Snapshot of our Practice
Our IP & Technology Practice, which includes a vibrant Telecommunications practice, has been busy advising on a range of transactions in IP and technology over the past month, and we have been briefed on several IP Disputes for a wide range of clients. Notably, our work in the Fintech and payments space has been increasing and is now cross-border. We have also advised on several franchising transactions. We continue to lead the front in advising on major telecommunication infrastructure projects across Africa, covering fibre roll outs and data centres, as well as regulatory and compliance work for leading telecom sector companies. We continue to advise on Fintech and digital lending, an area that is ever evolving in Kenya.
Updates From Regulatory Bodies
Office of the Data Commissioner
- Alternative Dispute Resolution for Data Protection Complaints
The Office of the Data Protection Commissioner (ODPC) announced that it had launched a public consultation on the draft Alternative Dispute Resolution Framework (the Draft ADR Framework) of the ODPC. In particular, the ODPC stated that following the enactment of the Data Protection Act 2019 and the Data Protection Regulations 2021, the ODPC developed the Draft ADR Framework with support from the United Nations Development Programme. In this regard, the ODPC specified that the drafting of the framework emanates from the Constitution of Kenya 2010, which promotes the use of alternative dispute resolution methods.
As such, the ODPC noted that interested parties are invited to submit comments on the Draft ADR Framework and may do so for 14 days from the date of issuance of the ODPC’s notice (that is, until 5 April 2022).
To read more, click here
Source: OneTrust DataGuidance
- Registration with the ODPC update
On the timelines within which to be registered as a data processor or controller, the Data Protection (Registration of Data Controllers and Data Processors) Regulations, 2021 provide for a grace period of 6 months from the gazettement date, which was 14 January 2022, for compliance with the Registration Regulations. From our engagements with the ODPC, we understand that the registration portal on the ODPC’s website will be launched in June 2022, and applications for registration must be submitted by 14 July 2022. Should you act as a data controller or a data processor, you will be expected to register as both through the ODPC’s website.
The ODPC is looking into developing sector specific guidance notes specifically targeting the following sectors: (a) telecommunications, (b) Fintech, (c) Health and (d) Education. These guidance notes will be published as such and not as guidelines, which means that entities can choose whether or not to comply, but we strongly recommend compliance. The guidance notes will form a compliance framework that will guide specific sectors on how to comply with data protection obligations.
KIPI
The Industrial Property Journal for March 2022 is available on the KIPI website. You can find it here
KFCB
In March 2022, the Kenya Film Classification Board (KFCB) proposed new rules that will see the involvement of content providers in the examination and classification of content meant to air on their respective platforms.
According to the Co-Regulation Framework for broadcast, Video on Demand (VOD) and Over the Top (OTT) content, KFCB proposes to allow broadcasters, and online streaming service providers to classify 70 percent of audiovisual content on their platforms using the local film classification guidelines.
Under the proposed arrangement, KFCB will only classify 30 percent of the content meant for broadcast on traditional broadcasting and new media platforms.
KFCB published the framework on its website for public and stakeholder comments and input, which closed on 4 April 2022. To read more, click here
Anti-Counterfeit Agency
The Anti-Counterfeit Authority (ACA) has commenced rolling out the intellectual property rights (IPR) recordation process. With this new regulatory requirement, the ACA has taken a pro-active approach to fighting counterfeits through the recordal of intellectual property rights. For purposes of conducting the recordal process, the ACA has developed a platform known as the Anti-Counterfeit Authority Integrated Management System. To access our more detailed analysis of the recordal process, click here
WIPO
As reported by WIPO on 10 March 2022, universities and research organizations filed nearly as many patent applications as corporations for COVID-19 vaccines during the early months of the global pandemic, with China and U.S.-based innovators most actively patenting new anti-COVID19 vaccine and therapeutic technologies.
