Dairy Australia Intellectual Property Policy

Dairy Australia Intellectual Property Policy Further information: Dairy Australia Level 5, IBM Centre 60 City Rd Southbank Victoria 3006 Australia T + 61 3 9694 3777 F + 61 3 9664 3733 www.dairyaustralia.com.au Published by Dairy Australia The Intellectual Property Policy is published for your information only. It is published with due care and attention to accuracy, but Dairy Australia accepts no liability if, for any reason, the information is inaccurate, incomplete or out of date. Copyright Dairy Australia 2007. All rights reserved.

Table of Contents 1 Introduction...3 1.1 Purpose... 3 1.2 Vision... 3 1.3 Mission... 3 1.4 Industry Objectives... 3 2 Definitions...4 2.1 What is Intellectual Property (IP)?... 4 2.2 What is a Patent?... 5 2.3 What is Commercialisation?... 5 3 Identifying R&D projects for investment...7 3.1 Dairy Australia Guiding Principles... 7 3.2 Identifying R&D projects... 7 3.3 Project bids from researchers... 8 3.4 Market failure... 8 3.5 Selection criteria and approval process... 9 3.6 Terms and conditions of research projects... 9 3.7 Background IP... 10 3.8 Sharing IP with Research Organisations Fee for Service... 10 4 Managing, protecting and administering IP...11 4.1 General Principles... 11 4.2 Ownership of IP... 11 4.3 Monitoring against technical milestones... 12 4.4 Responsibility for registering, prosecuting and maintaining IP... 12 4.5 Patents registration and maintenance cost sharing... 12 4.6 Patents infringement and defence cost sharing... 12 4.7 Patents entering National Phase... 13 4.8 Patents defence... 13 4.9 Patents relinquishment... 13 4.10 Post Implementation Review (Project Completion Report)... 13 5 Commercialising IP...15 5.1 How should Dairy Australia IP be commercialised?... 15 5.2 Investments in developing IP... 15 5.3 Outright sale... 16 5.4 Valuing IP... 16 5.5 Publication... 17 6 Measuring and communicating benefits from IP...19 6.1 Guiding Principle... 19 6.2 Communication Strategy... 19 6.3 Training and Education... 19 Dairy Australia Intellectual Property Policy Page 2

1 Introduction 1.1 Purpose The purpose of this Intellectual Property (IP) Policy is to provide consistent and sustainable rules and guidelines for the efficient allocation of funding to research and development (R&D) projects, investments in the development of other intangible assets such as brands and trademarks, the effective protection and management of IP resulting from those projects, the commercialisation of IP and the communication of the benefits from valuable outcomes. It will provide a platform for rational decision making, improved commercialisation efforts and the generation of better returns, be they industry, environmental, social or economic, consistent with the objectives of the Australian dairy industry and the vision and mission of Dairy Australia. 1.2 Vision The Vision of Dairy Australia is to deliver world s best services to achieve the Australian dairy industry s vision to grow an internationally competitive, innovative and sustainable dairy industry. 1.3 Mission Dairy Australia s mission is to develop and drive industry services and innovation for the ultimate benefit of levy payers. 1.4 Industry Objectives Dairy Australia and associated industry groups have identified three key objectives on which to focus to best meet industry s broader objectives and the Commonwealth s national and ministerial research priorities: 1. Increase Farm Productivity. 2. Develop value add, high margin markets, products and channels. 3. Promote and protect the unique benefits of Australian dairy. In particular the industry s objectives are to: have sustainable improvement in profitability for dairy farmers and all other sectors of the dairy supply chain; protect and grow the value and quality of industry assets in all sectors of the dairy supply chain; have viable growing markets for the dairy industry; have a positive operating and regulatory environment in all sectors of the dairy supply chain; have skilled human resource capability in all sectors of the dairy supply chain; and have access to natural resources as the basis for confidence to invest in the dairy industry. Dairy Australia Intellectual Property Policy Page 3

