D stage 4) 1,5 years, attrition rate 50 %, duration of Phase 3 (R&D stage 5) 2 years, attrition rate 50 %, and duration of R&D stage 6 2 years, attrition rate 80 %.

This means, in other words, and the author can follow the aforementioned paper fully insofar as these numbers have been confirmed by asking quite a few European pharmaceutical companies, that, if after R&D stage 1 10 substances (compounds) are selected from preclinical studies, after R&D stage 2 7 drugs remains, after R&D stage 3 5 drugs, after R&D stage 4 2 drugs (the assumption of the aforementioned paper that it could be three, instead of two, not being confirmed), after R&D stage 5 1 drug (maximum, also here the European experiences seem to be somewhat worse than assumed in the above mentioned paper, where "1 - 2" have been assumed), so that in and after, resp., R&D stage 6 only 1 drug remains for marketing.

2.2. University Licensing

Particularly in relation to pharmaceuticals, university based research plays an ever increasing role, particularly in U.S.A. and Canada. The universities become more and more aware of the commercial value of their inventions, less and less agreeing to their researchers freely cooperating with industry under agreements which from the very beginning provide for inventions coming out of the research work done by the University on behalf of the respective industrial entity automatically and without any license considerations belonging to the company.

Industry, which on the other hand appreciates very much the university work as a source for new substances to be tested for becoming drugs, therefore is faced with a situation in which reseach and development by universities makes it more and more necessary to determine license conditions right from the beginning, in order to give the researcher and his/her university, respectively, a fair share of the profit later possibly be made by the respective company based on the development made in the university.

In any case, the increasing role of university licensing, even if the university develops a drug until hypothetical R&D stage 1 to be finalized, makes licensing steadily more important for the pharmaceutical scene.

2.3. Start-Up Firms As Intermediates

Somewhat related to the importance of university research and licensing of its results as discussed under 2.2. above, it has to be observed that in many instances, just after certain research work done at universities and the like resulting in substances that might be interesting in a later stage to find pharmaceutical applications, start-up firms are founded by members of the university, in many instances together with capital investors, in order to develop drug candidates, having come out of a R&D stage 1 as defined above, for pharmaceutical applications, at least until the end of R&D stage 2.

For such start-up firms it is very typical that in normal instances they do not develop drugs further than to R&D stage 2, the clinical studies becoming by far too expensive for many start-up firms, so that the major goal of such firms consists in becoming licensors to the pharmaceutical industry after R&D stage 2.

2.4. Biotech Intermediates

A very special role in the development of pharmaceuticals offered to the pharmaceutical industry for licensing is played by firms specializing in biotechnology. Since biotechnology plays a significant role in developing new drug candidates, the role of such type of companies as licensors for big pharmaceutical companies (global players) cannot be over-estimated.

Typically, biotechnology companies develop substances to a similar level as start-up firms usually do, i.e. until the end of R&D stage 2 as indicated above, the respective drugs at that time becoming candidates for licensing to pharmaceutical industry. Biotechnology requiring extremely specialized skills, many pharmaceutical companies more or less systematically have focussed on not developing biotechnologically created substances by their own R&D departments, rather transfer such technology from companies specializing in biotechnology, some times in the form of joint-venturing with not only isolated biotech firms, but joining efforts with other pharmaceutical manufacturers in order to make the respective costs more tolerable.

3. Financial Elements In Pharmaceutical License Agreements

In the following, an attempt will be made to describe some rules that apparently are followed in determining typical financial elements of license agreements, with a specific view to license agreements in the pharmaceutical field. Here, as well as above and in the following, only license agreements will be considered which at least partially are directed to technology/substances protected by patents or at least by trade secret rules.

3.1. Downpayment

A typical element of license agreements, not only in the pharmaceutical field, is a downpayment or advance payment being payable by the licensee to the licensor at the time of or shortly after the signature of the license agreement, and at least in case of exclusive license agreements such downpayment apparently is considered as being indispensible. The question is how the downpayment should be determined.

In the above mentioned paper by M. Yamasaki a different, very attractive approach is described, which in U.S.A. apparently is followed in quite a number of patent licensing agreements and which is based on a more precise calculation of the cost of developing a substance for pharmaceutical application from R&D stage 1 to R&D stage 6. The downpayment in this model depends on the stage in which the drug is handed over, i.e. the technology transfer from licensor to licensee is realized by the coming into force of a respective license agreement.

