News & Updates – BCCS Law

NPC Advisory No. 2023-01: Implications for Businesses and Data Privacy in the Philippines

On November 7, 2023, the National Privacy Commission (NPC) of the Philippines issued Advisory No. 2023-01, providing crucial guidelines on deceptive design patterns. This advisory has significant implications for businesses operating in the Philippines, particularly those with digital interfaces that process personal data. Here’s what you need to know:

What Are Deceptive Design Patterns?

The NPC defines deceptive design patterns as “design techniques embedded on an analog or digital interface that aim to manipulate or deceive a data subject to perform a specific act relating to the processing of their personal data.” These can be categorized into two main types:

1. Appearance-Based Deceptive Design Patterns

2. Content-Based Deceptive Design Patterns

Key Points of the Advisory

1. Impact on Consent

The use of deceptive design patterns can invalidate a data subject’s consent, potentially rendering the processing of personal data unlawful. This aligns with the NPC’s previous Guidelines on Consent, which emphasize that consent must be freely given.

2. Transparency and Fairness

The advisory underscores the importance of transparency in presenting information to data subjects. User interfaces must provide clear, concise, and straightforward language about data processing activities. Moreover, the principle of fairness dictates that data processing should not be detrimental, discriminatory, unexpected, or misleading to data subjects.

3. Accountability and Privacy by Design

Personal Information Controllers (PICs) are held accountable for the data they process through analog or digital interfaces. The advisory also emphasizes that using deceptive design patterns is inconsistent with the obligation to adopt a Privacy by Design approach.

Implications for Businesses

1. Review of Digital Interfaces: Companies should conduct thorough audits of their websites, apps, and other digital platforms to identify and eliminate any deceptive design patterns.

2. Consent Mechanisms: Businesses must reassess their consent acquisition processes to ensure they are transparent, fair, and free from manipulation.

3. User Experience (UX) Design: UX designers and developers need to be aware of these guidelines to create interfaces that respect user privacy and autonomy.

4. Privacy Policy Updates: Organizations may need to update their privacy policies and consent forms to align with the advisory’s requirements.

5. Training and Awareness: Staff involved in UI/UX design, data processing, and privacy compliance should be trained on recognizing and avoiding deceptive design patterns.

The NPC’s Advisory No. 2023-01 represents a significant step towards protecting data subject rights in the digital age. It places the onus on businesses to ensure their digital interfaces are designed with privacy and transparency in mind. Non-compliance could lead to invalidated consent and potential regulatory action.

As the digital landscape continues to evolve, it’s crucial for businesses to stay informed about such regulatory developments and adapt their practices accordingly. This advisory serves as a reminder that data privacy considerations should be at the forefront of digital design and user experience strategies.

NPC Advisory No. 2024-01: Model Contractual Clauses for Cross-Border Transfers of Personal Data

The National Privacy Commission (NPC) of the Philippines has recently issued Advisory No. 2024-01, dated May 30, 2024, addressing the use of Model Contractual Clauses (MCCs) for cross-border transfers of personal data. This advisory is a significant development in the Philippine data privacy landscape, reflecting the country’s commitment to international data protection standards while facilitating global data flows.

Key Points of the Advisory

1. Voluntary Adoption: The NPC emphasizes that the use of MCCs is voluntary. Organizations are not required to adopt these clauses but are encouraged to consider them as a means of upholding the accountability principle in cross-border data transfers.

2. International Alignment: The advisory references several international MCC frameworks, including those from ASEAN, the EU, and other jurisdictions. This demonstrates the NPC’s efforts to align with global best practices.

3. Comparative Resources: The NPC highlights two key resources:

– The Global Privacy Assembly’s Comparative Tables of Contractual Clauses

– The Joint Guide to ASEAN MCCs and EU SCCs

4. Flexibility: While providing guidance, the NPC allows organizations to determine which MCCs best suit their needs and to negotiate additional terms as necessary.

5. No Official Review: The NPC will not review agreements for conformity with MCCs, placing the onus on organizations to ensure compliance.