2 Definitions 2.1 What is Intellectual Property (IP)? Intellectual property has been defined as representing the property of the mind or intellect. In business terms, this also means the proprietary knowledge of an organisation. There are seven groups of rights which make up intellectual property: Patents for new or improved products or processes. Trade Marks for letters, words, phrases, sounds, smells, shapes, logos, pictures, aspects of packaging or a combination of these to distinguish the goods and services of one trader from those of another. Designs for the shape or appearance of manufactured goods. Copyright for original material in literary, artistic, dramatic or musical works, films, broadcasts, multimedia and computer programs. Circuit Layout Rights for the three-dimensional configuration of electronic circuits in integrated circuit products or layout designs. Plant Breeder's Rights for new plant varieties. Confidentiality/Trade Secrets including know-how and other confidential or proprietary information. Some general points can be made about them: All but confidential information is closely regulated by Commonwealth legislation. The various types of rights last for different lengths of time and vary greatly in their scope. The rights and obligations are modifiable by contract between the owner and other parties. The rights can normally be divided by: - territory - time - purpose or use - exclusivity - particular rights (e.g. copy or broadcast, etc) Assignments and licences (and permissions) are the normal ways of dealing with such rights. Not all intellectual property, e.g. copyright, needs to be registered. In this Policy, Intellectual Property will typically refer to a product, a process or a service which has resulted from a research and development (R&D) project sponsored by Dairy Australia. Dairy Australia Intellectual Property Policy Page 4

2.2 What is a Patent? The most common form of Intellectual Property which is capable of being registered is a patent which is a right granted for any device, substance, method or process which is new, inventive and useful. A patent is legally enforceable and gives the owner the exclusive right to commercially exploit the invention for the life of the patent. This is not automatic. You must apply for a patent to obtain exclusive rights to exploit your invention. There are two types of patents in Australia: A standard patent gives long-term protection and control over an invention for up to 20 years. An innovation patent is a relatively fast, inexpensive protection option, lasting a maximum of eight years. The innovation patent replaced the petty patent on 24 May 2001. Patents give effective protection if you have invented new technology that will lead to a product, composition or process with significant long-term commercial gain. In return, patent applicants must share their know-how by providing a full description of how their invention works. This information becomes public and can provide the basis for further research by others. Artistic creations, mathematical models, plans (such as engineering drawings, e.g. Future Dairy), schemes or other purely mental processes cannot be patented. 2.3 What is Commercialisation? The central Australian body which administers and registers Intellectual Property in Australia is IP Australia. IP Australia has defined the commercialisation of intellectual property as the process of: Planning how you will take your good idea to the marketplace. It involves working the idea into your business plan, consideration of protection options and considering how to market and distribute the finished product. There are many diverse channels of commercialisation for research organisations or organisations which fund research and therefore achieve entitlements to IP including: licensing of inventions; consulting and contract research; creation of spin-off companies and joint ventures; and publishing, in traditional as well as electronic media. At one level commercialisation might be defined as the productive utilisation of the results of research (which would include publication, i.e. free access). At the other, a narrower definition involves exchanging the rights arising from research for financial compensation. In some ways the issue is whether commercialisation has the same meaning as technology transfer or whether it is used in a narrower (commercial) sense. Dairy Australia Intellectual Property Policy Page 5

This IP Policy has been predicated on two general assumptions: The sole purpose of a research project is not necessarily to generate a financial return by exploiting the resultant Intellectual Property; but Where a project has generated or has the capability of generating IP, the IP should be managed, administered and protected to ensure that the option to extract value and industry benefits for the levy payers is retained. Dairy Australia Intellectual Property Policy Page 6

