Insights on the Proposed Intellectual Property Office of Kenya

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Recently, the Standard newspaper published a piece titled: “Truth behind delay in parastatal reforms, months after President Uhuru Kenyatta’s directive”, in which it explained that the reason for the delay in the setting up of the proposed Intellectual Property Office of Kenya (IPOK) among other newly merged parastatals was that the Government Owned Entities (GoE) Bill 2014 is yet to be passed by Parliament. The draft GOE Bill 2014 is available online here. The media report also speculates that the slow pace in implementation of the parastatal reforms could be a sign that there is strong resistance from powerful parastatal chiefs opposed to the mergers.

In the most recent issue no 12 of the Kenya Copyright Board (KECOBO) newsletter, there is an article on the proposed merger of KECOBO, KIPI and ACA, which we have previously discussed here, here and here. Although KECOBO’s article discussed the human resource management aspects of the proposed merger, it provides us with a suitable entry point to discuss this planned centralization of intellectual property (IP) administration and enforcement in Kenya.

As previously discussed, it was the presidential taskforce on parastatal reforms which proposed that the three IP parastatals: Anti-Counterfeit Agency (ACA), Kenya Industrial Property (KIPI) and KECOBO be merged to form a single state agency tentatively christened IPOK. According to the GoE Bill 2014, a state agency means any entity formed by the government to undertake a specific government objective in delivering public service.

The idea behind IPOK was borrowed from several jurisdictions with a similar centralised system of IP administration such as; The Intellectual Property Office in United Kingdom, The Intellectual Property Office of New Zealand among other countries. Therefore the taskforce argued that international best practice shows that the functions undertaken by the three existing IP bodies complement each other and are domiciled in as one institution in many countries.

The nature and powers of IPOK will be drawn from the Copyright Act, Anti-Counterfeit Act and the Industrial Property Act and Trade Marks Act which will all be amended and incorporated in the Act creating IPOK. Presumably these amendments to existing IP legislation and the IPOK Act will be done after the GoE Bill has been passed by Parliament. More fundamentally, IPOK will spearhead the Executive branch’s implementation of Articles 11, 40 and 69 of the Constitution, which all impose an obligation on the government to promote, protect and support the IP rights of all Kenyans.

According to the merger team’s report, IPOK’s management shall be led by a Director General who will provide overall direction and support to the four directors on the day to day running of IPOK.
These four (4) Directors are: Industrial Property; Copyright; Enforcement; and Corporate Services. With the full establishment, IPOK will require 236 members of staff against the current 184 staff members in the three IP institutions. The current personnel emolument for the combined institutions is Kshs 396,375,000 whereas for the proposed merged institution will be Kshs 512,547,360. This means that IPOK will cost the Kenyan tax payer an extra cost of Kshs 116,172,360 on personnel costs alone.

With regard to office space, the merger team report proposes that IPOK’s headquarters be at NHIF Building (the same building currently occupied by KECOBO). In addition, it is proposed that IPOK has five (5) regional offices in Mombasa, Kisumu, Eldoret, Nakuru and Namanga. Currently, the IP bodies have a regional office in Mombasa and a go down at Kiang’ombe, Mombasa Road. The current rent for the combined three (3) IP offices in Nairobi, one regional office and one (1) go-down is Kshs 60,000,000 whereas for the rent for proposed merged institution will be Kshs 128,684,000. This leads to an increased rental cost of Kshs 68,684,000 to be borne by the Kenyan tax payer.

However the Kenyan tax payer will be pleased to learn that there will be an estimated saving of Kshs 18,500,000 in board related expenses with the establishment of IPOK. Presently, the Board of Directors of the three IP bodies consume a total of Kshs 28,500,000 which is expected to drop to Kshs 10,000,000 with the proposed merger since the three institutions will have one single board of no more than 11 members.

Finally, the merger team report states that the implementation of the merger will take approximately one year from July 2014 through to July 2015. The timeframe provided is as follows:

July 2014: Enactment of enabling legislation

September 2014: Constitution of the IPOK Board of Directors

October – November 2014: Recruitment of IPOK Director General

December 2014: Formulation of IPOK Budget for the financial year 2015-2016.

December 2014 – May 2015: Staff Placement

June – July 2015: IPOK sets up new office locations and begins work!

This blogger will be closely monitoring the progress and developments in the implementation of this proposed merger and the establishment of IPOK.

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