PLEDGE – RA11057 through a public auction and intervention of the

notary republic.
Contract of Pledge – it is constituted at the
moment when the pledgor delivers to a pledgee
In auction, the sale extinguishes the obligation
a movable, instrument evidenced in incorporeal
and the pledge. Non sale in the first auction
rights for the purpose of fulfilment of principal
results into a second auction sale with the same
obligation, after the fulfillment of the obligation
formalities as the first one. If not sold, the law
the pledged thing will be returned with its fruits
allows the creditor to appropriate the pledged
and etc.
thing to satisfy his claims. Proceeds is less than
Real Contract – perfected upon the delivery the purchase price, the creditor is not entitled
Unilateral – obligation on the part of the for deficiency as he accepted the price, if it is
pledgee to return the pledged thing upon the sold to a higher value, the creditor keeps it and
fulfilment of the obligation debtor has no right for the excess. The pledgor
Accessory contract- cannot exist without a may bid, and if offered the same bid(highest)
principal obligation, all of the obligation pure or with another, he will have the better right. The
conditional obligation creditor cannot bid (not valid) if he is the sole
bidder at the auction. The third person can
Contract of pledge is indivisible, while the satisfy the principal obligation if he has the right
obligation itself may be divisible. When a part of in or right to the thing, interested in the thing.
divisible obligation secured by pledge, after the
fulfillment of it, may be returned. You cannot Rights of the pledgor.
have double pledge; thing is subjected to A pledgor may demand the return of the thing if
pledge before. To be binding upon the third he has reasonable ground for danger,
persons, the date and description of pledged destruction without the fault of the pledgee.
must appear in the public instrument. The pledgee must notice the pledgor of such
danger. The pledgor has the right to substitute
A pledge is intended to secure an existing debt, the thing pledged.
the pledgor must also be the owner of the thing In public auction, he has the better right in
pledged. The pledgor must also have the free highest bid.
disposal right/ or legally authorized over the As he still is the owner, he is able to alienate the
thing pledged. The pledged thing, may be thing with the consent of the pledgee.
alienated if the principal obligation becomes A deposit may be asked by pledgor incase the
due, through a public auction following the pledgee violated the authority and misuse the
formalities of law. Lastly, the pledged thing is in thing pledged, there is danger of loss or
the possession of the creditor/pledgee. impairment, negligence of the pledgee.

