Open Source License Compliance for Philippine Technology Companies

Open source license compliance in the Philippines starts with a basic fact: the Intellectual Property Code of the Philippines (Republic Act No. 8293) treats computer software as a protected work, and the license attached to that software is a binding legal instrument. Using open source code does not mean using it without rules. The license governs how the code may be copied, modified, combined, and distributed. A company that ignores those terms risks copyright exposure and, in some arrangements, regulatory scrutiny of its technology agreements. Compliance is therefore a governance exercise: know what you are using, know what the license permits, and document both.

Does the Intellectual Property Code cover open source software?

Yes. Section 4.1 of the Intellectual Property Code lists copyright and related rights as one of the intellectual property rights the law protects. Software is a protected work, and the person who holds the rights may license it on terms of their choosing. An open source license is simply that: a grant of permission, subject to conditions.

This is the key insight for compliance. The code is not free of ownership; it is licensed. The rights holder has chosen to allow certain uses, but only within the boundaries of the license. Step outside those boundaries and the permission no longer covers the act.

What makes a technology agreement a "technology transfer arrangement"?

Section 4.2 of the Intellectual Property Code defines "technology transfer arrangements" as contracts or agreements involving the transfer of systematic knowledge for the manufacture of a product, the application of a process, or the rendering of a service, including management contracts. It also covers the transfer, assignment, or licensing of all forms of intellectual property rights, including licensing of computer software.

There is an important carve-out. The definition expressly excludes computer software developed for mass market. That means mass-market software licensing sits outside the technology transfer arrangement framework, while bespoke, enterprise, or customized software licensing may fall within it.

For Philippine technology companies, this distinction matters. A company that licenses customized software or receives systematic technical knowledge under a contract may be entering a technology transfer arrangement, which carries registration and dispute-resolution implications under the law. A company merely using mass-market open source components generally is not.

Who regulates technology transfer arrangements?

Section 5.1 of the Intellectual Property Code assigns the Intellectual Property Office the function of registering technology transfer arrangements and settling disputes involving technology transfer payments. It also directs the Office to develop and implement strategies to promote and facilitate technology transfer.

Section 11.8 reinforces this by giving the Documentation, Information and Technology Transfer Bureau the mandate to register technology transfer arrangements and settle disputes involving technology transfer payments. Section 11.7 adds that the Bureau provides technical, advisory, and other services relating to the licensing and promotion of technology.

Where a dispute over the terms of a license involving an author's right to public performance or other communication of a work arises, Section 7.1 grants the Director General original jurisdiction to resolve it, with appeals going to the Secretary of Trade and Industry.

How should a Philippine company build an open source compliance program?

Compliance is not a single filing; it is an operating discipline. The following steps reflect the general obligations that flow from treating software as licensed intellectual property under the Code.

Inventory the code. Maintain a record of every open source component in the codebase, including the version and the license that governs it. Without an inventory, no compliance claim is credible.

Read the license obligations. Each license sets its own conditions on copying, modification, and distribution. Identify what each one requires before the code is shipped or combined with proprietary code.

Separate mass-market from bespoke licensing. Because Section 4.2 excludes mass-market software from the technology transfer arrangement definition, classify each agreement correctly. Misclassifying a customized license as mass-market, or the reverse, creates avoidable risk.

Check registration exposure. If an agreement falls within the technology transfer arrangement definition, assess whether registration with the Intellectual Property Office is required and whether any payment terms could become the subject of a dispute before the Office.

Document decisions. Keep written records of license reviews, approvals, and the reasoning behind each classification. Documentation is what converts a policy into a defensible position.

Frequently asked questions

Is open source software protected by copyright in the Philippines? Yes. Section 4.1 of the Intellectual Property Code lists copyright and related rights among protected intellectual property rights. Open source code is protected; the license is the permission to use it.

Does the Intellectual Property Code cover software licensing? Yes. Section 4.2 includes licensing of computer software within the definition of technology transfer arrangements, but expressly excludes computer software developed for mass market.

Where are technology transfer disputes handled? Under Section 5.1 and Section 11.8, the Intellectual Property Office registers technology transfer arrangements and settles disputes involving technology transfer payments.

Practical takeaways

• Open source code is copyrighted material; the license, not the absence of ownership, defines what a company may do with it.
• Section 4.2 of the Intellectual Property Code brings software licensing within "technology transfer arrangements" but carves out mass-market software.
• The Intellectual Property Office registers technology transfer arrangements and settles disputes over technology transfer payments under Sections 5.1 and 11.8.
• Build a code inventory, review each license's obligations, and document every classification decision.
• Treat compliance as ongoing governance, not a one-time clearance.

Primary sources

The rules discussed above are drawn from the following primary sources, as published in the Official Gazette and the national statute book.

• REPUBLIC ACT NO. 8293 - AN ACT PRESCRIBING THE INTELLECTUAL PROPERTY CODE AND ESTABLISHING THE INTELLECTUAL PROPERTY OFFICE, PROVIDING FOR ITS POWERS AND FUNCTIONS, AND FOR OTHER PURPOSES

This article is general information and not legal advice. For your specific situation, consult a lawyer or ask ASG Legal AI.