Fortunately, in pharmaceutical industry it is quite well known that nowadays the R&D expenses for developping a new substance from start of research to launching in the market place reach about U.S. $ 200.000.000,--, as a worldwide average. If one now uses the attrition rates as discussed under 2.1. above, obviously the cost for a certain substance, as spent by the licensor until turnover of the respective technology to the licensee, depends on the R&D stage. Assuming that the total cost for the development is, as indicated above, U.S. $ 200.000.000,--, i.e. for one single drug finally launched in the market place, taking into into due consideration the attrition rate will lead to the fact, assuming that a Phase 3 clinical study will cost U.S. $ 10.000.000,--, that the accumulative cost per compound after completion of Phase 2, i.e. R&D stage 4, will be U.S. $ 90.000.000,-- per substance. If one furthermore assumes that the cost of Phase 2 is U.S. $ 5.000.000,--, the cumulative cost per substance after Phase 1 (i.e. R&D stage 3) is U.S. $ 40.000.000,--, and similar considerations lead to respectively lower values for substances after R&D stage 2 and after R&D stage 1.

Further details of this calculation, as well as the appropriate assumptions, can be found in the above mentioned paper by M. Yamasaki, which quite reliably reflects experiences one also can make in European pharmaceutical industry, as already stated earlier in this paper.

It appears as fair that the downpayment should cover the costs of licensor arisen until the time of technology transfer. In the above mentioned example, that would mean that a downpayment, assuming that the pharmaceutical is ready to launch (i.e. after R&D stage 6), should be U.S. $ 200.000.000,--, compared with only about U.S. $ 25.000,-- after R&D stage 2.

As a matter of course, the aforementioned figures have to be understood as examples. In practical licensing negotiations, also in the pharmaceutical field there exists a rather broad range of variation from the aforementioned calculations. Nevertheless, the afore described method of determination seems to be generally accepted at least to come to a commercially viable basis for further negotiations.

3.2. Royalty Rates

Royalty rates in recent pharmaceutical license agreements can be observed as ranging from a very few percent up to 20 % or even more. The determination of such royalty rates generally seems to follow the well-known "25 %-rule" e.g. described by Robert Goldscheider in "Les Nouvelles" September 1996, pp. 115 - 120. One assumes in this model that the total commercial success of the substance in the market at 50 % will depend on effects not linked with the competitive edge as given by the respective patent protection, and therefore belonging solely into the court of the licensee, the other 50 % being related to the protected invention, i.e. the competitive edge achieved by licensee because of the technology licensed from licensor. One furthermore assumes that the marginal profit should be equally shared between licensee and licensor, leading to 25 % of the net profit before taxes as made by licensee as being a reasonable royalty.

Again, the above mentioned article by M. Yamasaki is an extremely valuable source for finding a reasonable basis for calculating royalty levels in pharmaceutical industry, the assumption and its results fitting remarkably well with royalty rates that can be found in pharmaceutical license agreements with effective dates stemming from the about last 5 years:

The approach is based on the observation that the research and development expenditures of big pharmaceutical companies, according to e.g. "Annual Survey Report 1989 - 1991" of PMA (U.S. Pharmaceutical Manufacturer`s Association), can be considered as about 10 % of the total sales of such pharmaceutical companies. In other words, pharmaceutical companies in general spend about 10 % of sales volume to generate new drugs. If one takes into consideration, again based on the aforementioned PMA report, that about 30 % of the R&D costs are for R&D stage 1, about 30 % of total R&D costs are for R&D stage 2, and about 40 % are for R&D stages 3, 4, 5, and 6, one comes to the result that, if a certain substance after finalization of R&D stage 1 is licensed in, i.e. thereby saving 30 % of R&D costs of in total 10 %, the licensee should pay 3 % royalty, based on net sales, just from a cost viewpoint. The respective "justified" royalty rate before R&D stage 3, i.e. before starting clinical studies, would be 6 %, because 60 % of the development costs would be saved, and, finally, 10 % for the finished product, ready to be marketed.

