Termination of Contract

Intellectual Property

KPI

Exclusivity

Arbitration

Confidentiality

Risk

Risk

Termination of Contract

Intellectual Property

Description

Restrictive Clauses

Pro-Innovation Clauses

Case Analysis

Intellectual Property

It refers to the imminence, closeness or proximity of a possible breach or damage. If this occurs, the person who is responsible will have to remedy that breach, delay or disagreement in the development of the project.

In the case of Agreement 2, it is established that the risk is "shared".

In the case of Agreement 1, it is established that "both parties are willing to seek solutions together" in case of risk.

- In the case of the R & D Center, it is set that "both parties invest in the project"; therefore, the risk will also be assumed jointly.

Three of the 8 agreements have Risk clauses that facilitate technological innovation because they present the necessary symmetry for collaboration between the parties who sign the agreement:

The rest of the entities: Mining Company A and B, R & D Center and Provider A and B present risk clauses considered "neutral", because the principal assumes responsibility. No restrictive risk clauses were found in the agreements studied.

In the case of the R & D Center, it is set that "both parties invest in the project"; therefore, the risk will also be assumed jointly.

The Collaborative Contract, provided by the R & D Center, seeks to establish a mutual cooperation relationship, in which both parties assume the technological risk. In the document provided by the Trade Association, participant in this study, the risks related to the projects to be developed are shared.

In the document provided by the Trade Association, participant in this study, the risks related to the projects to be developed are shared.

The Collaborative Contract, provided by the R & D Center, seeks to establish a mutual cooperation relationship, in which both parties assume the technological risk.

When the risk is assumed by only one of the parties, there is no collaboration environment between them since it generates high costs and damages only for the party that bears this responsibility.

- When the risk is assumed by only one of the parties, there is no collaboration environment between them since it generates high costs and damages only for the party that bears this responsibility.

•Restrictive clauses are identified in the documents provided by the R & D Center and Provider B since the principal aspires to retain the intellectual property generated by the technology developer. These dynamics can put at risk the collaborative relationship in implementation phases

• Shared IP is considered a facilitator of collaborative innovation. • The possibility that the technology provider can aspire to economic benefits is regarded as a factor that promotes collaborative innovation.

•Shared IP is considered a facilitator of collaborative innovation.

•The possibility that the technology provider can aspire to economic benefits is regarded as a factor that promotes collaborative innovation.

"All the information given to the provider by the mining company, belongs exclusively to the company (...) The creation resulting from some of the activities of the project will be owned by the provider. However, the mining company will enjoy the right to indefinite use and for any of its business, production or management tasks both of the company and its subsidiaries"*

Research also involved building a data bank formed by contracts and agreements that analyzed exclusively clauses related to IP management and control.

In terms of the benefit of these transactions, it could be deduced that it is directly related to the size of the company that reaches these agreements and, in the case of providers, to the country where its headquarters are located. In the documents of mining companies A and B, the IP benefit is granted to the principal, who will be the only benefited by using the technological development. To have a better understanding of this, an extract of the contracts of both mining companies is shown:

Minning Company B

"(...) any creation that has arisen under the current contract may be registered by the provider if he is desirous, both in Chile and abroad. However, the provider will grant the company the right to use this property non-exclusively and free of charge, within a defined period, agreed by both parties (...) *

In most of the cases analyzed, it was seen that the IP owner was the principal (6 cases out of 9), equivalent to 67%.

Mining Company A

Mining Company B

Mining Company A

A branch of Law that seeks, on the one hand, to promote technological innovation, creation and transfer and, on the other, to organize markets to make decision-making easier to the consumers.

In the agreements signed by Provider Company A and the Company Management Project (MP), it could be seen that IP rights were kept by the "agent", i.e. the provider was listed as the entity controlling the use of know-how and IP. This happens because these companies (Provider A and MP) are large transnational corporations headquartered abroad, which gives them bargaining power over the principal. Once again, we come across a case of transactional asymmetry because although this time the client is the one who is at a disadvantage (unlike the previous cases) the agent is the one with the greater operational scope.

In the contract provided by the Trade Association, IP rights were set as "mutual", which means that both parties can make use of the underlying materials. This is one of the few cases in which there is a collaboration between the entities and, therefore, the development of technological innovation is facilitated.

In the case of Mining Company A, as the purpose of the provider is not to own his invention, but the result, which is the product that can be commercialized, the clause was classified as favorable for the principal.

In the case of Mining Company B, the provider of the solution is not able to level the transaction, unless it works with economies of scale; therefore, it cannot yield with its development in the client's operations, so it is also favorable for only one of the parties.

The rest of the entities (Provider B, IT Provider and Technology Providers A and B) were in the same position as Mining Companies A and B, i.e. the benefits of IP rights were granted solely and exclusively to the agent.

When the stages or phases of development of a project are determined by only one of the parties, the necessary feedback for collaborative dynamics is not generated. An example is the case of the contract granted by Provider A, in which it is stated that the agent —the transnational provider— shall define the KPI. Then, asymmetry is produced because the largest company (transnational provider) is the one who sets the deadlines and conditions to move on to the next stage without considering the opinion of the principal (smaller mining company).

Agreeing on progress results and critical milestones of the process enables the development of collaborative dynamics, which gather the knowledge and experience of both parties.

In Agreement 2, the KPI clause will be "defined jointly" between the entities participating in the contract. This is presented as a favorable environment for the development of technologies since both parties are in equal conditions for decision-making regarding this issue. That is, the necessary symmetry is provided.