3 Identifying R&D projects for investment 3.1 Dairy Australia Guiding Principles The following principles will guide Dairy Australia in choosing appropriate R&D projects for investment: The over-riding principle is that investment must be for the ultimate benefit of levy payers. Benefits from investments must be measurable and broader than benefit cost alone. Collective investment returns should aim to generate a significant Return on Investment (ROI) unless there are other compelling strategic reasons. The profile of Dairy Australia investments in conjunction with industry investment should match that of or exceed an internationally innovative industry (including period to realisation and risk profile). Dairy Australia activities should address market failure in the broader sense i.e. to achieve the desired objectives faster, more efficiently or more effectively. There must be broad industry acceptance of Dairy Australia s strategies. Investment strategy should be objective driven, not historically based. Value creation activities must be accompanied by mechanisms to distribute outcomes for the benefit of levy payers and the Australian dairy industry. Investments should allow Dairy Australia operational flexibility and ability to adjust to changing environments and afford a Freedom to Operate. Dairy Australia should have the flexibility to source alternative funds where the outcomes ultimately benefit the industry as well as the investor. Dairy Australia will invest globally to achieve the highest quality outcomes for the Australian industry. 3.2 Identifying R&D projects Research projects are largely identified from three sources: Australian companies; researchers; and internally generated projects by Dairy Australia. Proposals will be evaluated and ranked on their potential to generate value for levy payers and in accordance with principles outlined in this Policy. Proposals will be required to include an assessment of the potential market for any likely product, process or service generated from the project. The primary focus of R&D spending will be to invest in the best sciences with the highest potential to provide returns for levy payers. Although appropriate emphasis will be given to Australian projects, Dairy Australia Intellectual Property Policy Page 7

Dairy Australia will also consider strategic alignments and investments in overseas research and development provided that there are demonstrated net benefits to the Australian levy payers and the investment is supported by a robust business case. 3.3 Project bids from researchers Potential projects from researchers will be selected by a competitive process following a general call for proposals in June/July each year. The proposals will be reviewed, assessed and ranked by the Dairy Australia Program Managers based on the potential impact on the dairy industry and the quality and reputation of the researcher. A stringent process will evaluate the scientific merit of each proposal. As the proposals are competitive, tertiary institutions that submit successful proposals will also benefit from top-up funding through other research programmes sponsored by the Commonwealth. It is important that bids from researchers demonstrate a high degree of potential industry benefit. Bids to continue existing projects must explain clearly why additional investment will provide a net addition to industry value. 3.4 Market failure The emphasis for investment selection will be on early stage projects with a significant blue sky element where there is more likely to be market failure than in other opportunities identified by the manufacturing sector. Market failure usually occurs because the benefits are widely dispersed and risks are so high and rewards so far in the future that industry and private investors are not interested in investing in them. In other words, the market fails to deliver the industry improvements and growth that will otherwise accrue from innovation. Dairy Australia will address market failure in the broader sense and aim to achieve the desired R&D objectives faster, more efficiently or more effectively. In assessing proposals for investment, Dairy Australia will also take all appropriate steps to balance the benefits from long-term projects that promote sustainability in the industry against the short term imperative to generate financial returns. The dispersed and fragmented nature of many industry participants means that it is difficult for them to concentrate their interests and individual activities effectively in R&D. The most efficient alternative is a collective investment through a combined and co-ordinated initiative by the industry association, Dairy Australia, which addresses technology improvement issues with the assistance of government funding. The government contributes because it recognises that net benefits to industry and the broader community will result. Dairy Australia Intellectual Property Policy Page 8

3.5 Selection criteria and approval process A preliminary assessment of the economic prospects of the projects will be made but this is less important than a judgement on the likely impact of the proposed project on the Australian dairy industry itself. Qualifying projects will typically be higher risk and in areas subject to market failure. A Guiding Principle is that investment decisions should be driven by objectives and not history. Usually projects to improve existing production processes are best handled directly by the manufacturers themselves. However, there can also be market failure in this area or benefits to manufacturers from a collective investment by Dairy Australia in areas such as environmental and regulatory intervention. But, in most cases it will be earlier stage inventions with a degree of blue sky that requires more patient investment capital, which will be most appropriate for Dairy Australia funding. The ultimate approval for projects will be by the Board of Dairy Australia. 3.6 Terms and conditions of research projects The terms and conditions for projects which are approved in principle will be negotiated in detail with the researchers and a contract agreed. In some cases Dairy Australia may also introduce a third party co-funder to the project such as the Geoffrey Gardiner Dairy Foundation or a co-investor from industry. The terms and conditions of research agreements are based on the Dairy Australia Standard Project Agreement which addresses key topics including: obligations of the parties; intellectual property ownership and protection; commercialisation; reporting requirements milestones, project reviews and financial; project funding; project equipment; confidential information; publication; and others, including warranties, indemnities, insurance and dispute resolution. Research projects cannot commence until contract details have been finalised and a Project Agreement signed. Dairy Australia Intellectual Property Policy Page 9

