Changes in intellectual property standards imposed on companies that the Authority has invested it

For many years, the Innovation Authority has been advancing a policy of support for R&D activity that would lead to the creation of quality intellectual property in Israel. Registration of intellectual property is an important component in the financial success of both the entrepreneur and the economy. One of several reasons why its registration in Israel has a great deal of economic significance is because it serves as an anchor for local economic activity, including employment and tax revenue. This logic lies at the core of the conditions that the Innovation Authority sets for companies it invests in, in terms of registration of intellectual property, its future use, and its transfer to companies operating in other countries.

Nonetheless, in the era of accelerated digitization, globalization, and rapid technological changes, the process of technological development takes many forms, including the concept of intellectual property and the ways it is used. The Innovation Authority is aware of these trends, and consequently, is updating some of the conditions it had set regarding the registration and use of intellectual property developed with its backing. To this end, over the course of 2018, the Authority’s Council approved two significant changes in its policy on intellectual property.

Firstly, in order to enable support of R&D programs that include open-source software development – a widespread phenomenon that reflects current business models in the field of software – council approval was granted to back projects that include open-source coding to be used by the general public, as long as delivering the source code for public use is expected to create economic and business value for the backed company.

Secondly, new rules have been determined for the sharing of technological knowledge by Israeli companies that received a grant by the Innovation Authority with affiliated companies outside Israel, by authorizing the non-exclusive use of knowledge. These rules reflect the understanding that many R&D processes in Israel are currently being conducted with affiliated countries worldwide. This phenomenon increases the more that Israeli high-tech companies are growing and becoming global, and the more than multinational companies are putting down roots in the Israeli ecosystem. The new rules enable companies supported by the Authority to conduct global development processes without needing to transfer intellectual property ownership to an affiliated company in another country. With Amendment 73 of the ECIL (Encouragement of Capital Investments Law), they are establishing an infrastructure to expand the economic activity of multinational companies that hold development centers in Israel.