22 December 2021
On 23rd July 2021, the Department Related Parliamentary Standing Committee on Commerce presented 161st Report on “Review of the Intellectual Property Rights Regime in India” in the upper house of Indian Parliament (Report is available at: https://rajyasabha.nic.in/rsnew/Committee_site/
Committee_File/ReportFile/13/141/161_2021_7_15.pdf). The report indicated that Intellectual Property (IP) is essential for the holistic growth and development of a country and emphasised on promoting and developing the IP environment in India by considering measures at different fronts and suggesting a consolidated approach.
General observations and recommendations of the Committee on IP ecosystem include:
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Need to undertake studies analysing impact of IPR on the growth of Indian economy– The Committee notes the significance of IPRs, especially for encouraging Foreign Direct Investment (FDI), wherein one per cent improvement in protection of trademarks, patents and copyright increases FDI by 3.8, 2.8 and 6.8 per cent, respectively.
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Review of IPR policy– India adopted a comprehensive National IPR policy in May 2016, to stimulate innovation and creativity across sectors, and provide a clear vision regarding IPR issues. The report stresses that re-assessment of the policy is imperative in the wake of new and emerging trends.
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Public Awareness – The Committee was of the view that, instilling a culture of IPR in the entire country, encompassing rural and remote regions, by generating awareness to claim rights on innovations and inventions is the key for strengthening IPR regime. To increase this awareness,the Committee has recommended few measures, which are as follows:
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Establishing IPR Facilitation Centres in Tier-I, Tier-II and remote regions of the country with a focus on enhancing the awareness of Micro, Small and Medium Enterprises (MSMEs), small businessmen and traders.
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Organizing training programmes and workshops to inculcate scientific temperament and knowledge about identification of novelty in the products and protection of such novelties as IPRs. The Committee recommends beginning at the grassroot level in schools, colleges etc., by introducing IP courses and curriculum.
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Encouraging MSMEs and giving requisite assistance to register their IPRs in foreign countries, where they have the potential to expand their trading base, so that they become globally competitive.
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IP Financing– To encourage financing in IP, which is lacking in India, the Committee recommended that the Department should undertake committed measures in generating awareness and better understanding of IP financing, valuation and monetization. It also urged the Government to explore plausible ways to devise a uniform system of valuation of IP as an intangible asset in the country which would ensure a better evaluation of assets by financial institutions. The Committee also recommended the Department that a provision of IP funds should be created in the country which would help in supporting initiatives.
Apart from general recommendation, the Committee also made subject matter wise specific recommendations, which are as follows:
Patents:
In view of the changing trends of technologies and innovation, the Committee has recommended to review the provisions of the Indian Patents Act, 1970 particularly those which deals with the patent ineligible subject matters:
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The Committee has recognized arbitrary exercise of powers by Controllersof Patents while refusing grant of patents on the grounds of “contrary to public order or morality or which causes serious prejudice to human, animal or plant life or health or to the environment.”The Committee has recommended to amend the provisions of Section 3(b) of the Act, to safeguard against such practice. It is also recommended that said provision be amended to limit the exclusion to only those inventions which are barred under any law for the time being in force.
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The Committee has also recommended to explore the feasibility of granting patents to non-living substances occurring in nature, which, along with discovery of living things, are currently barred for patenting under Section 3(c).
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The Committee has also recommended that thorough analysis should be preformed to ensure granting of patents to plants and seedsfavourable to agriculture sector.
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The committee has also touched upon the issue of evergreening. It agreed that the provision of Section 3(d) is in complete harmonization with the TRIPS agreementand alsoobserved that this provision has guarded against frivolous successive patents intended to make the invention ‘evergreen’.
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The Committee also recommended to review Section 3(p) of the Patents Act for debarring the traditional knowledge of individuals, communities and manufacturers exhibiting traditional knowledge and indigenous inventions in their creations for ensuring growth of an inclusive IPR regime in India.
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The Committee also recommends the Government to address the structural issues in implementing a systematic mechanism of documentation and preservation of traditional knowledge in the country along with taking measures to strengthen Traditional Knowledge Digital Library TKDL as an effective database.
Compulsory License
The Committee noted the significance of issuing Compulsory Licenses to manufacturers andindividuals for utilizing the patents to serve public needs during circumstances of emergency and crisis such as this COVID-19 pandemic. The Committee, therefore, recommended that the Government should delve into the prospect of temporarily wavering patents rights and issuing Compulsory Licensing to tackle the inadequacy in availability and accessibility of Covid-19 vaccines and drugs.
Relaxation recommendations
In one of its recommendation, committee has suggested to examine the stringency of Section 122(2) and to make necessary amendments to relax the provision related with imprisonment.The Committee also recommended to consider relaxing the requirement to furnish information under the Form 27 on a yearly basis to ease the compliance burden on universities, R&D institutions, start-ups, and small enterprises.The Committee also recommended that the timeline of 4 years to request for examination by the patent applicant may be shortened to a reasonable time frame to avoid any unnecessary delay in examination and grants of patents.
