Interactive Workshop CSIR Guidelines and Procedures for Projects

Interactive Workshop CSIR Guidelines and Procedures for Projects P S Dutt Scientist & Head Business Development Unit National Environmental Engineering Research Institute Nagpur 440020 21 st April 2006

Coverage of Topics • Part A – Type of Projects (CSIR classification) • Part B – Pre project procedures (internal) – Project registration & procedures (CSIR Guidelines) – Special cases (CSIR Guidelines) • Part C – Licensing of IP and KB (CSIR Guidelines) • Part D – MOU’s And Agreements (CSIR Guidelines) CSIR Guidelines for Technology Transfer and Utilization of Knowledgebase (with effect from June 1, 2005)

Type of Projects Contract R&D Consultancy • Sponsored • Technical • Collaborative / Cooperative • Engineering • Grant-in-aid • Scientific • Other professional advice Technical Services In-house R&D • Testing & analysis • Training • Technical assistance • Fabrication/ production of Special Projects (Job work) • Repair & maintenance • Supply of information International Projects • Multilateral • Bilateral

Contract R&D • Sponsored R&D – Projects wholly funded by client having specified R&D objectives and well defined expected project output/results, generally culminating in generation of intellectual property/knowledgebase. – It also covers process design and engineering, process modeling and simulation, application of computational methods, development of software etc. – It could be multi-client, with two or more sponsors sharing the project funding and research output • Collaborative / Cooperative R&D – Projects partially funded by client and /or supplemented by provision of inputs such as expert manpower, engineering, production/ fabrication of product in bulk for testing/ trials, creation of infrastructural facilities or other inputs etc. – These projects could be in the advanced areas of research, for upscaling / proving of laboratory level know-how, technology development or generation of intellectual property etc. – It could also be multi-client, with two or more sponsors sharing the project funding and research output

Contract R&D (contd. ) • Grant-in-aid R&D – Projects involving grants by way of financial inputs, either in full or in part, assistance in kind. e. g. equipment, training etc. to supplement laboratory efforts in ongoing or new R&D projects or for creating new capabilities / Facilities. – These projects are normally for: • exploratory R&D • surveys or for maintaining large nationally important R&D groups, • generating databases • sophisticated equipments for testing and infrastructural facilities.

Consultancy • All consultancy services in CSIR shall be institutional • Consultancy shall comprise scientific, technical, engineering or other professional advice / assistance based on the available knowledgebase / expertise of the laboratory – Literature survey and preparation of feasibility studies, technology forecasting/ evaluation reports etc. – Interpretation of test results and data provided by the client – Risk and hazard/environment impact analysis, pollution abatement/ control measures etc. – Assistance in erection, commissioning, operation, troubleshooting, productivity improvements, energy conservation, waste utilization, etc. – Customized human resource development programme either at the laboratory or at clients location – Technical advice such as troubleshooting, problem resolving, quality control etc.

Technical Services • Technical services are meant to render to client / customers, assistance based on available knowledgebase, expertise, skills, infrastructure and facilities of laboratory • Technical services shall comprise: – Testing and analysis (including certification and calibration) – Routine training – Technical assistance of an advisory nature – Fabrication/ production special products (Job work) – Repair and maintenance – Supply of information

In-house R&D • • Exploratory in nature Cutting-edge science/applications Fixed duration Funding for new equipment and/or RAs/DJFs, contingency, consumables (limited) • Prioritisation by Director/RC

International Projects • Foreign clients could be: – A juridical entity registered / situated outside India – A company registered in India with more than 50% equity holding by foreign entity – All UN and World Organizations / Bodies such as UNDP, UNIDO, UNESCO, WIPO, CSC etc. – NRI client seeking to utilise/ exploit CSIR knowledgebase abroad • Security & Sensitivity Clearance of GOI (Mandatory) – GOI clearance is sought through CSIR (for individual projects as well as Mo. U/Agreements) (Annexure V) Head, ISTAD, CSIR – All bilateral projects with other international scientific organizations Head, TNBD, CSIR – All International business and marketing related projects viz. Contract research, Consultancy, Technical services, Licensing of intellectual property and Licensing of knowledgebase, and Global research Alliance (GRA)