PACTUM COMMISSORIUM – a prohibition Obligation of the Pledgor

imposed by law by which parties are prohibited He must notify the defect of the thing pledged
forming a stipulation that the thing pledged to the pledgee, if not he will be liable for the
automatically becomes the object of the damages resulting from it to the pledgee
pledgee incase the non fulfilment of obligation. He must pay the principal obligation, interest,
Any stipulation regarding this is void. As a expenses for preservation.
remedy, the creditor may dispose the thing
Rights of a pledgee The thing pledge is sold at the public auction, if
The pledgee has the right to possess the thing, the second auction is failed the appropriation of
he may also reject the transfer of ownership of the creditor.
the thing. The fruits/interest may be applied to
the interest earned of the obligation and to the Legal Pledge – created by the operation of law.
principal obligation. Pledgee can retain the In auction, the pledgor is entitled to the excess
possession of the thing until the fulfilment of proceeds.
the obligation. In case the pledged thing is
instrument of credit, he has the right to collect
the same. He may demand replacement or REAL ESTATE MORTGAGE
immediate payment if he was deceived, in
substance or quality of the object. Contract of Real Estate Mortgage – the debtor.
Reimbursement for the expenses of Mortgager guarantees a security of principal
preservation. Non payment can sell the thing at obligation by subjecting a immovable property,
a public auction, if he has also reasonable real rights over immovable property as security
grounds of destruction, impairment without incase of default at maturity date.
fault on his part he may sell the thing at the
public auction. It is a real contract, perfected by mere delivery,
If there are many things pledge, the pledgee has subsidiary and accessory. The price of mortgage
the right of choice, shall be sold. He can only is the price of the obligation. It is not a transfer
sell what covers the debt. He is allowed to bid if of ownership, merely a lien placed upon the
he is the sole bidder. Excess is given to the property, it creates a real right. Real right is
creditor, and debtor cannot claim the excess. those that are enforceable against the whole
He may only appropriate the thing after the world. It attaches to the property. Mortgagee
second failure of the auction. may claim payment from the third person to
whom it was transfer. The mortgage extent to
Obligations of the pledgee the property itself, accession, improvement,
He has the right to take care of the thing like a income, and etc.
diligence of a good father. He cannot
use/misuse the thing without authorization or it It is constituted to security the fulfillment of a
is needed for preservation of the thing. Agents principal obligation, past, present and future
of the creditor will hold the creditor for debt under a drag net or blanket cloth. The
damages they caused. The pledgee must notify Mortgagor must be the absolute owner of the
the pledgor of danger or impairment, as well as property. (present properties, as a general rule
the result of the auction. Pledgee must return future properties are not subjected to
the thing pledged if the obligation has already mortgage, unless there is a stipulation) He must
been paid. have the free disposal of the property. The
object must be immovable or real rights over
MODES OF EXTINGUISHMENT the property. There must be a requirement for
The thing is returned to the pledgor, the pledge registration. If it is not registered, it will not be
is extinguished. binding to third persons but binding to the
Renunciation or abandonment of the pledge of parties.
the pledgee, the pledge is extinguished.
 Reacquisition of the property by
mortgagor/third person.
Kinds of Mortgage Judicial Foreclosure – Equity of Redemption
Voluntary Mortgage – entered by agreement of - The mortgager still has the chance to
the parties get he property back 90-120 days at the
Legal Mortgage – Created by operation of law entry of judgement, or prior to the
Equitable Mortgage confirmation of sale
- One that lacks of formalities of - If the mortgagee is a bank, the equity of
mortgage but shows the intention of redemption is longer. 1 year from the
parties to treat the property as security confirmation of sale
of the obligation. Extrajudicial sale – Equity of Redemption
PACTUM COMMISSORIUM – prohibition by law, - He has a period of one year on the
any stipulation that allows automatic issuance of sale, must pay the purchase
appropriation of the creditor over the thing price and pay 1% per month, taxes and
upon failure of payment. interest.
Foreclosure – remedy of the creditor, wherein - In case of juridical person, mortgagee is
the creditor uses public auction for the payment a bank, the period is 3 months.
of his claim.
Judicial Foreclosure – the court in jurisdiction is ANTICHRESIS
where the property is situated, initiated by Contract of ANTICHRESIS
complaint filing, the court will determine the -the creditor acquires the right to receive the
amount due, orders payment in a judgement. fruits of real property of the debtor, applying
After this the debtor is given 90-120 days which those fruits to the interest of obligation or the
he will pay the amount, incase of default, the principal obligation. Mortgagee in possession,
buyer at the auction (provided there is sale) is the subject is the real property.
entitle to the property. Characteristics
If the proceeds has an excess, the excess will go It is an accessory contract as it exists as a
to the less preferred mortgages then to the security of fulfillment of principal obligation. IT
mortgagor is formal and follows the formalities of the law.
IF there is deficiency, the court will hold a It must be in writing, principal and interest for it
deficiency judgement and hold the debtor liable to be valid. It is a consensual contract,
for the balance perfected by mere consent. The creditor must
be in possession of the property. The
Extrajudicial Foreclosure- outside of the court, antichresis itself is indivisible and secures all
must be in the stipulation with special power type of obligation.
within the contract of mortgage
Filing an application, compliance with the The value of the fruits must be appraised at
requirements of posting of notice of sale (20 actual value at the time they are applied to the
days , three public places), if it is over 400 principal.
pesos, there must be publication once a week, 3
weeks in the city/municipality, Public auction, Rights
certificate of sale The creditor can retain the property until full
payment of the price
Equity Redemption
 The right to petition the court to sell the Rule
property in case of default in payments Chattel mortgage only covers existing
Extrajudicial foreclosure will govern, there must obligations. Future advances can be subjected if
be a stipulation and written in the contract. the parties stipulated, and will take an effect at
Obligations the time of those advances.
He is obliged to pay taxes, necessary expenses If the debtor fails to pay, the creditor is not the
for preservation. He is allowed to deduct those automatic owner. PACTUM COMMISSORIUM
expenses from the fruits he will received, he is does not apply to chattel mortgage.
not liable if the parties expressed stipulated.
The creditor may compel the debtor to Remedy
repossess the property, so that the creditor is 1. Foreclosure of the chattel mortgage,
relieved from taxes and expenses, unless the must be in the public auction however
parties has stipulated that the right is denied. the parties may stipulate private
He must apply fruits to the interest owing then auction. Within 30 days of nonpayment
to the principal obligation. of obligation, there must be a notice to
He must render an account for the fruits. the debtor 10 days before the auction.
PACTUM COMMISSORIUM should not appear in Equity of Redemption – payment of principal
contract of anti-chresis. obligation before the sale of foreclosed
The creditor and heirs, cannot obtain the property, they will be subrogated to the rights
property through prescription (passage of time). of creditor and foreclose the property subject
to the law.
Chattel Mortgage
Contract of Chattel Mortgage -a contract Application of Proceeds
wherein a personal property is recorded in the Cost/ Expenses of Keeping/ Sale
chattel mortgage register as security of Leftover – Claims of the subsequent mortgagees
obligation, an accessory contract, secures the Left – Mortgagor (Entitled to the excess)
fulfillment of obligation. If the parties failed to Deficiency – creditor can go to the debtor to
register the chattel it is still binding upon the collect the deficiency unless it falls to the RECTO
parties, registration notices the third parties LAW (installments)
and will not be binding upon them. It is a
unilateral contract. Chattel Mortgage, no delivery of the thing while
in pledged, the thing must be delivered. Former
Registration requires registration while the latter doesn’t
The personal property must be registered in need to. Rules of sale also differ, the excess in
chattel mortgage registry where the mortgagor chattel mortgage goes to the debtor while in
resides, if the thing is outside of the province pledge it does not, exception of stipulation or
reside, it must be registered both the province legal pledge. The creditor may sue for
of mortgagor and the personal property is deficiency in chattel mortgage, except 1484
situated. while in pledge creditor is not entitled to the
Affidavit of Good Faith – the chattel mortgage is deficiency.
entered for the purpose of securing particular
obligation. It puts preferred status on the
mortgage. RA 11507 – PART 1
It seeks to establish a unified modern goods interest will extend to the mass but
framework for securing obligations using limited to the proportion of the entire mass.
personal property, providing rules on creation
and determination of priority and enforcement
of security interest. It increases access to lease
cost credit.
PERFECTION OF SECURITY INTEREST
It provides of single type of security transaction, When perfected, it is already effective to third
security interest. parties unless it is not registered but still valid
It covers all transaction that secures obligations to the parties.
with personal property, tangible, incorporeal It is perfected through creation of security
rights, intellectual property, accounts and agreement, registration of notice in registration
livestock. Aircrafts and ships are not allowed. of property or possession of property of the
creditor (tangible assets)
Security Interest – collateral property right that
secures performance of obligation regardless of Electronic Central Registry – notice of and liens
nature in persona property is registered and search for.
Grantor – buyer, transferor, lessee of goods Notice can cover multiple agreements and
It extends to the traceable proceeds of the effective upon the time it is in the registry, and
personal property, it will continue in the last until the indicated time in the notice excess
collateral even if it is sold, leased, or disposed, there is a continuation notice within 6 months
unless there is a stipulation or the transferee is indicated. It must include the ID of the grantor,
buyer in good faith. If the security interest is if not it is a seriously misleading notice,
registered, he will not be in good faith. ineffective.
In accounts receivable, will still be valid even if The notices may be amended. This is applied by
there is a contractual limitation on the right of the grantor.
the grantor to create security interest. Security Interest is extinguished upon the
payment of the all obligations., not outstanding
CREATION OF SECURITY INTEREST commitment is extended. The grantor applies
It is created through a security agreement in for termination, another case is that there is no
writing signed by parties, may be in one or security agreement exists at all.
more writings provided that there is an Perfection through possession, created through
established intention of security interest. It the security agreement and possession of the
must have the description of the collateral, property.
sufficiently enough to identify the collateral. Control
It can also cover future property but subject 1. Creation of security interest in favor of
qualification that the interest will be created the depositary or intermediary
only upon the grantor obtain rights over the 2. Through conclusion of control
property. agreement.
Tangible assets/intangible assets may extend to 3. Notation of security interest in the
its products or replacement, the interest will books
only be limited to its value prior to Deposit institute cannot be compelled to
transformation or replacement. Comingling confirm existence of control agreement unless
it is requested by the grantor.
 Held by intermediary – Perfected by control
agreement over others