The rest of the entities: Mining Company A and B, R & D Center, Provider B and Collaborative Contract, present KPI clauses considered "neutral" in which the principal is the one who gives permission to proceed to the next stage.

Three of the eight documents contain KPI clauses that have an impact on collaboration. In two agreements the KPI clause is represented as a facilitator and in one as restrictive for collaboration.

In Agreement 1, it is stated that the KPI, i.e. the measurement that allows to pass to the next stage, will be determined by "being agreed on" by both parties, according to the nature of the project. This scenario is favorable for collaborative innovation since both stakeholders are in equal conditions regarding the approach and objective of each stage of the project.

The document granted by Provider A states that the agent will define the KPI. This clause is classified as restrictive for collaborative innovation since it is based on an asymmetric relationship between a transnational provider and a local mining company.

The "Key Performance Indicator" is the milestone or stage whose fulfillment empowers the provider or agent to advance from one phase to another in the development of a project. These milestones serve as indicators to measure the fulfillment of objectives in each phase.

Mediation or intervention of a third party in a dispute between two or several parties.

Taking legal action to resolve conflicts is considered a risk factor for the collaborative relationship. These dynamics generate high costs for the parties.

The arbitration clause is presented as a facilitator of technological innovation when it is established that the parties will be able to reach an agreement without the intervention of third parties. Thus, a search for solutions to conflicts between the parties is proposed, expecting a mutually beneficial solution between them.

In the eight contracts studied, it could be seen that in two of them the arbitration clause was restrictive and in one, it was a facilitator. In the other documents, this clause was classified as "neutral" because in the event of a possible problem, the Chamber of Commerce of Santiago or Legal Persons were named as arbitrators, excluding judicial institutions.

In Agreement 1, arbitration is regarded as "not necessary". This clearly aims at a desire for collaboration and trust between the parties.

• In the case of Mining Company B, it was stated in its documents that arbitration would be assigned to Lower Courts. Taking disagreements to court involves high costs and also causes distrust between the parties. This environment is considered restrictive for collaborative innovation.

In the R & D Center, arbitration is carried out by the courts of justice. Not only does this imply extra costs, but it also generates a disincentive for the collaborative process.

In the case of Mining Company B, it was stated in its documents that arbitration would be assigned to Lower Courts. Taking disagreements to court involves high costs and also causes distrust between the parties. This environment is considered restrictive for collaborative innovation.

It is a feature of information guaranteeing that only authorized persons within a contract can access to it. Failure to comply with this could cause damage to one of the parties.

Agreement 1 states that, in terms of confidentiality, "the parties can exchange strategic project information". This allows collaborative dynamics between the parties, favoring technological innovation.

Two of the eight contracts are classified as facilitators for collaborative dynamics.

The rest of the entities: Mining Companies A and B, R & D Center, Providers A and B and the Collaborative Contract include confidentiality clauses classified as "neutral" about the collaborative process because the agent must respect what is stipulated by the principal. In some cases, the contracts did not mention confidentiality.

In Agreement 2, the confidentiality clause is "to be agreed on" between the parties. The environment, in this case, is presented as a facilitator of technological innovation since there is symmetry between the parties when making decisions on this matter.

Collaborative interaction is favored when the confidentiality clause is "to be agreed on" between the parties. When the parties can exchange strategic information for the development of the project, collaborative dynamics are generated favoring the development of technological innovation.

•Collaborative interaction is favored when the confidentiality clause is "to be agreed on" between the parties. •When the parties can exchange strategic information for the development of the project, collaborative dynamics are generated favoring the development of technological innovation.

Clauses identified as constraints on the collaborative relationship are those that aim at the unilateral termination of a contract by the principal. These dynamics increase the level of risk for the agent and hinder a relationship of trust.

When the agreement between the parties is ended in a "shared" or "to be agreed on" form, it produces the necessary symmetry to generate dynamics of collaborative interaction.

On the contrary, Providers A and B, Agreements 1 and 2, and the Collaborative Contract, turned the "termination of contract" into a facilitating path for collaborative innovation as the end of the agreement between the parties was expressed as "shared" or "to be agreed on", generating the necessary symmetry to form dynamics of collaborative interaction.

Both Mining Companies A and B and the R & D Center, stated in their "termination of contract" clause that the principal was to terminate the agreement when he deemed it appropriate. This aspect was classified as restrictive for the collaborative process since it produces asymmetry between the entities participating in the agreement.

This is one of the most critical clauses for the process of technological innovation. In none of the eight contracts studied it was classified as "neutral". It is considered then that it has a high impact on innovation, either in a restrictive or facilitating way.

Termination of services due to the end of the duration of the contract, a breach by one of the parties, or any other reason that the principal considers relevant.

Right or privilege that a person or corporation has to forbid or ban the interaction or delivery of information to third parties.

Two of the eight agreements have an impact on the collaborative dynamics between the parties. One case appears as restrictive and one as a facilitator for the development of technological innovation.

Provider B states that "the knowledge generator cannot work on similar subjects with third parties". This restricts the collaborative process by preventing the propagation of the knowledge generated.

The rest of the entities: Mining Companies A and B, R & D Center, Provider A, Agreement 2 and the Collaborative Contract do not present information about this item.

The contract provided by Agreement 1 states that there is no exclusivity regarding the knowledge generated; therefore, this clause is considered a facilitator of the collaborative process.

Collaborative interaction is favored when it is established that there is no exclusivity regarding the knowledge generated since the flow of this information between stakeholders is allowed giving rise to a collaborative process.

When the principal prevents the agent from working on similar subjects with third parties, it is considered a restrictive exclusivity clause because the transfer of knowledge stops.