The report on the pandemic era indicated that the greatest number of COVID-19 patent filings were related to conventional vaccine technologies and repurposed drugs, followed by more-novel vaccine technologies like mRNA. To read more, click here
ARIPO
From the 14th to the 15th of March 2022, WIPO in collaboration with the African Intellectual Property Organization (ARIPO) held a virtual meeting on developing the Regional Technology and Innovation Support Centre (TISC) network. The meeting was held with the assistance of the Japan Patent Office (JPO) under the Funds Trust Arrangement for Africa and the Least Developed Countries (LDCs). The TISC is a cooperative project under the WIPO Agenda providing Intellectual Property users and innovators in developing countries with assistance in searching and retrieving technology information and mastering industrial trends, and new technology information more quickly. To read more, click here
OAPI
On 28 February 2022, the OAPI IP Office issued a notice informing them that the Registry requires trade mark specifications of goods and services to contain clear and precise descriptions. As a general rule, trade mark applicants are discouraged from using the general class headings utilized in the Nice Classification system, unless in circumstances where it would meet the required standards of clarity and precision. To read more, click here
Developments in the Intellectual Property Arena
Trademarks
Afia juice maker trademark row with ex-partner head to arbitration
A fight over the trademark used in the manufacture and distribution of children’s juice known as Squishy will now be handled by an arbitrator. Alternative Dispute Resolution will be used to address the matter after a bench of the Kenyan Court of Appeal declined to stop Kevian Kenya Ltd (KKL) from manufacturing, distributing and selling products under the trademark ‘Squishy’.
Squishy Drinks Limited (SDL) moved to the Appellate court arguing that a ruling by the High Court in December 2019 allowed the two (2) parties to conduct business using the same trademark, but such a ruling would continue to damage its brand.
As the case is pending, the parties agreed for the matter to be heard by an arbitrator and both have filed their submissions and are awaiting a decision.
This is one of the few IP disputes to seek resolution by way of arbitration in Kenya. This is a welcome development.
To read more, click here.
Source: Business Daily
Counterfeits
Haco to refund KES 15m in BiC pen counterfeit row
Justice Patrick Otieno of the Mombasa High Court in Kenya has ordered Haco Industries (Haco) to refund KES 15 million it was paid by Doshi Iron Managers (Doshi) to settle the counterfeiting of Haco’s BIC brand of pens. The Court ordered the refund as Haco was in breach of a settlement agreement by continuing to pursue claims against Doshi even after the settlement to the tune of KES 15 million.
Bowmans Comment: Courts generally allow and give parties room to settle disputes amicably between themselves involving counterfeits. Similarly, Courts will enforce the terms and conditions of any contractual arrangements between parties and will hold the parties to their bargain as provided for in a settlement agreement.
Ultimately, Courts will not re-write contracts for parties, and neither will the Courts hesitate to hold a party accountable where it is in breach of its contractual obligations.
Whilst it is possible that Haco may appeal the decision on the basis that settling its trademark infringement claim against Doshi did not bar Haco from pursuing subsequent criminal proceedings against Doshi in respect of the counterfeit pens, it will be interesting to see whether the Court of Appeal will agree on the question of whether a party may settle both its claim for trademark infringement and the right to file a complaint in respect of counterfeit goods in the context of a settlement agreement.
To read more, click here.
Source: Business Daily.
Patents
Latest WTO Waiver Compromise Text Targets COVID Vaccine Patents, Draws Criticism from Both Sides
Reports in March indicated that the European Union, United States, India and South Africa have reached a compromise on language for a waiver of intellectual property rights related to COVID-19 vaccine technology under the Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement.
The compromise is not final and will require official approval from all 164 World Trade Organization (WTO) Member countries. The latest text is limited to “patented subject matter required for the production and supply of COVID-19 vaccines” only. The previous proposal was much broader where “Patented subject matter” was defined as including “ingredients and processes necessary for the manufacture of the COVID-19 vaccines.”
The text now contemplates extending the waiver to “the production and distribution of COVID-19 diagnostics and therapeutics” within six months of adoption. It also limits “eligible members” to “any developing member country that exported less than 10 percent of world exports of COVID-19 vaccine doses in 2021.”
Bowmans Comment: A successfully negotiated intellectual property waiver would ensure manufacturers cannot block production or access to raw materials and finished products for COVID-19 technologies worldwide. A waiver would also prevent companies from charging unaffordable prices while, at the same time, these same companies have no competition for their products.
To read more, click here.
