IPR1 (industrial property rights)

IPR1 stands for industrial property rights. In procurement, IPR describes the rights that govern intellectual property tied to a purchase, in particular who has access to it, who may use it and who owns it. Those arrangements decide what a supplier keeps and what the buyer receives once a contract is performed.

NATO procurement policy requires these arrangements to be stated in both the solicitation documents and the resulting contract. Canadian federal policy uses the broader expression intellectual property rights and applies it to Crown procurement contracts. The numbered form IPR1 does not appear in Canadian policy documents, but the subject matter is the same: who holds the rights to what is created or supplied under a contract.

How NATO procurement treats IPR arrangements

NATO's procurement policy states that IPR arrangements must address access, usage and ownership. These arrangements are set out in the solicitation documentation so that bidders know the terms before they submit an offer, and they are carried into the contract that follows. The policy is published by NATO at nato.int.

For a supplier, this means IPR terms are a defined part of the bid package rather than something left to negotiation after award.

How Canadian policy defines intellectual property rights

Treasury Board policy defines intellectual property rights as rights recognized by law. They include rights protected by patents, copyright, industrial designs, integrated-circuit topographies and plant-breeders' rights. They also include rights that arise from the protection of trade secrets and confidential information. The full text is in the Treasury Board policy on intellectual property arising under Crown procurement contracts.

The stated objective of that policy is to increase the potential for commercial exploitation of intellectual property developed by a contractor under a Crown procurement contract.

Foreground and background IP in Crown contracts

• Foreground IP is intellectual property first conceived, developed, produced or reduced to practice as part of the work under a Crown procurement contract.
• Background IP is intellectual property that existed before the contract, or that was supplied for contract performance.

Standard clauses can require a contractor to license background IP when Canada needs it in order to use the foreground information. An example is in the Employment and Social Development Canada contracting clauses.

CanadaBuys guidance tells buyers to identify, before issuing a solicitation or awarding a contract, both the IP that exists before award and the IP expected to be generated by the contract. That IP can include material that is copyrighted, trademarked, patented or licensed. See the CanadaBuys guidance on intellectual property and copyright.

Ownership clauses used in Government of Canada contracts

Canada's default position is generally that the contractor keeps ownership of IP generated under government contracts, which supports private-sector commercialization. The client department must still determine what rights Canada needs in order to use the IP. CanadaBuys guidance describes different default outcomes by procurement type: contractor ownership for research and development and goods associated with it, and Canada ownership of copyright for goods or services where no research and development is expected, subject to specified alternatives.

Two types of standard clause illustrate the range:

• A contractor-owned clause vests IP in the foreground information in the contractor. It grants Canada a non-exclusive, perpetual, irrevocable, worldwide, fully paid and royalty-free licence for public purposes.
• A Canada-owned clause vests all IP rights in the foreground information in Canada. The contractor has no rights except those expressly granted in writing.

What IPR means for a supplier bidding on Canadian public contracts

Read the intellectual property provisions in each solicitation and draft contract. The solicitation and contract decide whether Canada or the contractor owns foreground IP, and what licences, assignments, access rights or restrictions apply, so the general policy default is not enough to rely on.

• Identify and document your background IP before you bid.
• Confirm that you hold the rights needed to perform the work.
• Be ready to grant Canada the licences the contract specifies.
• Disclose or account for IP generated under the contract where it is required.

On NATO opportunities, expect the access, usage and ownership terms to be stated in the solicitation documents and to carry into the contract.