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In a dramatic escalation of the rift between Russia and the West, the Russian Federation has issued an edict allowing its citizens to copy and use Western patents without payment or requiring authorization for use. Regulation No. 299, issued on and in effect as of March 6, amends the prior decree on licensing patents to state that Russians will pay 0 percent for patent use to those who reside in what Russia has defined as an “unfriendly nation.”

The Russian Federation has issued a list of 48 “unfriendly nations,” including the United States and Canada; the European Union (EU) member states; the United Kingdom (including Jersey, Anguilla, the British Virgin Islands, and Gibraltar); Ukraine; Montenegro; Switzerland; Albania; Andorra; Iceland; Liechtenstein; Monaco; Norway; San Marino; North Macedonia; Japan; South Korea; Australia; Micronesia; New Zealand; Singapore; and Taiwan.

More specifically, the regulation states:

“In relation to patent holders associated with foreign states who commit unfriendly actions against Russian legal entities and individuals (including if such patent holders have citizenship of these states, their place of registration, the place of their primary business activity, or the place of their primary profit from the activities are these states), the amount of compensation is 0% of the actual income of the person who exercised the right to use an invention, utility model, or industrial design without the consent of the patent owner, from the production and sale of goods, performance of work, and provision of services for the production, performance, and provision of which the corresponding invention, utility model, or industrial design was used.”

This change in law is unprecedented and has wide-ranging implications since the potential impact is not limited to companies that do business in Russia. For companies currently doing business in Russia and using patented methods or devices, Russian entities can continue to exploit patents without a royalty obligation or risk of liability. Moreover, since the regulation affects any patent owner residing in any of the “unfriendly nations,” even companies that do not currently do business in Russia may find their patents pirated by Russian competitors.

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