When should it be used?
- When one party wishes to share proprietary physical materials with another party; and
- The parties are Australian entities
The agreement is also suitable when one of the parties is a Commonwealth Entity.
Whilst it will often be the University providing material to an industry collaborator, the agreement is structured so that either party could be the transferor.
A Material Transfer Agreement (MTA) can be used for situations requiring the exchange of physical materials, for example, where a company wishes to test materials to decide whether to sign a licence or purchase agreement. It can also be used to provide materials for use in a project or other collaboration if the agreements for those projects do not already include terms relating to the exchange of materials.
When should it not be used?
- For the transfer of biological material
- For transfers where specific intellectual property (IP) arrangements relating to the material are required. For example, where the recipient may create new patentable discoveries through use of the material
- For longer term project activities. In these circumstances, the parties should use a further agreement such as a research agreement that will contain additional terms to protect each party’s interests
- When the material could pose significant environmental or health and safety risks or is intended to be used in animal or human testing. Further assessment of risks will be needed in these circumstances and a bespoke agreement will be required
Key considerations when completing the template
The following table is provided as a guide to help the parties appreciate the key considerations that each party will have when negotiating a Material Transfer Agreement using the template.
The template is provided in the Accelerated track and it is expected that parties can use the template with minimal negotiation. Nevertheless, discussing and understanding each party’s needs and concerns up front will help you reach an agreement more quickly. A Material Transfer Agreement may take a few days to a few weeks to negotiate and sign depending on the nature of the materials being exchanged and their proposed use.
For organisations, particularly SMEs, that have not previously been asked to enter this type of agreement, this table will help you understand what the key provisions of a Material Transfer Agreement are and what you need to discuss and agree in order to finalise the agreement from the template.
Additional plain English guidance on the meaning of key clauses is provided in a separate annotated version of the template.
This table sets out the key points each party needs to consider when entering a Material Transfer Agreement. Understanding your own key considerations, as well as those of the other party, will help you to negotiate a fair and reasonable agreement that works for both parties.
| Key points |
Material Transfer Agreement Provision |
University (Transferor) |
Collaborator (Recipient) |
|---|
| Details of the Material being exchanged |
- A clear description of the Material being transferred including its technical specifications
|
- Descriptions should have enough detail to make it clear what the Material you will be sharing is made up of
|
- Ensure you understand what Material is being received, and that it is in a suitable form for your intended use
|
| Permitted Use |
- A clear description of what the recipient is allowed to do with the Material; for example, “to use the Material internally to test its activity for x”
- This should be as clearly defined as possible and avoid generic descriptions such as “for internal research purposes”
|
- Ensure your Material is only used for the specific project described and cannot be used more widely by the Collaborator (unless this is agreed)
|
- Understand the restrictions on how the University’s Material can be used, and ensure this covers all of your intended uses
|
| Delivery, Handling and Return Instructions |
- Details of how the Material will be delivered and whether there are any specific handling requirements
- In most cases, the Transferor should ask for the Material to be destroyed at the end of the Agreement
- The Transferor would not normally get the Material back at the end of work, so if this is important, this should be made clear at the outset
- If there are no agreed instructions to return the Material, ownership of the Material transfers to the Recipient on receipt
|
- Ensure the Collaborator is aware of any special conditions for transport and handling of the Materials
- This is particularly important if there are known hazards or other requirements e.g., the Material needs to be kept below freezing
- Ensure the Collaborator does not continue to use the Material after the end of the Agreement (unless the University agrees to this)
|
- Ensure you are informed of and understand any special handling requirements so that you can meet these
- Ensure you inspect the Material and are satisfied it meets the requirements upon receipt. Inform the University of any issues prior to commencing work with the Material
- Be aware of what you need to do with the Material at the end of the Agreement and the potential costs involved in returning the Material
|
| Fees & Expenses |
- For many exchanges of materials for research purposes, it may not be appropriate to charge a Fee and the template is structured to be legally binding whether a Fee is charged or not
- If a Fee is being charged for the Material, this needs to be discussed and agreed up front
- Any additional expenses incurred (for example, delivery costs) should be identified and included
|
- Decide whether a Fee is appropriate and discuss this with the Collaborator as early as possible. Be prepared to justify the Fee, for example, based on the costs incurred by the University in making the Material or its value to the Collaborator
- If you will incur out of pocket expenses for delivery of the Material, make sure these costs are recorded and that they are reimbursed
|
- If a Fee is being charged, this is usually negotiable and will depend on the value of the Material (including costs incurred by the University to make it)
- Typically, this will include reimbursement of delivery costs unless this is included in the Fee. Sometimes it can be cheaper if you organise collection of the Material yourself
|
| Confidential Information exchanged |
- A clear and concise description of the scope of the information that each party intends to share with the other and which that party considers to be confidential
- How long this information must be kept confidential should also be included. Typically, the time period will be 5-7 years, although longer periods may be appropriate. In most cases the term will be the same for both parties
|
- Ensure if confidential information is exchanged with the Material that this is clearly identified
- Ensure this information is kept confidential long enough so as not to impact on your research and commercialisation activities. For example, so that others cannot use this information before the University has published it or filed patent applications
- Understand what restrictions apply to confidential information shared with you by the Collaborator. This will usually include information about their work with the Material
|
- Ensure you understand what information you receive from the University that needs to be kept confidential
- Ensure it is clear what information you will share that you consider to be confidential information and that this is kept confidential long enough so as not to impact on your commercial activities
- For example, so that the University does not publish the information and competitors do not benefit from this confidential information whilst it still provides a competitive advantage
|
| Warranties & Liabilities |
- The Transferor provides a warranty that, to the best of its knowledge and belief, the Material when used for the Permitted Use does not infringe any IPR of a third party
- No further warranties or indemnities are included in relation to the Material and its use
- The template includes an option for the parties to agree a cap for certain liabilities that may arise
|
- Ensure that the University can agree to the warranty and that you are not aware of any third party rights that use of the Material by the industry partner would infringe
- If a liability cap is agreed to, ensure this is appropriate taking into consideration any fee paid for the Material and the agreement risks
- The liability cap could be $0 if no fees are being charged
|
- If a liability cap is agreed to, ensure this is appropriate taking into consideration any fee paid for the Material and the agreement risks
- The liability cap could be $0 if no fees are being charged
|