3.7 Background IP In order to undertake a research project it will often be necessary for Dairy Australia to access the Background Intellectual Property which will be contributed by the researcher or by a third party. The Background IP may either be registered IP, such as a patent, or non-registered IP, such as knowhow or other tacit knowledge. If a licence fee is payable to access the Background IP, the negotiation over the appropriate fee will form part of the overall contract negotiation. Dairy Australia will be prepared to consider a fair value for the Background IP which may either be reflected in the relative shares of project profits or by royalties generated by a successful project or some other mechanism. If Dairy Australia contributes Background IP to a project, it will expect its contribution to be valued in a similar way. The actual expenditure on Background IP by a researcher may not be an acceptable basis for calculating the value of any Background IP contributed. This is because the cost to the researcher is not necessarily representative of the value to Dairy Australia or the potential project. Background IP must be differentiated from Generated IP which is the Intellectual Property that results from the project. Background IP is contributed by the parties at the outset. 3.8 Sharing IP with Research Organisations Fee for Service Dairy Australia will not usually enter into a contract with a Research Organisation purely for contract research but if it does and if no significant Background Intellectual Property is contributed by the researcher (other than the skills the market would normally expect from a research service provider to discharge his duties satisfactorily), then Dairy Australia would not expect to share any IP resulting from the project with the researcher. The fee for service under the contract for research should be adequate reward. Dairy Australia Intellectual Property Policy Page 10

4 Managing, protecting and administering IP 4.1 General Principles Although it is not Dairy Australia s intention to create Intellectual Property from every project which can be commercialised, management of the IP arising from the project will be undertaken in a way so that it is capable of being protected. The better the protection of the IP, the higher the potential rewards from commercialisation. Management of IP during a project will involve taking measures to ensure that there is no leakage of confidential information, e.g. through publication of articles or the presentation of posters at conferences. Dairy Australia will maintain an Integrated Project Management System including an IP register to record individual patents relating to IP generated during projects, their current status and the funds expended to date in legal fees and patent costs. This professional approach to protecting and managing IP will lay the foundation to advantageous licensing if the technology developed results in commercial potential. However, licensing is not a total set and forget process. Dairy Australia will manage and monitor the continuing relationship with the licensee to ensure that: the appropriate royalties are collected and remitted promptly to Dairy Australia; the licensee continues to support the product or the products containing the technology with appropriate sales and marketing to maximise returns to Dairy Australia; and the administration of the relationship is conducted efficiently so that the benefits continue to outweigh the costs. 4.2 Ownership of IP In the absence of agreement to the contrary, Dairy Australia will own 100% of the Intellectual Property which is generated during the project. Where an agreement has been reached for co-ownership, Dairy Australia and the research organisation will jointly own Intellectual Property generated from the project as tenants in common in proportion to their contributions to the project including the value of Background IP contributed. Where there is a co-investor with Dairy Australia, e.g. Geoffrey Gardiner Dairy Foundation, the coinvestor will be included in these ownership arrangements. Generated Intellectual Property refers to IP which results from the project and is distinct from Background IP which is contributed by the parties at the outset. Background IP remains the property of the contributor but typically the other party will be granted royalty free access to it for the purposes of academic research. Dairy Australia Intellectual Property Policy Page 11