Guidelines for Budget (A) Direct Expenses (Inst. + PL) • Manpower charges – – (i) man days of CSIR staff deployed (Inst. ) (ii) temporary project staff deployed (PL) (with overheads 40%) (Inst. ) • Cost of Consumables / raw materials / components (PL) (with 25% overheads )(Inst. ) • Cost of physical inputs / services / utilities (with 25% overheads) (Inst. ) • Equipment usage cost (Inst. ) • Cost of new equipment (PL) (with overheads 5%)(Inst. ) • TA/DA (PL) • Contingencies including external payment envisaged e. g. for hiring infrastructural facilities, experts, computer time , information etc. (PL) (B) Intellectual fee (Inst. ) • At least 40% of total expenses (for Sponsored & Collaborative) • At least equivalent to total manpower charges( for Consultancy and TS) • No intellectual fee is applicable (for Grant-in-aid and Socially relevant) (C) Service Tax (other than Grant-in-aid) • applicable at the rate of 10. 2 % including educational cess (Notification awaited for 12%). Total Project Charges = (A) + (B) + (C)

Budgets at a Glance Head PL/ Sponsored Grant-in-aid Consultancy Tech. Services Project staff PL 192000 537600 192000 0 Ext. Payment PL 50000 0 TA/DA PL 100000 75000 100000 50000 Contingency PL 50000 60000 100000 150000 New equipment PL 1000000 0 0 Consumables PL 200000 100000 50000 150000 Sub-total PL 1592000 1772600 492000 350000 Staff salary In 185000 0 74000 200000 Services/utilities In 50000 0 50000 Equip. usage In 25000 0 50000 Overheads In 189300 265890 101800 50000 Sub-total INST 449300 265890 275800 350000 Intellectual Fee In 416520 0 266000 200000 Total Project Charges 2457820 2038490 1033800 900000 Service Tax 250698 0 105448 91800 Grand Total 2708518 2038490 1139248 991800 Duration 1 Year 2 Years 1 Year 6 months Benefits on completion Hon. & IP/KB Hon. PL : INST : IF 65 : 18 : 17 85 : 15 : 0 48 : 27 : 25 39 : 22

Pre-project Procedures • Project Proposals by PLs – Technical scrutiny by HODs – Project Budget scrutiny by BDU • All costs to be estimated • NEERI’s & Sponsor’s obligations to be identified • Only Gross budget details should be communicated to sponsor – Final approval by Director • MOU/Agreements through BDU • Expression of Interests/Tenders/others by PLs in consultation with BDU • Negotiations by PLs in consultation with BDU • After negotiation, various budget heads shall be proportionately scaled down to the revised budget and in the project documents

Project Registration & other Proc. • • • Project No. allotment on Project proposal/synopsis Receipt Breakups (for every receipt) Receipt Reallocation (occasionally) Progress Reports (quarterly) Project Extensions (only in exceptional circumstances) Project Completion Certificate (at the end of the project) Honorarium Distribution (after full recovery of proj. cost) Customer Satisfaction Evaluation (after proj. completion) Special Cases (with proper justification by PL and approval by CA – Director/Management Council/DG) – – – Foreclosures Project extensions (of time but not budget) Exemptions/waivers Deferment of installments Write-off of unrecoverable dues Project Formats revised based on CSIR Guidelines and MC observations

Contract R&D • Well defined project outputs • IPR/KB – details in other part • Fully funded • Intl. Fee waiver for tiny and SSIs • S&T staff (Manday Charges): Above Sci. F – Rs. 7, 000 Sci. B-Sci. EII – Rs. 4, 000 Others - Rs. 3, 000 • Project Staff (include 40% overheads) Level I: Rs. 5000 per month Level II: Rs. 8000 per month Level III: Rs. 10000 per month Level IV: Rs. 12000 per month • Inst. Overheads as indicated • Equipment ownership

Contract R&D • Intellectual Fee Ø At least 40% of total expenses for Sponsored and collaborative projects Ø No Intellectual fee for GIA projects/waiver for SSIs • Payment terms Ø I installment : At least 25% Ø Other installments linked to ilestones/deliverables • Mo. U/Agreement Ø As deemed necessary/ desired by client • Bank Guarantee/S. D. etc. Ø normally not permitted • Utilisation of IPR/KB Ø Terms set and agreed for ownership, licensing and royalty

