India - Protecting Intellectual PropertyIndia - IPR
In any foreign market companies should consider several general principles for effective management of their intellectual property. For background on these principles please link to our article on Protecting Intellectual Property and also Corruption.
Intellectual Property Rights
India remains one of the world’s most challenging major economies with respect to protection and enforcement of IP. Despite positive statements and initiatives upon which the Modi Administration has embarked, the pace of reform has not matched high-level calls to foster innovation and promote creativity. India has yet to take steps to address longstanding IP issues that are affecting innovative industries. India was listed on the Priority Watch List in USTR’s Special 301 report for 2017. The country continues to remain the home to several “Notorious Markets” across the breadth of the country, according to USTR’s latest report in [November 2016].
Engagement and Developments
Engagement with India on Intellectual Property Rights (IPR) continues, primarily through the Trade Policy Forum’s Working Group on Intellectual Property. In 2016, India released its comprehensive National IP Policy, with its primary focus being on awareness and building administrative capacity. The portfolio of Copyright and Semi-Conductors shifted to the Department of Industrial Policy and Promotion, Ministry of Commerce. The Cell of IP Promotion and Management (CIPAM) was set up and is tasked with implementing the IP Policy and interagency coordination. In 2016, the state of Telangana set up India’s first IP Crime Unit, to combat the menace of internet piracy. The Commercial Courts of two states became functional and industry saw some positives decisions coming on the patent front. The US Government enhanced its engagement and conducted two workshops with Government of India, one on Copyright and one on Trade Secrets. In addition, the Patent Rules as well as the Trademark Rules were amended. The Copyright Board was merged with the IP Appellate Board. The Indian Patent Office hired 458 examiners to address the issue of patent and trademark backlog.
Legislative Climate in India
India has adequate copyright laws, but enforcement is weak and piracy of copyrighted materials is widespread. The U.S. government has advocated for the creation of anti-camcording legislation, which would have a significant impact on stopping digital piracy in India. This legislation would also improve India’s ease of doing business rankings, as well as send a signal to investors and entrepreneurs that the government values transparency, predictability, and the rule of law. As of early 2016, Indian government interlocutors said that an anti-camcording bill is currently being circulated for inter-ministerial discussions and could be introduced in the next session of Parliament.
Pharmaceutical and agro-chemical products can be patented in India. Plant varieties are protected by the Plant Varieties and Farmers’ Rights Act. However, the interpretation and application of the patent law lacks clarity, especially with regard to several important areas such as compulsory licenses, pre-grant opposition provisions, and the scope of patentable inventions (e.g., whether patents are limited to new chemical entities rather than incremental innovation). Indian law does not protect against the unfair commercial use of test data or other data submitted to the government during the application for market approval of pharmaceutical or agro-chemical products. The Pesticides Management Bill (2008), which would allow data protection of agricultural chemical provisions, stalled in the previous Parliament.
Indian law provides no statutory protection of trade secrets. The Designs Act allows for the registration of industrial designs. The Designs Rules, which detail classification of design, conform to the international system and are intended to take care of the proliferation of design-related activities in various fields. India’s Semiconductor Integrated Circuits Layout Designs Act is based on standards developed by WIPO; however, this law remains inactive due to the lack of implementing regulations.
Customs officers have ex-officio authority to seize and destroy counterfeit goods, though rights holders must pay for storage and destruction of counterfeit materials. In the past few years, with regular training customs and police enforcement has marginally increased. The new customs recordation system allows trademark owners to record their brands and trademarks with the ministry and seek affirmative action in case of any counterfeit issue at the ports. In 2016, as a state level initiative was taken by the state of Telengana and India’s first IP Crime Unit was established, which would focus on IP Crimes and in particular on online crimes. The US is encouraged by this event and hopes that other states will follow suit. India offers all types of counterfeit goods for sale; the seven most vulnerable sectors for IPR crime include automotive parts, alcohol, computer hardware, fast-moving commercial goods (FMCG) for personal use, FMCG packaged foods, mobile phones, and tobacco products.
Recently, the filing of trademarks was simplified by the reduction in the number of forms an applicant had to file.
New Areas of Concerns
Despite, these positive developments, 2016 also saw some new issues in the field of intellectual property came to light in the following sectors: (a) agriculture; (b) software and (c) pharmaceuticals.
- Just days after the National IP Policy, the Ministry of Agriculture released the “Licensing and Formats for GM Technology Agreement Guidelines, 2016” (GM Licensing Guidelines). This measure would force companies to license their technology as well as impose unprecedented up-front terms and conditions on private party transactions covering a broad range of genetically-modified agricultural products. The GM Licensing Guidelines called for immediate termination of all private licensing agreements, following which, each company would have 30 days to enter into a new license agreement prescribed by MAFW. However, on May 24, the government rescinded the GM Licensing Guidelines notification following concerns expressed by high-level interagency officials and business leaders. MAFW then re-issued the guidelines in draft form, open for comments. There is has been no open stakeholder engagement on this issue at the moment. The Government of India’s refusal to strongly repudiate MAFW’s GM licensing guidelines has already resulted in the withdrawal of next-generation innovative biotechnology from the Indian marketplace, and has given pause to many other companies who seek to protect their innovative products. Furthermore, MAFW wrote to DIPP requesting them to revoke Monsanto’s patent on the grounds that the patent was against public interest.
- In the field of software patents, India released the revised Computer Related Invention Guidelines for examination of patent applications in February 2016. These revised guidelines, requires the patentable software to be applied to a novel hardware, restricting the patentability of software in India. The US Government and industry are working with GOI to provide clarity on this issue.
- In April of 2017, the Ministry of Health and Family Welfare (MoHFW) by way of a notification removed the requirement for companies to inform whether a drug is under patent or not at the time of filing for a manufacturing license. This is a regressive step and against the IP Policy that calls for better center and state coordination. This coupled with liberal price controls for pharmaceuticals and medical devices, creates uncertainty for the sector.
- India also actively engages at multilateral negotiations and the WTO TRIPS Council. India has strongly supported and sometimes led the charge in calling for open technology transfer, liberal use of compulsory licensing cross sectors, price controls and protection of traditional knowledge. These negotiations will have an impact on innovation, trade, and investment in IP-intensive products and services.
IP Attaché Contact for India (Acting)
Ms. Komal Kalha
American Centre, 24 Kasturba Gandhi Marg, New Delhi, 110001
+91 11 2347 2000
India Trade Development and Promotion Intellectual Property