4.3 Monitoring against technical milestones Unless otherwise agreed, a researcher upon entering into a contract with Dairy Australia will meet the following terms and conditions: Notify Dairy Australia of any significant developments with the research project. Report quarterly against technical and commercial milestones. Permit project reviews. Prepare appropriate financial reports. Prepare a final Project Report. Allow an audit of records including researcher s files and notebooks. 4.4 Responsibility for registering, prosecuting and maintaining IP Research Organisations usually generate a number of patents and other registerable Intellectual Property and will have appropriate program and IP management systems in place. Where Dairy Australia does not own 100% of the IP and researchers can demonstrate that this is the case and unless otherwise agreed, the research organisation will usually be responsible for the registration and maintenance of patents. 4.5 Patents registration and maintenance cost sharing Unless otherwise agreed, Dairy Australia and the research organisation shall share the costs of registration, prosecution and maintenance of their rights in any project Intellectual Property in proportion to their respective ownership shares. Where royalties result from the generation of IP, there shall be no right for the paying party to set off royalties against their obligations to meet patent or other IP expenses. 4.6 Patents infringement and defence cost sharing Unless otherwise agreed, the costs of defending any third party claims for alleged infringement of patents and the cost of prosecuting cases against third parties infringing project Intellectual Property shall be borne by the licensee under any licence or similar agreement. Dairy Australia reserves the right to determine defending strategy, including the provision of adequate exit clauses within contracts. Notwithstanding, infringement against patents in which Dairy Australia has a financial interest must be defended vigorously and this obligation will be a clear condition of the licence, assignment or other similar technology transfer document. Dairy Australia Intellectual Property Policy Page 12

4.7 Patents entering National Phase Approximately 30 months after the initial Provisional Patent has been lodged and the Patent Cooperation Treaty (PCT) period has expired, it is necessary to register patents in individual countries (the National Phase ). There are some exceptions to the need to register patents countryby-country e.g. registration in certain European countries can be achieved through a single application. However, in most cases individual countries need to be selected. The cost of registration in many of these countries is high, particularly where translation is required, e.g. Russia, Japan and China. Dairy Australia and the research organisation will jointly agree which countries will be chosen for National Phase registration, having regard to the market potential of each country, the vigour with which IP rights are upheld in the jurisdiction and the costs of registration. 4.8 Patents defence Dairy Australia reserves the right to determine defending strategy, including the provision of adequate exit clauses within contracts. Notwithstanding that it will be a general condition of licences and other similar documents that a licensee bears primary responsibility for the defence of jointly owned Intellectual Property, Dairy Australia will take all steps to defend its rights in project IP at the national and international level if it is clear that a third party is wilfully infringing a patent or other defensible right. 4.9 Patents relinquishment Although the primary aim of research projects is not necessarily to commercialise a product, process or service, it may still be necessary to invest in protecting and managing Intellectual Property which is capable of providing benefits to levy payers. The cost of protection for the first 30 months during the provisional and PCT patent registration phases is usually not excessive. However, if the IP does not have any tangible prospects for commercialisation by the expiration of the PCT period, Dairy Australia will give serious consideration to relinquishing the patent or other form of protection and discontinuing any further funding. 4.10 Post Implementation Review (Project Completion Report) After a project has been completed the outcomes will be assessed against the criteria which caused it to be selected in the first place and the Key Performance Indicators (KPIs) including budget, timeframes and scientific outcomes. A report will be compiled by the Program Managers for review by the Managing Director which sets out the objectives of the project and the outcomes. Where Intellectual Property has been developed in the course of the project, the Program Manager will advise how it is intended for the IP to be transferred for the benefit of levy payers either through the active pursuit of a commercial partner or by an alternative means such as publication. Decisions will be made at this point whether to continue Dairy Australia Intellectual Property Policy Page 13

to invest in IP protection, e.g. by continuing to pay refresher fees on patents. Program Managers will also outline the proposed Communication Strategy for disseminating information regarding the outcomes to levy payers. The Report will be signed off by the Board to complete the circle which started with Board approval to initiate the project. Dairy Australia Intellectual Property Policy Page 14

