Involving inventors is a clear success factor for spin-off companies. However, starting an entrepreneurial career is often perceived as a risk by researchers. Since 1999, a legal French framework allows researchers from public organisations to participate in different ways in the creation or development of companies based upon their research work. Providing job security, this framework is considered to be really favourable for researchers. www.FITT-for-Innovation.eu

1. Involving Researchers in Spin-Offs
FITT
– Fostering Interregional Exchange in ICT Technology Transfer –
www.FITT-for-Innovation.eu
Except where otherwise noted, this work is licensed under a Creative Commons Attribution 3.0 License.

2. “Innovation law”& researcher’s mobility
 French Law for Innovation and Research of 1999 aims at fostering the
creation of innovative companies and the transfer of public research
towards industry.
 Scope of the law covers 4 main topics:
Mobility of the public research employees
Cooperation between public research organization and enterprises
Fiscal framework for innovative companies
Legal framework for innovative companies
 Focus here on the mobility part, i.e. a legal framework to incite
researchers to participate in the creation or development of innovative
companies.
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3. A substantial change for employees of public
research organisations
Favourable conditions for public research employees to be involved with
private companies exploiting their work
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4. 4 schemes for researchers to be involved with
an innovative company
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5. A few requirements
Employees of a PRO who want to be involved with a company
according to the conditions described in the law must comply with
the following principles:
 The company must exploit the research work of the employee
 Respect of the interests (moral & material) and functioning of the public
research organisation (PRO)
 Respect of the research/ technical mission of the employee
 Contract between the company and the PRO
 Prior authorisation by the national Commission of Deontology for public
service
 The National Commission of Deontology must be informed on the contracts
and partnerships signed between the company and PRO (duration of the
authorisation + 3 years)
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6. 1) Creation of a company
Initial position in the PRO
Articles L 413-1 to L413-7 of the Code of
Research (formerly article 25.1 of the Law
Ask for the autorisation of organisation and
of Innovation dated from July 1999 ):
Commission of Deontology BEFORE creating
the company Procedure if an employee of a public
research organisation wants to create
Yes No a company to exploit technologies that
he developped.
Quit prior activity in the PRO (derogation possible for part-time teaching activities)
Contract between employee and research organisation
Contract between company and PRO on management of Intellectual Property)
Position of « détachement » or « mis à disposition », to work for the company
The employee can be a partner or manager of the company
After 2nd and 4th
Ask for the autorisation of the PRO & Commission of years
Deontology
Yes No
After 6th years
(maximum possible)
Return to PRO
Stay in the company (put an end to cooperation with
and quit the PRO company within a year)
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7. 2) Consulting activities (“Conseil scientifique”)
Initial position in the PRO
Articles L 413-8, L413-10 and L413-11 of
the Code of Research (formerly article
25.2 of the Law of Innovation dated from
Work for the PRO
Ask for the autorisation of the PRO and national
Commission of Deontology July 1999 ):
Procedure if an employee of a public
research organisation wants to
Yes No
provide scientific support for a
company exploiting his research work
-Contract between employee and company (on content of consulting whilst remaining in the public sector
activities, duration, remuneration…)
-Contract between PRO and company about intellectual property
matters
-Scientific activity only (no management)
-Consulting activities must be done outside the laboratory
-No participation in the negotations between PRO & company
-Not more than 20% of the time
-Maximum remuneration fixed at 66 000€ per year (Gross income)
Every 5 years, as long
as the company
Ask for the autorisation of the PRO and Commission of valorizes the research
Deontology work of the employee
Yes No
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8. 3) Participation in the administrative or
advisory board of a company
Initial position in the PRO Articles L 413-12 to L 413-14 of the Code
of research (formerly art 25. 3 of the Law
of Innovation dated from July 1999 ):
Work for the PRO
Ask for the autorisation of the research organisation and
national Commission of Deontology Procedure if an employee of a public
research organisation wants to
participate in the decision board of the
Yes No company.
-Only remuneration possible is director’s fees (« jetons de présence »).
The maximum is determined by decree.
-Obligation to inform the PRO about the revenues resulting from the
director’s fees, dividends or the selling of titles.
Giving up the rights
-Not compatible with consulting activities (« Concours scientifique »)
-The participation in the capital of the society and voting rights cannot
exceed 20%
When the authorization has ended,
the employee has 3 months to give
up his rights in the company. If he
Every time the wants to keep them, he must quit the
term of office is PRO
Ask for the autorisation of the research organisation and finished.
Commission of Deontology
Keeping the rights
Yes No
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9. 4) Participation in the capital of a society
Initial position in the PRO
Articles L 413-9, L41310 and L413-11 of
the Code of research (formerly art 25. 2 of
the Law of Innovation dated from July
Work for the PRO
Ask for the autorisation of the research organisation and
national Commission of Deontology 1999 ):
Procedure if an employee of a public
Yes No research organisation wants to have a
participation in the capital of a society
exploiting his research work
-In the exercice of his activity, the employee should not have had a position of
control over the company or have been involved with contracts between the
company and public research services in the last 5 years.
-Not possible to have a position in the top management of the company (but
compatible with consulting activities)
-Limit : 49% of the capital and 49% of the voting rights
-Obligation to inform the research organisation about the incomes related to the
participation in the capital of the company.
-Contract PRO/company about technology transfer and between
employee/company about the condition of participation in the capital
Every 5 years, as long When the authorization has ended,
as the company the employee has 1 year to conclude
Ask for the autorisation of the PRO and Commission of valorizes the research his participation in the capital of the
Deontology work of the employee company.