Source: IP Watchdog
Trade Secrets
US Supreme Court Epic’s attempt to preserve full trade-secrets payout
The U.S. Supreme Court denied a petition from Epic in March regarding an appeals court’s decision to cut the electronic health record vendor’s total damages in a trade secrets case involving Tata Consultancy Services.
The State and Federal Courts whittled down the award for punitive damages of USD 940 million awarded by the U.S district court jury.
Epic’s initial USD 940 million settlement – which it was awarded after accusing Tata Consultancy Services employees of downloading technical documents during a hospital consultation, then using the information to create a competing product – was one of the most substantial trade-secrets awards to date. But over time, that award has been reduced.
After the Wisconsin court reduced the award to USD 480 million, the Seventh Circuit court opined to reduce it further to USD 140 million stating that the punitive damages were “constitutionally excessive,”
Bowmans Comment: Kenya has not enacted a specific law for the protection of trade secrets and the approach has been for courts to protect trade secrets under principles of common law on contract and equity. Kenya is also signatory to the TRIPS agreement and adopts the TRIPS Agreement through Article 2(5) and 2(6) of the Constitution on ratification of international law treaties.
There have been a few Kenyan decisions that touch on the protection of confidential information. In Sunbird Helicopters Ltd -vs- Michael Odongo, the Plaintiff sought, inter alia, orders to restrain the defendant from taking up employment with its competitor and an injunction for one year to restrain the defendant, who had been in the plaintiff’s employ as a Helicopter Chief Engineer from using and/or disclosing any confidential information and/or any trade secrets acquired by the defendant from it. The court ruled that it would not enforce any negative covenants that would result in either the defendant remaining idle or being forced to work and dismissed the case.
In another case, Baseline Architects Limited & 2 Others -vs- National Hospital Insurance Fund Board Management, the court struck out the documents which the claimant wanted to use for their case because they were privileged and confidential and had been illegally obtained.
To read more, click here
Source: Health care It News
Technology, Media and Telecommunications
Kenya
Digital lenders have up to September 2022 to register in new CBK rules
The Central Bank of Kenya (CBK) has finally gazetted the Digital Credit Providers (DCPs) regulations, 2022 (DCP Regulations) that will require all digital lenders to apply for licences from the banking regulator before September. Under these new regulations, all mobile phone lenders are required to register with the CBK six months from 18 March 2022.
The new rules also bar lenders from sharing borrower’s information with third parties, to disclose all terms of credit to their borrowers and to seek approval from the CBK on interest on their loans.
All previously unregulated DCPs are required to apply to the CBK for a license by the 18th of September 2022. Failure to obtain the license will have the DCP cease operations.
Gazettement of the regulations follows the signing into law of the Central Bank of Kenya (Amendment) Act, 2021 in December, bringing digital lenders under the watch of the banking regulator for the first time. The regulations will see digital lenders operate for the first time under similar regulations as banks and micro-financiers.
Bowmans comment: The DCP Regulations provide that digital credit providers must be licensed under the Act and that failure to obtain a license constitutes an offence that attracts a fine of KES 500,000. Digital credit providers who are operational are required to apply to the CBK for a license by 18 September 2022.
The DCP Regulations provide for consumer protection, confidentiality, credit information sharing, anti-money laundering & combating of the financing of terrorism obligations, governance & reporting requirements, as well as CBK’s supervisory role.
To read more, click here
Source: Business Daily
Africa
Microsoft Opens 2 New Offices for ADC in Africa
Microsoft has announced that it has opened two new offices for the African Development Center (ADC) in Nairobi, Kenya and Lagos, Nigeria.
The two new offices for ADC are part of Microsoft’s way of reinforcing its commitment to developing tech talent in Africa. Nairobi will host a new research institute, the Microsoft Africa Research Institute, which is the first on the continent.
In Kenya, ADC is now based at Dunhill Towers along Waiyaki Way in its new ultra-modern state-of-the-art facility, the first of its kind serving the East African region. The facility will house the engineering, design, research and innovation teams, as well as the Microsoft Garage, an incubation hub launched as part of the ongoing efforts to scale tech innovation on the continent.