Visionary Recommendations:
The Committee has made several recommendations that not only address the current needs of the Patent law but pave way for overcoming future challenges and changes. With rising awareness of IP and consequently, rising number of contentious matters, the Committee has recommended to amend the provision of jurisdiction to promote establishing of alternative dispute resolution mechanism in India such as arbitration, mediation, etc., for ensuring speedy justice to right owners in IPR litigations. The Committee opined that labelling of products with ‘patent pending’ would acknowledge their credibility and authenticity hence yieldmarketing benefits to the patentees. It further recommended that the Department should make efforts in reviewing the existing legislations such as the Patents Act, 1970 and Copyright Act, 1957 to incorporate the emerging technologies of AI and AI related inventions in their ambit.
The Committee also recommended to explore and study patenting of Utility Models and its implementation in different countries for ascertaining it being considered as an alternate IPR in India.The Committee also recommended to explore opportunities in establishing PPH with other nations/countries and, also to carry out impact assessment of the Japan PPH model, which India already has, before venturing on PPH programs with other countries. Above all, the Committee highlights the need for supplying more manpower to the IP Office.
Copyrights
In the area of Copyright, Committee has recommended:
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Encouraging a ‘fair and equitable’ ecosystem in literary works culture in the light of famous DU photocopy case on the issue of conflict between fair use and publishers’ copyright. It has recommended making changes to section 52(1) of the Copyright Act to permit storage of reprographic works in Government owned educational institutions; and at the same time imposing limitations on the scope of education related fair use exception so that unrestricted copying of literary works as well as storing digital versions thereof can be checked. It has further recommended establishment of community libraries and upgradation of existing libraries for providing easy public access of foreign publishers’ highly expensive works.
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Increasing the term of registration of the Copyright Societies under Section 33(3A) of Copyright Act from 5 years to 10 years.
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To include ‘internet or digital broadcasters’ within the scope of Section 31D of the Copyright Act which relates to statutory licensing for radio and television broadcasting of sound recordings under which the broadcasters get the license to exploit the works by way of giving a unilateral notice to copyright owners and paying them the royalty at the rate fixed by the Copyright Board.
Trademarks
With regard to trademarks, the Committee has recommended to:
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provide an elaborate and specific classification of goods and services under the Trademarks Act to meet the requirements of evolving industry and trade.
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curtail the time-period of filing opposition against a trademark application from 4 to 2 months.
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Modernize trademark offices and workplaces by “undertaking digitalization of work processes and facilitating e-services for speedy redressal of work”.
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Streamline and simplify procedures regarding search and seizure operations under Section 115 of the Trade-Marks Act, with an aim to expedite investigations. It has been recommended that a well-trained police officer specialized in tackling IP crimes should be deployed in place of a deputy superintendent of police; the Registrar of Trade Marks should be connected through a software and the opinion that the police is required to seek from the Registrar should be delivered in 48 hours rather than 7 days.
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provide for a separate category for Export Oriented Units (EoU) products in order to give them priority so that the registration of their trademarks could be expedited and they can export their products in time.
Counterfeiting and Piracy
Starting with an acknowledgement that counterfeiting and piracy are the rising threats to IPRs the Committee has recommended a specific legislation to curb counterfeiting and piracy to restrain the menace of IP crimes in India. Since IP counterfeiting and damages are indispensably related, it has been opined that a determinate method to estimate the revenue losses being incurred due to counterfeiting and piracy and the level of such crimes being committed should be devised, especially from economic point of view. It has also been recommended to consider establishing a Central Coordination Body on IP Enforcement for undertaking coordinative efforts by involving various Ministries, Departments, and Governmental agencies.
Trade Secrets
The Committee has acknowledged the need for businesses which possess secret formulas, business strategies, algorithms, etc. to secure the same and maintaining its confidentiality. In view of thereof, the Committee has recommended enactment of a separate legislation or a framework for protection of trade secrets, after referring to laws in other jurisdictions.
Geographical Indications (GI)
The Committee report captures the declining trend in seeking GI protection which is evident from drop in number of filings and registrations. To reverse this trend, the Committee has recommended concerted efforts should be taken by both the Department for Promotion of Industry and Internal Trade (DPIIT) and GI Registry to generate awareness in the country about the importance of GI in imparting uniqueness to a product related to its place of origin. Further to prevent duplicity, infringement and unfair competition of GI tagged products causing economic losses, there has been a recommendation to have an enforcement mechanism through a centralized agency to ensure compliance that of GI tagged products.
Reconsider reviving Intellectual Property Appellate Board (IPAB)
The committee favoured reviving IPAB and recommend empowering and strengthening IPAB with more structural autonomy, infrastructural and administrative reforms, as well as ensuring timely appointment of officials and experienced manpower.
The recommendations also suggest setting up of various government nodes such as an apex level institution for IPR development, National IPR agency to facilitation coordination between industries, government and international agencies; and state level innovation councils for increased role of state government in promotion and development of IPR. The overall observations and comments of the Committee indicated that the importance of IPR was analysed and understood from the economic point of view.
Authors: Manisha Singh and Varun Sharma