ADDTL RULEs
If the collateral produces money, the security
interest will extend to it. Purchase Money Security Interest
If proceeds are not money, there must be a new Security interest in goods by the seller to secure
registration, control, possession. If they are not the payment of the buyer.
perfected within 15 days, they will not be In Equipment, Proceeds or Consumer Goods –
effective against third persons. priority over other conflicting security interest if
If it is over a fixture, it continues to exist the notice is registered withing 3 business days
provided that the property is still traceable. Any from the grantor receives the goods
subsequent change in the means of perfection,
does not affect the prior perfection. If a third person acquire the rights of the goods
– perfected upon the 3-day rule(timely), the
PART 2------------------------------------------------------ secured creditor has priority over the third
Priority of Security Interest – the right of a person which may arise from the delivery of
person in encumbered asset preference of goods and registration of notice.
competing claimant, preference in payment
with regard on movable property. Inventory, IP, Livestock – perfected when the
General Rule - liens on the same collateral is grantor receives the asset/rights, and secured
determine on the time of registration in the creditor must give written notice of security
notice, or perfection in other means. interest to the conflicting holder before grantor
acquires the asset/rights.
Specific Rules If the secured creditor failed to give notice, the
Deposit Accounts – set off or compensate priority transfers to security interest which
against the grantors’ right payment of funds secures obligation of necessities for the same
credited to the deposit account livestock.
In case of a security interest in a deposit Negotiable Instruments - Possession will prevail
account, the secured creditor is bank or over registration
intermediaries Person who provides goods/services and retains
Security interest in deposit account/investment the goods have the priority until he is paid
account that was perfected by control
agreement. Before Insolvency proceedings - interest
With many control agreement, we determine perfected before the insolvency proceedings
by the time of control have priority as it has before the proceedings.