5 Commercialising IP 5.1 How should Dairy Australia IP be commercialised? When Dairy Australia enters into an arrangement with a researcher to fund a project which may generate Intellectual Property, Dairy Australia will agree in advance on which party or parties has or have responsibility for commercialisation of any resultant IP and the time frame within which that IP should be brought to market. If an industry partner funds or partly funds research projects, that partner will generally have the right of first refusal over commercialising the resulting IP (if any). As far as is practical, Dairy Australia will negotiate the terms and conditions of any licence which is part of that option, in principle, in advance. In other circumstances, or if the partner does not exercise the option to take up the IP, Dairy Australia will take responsibility for commercialisation and will broker the IP to interested parties. The role of Dairy Australia in such instances will be to act as a broker rather than a proprietor. It will focus on identifying appropriate parties in Australia to licence the IP or it will investigate the viability of spin-offs (with or without partners) or some other viable means of creating value from the IP. By Dairy Australia assuming this role, the perceived conflicts of interest and/or allegations of self interest which might arise if industry participants assumed the commercialisation role will be avoided. As a last resort for either encumbered or unencumbered IP which is not taken up by Australian parties, potential international partners will be canvassed. The best outcome here is that the technology, if adopted, will not directly compete with the Australian dairy industry but will provide a reasonable rate of return on the investment. Dairy Australia will balance the potential financial rewards against any detrimental impact on levy payers and the industry generally. However, such arrangements may not preclude Australian companies from accessing the benefits of the IP by purchasing finished products rather than licensing the technology in and developing products themselves. 5.2 Investments in developing IP Dairy Australia will retain flexibility in its approach to commercialisation. If the first stage of a project has concluded successfully but the indications are that further expenditure is required to develop the Intellectual Property to make it commercially attractive, Dairy Australia will consider further investment provided that all associated costs are carefully quantified, the proposal is supported by a robust business plan and the incremental benefits exceed the incremental costs. Dairy Australia Intellectual Property Policy Page 15

5.3 Outright sale There are a number of ways by which Intellectual Property can be transferred for the benefit of the Australian dairy industry and levy payers. Generally, the most appropriate vehicle to transfer valuable IP for commercial benefit will be via a licence. A licence continues to provide Dairy Australia with an interest in the growth and development of the technology, typically by relating rewards to say, increased sales of the end product. As the IP developed in research projects is usually early-stage, it may require the early partnering with a large commercial organisation with substantial financial means and networks, not only to provide the investment to prove and scale-up the concept but also a to assist in IP defence and to dissuade would-be infringers. Dairy Australia will also consider an outright sale of the IP. The break that results is clean and provides Dairy Australia with funds up front without the need for further monitoring and audit but there will be no share of the upside if the invention turns out to be a significant, long term revenue earner. Alternatively, Dairy Australia will consider selling the IP into a spin-off company where an interest in the potential upside can be retained through equity. The IP may be vended in to the spin-off for equity or a mixture of cash and equity. The costs of operation and tax and grant impacts will be carefully considered in making this decision. 5.4 Valuing IP Decisions to invest in commercialising Intellectual Property will require a careful assessment of the potential: economic benefits to levy payers using traditional cost benefit analysis; and financial returns using market accepted techniques for the valuation of intangible assets. The financial returns from the investment in commercialisation will largely depend on the fair value of the IP, the market price and the likelihood of identifying a buyer, investor or licensee. For Dairy Australia to commit further funding to commercialisation, the economic benefits and the financial returns must exceed the related costs having regard to the riskiness of the venture and the likelihood of success. The preferred methodology that Dairy Australia will use to estimate the value of IP relies on the basic concept that any asset is worth the net cash it will generate over its life, expressed in present day dollars, i.e. the IP value is the Net Present Value (NPV) of the Discounted Cash Flow (DCF) that the IP will generate over its life. Dairy Australia Intellectual Property Policy Page 16

