Compulsory Licensing

Compulsory licensing is a statutorily created nonexclusive license by the competent authority granted to a third party to make, use, or sell an invention, where remuneration is paid to the right holder and the right holder maintains his legal intellectual property rights. Thus, the compulsory licensing differs from expropriation, where the property ownership is transferred and no remuneration is paid, but represents an exception to the normal exclusivity enjoyed by a right holder. Nevertheless, as compulsory licensing represents an invasive and mandatory act by the Government in citizen and undertakings property rights, there are varying views on the economic and legal implications of the concept.