Electronic Security Enforcement of Security Interest

Not held by intermediary – First preference is Rights of Secured Creditor
perfected by notation in the books, perfected Extrajudicial or Judicial
by control agreement, Registration of notice – if 1. Expedited repossession of collateral
many, determine it by time of control Grantor’s default, creditor takes the possession
agreement of the collateral extrajudicially, if it stipulated
and it can be done without breach of peace, if
not, he has to apply for court order and will be obligation, claims of subordinate security
entitled for expedited hearing interest if written demand/proof is received
before the proceeds is distributed.
Excess – grantor is entitled for the excess
2. High ranking creditor to take over the Deficiency – grantor is liable, creditor can claim
enforcement from the grantor unless if there is a stipulation
If there is a secured creditor that has priority, 5. Special rights under PPSA
he can takeover enforcement. This right may be On default, these are the remedies
invoked. extrajudicially
3. Retention of collateral Accounts Receivable – instruct the debtor to
Creditor may retain full or in partial of the make payments to the creditor
collateral by sending a proposal to the grantor, Negotiable Instrument - creditor can claim
creditors and parties interested. In full satisfaction from the instrument or goods
satisfaction, it cannot be granted if there is covered by it
objection after the proposal is sent(20 days) to Deposit account – creditor may instruct the
the parties. Partial satisfaction is granted if the institute to pay balance to the account of the
creditor received the affirmative consent in creditor, security agreement and affidavit is
writing of the parties within 20 days. given
4. Dispose/sell the collateral 6. Right to damages
It must be an auction(sale), in present condition Remedy of Grantor
or commercially reasonable preparation of the Non compliance of creditor, the court may
collateral. Secured creditor must act in a order/restrain collection of the collateral
commercially reasonable manner, he is Right of Redemption, except grantor waived the
conformity with the common practice. right, collateral has been sold, creditor retained
The sale must be done in good faith, the entity the collateral on retention
presiding the auction is an expert, there is no
collusive practices in auction, records of the Rights of a buyer (Highest bidder)
auction must be documented in writing and HE acquires the grantor’s right free from other
maintained, the asset must be awarded to the rights of creditors
highest bidder and paid full at the conclusion of Lessee is entitled for the benefit of lease for the
the auction. period of term