The aforementioned considerations to determine the reasonable royalty rate are, as a matter of course, "minimum" royalty rates, just based on costs saved by the licensee. If one takes into due consideration that the risk for the development until the licensing stage has been borne fully by the licensor, one might consider it as justified that at least 50 % of the aforementioned royalty rates are added to the cost-based ones, in this manner leading to royalty rates for substances determined as candidates for clinical studies of at least 4,5 %, selected ones for clinical studies of at least 9 %, and after clinical studies and approval of at least 15 %. The author believes that the aforementioned figures will look very familiar to professionals in the pharmaceutial licensing field.

It should be duly noted that running royalties usually will start only after the putting into the market place of a certain product, a latest date very often being agreed on, however, after which running royalties would have to be paid by the licensee even on a fictive net sales scale.

3.3. Minimum Royalties

Minimum royalties in pharmaceutical licensing agreements play a similar role as in agreements in different fields of technologies: They have to be considered as an insurance policy, in favour of the licensor, against lack of activities by the licensee.

Accordingly, it can be observed that the minimum royalties, usually on an increasing scale, are set to be at least 50 % of the estimated cumulative annual running royalties expected by the parties of a license agreement for the respective years during the lifetime of the agreement.

It is difficult to determine whether in the majority of cases minimum royalties only function as an "insurance policy", as described before, i.e. non-payment of which gives the right to terminate the agreement to licensor, or whether such minimum royalties have to be paid under all circumstances. In view of the fact that the marketing of substances is only possible for the licensee after having heavily paid in terms of downpayment and/or R&D costs, the tendency that licensees do not use a licensed pharmaceutical technology sufficiently seems to be rather low, so that licensors in many instances accept the "insurance policy" function of minimum royalties at least in such cases where the licensing of the technology takes place at a rather late stage of R&D, i.e. shortly before marketing.

Typically, it can furthermore be observed that minimum royalties of only a more or less nominal height are agreed on for the years before the estimated time of marketing for the respective product, with a sometimes sharp increase thereafter.

4. Legal Aspects Of Licensing Under EU Rules

License agreements in the pharmaceutical field, as other license agreements, must observe the competitional rules of the European Union. Amongst those, Article 85 (1) is of greatest importance, which in principle considers at least exclusive patent and know how license agreements as potentially interfering with the principles of free competition and trade inside the European Union, so that as a base rule only such license agreements are exempted from the general prohibition of Article 85 (1) of the Treaty of Rome which are block-exempted under the existing Block Exemption Regulation for Technology Transfer of the European Union, i.e. Regulation 240/96. The aforementioned Regulation cannot be discussed in detail here, but it is strongly recommended that it is strictly followed when formulating licensing agreements in the pharmaceutical field having effect for the territories of the European Union.

4.1. Territorial Restrictions Under EU Rules

Specifically suspicious in the eyes of the Commission of the European Union are territorial restrictions in patent and know-how license agreements, and particularly in case of agreements in fields where because of considerable differences in price level in different territories inside the European Union it might be attractive for a licensor to separate the territories of various licensees as much as possible. Under certain assumptions, one may assume that the pharmaceutical field belongs to the aforementioned "suspicious" category.

4.1.1. Direct Export Bans

In view of the circumstances as discussed above, Block Exemption Regulation 240/96, in the following just called the "Regulation", according to its Article 1 permits direct export bans only in a very restricted sense.

Three different situations should be duly observed:

a)For the maximum permitted exclusivity period, i.e. in patent license agreements the life time of the longest running of the patents already being in existence, at least in the application stage, at the time of signature of the agreement, the licensor can prohibit that its licensee conducts any use of the licensed technology in territories reserved by the licensor for himself. In other words, the licensee for the aforementioned exclusivity period can neither manufacture in the territory of the licensor, nor import into that territory, neither conducting an active marketing policy nor following unsolicited orders.

b)As far as territories of other licensees are concerned, the licensor can prohibit the licensee to conduct an active marketing policy there for the time of the exclusivity period as discussed under a). The same applies to manufacturing in other licensees` territories.

c)As far as following unsolicited orders is concerned, the licensor can prohibit a licensee to follow such orders from the territories of other licensees only for five years after the first putting into the market place of the respective product by licensee inside the European Union.

Further territorial restrictions would clearly fall under the so-called Black List of clauses under the Regulation, and therefore would make it necessary that individual exemption from the prohibition of Article 85 (1) is sought for. If that is not done, the agreement would not only be unenforcable in relation to the territorial restrictions, but the parties thereof would have to be aware of severe penalties, a situation which any reasonable party in a license agreement certainly wishes to avoid.

