Review of the IPR regime in India by Parliamentary Committee in India

Nicolas Gutierrez Douënel

IP Advisor - India IP SME Helpdesk

In the course of this past summer of the year 2021, the Parliamentary Committee on Commerce of the Indian Parliament issued its review of the intellectual property regime in India (“the Report”). This Report constituted an opportunity to review the implementation of India’s 2016 “National IPR Policy” launched 5 years ago with the stated objectives of raising IPR awareness, stimulating the registration and generation of IPRs, modernising and strengthening the IP administrations and enforcement mechanisms, as well as creating value for the economy through the stimulation of commercialisation of IPRs.

 

 In light of recent developments, the review was particularly timely. Indeed, IPR has taken an important part in the public debates in the past year, especially on the issues related to the opening of patents for COVID-19 vaccines, for which India was one of the biggest advocates. Furthermore, the closing of the Intellectual Property Appellate Board (IPAB) as part of the Tribunal Reforms last spring has created waves in the Indian IP World. As a reminder, the IPAB was the body possessing the power to, inter alia hear appeals against decisions of the Indian Trade Mark Office or Patent Office. Unsurprisingly, the Report calls for the restoration of the IPAB, which for all its faults, proved better equipped to handle complex cases than the High Court. At the very least, it calls for the creation of dedicated IP benches at the High Court for a better management of complex IP cases.

 

This Report, as its name suggests, aimed to represent and oversight of the Indian IP ecosystem, including an analysis of the IP regime to the promotion of innovation and entrepreneurship in the country, as well as an examination of the main challenges in the creation and strengthening of a strong IP regime, especially in terms of procedural constraints, low awareness of IPR, counterfeiting and piracy.

 

The findings

 

State of IP and IPR awareness in India

 

After initially noting the positive correlation between the existence and use of IPRs in an economy with the growth of Foreign Direct Investment (FDI) in this economy, it noted that unfortunately India ranks way behind other larger economies, including China, in the numbers of IP filings and grants. For example, despite marked increase in the past few years, the total number of patents granted in India amounts to little over 5% of patents granted in competing economies such as China. Nearly 2/3 of the patents granted in India in that time had been applied for by foreign entities, meaning much of the innovation being protected in India was not created in India, but rather imported by foreign entities for commercialisation or exploitation.

 

One of the key elements for this failing found by the Committee was the lack of awareness regarding IP rights across the Indian population, including among business owners, traditional artisans and craftsmen whose work would be in large part be subject to IPR protection. To remedy this an IP Fund is proposed by the Committee, dedicated to instil IP culture across India, including in the most remote regions where the population to a large extent still uses traditional and indigenous knowledge which should be protected.

 

Lack of personnel at the Patent office

 

Another weakness of the Indian IPR regime highlighted by Committee is that while the numbers of patent registrations is much lower than might be desired, as described above, the Indian Patent Office proves understaffed and without the manpower necessary to process all patent applications within an optimal time frame. Furthermore, the number of patent applications is growing at a much higher rate than the number of new patent examiners.

 

Based on this, the Committee demands that the recruitment of the IP offices be accelerated, and the working conditions of IP officials be provided to a level so as to ensure they are retained and do not move on looking for jobs elsewhere.

 

Furthermore, it recommends that the Indian Patent Act be amended so as reduce the timeline of 4 years for the filing of examination reports, showing the intention to reduce the time necessary for the full patent grant procedure. This will be hard to put into practice unless the Indian Patent Office is given more manpower to handle applications more rapidly.

 

Patent Prosecution Highway

 

India participates in one Patent Prosecution Highway (PPH) agreement, with Japan. These initiatives are tool which aim to help the fast prosecution of patent applications by allowing equivalence in the patent granting process between applications for a same invention filed in different countries. The Committee claims that the development of further PPH agreements with other countries should be considered, once an impact assessment of the Japan PPH model has been made.

 

Suggested amendments to the main Indian IP Laws

 

Additionally to suggestion of a more general nature regarding IP policy and administration, the Report also includes several recommendations or amendments of Indian substantive intellectual property legislation. Here are some of the standout recommendations which may be of interest:

 

• Patent licensing: the Committee expressed its support for Indian legislation regarding compulsory licensing which has come under strong scrutiny following India’s support for the opening of patents for COVID-19 related inventions. The Committee notes that the legislation strikes a good balance between the interests of IP holders and those of the general public, bringing forward the argument that only one compulsory licence was ever granted by Indian courts. The Report specifically states that in times of pandemic, they can prove a useful tool should the normal IP system fail to bring the necessary innovation to the market.
• Patent’s Statement of working: Indian patent law currently requires patent holder to deliver a yearly statement of working of the patent (Form 27) in which description of the use of the patent in India is detailed. The Report suggests that this requirement should be relaxed for universities, R&D institutions and SMEs, to avoid it being an unnecessary weight on patent holders which may not have the capacity or which may face unreasonable consequences for failure to strictly comply with this requirement.

 

• Section 52(1) of the Copyright Act: s52(1) lists the exceptions to copyright protection, i.e. where a copyright protected work can be used by third parties without the consent of their owner without facing an infringement claim. The Committee recommends that this section be reviewed to strike a better balance between the interests of the copyright holders and the general public’s interest in having access to creative and informative works. Specifically, it recommends that public education organisations should be allowed to store reprographies of protected works for the interest of students.

 

• Geographical Indication enforcement: the Committee recommends that a Central Agency be created to ensure compliance with rules regarding the tagging of GI signs. Enforcement of these is suboptimal and detrimental to the reputation of Indian GI-tagged products abroad.

 

 

The report concludes by stating that an “IP Audit” should be conducted throughout the Indian economy, for assessing and evaluating IPR potential in specific sectors, in order to design a policy of targeted IP programs, thereby promoting innovation and the protection of intellectual creation in the Indian economy.

 

As a final note, it should be noted that the recommendations of the Committee as expressed in this report are not mandatory, and it remains to be seen what the Parliament and Indian policy makers decide to make of these recommendations. From the perspective of EU companies looking to protect their IP rights in India, suggestions such as the strengthening of the judicial system on IP matters, or calls for the hiring of more patent examiners can only be welcome.

 

You can read the full report here.