Seller must give notice 10 days before the PATENTS (IPL)

auction to the grantor, other secured creditor. RA 8293
Creditor must post the description of the
collateral and details of the sale and made it Patent – exclusive right acquired over an
available to the public. invention, sell, use or to make the same.
Inventions that are technical solution of any
Government agency can conduct auction or problem, in human activity. Requirements that
private entities, IRR will be submitted to the it must be new, involves an inventive step and
Finance department. industrially applicable. It may relate to a
product, improvement or process.
Proceeds – will be applied to the reasonable
expenses of the thing, satisfaction of principal
It is to reward the advances of sciences and It belongs to the inventor, heirs, assigns and co-
technology, encourages dissemination of inventor (jointly). If two or more persons
discoveries and invention, it brings new design invented the invention separately and
into public domain using disclosure. Patents independent of each other, right of patent
protects investor’s ideas for a specific number belong to the one who first file the application.
of years, and after the years it will go to the If two application is filed on the same invention,
public domain. the priority is the earliest application. If filed
3-fold purpose abroad and domestically, inventor can ask the
To foster and Reward invention, promote IPO to recognize earliest date, provided that the
disclosure of invention and stimulate local application must expressly claim priority,
innovation, stringent for requirements must be filed within 12 months from the date of
protection, public ideas remain for the use of earliest foreign application, certified copy of
the public. foreign application with English translation.