4.1.2. Parallel Imports

So-called "Parallel Imports", i. e. imports of articles protected by intellectual property rights, like patents or trademarks, into a country where a certain party is the owner of exclusivity rights under a patent and a trademark, respectively, are a particular problem in relation to goods the prices of which traditionally have been rather dramatically different in the various countries involved. This is particularly true for the pharmaceutical market in Europe, bearing in mind that certain pharmaceuticals for nearly decades, just as an example, have been five times, in many instances, more expensive in, e. g., Germany than in Spain. Accordingly, knowing both the general rules of Parallel Imports and their unavoidability on one side, but also the absolutely legal possibilities to prevent such Parallel Imports in certain situations where from a first viewpoint Parallel Imports might be considered as - but truly are not! - being admitted, is of great importance particularly when considering pricing policies etc. in the European market.

In the following, the principle of "Parallel Imports" in the EU, closely being related to the "Principle of Territoriality" of intellectual property rights and the exhaustion of such rights, will be explained in some detail.

For the purpose of the aforementioned explanations "Parallel Imports" mean imports of goods from a third country, where a patent or trademark protecting the respective product may or may not exist, into a certain country of the EU or the European Economic Area (EEA) where such product is protected by a patent or a trademark. The right based on a patent or trademark will be considered as "exhausted" if the owner of the respective right, or its licensee, is not entitled to make any further use of the respective right to prevent third parties from freely disposing e. g. of a product protected by the respective patent or trademark.

4.1.2.1. Patents

Patents covering any country of the territory in question always are national patents restricted to the respective territory or country, irrespectively of whether the patent in question was obtained by a national patent application, a PCT-application designating one or several countries of the European Patent Convention (EPC), or a direct EPC-application, since also the latter "international" applications after patent grant result in a bundle of national patents. The effect of such patents is strictly limited to the respective country, with the effect that only the owner of the patent, or a party deriving its respective right from the patentee, is entitled to locally use the teaching of the patent, including manufacturing, offering and sale of products in accordance with the patent. Accordingly, in principle the patentee can prevent third parties from importing goods corresponding to the respective patent from a third country into the "protected" country.

4.1.2.1.1. Products First Distributed (Sold) Outside EU/EEA

According to the national law of the broad majority of the countries in question, and in line with the EU laws insofar covering also EEA, the putting into the marketplace of a product outside EU/EEA, e. g. in U.S.A., does not exhaust any patent right in Europe, whether the product was sold outside EU/EEA by the patentee itself, or with its explicit consent, e. g. by a licensee; in this regard, the principle of "Consent" will be dealt with in more detail lateron in this paper. That means that the owner of a patent in a certain EU or EEA country can prevent importation of such goods into the respective country.

4.1.2.1.2. Products First Distributed (Sold) Inside EU/EEA

The principle generally excepted in all EU/EEA countries is that whenever a product was sold in a country inside EU/EEA, irrespectively of whether a patent protecting that product in the country of first sale does exist, by the patentee or with its consent, the patentee having a patent in another EU/EEA country cannot prevent importation of the respective product into the country where the patent in question exists.

In other words, different from the sale of a product in a country outside EU/EEA, such sale in a country inside EU/EEA enables parallel imports, provided that the consent of the patentee to the respective sale was given directly or implicitly.

4.1.2.2. Trademarks

As in the case of patents, all trademarks existing in any EU/EEA country, are national trademarks with national effect only, the exclusivity rights based on which are strictly limited to the respective territory, irrespectively of whether the trademark was obtained by a national trademark application, or by international registration using the provisions of the Madrid Agreement or Protocol, or as a Community Trademark.

4.1.2.2.1. Products First Distributed (Sold) Outside EU/EEA

Until a few years ago, in many countries of the EU/EEA in relation to trademarks, totally different from patents, a fully international exhaustion principle was accepted. In other words, the countries following this principle, namely Austria, Belgium, Denmark, Finland, Germany, the Netherlands, Norway, and Sweden, would not give the owner of a trademark in a certain one of these countries the possibility to prevent importation of goods which where provided "with consent" anywhere in the world outside of this country with the respective trademark. The reason for this jurisdiction, at least as far as Germany is concerned, was that the right based on a trademark is considered as fully exhausted already if the trademark is "affixed" to a certain product etc., different from a patent where the right of use comprises not only the manufacturing of the respective good, but also the distribution, even the offering of the product etc.