The ADC offices in Nigeria are based at Kings Tower on Glover Road, Ikoyi and will be housing the product engineering, ecosystem development and innovation teams. The facility is also home to Microsoft Garage. The Microsoft Garage, which is structured as a freeform workspace to serve Microsoft employees, interns, schools and community groups, is meant to spread the values of openness and collaboration throughout the Microsoft ADC.
The Microsoft Africa Research Institute will be at the forefront of inventing new technologies to advance scientific knowledge in the field of computer science. It will conduct cutting edge research in the fields of Artificial Intelligence, Machine Learning, Systems and Human-Computer Interaction (HCI).
Bowmans Comment: This is a commendable move by Microsoft, which demonstrates not only the company’s efforts towards training, equipping and hiring engineering talent in Africa but also its commitment to the continent. For Kenya, this definitely strengthens the country’s position as a leading regional digital innovation hub, putting Kenya on the path to achieving large-scale industrial technology status, as other countries such as China, India, and Israel.
To read more, click here,
Source: TechAfrica News
Orange and DabaDoc Launch Digital Medical Consultation for African Diaspora in Europe and the USA
Orange and DabaDoc announced in March that they have launched a video medical consultation for the African diaspora in the USA and Europe.
Through the new service, African diaspora residing in Europe and the United States will be able to offer video medical consultation to their relatives living in their country of origin.
The launch of the exclusive service comes in response to a concern shared by many emigrants: taking care of the health of their parents and loved ones living in their countries of origin by allowing them access to a video medical consultation wherever they are. To do so, the DabaDoc and Orange Link teams have jointly developed a simple and smooth process: the customer, from the diaspora, wishing to offer a DabaDoc Consult signs in to the Orange “Transfer Pays” (country transfer) platform, chooses the amount they wish for the consultation, and then pays for the service by bank card. The beneficiary of the DabaDoc Consult then instantly receives a code that they can use as payment for the video consultation on the platform.
DadaDoc which was launched in Morocco in March of 2020, was aimed to help doctors and patients interact through video conferencing so as to avoid the spread of COVID 19.
Bowmans Comment: In Kenya, we have seen a rise in healthcare tech businesses such as M-TIBA, which is currently the leading health financing technology platform for consumers, insurers, healthcare providers and governments.
Fintech in healthcare brings new and improved digital financial service models into the health-care space through leveraging blockchain, artificial intelligence and machine learning to eliminate inefficiencies endemic to most healthcare plans. They aim to streamline the flow of information and money between patients and providers to save time for everyone involved. Other healthcare payment-oriented fintech solutions include health savings accounts and low interest healthcare loans.
To read more, click here,
Source: TechAfrica News
U.S tech giants face tough new rules as EU countries and lawmakers clinch deal
Alphabet’s Google, Amazon, Apple, Meta and Microsoft may have to change their core business practices in Europe as EU countries and EU lawmakers in March clinched a deal on landmark rules to curb their powers.
Thierry Breton, E.U Industry chief, tweeted about a deal with EU countries that could ensure fair and open digital markets. According to the EU antitrust chief, Margrethe Vestager, the main large gatekeeper platforms were preventing businesses and consumers from benefiting from competitive digital markets.
The Digital Markets Act (DMA) sets out rules for online gatekeepers – companies that control data and platform access. Under the DMA, the tech giants will have to make their messaging services interoperable and provide business users access to their data.
The new rules prohibit companies from favoring their own services over rivals’ or preventing users from removing pre-installed software or apps. Business users will be able to promote competing products and services on a platform and reach deals with customers off the platforms.
Bowmans Comment: The move by the EU to ensure fair and open digital markets is long overdue. Several cases have been decided by the European Commission on this matter, but the approach should be a balanced one and the views of Big Tech who have invested in and enabled access to the internet and technology based on their investments needs to also be fairly considered.
To read more, click here
Source: REUTERS
Cryptos, AI, Blockchain +
Coinbase and MetaMask Warn Over Privacy as Global Crypto Rules Take Shape
Lawmakers in the European Union on Thursday 31 March 2022 voted in favor of a proposal that would effectively make anonymous crypto currency transfers illegal. Coinbase and wallet provider MetaMask raised privacy concerns about this latest push to regulate crypto assets.