Requirements If there is a patent, before the original

An invention is novel if it new and not part of a invention, the remedy would be to file petition
prior art/invention. It also has an inventive step, on cancellation of the patent on the grounds of
with prior art, it is not obvious to an expert he is the true and actual inventor.
person of the art at the filing date. Last
requisite is that it has industrial applicability, it Invention through Commission
can be produced and used in any industry. The commissioner is the owner of the patent
If the invention is new and industrial applicable, unless stipulated, if the employee made the
it may qualify as utility model, model of product invention in the course of his employment
which is practical utility. It is not patented but contract, patent is his or his employer. It will
registered for the period of 7 years. belong to the employee if it is not included in
If an invention is new but not industrially his employee duties, it will belong to the latter
applicable nor no inventive step, it is not if it is a result of his duties(employment
patented but qualify for industrial design. It has contract) unless there is an agreement.
a special appearance or pattern for an industrial
product. Inventor is protected for the term of 20 years
from the date of filing, incase of utility model it
Excluded from Patent Protections is 7 years and industrial design is 5 years from
Non patentable – discoveries, mathematical application, renewable not more 2 times, each
methods and scientific theories, rules of mental term of 5 years.
act, playing games, doing business, programs
for computers, method for treatment of Application of Patent
human/animal by surgery, therapy or diagnostic Inventor must apply in the IPO, subjected to
methods, plant varieties/animal breeds, unity of invention. The application relates to
biological process of plants and animals, one or more invention that has general
aesthetic creations, works of art and anything inventive concept. IPO will search for a prior art
contrary to public order/morality. to see if it is new, then they will publish a
document after 18 months in the IPO gazette.
Right of patent Within 6months, the applicant submits a
request for substantive examination, where the 1. Using patented product put by the
IPO accepts or refuse the patent. owner on the Philippine market
Application already grants certain rights to the 2. Act is done privately on a
inventor, civil action of infringement to any noncommercial scale for
person wrongfully exercising the invention. noncommercial purpose provided that
Provided that, the offender has written notice it does not affect the economic interest
that the invention is subject for application or of the owner
subject matter of a published application. 3. Act consist of making, using exclusive
Action may not be filed, after the grant of purpose of experiments relating the
patent of the published application within 4 patented invention
years of acts complained. 4. Medicine in accordance to prescription
5. Invention is used on vehicle any other
IPO can cancel in whole or in part a patent, countries entering Philippines
done in petition of any interested person in the temporarily or accidental
grounds of not new invention, not disclose in a Prior User – in good faith, using the invention
clear manner, contrary to public order or before the filing date of patent shall have the
morality. continue to use thereof, may only be
transferred together with his business.
Rights granted by a patent Govt – can exploit the invention without the
1. If it is a product, he has the right to agreement of patent owner for public purpose
prohibit any unauthorized person for
selling, using the product. Infringement
2. If it is a process, he has the right to Using, selling, importing of a patented
prohibit any unauthorized person from product/process without authorization of the
using the process or product that used patentee, not only direct but also contributor
such process infringer is liable solidarity with the infringer.
3. The right to assign, transfer by The law allows the patentee to bring civil action
succession and conclude licensing to recover damages from the infringer. Criminal
contracts. In transferring it can be a case for repeated infringement.
portion or while, limited to a specific
territory certified by notary public. A machine/device has the same function,
4. A patentee to exploit patented process result by identical or substantial
invention through voluntarily or identical means, mode of preparation is the
compulsory licensing. Former, patent same to constitute infringement.
owner grants other person to use the Literal Infringement test – comparing the two
invention. Compulsory, grant to exploit inventions side by side
the invention without the consent of Doctrine of Equivalence – a device appropriates
the patent owner in favor of any person a prior invention by incorporating its innovative
shown capability to exploit the concept. It requires satisfaction of function,
invention. means and result.
Limitations on Patent rights
The owner of the patent has no right preventing _______________________________________
third parties performing without his
authorization TRADEMARKS
Mark can be a name, surname, joining of a must be evidence the longevity of the business,
name, composite mark. has acquired good reputation.
Trademark – visible sign that is capable of Duration
distinguishing the goods of a firm, stamp or Protection last for 10 years, renewable for
mark container of goods. IF the mark is for periods of 10 years in each renewal. There must
services, it is a service mark. be request 6 months before or after the
Tradename - a name or designation identifying registration.
an enterprise or goodwill. Goodwill is a Acquired by
property right, reputation. Trade name refers to Mark – registration
name and goodwill while trademark refers to Name - adoption of the name
the goods
Laws of Names
Collective mark- visible sign of distinguishing 1. Restrictions such as contrary to public
the origin or common characteristics of order or morals, or liable to deceive
different enterprise under a control of a trade circles/public
registered owner of the mark. 2. Registration is not required to enjoy the
protection of the law, but it is preferred
Functions to register
1. Indicate Origin/Ownership of goods Law of Trademarks
2. Assuring the public of genuine products 1. Acquired solely by registration
3. Protects manufacturer from sale of 2. Priority right is given to applicant who
inferior product applies first to foreign then in the
4. Advertises the products or Silent country. He can oppose/petition to
Salesman cancel the registration or sue for unfair
5. Secures the fruit of labor/skill of the competition without prejudice when his
person who brought the item to the registration is granted.
market, as the owner has the exclusive 3. Registration by itself and grant, does
right to prevent unauthorize/other not vest ownership in the mark if the it
person using his mark. Applies to mark is proven that someone is actually the
that are not registered to the PH, but owner of the mark. Ownership confers
are well known(internationally and the right to register.
Philippines). 4. Ownership of a trademark is acquired
Owner of well-known mark can register the through its registration and its use.
mark in the PH to prevent the use in unrelated 5. The proposed mark should not be
goods. Compliance, there must be proof of prohibited by law, it should not consist
mark connection to the goods of owner. The of immoral and scandalous matter, it
interest of the owner is likely to be damaged by must not disparage upon living or dead
the use of such mark. persons, institutions beliefs, libel. No
Doctrine of Secondary Meaning (distinctiveness insignias of the country/foreign is used.
of trademark and names) – exclusive No mark of living individual unless there
continuous use of a mark, such marks loss its is consent. No mark to deceased
primary meaning and now associated with president during the lifetime of the
particular goods, is entitle to have the mark widow, unless there is written consent
registered with the IPO. To invoke this, there of the widow. Mark misleading the
 public is prohibited. It must not be 3. Use of the mark/colorable imitation of
contrary to public order or moral. the alleged infringer and caused
6. For partly registrable/non-partly confusion
registrable, he must disclaim the Colorable imitation – close imitation calculated
unregistrable component and proceed to deceived the customers/purchaser
with the valid portion. Two types of Confusion
7. Certificate is given to the 1. Product Confusion – purchaser is
applicant/assignee as evidence of induced a product believed to be the
validity of registration, ownership and other
exclusive right of use. It is required that 2. Confusion of business/ source or origin
