Finocchio & Ustra Sociedade de Advogados | View firm profile
International Research and Development (R&D) agreements have become increasingly significant worldwide, as companies pursue global competitiveness, technological advancement, and integration into international value chains in response to growing demands for innovation.
These agreements, however, become significantly more complex when they involve global partners, which demands careful alignment between international contractual standards and domestic legal frameworks, particularly concerning intellectual property (IP) protection and adherence to local regulatory requirements.
Brazil, in particular, represents a strategic market, especially in sectors like pharmaceuticals, animal health, and biotechnology, considering that the country has one of the largest and most dynamic consumer markets in Latin America, a robust agricultural and industrial base, and an expanding innovation ecosystem supported by renowned research institutions.
However, proper management of Intellectual Property (IP) is critical for these agreements to fulfill their objectives and ensure legal security for all parties involved.
In Brazil, the Industrial Property Law (Law 9.,279/96), the Software Law (Law 9,609/98) and the Innovation Law (Law 10.,973/2004) constitute the legal basis for the protection of patents, trademarks, copyrights on software and technology transfer mechanisms. However, the expansion of the R&D ecosystem in Brazil faces significant hurdles, such as the slow pace of patent examination by the National Institute of Industrial Property (INPI) and the lack of specific regulations for protecting know-how and research data in multilateral projects, and understanding these specificities is crucial for foreign companies and institutions aiming for productive partnerships within the country.
Therefore, it is essential that the legal advisors involved in such R&D agreements proactively include contractual mechanisms designed to protect the parties’ intellectual property assets and prevent potential disputes. These mechanisms should explicitly differentiate between each party’s pre-existing technology (background IP) and the technology developed collaboratively during the project (foreground IP), incorporate comprehensive cross-licensing provisions, clearly define ownership rights related to research outcomes and further obligation, such as but not limited to regulatory procedures.
Deciding between sole ownership or co-ownership must consider factors such as the parties’ actual contributions, the conditions for commercial exploitation, and the specific legal frameworks applicable both locally and internationally. While co-ownership might initially seem equitable, the parties should carefully evaluate the potential risks involved, especially concerning future commercial use of the results, as well as obligations related to IP registration, protection and rights regarding licensing to third parties and use of the IP in general.
Such measures not only facilitate the equitable distribution of risks among the parties but also enhance predictability and legal certainty throughout the partnership. The lack of well-defined contractual term can lead to protracted legal disputes, particularly in agreements involving public entities and private companies.
Furthermore, the protection of know-how—often inadequately addressed through generic non-disclosure agreements (NDAs)—underscores the pressing need for more robust and tailored contractual mechanisms to safeguard confidential information and proprietary expertise.
Moreover, international collaborations in Brazil benefit greatly from leveraging local research institutions and universities, many of which are globally recognized for their specialized expertise, advanced scientific infrastructure, and strong track record in applied research.
These institutions often serve as critical bridges between global innovation ecosystems and the Brazilian regulatory and scientific environments,
having as a particularity that agreements must be compliant with public policies and applicable rules. Establishing clear, well-structured and mutually beneficial partnerships with them, and knowing the specific legal provisions, not only enhances the technical robustness and credibility of research outcomes, but also facilitates informed navigation of local regulatory frameworks and cultural nuances that directly influence how R&D activities are executed in Brazil. This localized collaboration model is essential for mitigating operational risks, accelerating innovation cycles, and unlocking access to public funding and innovation incentive programs under the Brazilian legal framework.
Finally, companies and institutions negotiating international R&D agreements involving intellectual property in Brazil should adopt a strategic and structured approach that includes a comprehensive checklist addressing the key contractual elements discussed, along with proactive and well-informed negotiation practices, aimed at mitigating future risks and enhancing both commercial and technological outcomes. In addition, continuous monitoring and regular updating of the contractual terms and conditions are essential due to the dynamic nature of both technological advancements and regulatory changes.
The parties should formally establish mechanisms for regular reviews to ensure that contractual terms remain responsive to new legal, technological, and market developments —thereby safeguarding their interests, ensuring legal certainty, and fostering long-term, sustainable collaboration.
In conclusion, the careful structuring of contractual clauses in international R&D agreements carried out in Brazil significantly maximize commercial and technological benefits while minimizing the probability of potential legal disputes. Therefore, companies and institutions must adopt a strategic and forward-looking approach from the very outset of negotiations, ensuring not only the legal soundness of the agreement but also the long-term success and sustainability of their collaborative innovation initiatives on the international stage.
Authors: Talita Orsini de Castro, Isabela Zumstein Guido and Luiza Fernandes de Andrade.