The calculation has two basic components: 1. The cash that will be generated from sales less the cost of generating those sales and any additional capital expenditure that might be required. 2. A rate to discount future earnings into present day dollars. In order to estimate net cash, Dairy Australia will take into account: the size of the market for the end product; the likely market share that a new product might achieve over time; the time it will take to achieve that market share; the likely reaction of competitors; the likely emergence of new competitive products; operating expenses (OPEX); and capital expenditure (CAPEX). Valuable intellectual property will usually be protected by patents (which have a finite life) and if the IP is likely to be licensed, revenue will be received not as the sale of a product but as a royalty (usually expressed as a percentage of sales), together with some lump sum or milestone payments when certain targets are achieved. In such cases the cash generated will be a combination of the royalties and milestones but the market data is still relevant. The other key ingredient is the discount rate. This is the rate that is used to translate future dollars to their present day equivalents. The simple principle is that a dollar to be earned in, say, ten years is not worth as much to us as the dollar we can earn today. The discount rate reflects a basic principle called the time value of money and also the riskiness or certainty of the future cash flows. For example, there is more certainty about the income from investing in a Commonwealth Bond than there is in the income which might arise from an invention. An investor adjusts to these differences in certainty by requiring a higher return on invention income. Dairy Australia will do the same and generally apply a market discount rate to the NPV calculation which will be representative of the risks associated with commercialisation and a successful outcome. An alternative measure is to quantify the Internal Rate of Return (IRR) of a project to commercialise IP. A similar process is used as for an NPV calculation and provided that the IRR exceeds the appropriate target rate of return, an investor would normally proceed with the project. 5.5 Publication Dairy Australia will manage research outcomes to make them as widely available as possible to levy payers having regard to any commercial contractual obligations. However, the optimum path to pursue for the adoption of R&D is not always obvious. For example, the dissemination of free information through publication or display on a web site may be intuitively appealing to researchers but it is not necessarily the best way to achieve market penetration and uptake. Sometimes it Dairy Australia Intellectual Property Policy Page 17

devalues the research. Sometimes even the best of ideas need to be actively sold in order to be adopted or adopted within a reasonable time. There is also the consideration that once an invention is published, it is available to the world, including international competitors. This needs to be balanced against the strategic advantages of developing international connections and research collaborations. Generally, Dairy Australia will only sanction the transfer of information relating to Intellectual Property into the public arena through publication or presentation at seminars and conferences if it is protected. In any case, researchers cannot proceed to publish or otherwise transfer information into the public domain unless prior approval has been obtained from Dairy Australia. This approval will not be unreasonably withheld. Dairy Australia will ensure that contracts with researchers reflect this and contain appropriate terms and conditions. Dairy Australia will carefully consider requests for the publication of research outcomes from sponsored projects and will take all reasonable steps to balance the interests of researchers with the need to manage commercial obligations and the best interests of levy payers. Dairy Australia Intellectual Property Policy Page 18

6 Measuring and communicating benefits from IP 6.1 Guiding Principle A guiding principle for Dairy Australia is that there must be broad industry acceptance of Dairy Australia s strategies. Broad industry acceptance requires communication of the benefits of the Value-Chain Innovation investments in R&D. Dairy Australia will take appropriate actions to communicate research outcomes to demonstrate the benefits to levy payers and the industry at large. 6.2 Communication Strategy The Communications Group will be responsible for providing information to stakeholders on developments of interest, including successful outcomes from the Value Chain Innovation Program research projects. Information will be disseminated through newsletters, the public media and on the web site. 6.3 Training and Education One of the key objectives of the Dairy Australia research programs is to encourage the training and education of industry participants or potential participants. Dairy Australia will achieve this objective by sponsoring PhD students with appropriate interests as members of the research teams in R&D programs. Where sponsored PhD students are part of bids by research organisations, Dairy Australia will ensure confidentiality either directly or indirectly. While copyright in a thesis remains with the student, all rights in any IP developed during the project will be assigned directly or indirectly (through the research organisation) to Dairy Australia. Dairy Australia Intellectual Property Policy Page 19