the registrant must file a declaration of confusion - the product is assumed to
actual use within 3 years of the filing of originate to a registrant of earlier
the application. product, the public is deceived to
IPO can cancel registration, any person with believe that there is connection to two
reasonable grounds that he will be damage by parties.
the mark, can apply for cancellation of mark to Two tests of Infringement
IPO. 1. Dominance Test – focuses on the main
or essential feature of marks together
Part 2 and confusion is likely to result, this test
is incorporate into law, it includes not
Owner of the mark prevents another person only visual but also oral, auditory and
from using the marked product without his other aspect.
consent. The owner can prevent and punish 2. Holistic Test – considers the mark as a
violation. whole, if the buyer is deceived
attributable to the whole mark
Infringement – a registered mark is used in Remedies of Infringement
commerce without the consent of the owner, 1. The mark owner may file for damages,
and that it caused confusion, the marks have to the goods to be destroyed or
be registered to be protected against impounded. He may also pray for
infringement double damages, wherein there is
1. Committed by any person who used intent of defrauding the public.
reproduction, counterfeit, colorable 2. Ask for injunction to stop the use of his
imitation, copy of a registered mark. unauthorize mark.
2. Any person who reproduces, 3. File for criminal case or administrative
counterfeit, copy, colorable imitation, sanctions
and applied it to package, print, label 4. To be entitled for damages, he must
and caused confusion/deception in the show that those acts are with
commerce. knowledge to cause confusion, fraud,
Infringement happens when two of the and deception. Knowledge is presumed,
requirements happens regardless of sale. if the mark is registered or with actual
Elements must be shown notice of registration.
1. Valid trademark Law imposes limitation on remedies
2. Ownership of the mark 1. Owner cannot sue for infringement to
third person who was using it in good
 faith before the registration or priority Goods – Identical/similar goods in infringement
date. but may be in different goods in unfair
2. The acts of infringer relate to printing, competition.
distributing and the infringer is Section 169 (false destination of origin and
innocent, he is only entitled for representation – allows the mark owner to file a
injunction to stop future printing. civil action for damages and injunction to any
Goodwill is also protected created by the mark. person who uses container in commerce of
He has the property right towards the goodwill. symbol, false destination of origin, false
description, misleading representation that are
Unfair Competition likely to cause confusion or association of
- Use of deception, means contrary to person to other.
good faith, by which he passes of the COPYRIGHT
manufactured goods by him/which he
deals for those of another person who Copyright – is an intangible incorporeal right to
established goodwill in the goods he certain literary, scholarly, scientific and artistic
manufactured/deals with. productions granted by law to author of work. It
- Example: he manufactures goods but is protected at the moment of creation.
clothes it with general appearance of
the other to defraud the public. It is different from the material object.
- Person who commits false statement or It protects the original and derivative works.
commit act contrary to good faith to Former is the works that are protected at the
discredit the product or business of the moment of creation irrespective of the mode or
other. form of expression the content. The latter,
- Confusing similarity with the works that are derive from original work. This
appearance of the goods, intent to includes dramatization, translations,
deceive and defraud a competitor. It adaptations, arrangement and alteration.,
may result to other factors such as compilation of data which are original.
packaging, and presentation of goods.
Test of unfair Competition – test whether the Not Protected by Copyright
certain goods are intentionally clothed with the 1. Idea, procedure, method, system,
appearance to deceive purchaser. The discovery, mere data
viewpoint is from the prospective buyers. 2. News of the day, miscellaneous facts
3. Official texts of legislative
Remedies are the same as infringement. 4. Work of government of the PH, unless it
is exploited
Infringement VS Unfair Competition
Nature – Infringement is from unauthorized use SCOPE
of the mark, latter is from passing of one’s 1. Gives protection to the author and his
goods as goods of the another. heir, and gives economic and moral
Existence of Fraudulent Intent – it must be Rights
established in unfair competition, not necessary Economic Rights – derive money from
in infringement 1. Reproduction of work or substantial
Prior Registration of the Mark – It is necessary portion of it
in Infringement, but not in unfair competition. 2. Any transformation of the work
 3. First public distribution of the original with his duty, the employer is the
and its copy owner unless there is an agreement.
4. Rental of original or copy of the work 4. Commissioned work, the person who
5. To carry out public display of the commission the work is the owner but
original or copy of the work the copyright stays with the creator
6. Carry out public performance of the unless there is a stipulation.
work 5. Audiovisual work copyright belongs to
7. Other communication to the public of the producer, composer, film director
the work and author of the work. 50 years from
Right to receive proceeds from subsequent the date of publication or making
transfer of work. (Droit de suite) The author and 6. Letters/public communication are
his heirs have inalienable right to receive 5% of owned to person who are they
the sale and or lease of the work. The rule does addressed, cannot be publish without
not apply to prints, etching, engravings, where consent of the writer or heirs
the author derive gain from reproduction. 7. Anonymous /Pseudonymous work,
Exists in the lifetime of the author and 50 years publishers represent the authors unless
after his death contrary appears
Works of applied art 20 years, photographic
Moral Rights – retains the following works 50 years from publication or making,
1. To require that the work is attributed to performance not recorded 50 years, sound
him in a prominent way during his recordings 50 years, broadcast 20 years
lifetime and perpetuity
Terminus – Same as economic rights (period) Specific Economic rights to performers,
1. Make alteration of his work prior to or producers, actors. This is Neighboring Related
withhold it from publication Acts
2. Object any modification/derogatory - Rights that belong to the actors,
action in his work performers, producers, composers,
3. To restrain the use of his name in works broadcasters.
that is not his creation, or distorted 1. performers of literary or artistic works
version of his work 50 years after death.
Cannot be assigned, transferred or subject to a 2. Direct or indirect reproduction of their
license. performances
3. Right of authorizing the first public
Who owns / how long distribution of original and copies of
1. Original – Author owns it and last performance. They must receive 5% at
during his life and 50 years after death first communication
2. In case of joint ownership, coauthors is 4. Authorizing the commercia rental of the
the original owners of copyright, if performances
there is an agreement it is followed. If 5. Authorizing the making available
the work is separable, the author of performances fix in recordings
each part is the original owner Moral Right
3. In his course of employment, if the 1. They should be listed in the credits and
object is not in line of his duty, it object distortion to any works and acts
belongs to the employee. If it is in line created by them
Producers consent of the owner of the copyright. Copying
1. Direct or indirect reproduction of their must produce injurious effect. It is a crime that
recordings does not take to account the intent of the
2. Right of authorizing the first public offender, it is the act of infringement that
distribution of original and copies of causes the damage. Good faith is not a defense.
recordings. They must receive 5% at
first communication Remedies
3. Authorizing the commercial rental of 1. Injunction to stop the infringement
the recording 2. Payment for damages
4. Authorizing the making available sound 3. Impounding and destruction of the
recording infringed
Broadcasting 4. Moral and Exemplary damages
1. Rebroadcasting of their broadcast 5. Penalties for imprisonment (1 year (first
2. Recording, making of films of their offense) -9 years (3rd offense to
broadcast subsequent offense))
3. Use of record for fresh transmission or Prescriptive Period -action is brought within 4
recording years