Consultancy/ TS • Based on expertise and facilities • Well defined project deliverables • IPR/KB • Normally not envisaged and part of project • Fully funded by sponsor • Intl. Fee at least total manpower cost /waiver for tiny SSIs • S&T staff (Manday Charges): Ø Above Sci. F – Rs. 7, 000 Ø Sci. B-Sci. EII – Rs. 4, 000 Ø Others - Rs. 3, 000 • Project Staff (include 40% overheads) Ø Level I : Rs. 5000 per month Ø Level II : Rs. 8000 per month Ø Level III : Rs. 10000 per month Ø Level IV : Rs. 12000 per month • Inst. Overheads as indicated • Equipment/computer usage • New equipment – specific to requirements

Consultancy/TS • Intellectual Fee Ø At least total manpower expenses waiver for SSIs • Payment terms Ø I installment : At least 50% (justification by PLs for other cases) Ø Other installments linked to milestones/deliverables Ø Open tenders – as per agreed terms • Mo. U/Agreement Ø As deemed necessary/ desired by client • Bank Guarantee/S. D/EMD etc. Ø Normally not permited

Budget Checks for: • Staff salary • PF salary • Overheads • Intellectual Fee • Service Tax

A Ready Reckoner

Receipt Break-Up Checks for: • Staff salary • PF salary • Overheads • Intellectual Fee • Service Tax • TDS, if any • Installment wise

Reallocation • As per requirements • Only for PL’s heads • Checks for: Ø Project balance Ø Head wise balances Ø Sufficient balances Ø Transfer entry's Ø Corresponding Ø changes in contract Ø and receipt

All Project Extensions • Only under exceptional cases • If supported by sponsor’s extension • Extension once only, but not beyond 6 months

Closure Certificate After completion of all formalities: • Full receipt of total project cost • Fulfillment of all deliverables • Instruction for balance transfer • Suitable justification for any deviation (preferably with sponsor’s concurrence for discharge of all obligations)

Honorarium Distribution • Applicable to all sponsored, consultancy and technical services projects • Not applicable for projects partly funded/foreclosed/short receipts cases • Intellectual Fees must be fully received before distribution

Customer Satisfaction Evaluation • After completion of project Presently poor response Follow up necessary

Security & Sensitivity Clearance of GOI • Mandatory requirement for all international projects and agreements/Mo. Us • Case specific documentation is required • Justification by PL • Scrutiny by Lab. • Scrutiny by CSIR Hq • Approval by DG/Secretary, DSIR

Special Cases • Deferment of Installments – Due to technical/other reasons from sponsor – Keep the project in abeyance till the sponsor meets the stipulated obligation – A proposal by PL clearly stating the reasons for non-fulfillment of obligations through BDU for MC approval. • Write-off of unrecoverable dues – In the event of unrecoverable dues relating to premia / royalty / installments from sponsor/client, – Head, BDU sends a comprehensive proposal stating the reasons for short-receipt of dues to the CA – CA constitutes a write-off committee, and the committee’s recommendations sent to MC for approval

Licensing of Intellectual Property • Intellectual property – Patents, Copyright, Trademark, Design and Computer software (Encumbered/Unencumbered) • Channels of licensing (transfer of IP for commercial exploitation) – Direct Licensing by laboratory – Licensing of IP through TTAs /NRDC/Business consultants • Issues of Licensing – – – – Ownership Licensing: exclusive/non-exclusive Pricing Licensing fee and/or annual royalties (+ Service Tax) Duration Negotiations and Agreements Monitoring and review

Licensing of Knowledge Base • Knowledge Base – Process Know-how, technology, technique, new product (Encumbered/Unencumbered) (protected/not) • Channels of licensing (transfer of KB for commercial exploitation) – Direct Licensing by laboratory – Licensing of KB through TTAs/NRDC/Business consultants • Issues of Licensing – – – – Evaluation, Legal protection, documentation Licensing: exclusive/non-exclusive Pricing : cost of development + opportunity value (market based) License fee and/or annual royalties (+ Service Tax) Duration Negotiations and Agreements Monitoring and review