Yes No
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10. When?
Law n°99-587 of July12, 1999
http://www.legifrance.gouv.fr/affichTexte.do;jsessionid=E06C858F5BDE540E506
BA53962AD884D.tpdjo06v_3?cidTexte=LEGITEXT000005628198&dateTexte=2
0090921
Also included in the of the Code of Research (articles L 413-1 and following)
http://www.legifrance.gouv.fr/affichCode.do?cidTexte=LEGITEXT000006071190&
dateTexte=20090921
The content has been slightly modified since :
- “Loi de programme pour la recherche” n°2006-450 (18 avril 2006):
participation allowed in the capital of a company is 49% instead of 15%.
- “Loi de modernisation de la fonction publique” n°2007-148 (2 février 2007):
creation of a specific commission for research-related decisions.
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11. Who ?
 Persons concerned by the law:
 Researchers, teachers-researchers, engineers, PhDs, technical and
administrative staff from most public research organisations
- EPST (Etablissements Publics à caractère Scientifique et
Technique) such as CNRS, INSERM, INRA, INRIA
- EPSCP (Etablissement Publics à caractère Scientifique, Culturel
et Professionnel) including universities and public engineering
schools developping their own research.
- EPIC (Etablissements Publics à caractère Industriel et
Commercial) are not concerned.
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12. Pros & Cons
PRO’s CON’s
 Strong incentive for technology transfer :  Because it is a law, this plan relies on the
allows researchers (and other employees) government’s agenda.
to engage in TT activities outside their  The law prevents the employees who
laboratory whilst keeping the advantages of are involved in starting up companies
public service. from being penalized in terms of research
 Measures to promote mobility of the staff careers but there is no concrete
can be adapted at a institution level (not measures.
necessarily a law).
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13. Why?
Why was the Law established?
Will to foster the transfer of public research outputs to industry. The Innovation Law
provides a legal context that supports the creation of innovative technology-based
companies, notably by young people.
What was the context?
The law fit in a more general governmental action to stimulate innovation. The 1999 Law
introduced other measures alongside the mobility of researchers : decision to create
incubators and Technology transfer offices in each university, improvements for
research tax credits...
In 1999 the national award for creation of innovative companies and thematic seed funds
were also introduced by the government.
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14. Outcome
Applications to Commission of Deontology and decisions between 2000 and 2006
From 2000 to 2006 Nbr of referrals Nbr of % of the total
(7 years) agreements
Art.25.1 153 133 23
Art 25.2 482 418 72
Art 25.3 36 31 5
Total 671 582 100
Average for a year 96 83
Source : Etat de la situation et bilan au 31 décembre 2006, Ministère de l’Enseignement
supérieur et de la Recherche, DGRI, Juin 2007
During the first years, 3/4 of the applications targeted consulting activities, nearly
1/4 pertained to the creation of start-ups while the participation in the management
of the companies was less common.
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15. Outcome
Evolution of the number of decisions of the Commission of Deontology
2000 2001 2002 2003 2004 2005 2006 Total
Decisions 93 94 138 117 67 98 77 684
% of the 14% 14% 20% 17% 10% 14% 11% 100%
total
Source : Etat de la situation et bilan au 31 décembre 2006, Ministère de l’Enseignement supérieur et de
la Recherche, DGRI, Juin 2007
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16. Outcome
Repartition of the decisions according to job categories in 2006
Job categories Number of % of the total Number of % of agreements
referrals number of agreements according to the
referrals delivered by the job category
Commission of
Deontology
University 21 27 14 67
professors
University « Maîtres 15 19 11 73
de conférence »
Research Director 18 23 18 100
« Chargé de 11 14 11 100
recherche »
Research engineers 2 3 2 100
Others 10 13 9 90
Total 77 100 65
Source : Etat de la situation et bilan au 31 décembre 2006, Ministère de l’Enseignement supérieur et de la
Recherche, DGRI, Juin 2007
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17. Suggested Readings
 Link to bibliography
G.D. Markman, P.T. Gianiodis, P. H. Phan, D.B. Balkin, Entrepreneurship from the Ivory Tower: Do Incentive Systems Matter? Journal of
Technology Transfer, Vol.29, no 3-4, August 2004
Académie des sciences, Rapport du groupe de travail sur la loi 99-587 du 12 juillet 1999 Innovation et recherche, 1st February 2010
http://media.enseignementsup-recherche.gouv.fr/file/2010/45/9/rapport_Academie_des_sciences_Loi_inno_136459.pdf
Ministère de l’Education supérieure et de la Recherche, Recherche et développement, Innovation et partenariats, Rapport 2008
http://media.enseignementsup-recherche.gouv.fr/file/inov_et_rech_techno_-_rapports/90/5/Bilan_SETTAR_23dec09_131905.pdf
Ministère de l’Education supérieure et de la Recherche, Innovation et recherche technologique, état de la situation et bilan au 31 Décembre
2006 http://www.enseignementsup-recherche.gouv.fr/cid21238/etat-de-la-situation-et-bilan-au-31-decembre-2006.html
 Link to code book
Mobility; Law; Entrepreneurship; Career; Spin-off; Consulting activity; Motivation
 Link to related websites
 Integral text of French Code of Research (see articles L 413-1 and followings)
http://www.legifrance.gouv.fr/affichCode.do?cidTexte=LEGITEXT000006071190&dateTexte=20090921
 Webpage on the 1999 Law on Innovation and Research, Ministry of Higher Education and Research
http://www.legifrance.gouv.fr/affichCode.do?cidTexte=LEGITEXT000006071190&dateTexte=20090921
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