Implications for Businesses

1. Enhanced Options for Data Transfers: Organizations now have access to a variety of MCC templates, potentially simplifying the process of ensuring compliant cross-border data transfers.

2. Increased Responsibility: With the NPC not offering reviews, businesses must take greater responsibility in selecting and implementing appropriate MCCs.

3. Global Interoperability: The advisory facilitates easier data flows between the Philippines and other jurisdictions, particularly within ASEAN and with the EU.

4. Compliance Flexibility: The voluntary nature of the MCCs allows businesses to tailor their approach to cross-border data transfers while still adhering to data protection principles.

Recommendations

1. Review Existing Practices: Organizations should assess their current cross-border data transfer mechanisms in light of this advisory.

2. Consider MCC Adoption: While not mandatory, adopting MCCs can demonstrate a commitment to data protection best practices.

3. Stay Informed: Keep abreast of further developments, as the data privacy landscape continues to evolve both locally and globally.

4. Seek Expert Advice: Given the complexity of international data transfers, consulting with legal experts in data privacy can help ensure compliance and optimize data transfer strategies.

This advisory reflects the Philippines’ proactive approach to data protection in an increasingly interconnected world. By providing guidance on MCCs, the NPC is empowering organizations to engage in international data transfers with greater confidence and security.

For specific advice on how this advisory may impact your organization’s data transfer practices, please contact our data privacy team.

Navigating the New Soundscape: Understanding IPOPHL’s Groundbreaking Circular on Rights of Sound Performers and Producers

The Intellectual Property Office of the Philippines (IPOPHL) has unveiled a pivotal legal update with Memorandum Circular No. 023, S. 2023. This circular explicitly addresses the Implementing Rules and Regulations concerning the Rights of Sound Performers and Producers of Sound Recordings, providing a detailed framework for intellectual property rights in the audio and music industry.

Anchored in Section 13, Article XIV of the Philippine Constitution, the circular fortifies the State’s commitment to protect the intellectual property rights of artists and other creative citizens.

This circular is not limited in its ambitions; it covers a comprehensive array of rights and obligations, from the right to reproduction to distribution and public performance.

One striking provision is the introduction of a right to remuneration for both sound performers and producers when their work is broadcasted or communicated to the public. This is a monumental shift, as it directly addresses the financial aspects of intellectual property in sound recordings and performances.

The circular also articulates specific limitations on exclusive rights. For instance, it provides exemptions for uses related to news reporting, educational activities, and public performances that are not meant for commercial gain. This nuanced approach ensures that the law does not stifle creativity and public discourse.

A noteworthy inclusion is the robust anti-piracy measures that the circular introduces. These measures give both sound performers and producers more substantial legal footing to combat unauthorized use and distribution of their work.

This update is a game-changer for sound performers and producers alike. It not only provides a legal framework for protecting their intellectual property but also includes specific clauses that could have immediate financial benefits. Both parties should acquaint themselves with these new guidelines to fully comprehend their new rights and responsibilities.

The Importance of IP Due Diligence in Mergers and Acquisitions in the Philippines

Introduction

In the complex world of mergers and acquisitions (M&A), intellectual property (IP) assets often emerge as critical factors that can make or break a deal. In the Philippines, where IP laws have their unique set of complexities, understanding the nuances is even more crucial. This article aims to provide an in-depth look into how to conduct IP due diligence in the Philippine context during an M&A transaction.

Intellectual Property Inventory

Creating a complete inventory of the company’s IP assets is the foundational step. This includes identifying all patents, trademarks, copyrights, and trade secrets that the company owns or licenses. The inventory serves as a roadmap, helping both parties understand what is at stake. Accurate valuation and strategic planning can only occur when you know exactly what IP assets are involved.

Ownership and Control

Clarifying ownership and control of IP assets is the next critical step. Many deals have fallen apart because of misunderstandings or conflicts over IP ownership. All IP assets must be either legally owned or controlled by the company. Pay special attention to any joint ownership arrangements and understand how they impact control and revenue sharing. It’s also essential to consider IP owned by subsidiaries, as these can significantly affect the transaction’s value and complexity.