The Proposal by European law makers would effectively make anonymous crypto payments illegal. The proposal would not only cover transfers made through exchanges like Coinbase Global but also private wallets such as MetaMask, the most popular crypto wallet with more than 3 million users.
As part of a package of new anti-money-laundering laws in the 27-member-state bloc, the proposal treats crypto transfers as fundamentally different from conventional payments.
Before the proposals were adopted, Coinbase CEO Brian Armstrong said via Twitter that the company would be required to collect, store, and verify information on users of private wallets before crypto could be sent or received to them by Coinbase customers. Additionally, any time a customer received more than €1,000 in crypto from a self-hosted wallet, Coinbase would be required to report them to the authorities, even with no indication of suspicious activity.
Bowmans Comment: This proposal would effectively impose additional compliance requirements that were not previously applicable to crypto transfers, that is, data protection compliance requirements.
Currently, in Kenya, there is no law that governs or specifically classifies cryptocurrencies. However, should the companies dealing in crypto currencies be mandated to collect, store and verify customer information, then such companies would have to comply with the data protection laws and regulations in Kenya, including registration as a data controller and/ or data processor as the case may be.
To read more, click here.
Source: Barron’s
Crypto Exchange, LBank Launch into Nigeria
LBank, a cryptocurrency exchange, has announced its entry into the Nigerian market. On the 19th of March, LBank successfully held a blockchain event for its premium users in Nigeria. A selected number of LBank expert traders, VIPs, and Blockchain enthusiasts were present at the exclusive hangout to familiarize themselves with the leading exchange.
The event by LBank formed an avenue for the company to encourage Nigerian traders and pioneers of the exchange to continue trading on the platform as well as to give them a sense of recognition.
World-class global speakers delivered thrilling lectures to the audience during each session of the event. The first session was titled ‘Blockchain technology and the solution of LBank, followed by another informative segment in which the speaker introduced LBank and its offerings, dubbed “Introduction to LBank and LBank products.”
To read more, click here.
Bowmans Comment: Currently, in Kenya, there is no law that governs or specifically classifies cryptocurrencies.
In the case of Wiseman Talent Ventures v Capital Markets Authority [2019] (“Wiseman Case”) (available here), the Capital Markets Authority (CMA) argued that due to its wide mandate to protect the public with respect to capital markets, they were justified in interfering with a planned Initial Coin Offering (ICO) in Kenya. The substantive suit has yet to be determined and the decision of the court in the Wiseman Case may be material in providing further guidance as to the treatment of cryptocurrencies in Kenya.
From our engagements with the CMA in relation to regulating cryptocurrencies under existing securities legislation, we understand that the CMA will be looking to take a proactive approach as regards the regulation of cryptoassets and currently encourages new entrants to the market to participate in its regulatory sandbox. The CMA has made it clear that any regulation of cryptocurrencies falls strictly within the mandate of the Central Bank of Kenya.
Source: TechAfrica News
Bank of England sketches out first regulatory approach to crypto
The Bank of England (BoE) on Thursday 24 March began sketching out Britain’s first regulatory framework for Cryptoassets, saying that although the sector remained small, its rapid growth could pose risks to financial stability in the future if left unregulated.
The need to bring Cryptoassets under regulation is due to concerns that they may be used to circumvent the financial sanctions imposed on Russia since its invasion of Ukraine.
The British finance ministry is taking steps to bring unregulated Cryptoassets such as Bitcoin and Ether within the regulatory ‘perimeter’. According to the Financial Policy Committee, the direct risks to financial stability from crypto were currently limited, but if the recent pace of growth is not maintained, there would be risks in the future.
The sector globally grew tenfold between early 2020 and November 2021, and now stands at USD 1.7 trillion or 0.4% of global financial assets, with over 17,000 different Cryptoasset tokens in circulation.
Until crypto assets are brought fully under the regulatory net, the BoE is focusing on ensuring that risks from crypto are controlled in the banking sector.
Bowmans Comment: There is a global move towards regulation of crypto currencies, and Kenya is not exempt. (Please see our analysis above). This is a welcome development as, through regulations, authorities could implement measures to help cryptocurrency investors protect their assets. Also, investors could address concerns or reclaim their investments in case they lose them.
To read more, click here.
Source: REUTERS