Meanwhile, in accordance with the EU Trademark Directive, however, the aforementioned countries have changed their laws to the extent that exhaustion of a trademark will not be assumed if the respective product was provided with the trademark outside EU/EEA, whereby the same situation has been created as in relation with patents.

4.1.2.2.2. Products First Distributed (Sold) Inside EU/EEA

Because of the aforementioned Trademark Directive of the European Union, but also in accordance with the former practice in all EU/EEA countries except France and Greece, where still certain reservations did exist insofar, parallel imports cannot be prevented if the respective good was distributed/sold with the consent of the trademark owner in any EU/EEA country. The situation is somewhat different, however, in case of "split" trademarks, in which even two identical marks of same origin can be used for market separation if a whole business, together with its partial original mark, was sold by the owner of the originally one trademark.

4.1.2.3. The Principle Of Consent

As already explained above, the criterion for deciding whether a certain patent or trademark can be used to prevent parallel imports, i. e. particularly free circulation of goods inside EU/EEA, is whether the putting into the market place - bringing out of control of the distributor - of the respective product in a certain third country took place with the direct or implicit consent of patentee.

Such consent is always given, of course, if the patentee itself sells, without imposing any limitations on the kind how to use it, the respective product. Limitations of this kind, by the way, are null and void, usually, as far as they restrict the free circulation of goods inside EU/EEA, with a few exemptions as e. g. defined by the Block Exemption Regulations applicable here.

There are other kinds of consent, of course some of them, to be discussed in the following.

4.1.2.3.1. License

If a patentee or trademark owner grants a license to make use of the respective patent or trademark, the owner of the intellectual property right in general gives its permission, and its consent, to manufacture and sell the respective product. Accordingly, a product sold in a certain country under a license which not legally validly does contain restrictions for exportation from the respective country means a sale with a consent of the patentee and trademark owner, respectively. The consequences of such consent have been explained above.

4.1.2.3.2. Compulsory License

A compulsory license, by definition, is given against the explicit wish of the patentee or owner of a trademark. Accordingly, products manufactured and sold under such a compulsory license cannot be considered as having been brought into the market place with the consent of the owner of the respective right.

4.1.2.3.3. Right Of Prior Use

In all countries of EU/EEA, the institute of a right of prior use in relation to patents does exist. That means that somebody who had been in the possession of an invention, lateron patented by a third party, already before the priority date of the respective patent, cannot be prevented by the later patentee to use the respective inventive teaching.

The aforementioned rights of prior use are strictly limited to the country in which they have been originated. Also, such a right of prior use is not created by the consent of the patentee, but totally independently of the owner of the "parallel" invention that later on was patented. Accordingly, products manufactured and sold in certain EU/EEA countries under such a right of prior use cannot freely circulate inside EU/EEA.

5. Summary

Licensing both on an exclusive and non-exclusive basis, as well as joint R&D playing a more and more important role in the pharmaceutical field, it appears as advisable to come to more reliable methods of determining the value of technology to be licensed, with the aim of having instruments available for calculating the basis of reasonable, rationally plausible negotiations on financial conditions, like downpayment, royalty rates, minimum royalties, etc.

Furthermore, it appears as necessary, as always in licensing, to carefully watch the competition law provisions of particularly the European Union, if licensing takes place between entities affecting the European pharmaceutical market in a not neglectible manner.

The content of this article is intended to provide a general guide to the subject mater. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Heinz Goddar
 
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert
Email Address
Company Name
Password
Confirm Password
Mondaq Topics -- Select your Interests
Accounting and Audit
Anti-trust/Competition Law
Consumer Protection
Corporate/Commercial Law
Criminal Law
Employment and HR
Energy and Natural Resources
Environment
Family and Matrimonial
Finance and Banking
Food, Drugs, Healthcare, Life Sciences
Government, Public Sector
Immigration
Insolvency/Bankruptcy, Re-structuring
Insurance
Intellectual Property
International Law
Law Practice Management
Litigation, Mediation & Arbitration
Media, Telecoms, IT, Entertainment
Privacy
Real Estate and Construction
Strategy
Tax
Transport
Wealth Management
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.

Disclaimer

Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.

Registration

Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.

Cookies

A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

Links

This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

Mail-A-Friend

If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

Security

This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.