Compliance and Regulation

Being compliant with both local and international laws is not just a legal necessity but also a valuation factor. Always check the IP assets’ standing with the Intellectual Property Office of the Philippines and other relevant bodies. If the IP has international reach, make sure it complies with the laws of those jurisdictions and international treaties.

Financial Assessment

A detailed financial assessment of IP assets is non-negotiable. This includes obtaining professional valuation reports, understanding the revenue streams tied to the IP, and recognizing the costs of maintaining these assets. Knowing the financials in and out can offer insights into the return on investment and help to structure the deal better.

Litigation and Risks

Uncovering any ongoing or past litigation related to IP assets is essential. Any legal issue can not only diminish the IP’s value but can also bring reputational risks. A thorough risk assessment should be conducted to identify potential challenges or vulnerabilities in the IP portfolio. Knowing these risks upfront can help in making an informed decision.

Agreements and Contracts

Reviewing all existing agreements and contracts related to the IP is crucial. This includes licensing agreements, non-disclosure agreements (NDAs), and employee contracts that specify IP ownership. These documents can significantly impact the revenue streams, control, and overall value of the IP assets.

Future Prospects

It’s not just about the present; one must also consider the future. Understand what IP is currently in development and how it aligns with the acquiring company’s future strategies. Additionally, it’s essential to assess any plans the company has for leveraging this IP for market expansion or penetration into new domains

Understanding the impact of Memorandum Circular No. 2023-001, S. 2023 on motion marks in the Philippines

Introduction

Intellectual property laws are continually evolving to adapt to the dynamic nature of innovation and branding. In this context, the Philippines has taken a significant step forward with the issuance of Memorandum Circular No. 2023-001, S. 2023. This new circular replaces previous guidelines and notably includes explicit recognition of the registrability of motion marks, providing a robust framework for brand owners and legal practitioners.

Significance of the new circular

The advent of Memorandum Circular No. 2023-001 brings about a welcomed update to the intellectual property landscape in the Philippines. While prior guidelines offered a foundation for dealing with motion marks, especially those with varying representations like still images and video files, the new circular broadens this scope. It explicitly acknowledges the registrability of motion marks, thereby enhancing the legal mechanisms available for their protection.

Practical implications

The formal recognition of motion marks in the new circular has practical ramifications for brand owners seeking diversified avenues for brand protection. Now, with explicit guidelines in place, brand owners can have more confidence in registering and protecting their motion marks in the Philippines. The circular provides a much-needed layer of legal clarity, enabling a more standardized approach to the registration and defense of these dynamic forms of trademarks.

Descriptive clarification

The new circular also maintains the emphasis on clear identification between different types of motion mark representations. If a motion mark is applied for using a sequence of still images, the guidelines suggest that a descriptive text may be required to clarify the subject matter. This provision serves as an additional tool for achieving specificity and alignment between varying representations of a motion mark.

Global context

The updated guidelines set forth by Memorandum Circular No. 2023-001 are not only significant domestically but also have implications on a global scale. As Philippine brands look toward international markets, and as foreign brands consider entry into the Philippines, these standardized guidelines could serve as a catalyst for a more harmonized approach to intellectual property rights concerning motion mark.

The issuance of Memorandum Circular No. 2023-001, S. 2023 marks a progressive step in the Philippines’ intellectual property regime. By explicitly recognizing the registrability of motion marks, it fills a crucial gap in the previous guidelines, providing brand owners and legal professionals with a more comprehensive and clear framework. As we move further into an era characterized by dynamic and multimedia-centric branding, these updates signify a positive and timely development in Philippine intellectual property law.

Heads up, MSMEs! – A new guide for MSME franchise agreements

On 12 May 2022, Executive Order (E.O.) No. 169, s. 2022 was signed into effectivity, requiring all franchise agreements between franchisors and Micro, Small and Medium Enterprise (MSME) franchisees to be in writing, duly notarized, and to contain a number of minimum provisions, such as, among others, those relating to full disclosure of pre-signing, initial or recurring fees; a cooling-off period, where the MSME can opt to terminate the agreement; and an alternative dispute resolution mechanism which shall include a stipulation that the parties may seek voluntary mediation under Republic Act No. 9285 or the “Alternative Dispute Resolution Act of 2004”.