Registration Limitations Copyright

1. The owner of the copyright, register 1. Reproduction/Distribution in a
and deposit two complete copies of specialized format for the blind. (non-
work prescribed by the library profit basis, indicate the owner)
Use of Copyright 2. Performance of work when it is lawfully
1. Evidence of copyright accessible to the public, for charity or
2. Facilitates enforcement of copyright religious purpose
after the death of creator 3. Making of quotations from a published
Copyright exists when there is notice of work in fair use
copyright bearing its name and publication, in 4. Reproduction/Communicating of
death, the year of such death. articles, literary, scientific, artistic works
Copyright may be assigned, licensed in part or 5. Inclusion of work in relation to public,
whole. Licensee/Assignee is entitled to for teaching purposes in fair use
remedies of copyright. 6. School recordings of broadcasts, and it
If 2 or more-person own copyright, licenses is is deleted within reasonable period
granted only with the consent of the owners. after first broadcast
7. Temporary recordings of broadcast
Infringement (piracy, plagiarism) 8. Work under government
- Offender appropriates whole, part of 9. Work with no admission fee is required
language of the work and passes it as 10. Professional legal advice
his own.
He Directly commits and benefits from it. With Doctrine of Fair use – criticism, news reporting,
knowledge, he contributes to the act of comment, teaching purposes is not
infringement of the other. infringement
It is a trespass to a private domain, therefore 1. Purpose of the use
protected by law. Doing in any way without the 2. Nature of the work
 3. Amount of the portion use of the work
4. Effect of the use of the work

Fair use in compilation – is done to obtaining

information necessary to achieve
interoperability

Reproduction of Published Works – allowed for

research and private study

Reproduction is allowed, limited copies

1. The work is in fragile nature
2. The reproduction is necessary to supply
a request
3. Is in order to preserve, to replace a
copy
Reproduction of Computer Programs, once back
copy is permitted without the authorization of
the owner by the lawful owner of the program
if it is necessary
1. Use is in conjunction with a computer
with a purpose
2. Archival purposes, replacement

RA 10088 anti cam cording act 2010 – prevents

recording for any person to use or attempt a
recording device of a film or performance, or to
have in his possession a device to intent record,
to aid or bet or connive in the commission of
the prohibited acts. Any guilty is subjected to a
fine 50k not exceeding 700k, prisonment of
6months – 6years.