The Philippine Constitution mandates the protection of artists, authors, and creators in relation to their intellectual property. In line with this duty, the Intellectual Property Office of the Philippines (IPOPHL) issued Memorandum Circular No. 2020-023 on July 20, 2020, which laid down the Implementing Rules and Regulations (IRR) on Resale Rights.
This framework—sometimes called the droit de suite—ensures that artists and their heirs continue to benefit financially from the resale of their original works, even after the first transfer.
Scope of the Rules
- Covered transactions – The resale right applies when an artist’s original work of painting, sculpture, manuscript, or musical composition is sold or leased after the first disposition. It applies even if the work was created prior to the effectivity of the IRR.
- Eligible authors – Filipino citizens, as well as nationals of Berne Convention member states that recognize resale rights, are entitled to protection.
- Exclusions –
- Prints, etchings, engravings, works of applied art, and similar works where value is derived from reproductions.
- Private transactions between individuals without an art market professional (such as galleries, auction houses, or dealers).
- Sales or donations to public museums.
Nature of the Resale Right
- Inalienable and non-waivable – Authors cannot sell, assign, or waive their resale rights. Any contract attempting to do so is null and void. This ensures long-term protection for creators.
- Heirs’ entitlement – Upon the artist’s death, the right passes automatically to the heirs and remains enforceable for 50 years after death. For joint authors, it lasts until 50 years after the death of the last surviving author.
- Presumption of authorship – If an artist’s name appears on the work at creation, he or she is presumed the author unless proven otherwise.
Practical Application
- Resale threshold – A transfer is considered a resale if it involves a professional intermediary and the work is registered in the Registry of Qualified Works maintained by IPOPHL’s Bureau of Copyright and Related Rights (BCRR).
- Leases – A lease exceeding one year, accompanied by a written agreement, is also covered.
- Royalty rate – Up to 5% of the gross resale price is due, computed based on IPOPHL’s prescribed sliding scale.
- Payment timeline – The royalty must be paid to the author or heirs within 60 days of the resale or lease.
Dispute Resolution
- Filing claims – Any claim for unpaid resale royalties must be filed with the Office of the Director of the BCRR within one year of the cause of action.
- Appeals – Decisions of the BCRR Director may be appealed to the IPOPHL Director General within 30 days, whose ruling shall be final and executory unless further elevated to the Court of Appeals or Supreme Court under judicial review.
Real-World Example
A relevant case that highlights artists’ ongoing rights is Malcolm vs. Francisco (G.R. No. L-10033, 1916), where the Supreme Court of the Philippines recognized that authorship and copyright ownership confer lasting economic and moral rights. Although resale rights were not yet codified then, the principle laid the groundwork for today’s recognition of continuing author benefits.
In a modern context, suppose a Filipino painter sells a canvas for ₱50,000. Years later, the same piece is auctioned at a Makati gallery for ₱2,000,000. Under IPOPHL’s resale rights rules, the artist (or heirs) is entitled to a royalty of up to 5% (₱100,000)—a recognition that the increased value stems from the artist’s reputation and continuing creative contribution.
Why This Matters
The resale rights regime is crucial in the Philippines, where many artists sell works at modest prices early in their careers but see their art appreciate in value later. The law ensures they, and not just collectors or dealers, share in that success.
For those wishing to register works or assert resale rights, working with professional IP agents like Brealant, Federis, or Hechanova can provide guidance in navigating IPOPHL procedures, especially since enforcement often involves complex filings and registry requirements.
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