Under E.O. No. 169, franchisors, with MSMEs as franchisees, are required to register the franchise agreement with the Department of Trade and Industry (DTI), who is also tasked to create an MSME Registry of Franchise Agreements for this purpose. E.O. No. 169 also provides that compliance with the listed minimum terms and conditions may entitle franchisors to incentives from the National Government.

What does this mean for existing franchise agreements?

The guidelines shall apply not only to franchise agreements yet to be entered into but also to existing franchise agreements between a franchisor and an MSME franchisee upon renewal of their respective agreements.

What about the IP Code provisions covering franchise agreements?

Since franchise agreements come within the description of technology transfer arrangements (TTAs), which are regulated under the IP Code, franchise agreements involving MSME franchisees will also need to be consistent with the provisions of the IP Code on mandatory and prohibited clauses. Otherwise, the agreement will be unenforceable. In other words, franchise agreements involving MSME franchisees will need to comply with both the IP Code provisions governing TTAs and E.O. No. 169.

With the continuous proliferation of MSMEs amid a global pandemic, this executive measure regulating franchise agreements will not only protect MSME franchisees, but it will also empower franchisors in view of the incentivization scheme to be formulated and helmed by the National Government.

For more details, E.O. No. 169, s. 2022 may be accessed at https://www.officialgazette.gov.ph/downloads/2022/05may/202200512-EO-169-RRD.pdf.

For additional discussion on TTAs, please refer to

https://bccslaw.com/technology-transfer-and-licensing/.

Katherine Imperial promoted to partner

BCCSLAW is delighted to announce the promotion of Katherine R. Imperial to partner with effect on January 1, 2022.

Katherine obtained her law degree from the Ateneo de Manila University School of Law. She joined the firm as a senior associate to focus on domestic and international trademark registration, licensing and enforcement. She expanded her practice to cover data privacy, online media and fintech, advising various industry leaders in air transportation, e-commerce, streaming, networking, and finance.

BCCSLAW at INTA

BCCSLAW will attend the in-person mini conferences of the International Trademark Association at the following locations:

New York, New York, USA — Tuesday, November 16, 2021
811 7th Avenue, 53rd St, New York, NY 10019

Berlin, Germany —Wednesday, November 17, 2021
Inge-Beisheim-Platz 1, Berlin 10785 Germany

Los Angeles, California, USA —Thursday, November 18, 2021
900 West Olympic Boulevard, Los Angeles, CA 90015

We are PROUDLY FULLY VACCINATED TO KEEP YOU SAFE^TM.

BCCSLAW celebrates its 10^th year as a leading legal service provider for IP, Technology and Data Privacy in the Philippines by continuing to act for the largest online retailer, the largest multimedia streaming service provider, the largest pharmaceutical company, the largest microblogging social networking service, the largest multimedia conglomerate, and the largest Filipino quick service restaurant chain, among other highly admired and innovative companies in the world including well-established FMGCs, airlines and automobile manufacturers. BCCSLAW has also expanded the scope of its trademark protection services to most of the Pacific Islands, including the Northern Marianas, Palau, Fiji, the Marshall Islands, and Micronesia.

Leo Singson joins BCCSLAW

We are pleased to announce that Leonardo Singson has joined our firm as Of Counsel for Special Corporate Transactions, Regulatory Compliance, and Immigration. Mr. Singson was formerly a Partner in the Corporate and Special Projects Department of Villaraza and Angangco. He obtained his law degree from the University of the Philippines.

COVID-19 corporate report submission guidelines

The Securities and Exchange Commission has issued a summary of guidelines on the filing of reports and other documents during the enhanced community quarantine that has been imposed over Luzon and other regions in the Philippines due to the COVID-19 pandemic. A copy of the issuance can be downloaded here: SEC COVID guidelines