Terms of IPR • Sponsored R&D – The ownership rights of IP & KB shall rest with CSIR – Sponsor shall be given first right for commercial exploitation of IP & KB with minimum period set for commercial exploitation – CSIR shall be free to license the IP & KB to third parties thereafter – Wherever possible, either the sponsor shall be given an exclusive license with a minimum period set for commercial exploitation; or, an non-exclusive license is granted for limited period of time for commercial exploitation of the IP & KB. – In specific deserving cases, exclusivity till the validity of patent can also be given with the approval of Competent Authority. – License fee could be a lumpsum and/ or a recurring royalty. – CSIR shall have the right to license the IP & KB to any other party on the terms and conditions it may decide in case it has granted nonexclusive or limited exclusivity license upon expiry of the exclusivity period. – Notwithstanding the exclusive license granted to the sponsor, CSIR shall have the right to license the intellectual property during the period of license if Government of India desires CSIR to disclose the intellectual property for its use in India in national interest. – Monies accruing shall be shared between CSIR and collaborator on mutually agreed basis

Terms of IPR • Collaborative R&D – The right of licensing of IP & KB shall be jointly held by CSIR & Collaborator – The collaborator shall have the first right for commercial exploitation IP & KB on mutually decided terms and conditions between CSIR and the collaborator. – In case if collaborator fails to exercise commercial exploitation of IP &KB within the pre-specified period as defined in the contract, CSIR shall have right to license the intellectual property to others on terms to be mutually decided between collaborator and CSIR. – Wherever feasible collaborator shall be given a non exclusive license failing which, an exclusive license for a limited period of time for commercial exploitation of IP&KB. – In specific cases exclusivity till the validity of patent can also be given with the approval of Competent Authority. – CSIR shall have the right to license the IP & KB to any other party on the terms and conditions it may decide in case it has granted non-exclusive or limited exclusivity license upon expiry of the exclusivity period. . – Notwithstanding the exclusive license granted to the sponsor, CSIR shall have the right to license the intellectual property during the period of license if Government of India desires CSIR to disclose the intellectual property for its use in India in national interest. – Monies accruing shall be shared between CSIR and collaborator on mutually agreed basis

Terms of IPR • Grant-in aid Projects – Licensing right of IP in case of Government departments and agencies may be as per their standard terms and conditions – Where grantor has no standard conditions, and for all non-government agencies, licensing rights shall be that of CSIR – It could also follow the guidelines for Sponsored R&D and Collaborative/Cooperative R&D projects.

Ownership of IP • In the event patentable inventions result from the research conducted hereunder, CSIR/NEERI shall file application for seeking Intellectual Property Rights (IPR), but it shall offer license of this IPR to XXX on mutually agreed terms. The ownership of IPR shall vest in CSIR/NEERI. – XXX shall not file any application for seeking IPR in its own name or in the name of its associates or any other person on any matter relating to the information disclosed to it by CSIR/NEERI. – XXX shall not oppose or direct or cause any person to oppose any application seeking IPR relating to Projects filed by CSIR/NEERI.

Utilisation of Knowhow • XXX shall have the right on exclusive basis to commercially exploit/use the Knowhow generated in the Project for a period of ---- years from the date of receipt of the Final Report on the Project. After the expiry of the exclusive period, CSIR shall have the right to license the Knowhow to others. • In the event the XXX fails to utilize the Knowhow within ----months of receipt of the Final Report, CSIR shall be free to license the Knowhow to other parties. • In case XXX utilizes the Knowhow within the stipulated period as above, CSIR/NEERI shall have the right to license it to other parties after the expiry of the exclusive period of license. In case, XXX is involved in the transfer of the Knowhow to other parties, the premia/royalty received by CSIR shall be shared between CSIR and XXX on a mutually agreed basis depending on the relative inputs of the parties.

MOU’s And Agreements Mo. U – Memorandum of Understanding – An agreement between parties prepared with due diligence – Avoids future complications and communications – It is not legally enforceable Types of Agreements (Legally enforceable) – – – Research Alliance Agreement Contract Research Agreement Consultancy Agreement Licensing Agreement Confidentiality/Secrecy/Non-disclosure Agreements Material Transfer Agreement – Tri-partite/multi-party agreements Each project is a unique experience ! Execute an Mo. U/Agreement with Client/Sponsor

MOU’s And Agreements Components/Clauses – – – Recitals of parties Genesis Scope Obligations of parties Duration Financial and payment terms Confidentiality Publications Ownership of IP/KB Utilisation of IP/KB Other IP/KB Terms Licensing/Royalty • • • • Communication of results Indemnity/Liability Due diligence req. Disclaimers Force Majeure Waiver Failure to perform Amendments Assignment Termination Notices and contacts Law, Jurisdiction, Arbitration Miscellaneous Closing IPR clauses survive even after completion of tenure of Mo. U/Agreement

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