In this blog post, Bharghav Chetankumar Thakkar, pursuing M.A. in business law from NUJS, Kolkata, discusses the concept of intellectual property rights and the intellectual property systems in India. 

 

Introduction

Intellectual property rights have grown to such a position from where it plays is given role in the global economy’s development over the past two decades. In the 1990s, laws and regulations were strengthened in this area by many countries unilaterally. In the multilateral level, there was enhanced protection and enforcement of IPRs to the level of solemn international commitment because of the successful conclusion of the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) in the World Trade Organization.

There is a vast domain of intellectual property. Designs, Copyrights, and Patents Trademarks have since received recognition. Newer forms of the protection are also developing particularly encouraged by the stimulating emergence in technological and scientific activities.

 

The Concept of Intellectual Property

The concept of intellectual property is not new as Northern Italy during the Renaissance period was the first to come up with the framework of the intellectual property system. A Venetian Law of 1474 made the first methodical attempt to protect inventions in the form of a patent, which allowed this right to an individual for the first time. The invention of the printing press and movable type by Johannes Gutenberg around the year 1450, helped in the origin of the first copyright system in the world.

By the end of the 19th century, new creative ways of manufacture caused large-scale industrialisation accompanied by the growth of cities, the investment of capital, expansion of railway networks, and nationalism which led many countries to establish their modern Intellectual Property laws. At that point of time, the International Intellectual Property system also began to take shape with the creation of the Paris Convention for the Protection of Industrial property in 1883 and the Berne Convention for the Protection of Literary and Artistic Works in 1886. The evidence underlying Intellectual Property throughout its history has been that the rewards and credits related to ownership of inventions and creative works encourage further creative and inventive activity that, motivates economic growth.

The Convention establishing the World Intellectual Property Organization (1967) gives the following list of the subject matter protected by intellectual property rights:

  • trademarks, service marks, and commercial names and designations;
  • inventions in all fields of human endeavour;
  • industrial designs;
  • protection against unfair competition; and
  • “all other rights resulting from intellectual activity in the industrial, scientific, literary or artistic fields.”
  • literary, artistic and scientific works; scientific discoveries;
  • performances of performing artists, phonograms, and broadcasts;

The role and importance of intellectual property protection have been listed in the Trade-Related Intellectual Property Systems (TRIPS) Agreement, with the establishment of the World Trade Organization (WTO). At the end of the Uruguay Round of the General Agreement on Tariffs and Trade (GATT) treaty in 1994, it was negotiated that –

“The TRIPS Agreement incorporates, in principle, every form of intellectual property and targets the complementary and firming standards of protection and providing for operative enforcement at national as well as international level. It addresses applicability of general GATT principles and the provisions in international agreements on IP (Part I). It also builds standards for scope, usage, readiness (Part II), enforcement (Part III), acquisition and maintenance (Part IV) of Intellectual Property Rights. Moreover, it addresses related dispute prevention and settlement mechanisms (Part V). Formal provisions are addressed in Part VI and VII of the Agreement, which cover transitional, and institutional arrangements, respectively.”

The TRIPS Agreement came into effect on 1st January 1995 and is considered till date a complete multilateral agreement on intellectual property. The areas of intellectual property it covers are as following:

  • Trademarks which include service marks as well;
  • Industrial designs;
  • Copyright and related rights (i.e. producers of broadcasting organisation, the rights of performers);
  • Geographical indications which include appellations of origin;
  • The layout designs (topographies) of assimilated circuits;
  • The information which is not closed which includes test data and trade secrets;
  • Patents which include protection of new varieties of plants;

 

Intellectual Property System In India

In 1485, the first system of protection of intellectual property came into formation at the Venetian Ordinance, historically, in England in 1623 followed by the Statute of Monopolies, which extended rights of patents for Technology Inventions. In 1760, patent laws were introduced in The United States. Between 1880 and 1889 patent laws of most European countries were developed. In the year 1856, the India Patent Act was introduced which remained in force for more than 50 years it was later modified, revised and called “The Indian Patents and Designs Act, 1911”. A complete bill of the Patent Rights was enacted after Independence in the year 1970 and was called “The Patents Act, 1970”.

Specific statues protected only specific types of intellectual output; till very recently only four forms were protected. The protection was in the form of the grant of designs, patents, trademarks and copyrights. In India, copyrights the under the Copyright Act, 1957; trademarks under Trade and Merchandise Marks Act 1958; patents under Patents Act, 1970; and designs under Designs Act, 1911.

The establishment of WTO and India also being a signatory to the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), led to the passing of many new legislations for the protection of intellectual property rights to meet the obligations internationally. These included the following: Designs Act, 1911 was replaced by the Designs Act, 2000; the Trade and Merchandise Marks Act 1958 was replaced by the Trade Mark Act, 1999; the Copyright Act, 1957 was revised a number of times, and is now known as the Copyright (Amendment) Act, 2012; and in 2005 amendments were made to the Patents Act, 1970. Other than this, plant varieties and geographical indications were also enacted in the new legislations. These are called Geographical Indications of Goods (Registration and Protection) Act, 1999, and Protection of Plant Varieties and Farmers’ Rights Act, 2001 respectively.

Intellectual property rights have developed to a stature from where it plays a major role in developing an economy globally, over the last fifteen years. In the 1990s, laws and regulations were strengthened in this area by many countries unilaterally. In the multilateral level, there was enhanced protection and enforcement of IPRs to the level of solemn international commitment because of the successful conclusion of the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) in World Trade Organization. It is felt strongly that under the competitive environment globally, stronger IPR protection raises the incentives for innovations and raises returns to the international transfer of technology.

 

Development of TRIPS in India 

The Development of World Trade Organisation was a result of International trade calls and framework of trade calls for harmonisation of several aspects of Indian Law relating to Intellectual Property Rights. The TRIPS agreement set minimum standards for the protection of IPR rights and also set a time frame within which countries were required to make changes in their laws to comply with the necessary degree of protection. In view of this, India has taken actions to modify and amend the various IP Acts in the last few years.

Patents Act, 1970

India after signing the TRIPS agreement and forming part of the Agreement establishing the World Trade Organization (WTO) for the purpose of reduction of distortions and impairments to international trade and promotion of effective protection of intellectual property rights, became a signatory, which led to the amendment of the Patent Act from time to time in the year 1995, 1999, 2002 and 2005 to meet its obligations under the TRIPS agreement. Further, it has been amended to support the various technological developments in India, to match with the development of International Intellectual Property Laws; India has also made amendments to Intellectual property rights. The amendments were also aimed at making the Act a modern, harmonised and user-friendly legislation for the protection of national and public interests along with fulfilling India’s international obligations under the TRIPS Agreement.

Subsequently, the rules under the Patent Act have also been amended and became effective from May 2003. These rules have been further amended by the Patents (Amendment) Rules 2005, w. e. f., 01.01.2005. Thus, the Patent Amendment Act, 2005 is now fully in force and is operative.

Trade Mark Act, 1999

The law of trademarks is also now modernised under the Trademarks Act of 1999. A an is a special symbol for distinguishing the goods offered for sale or put into the market by one dealer from another. In India, trademarks were protected for more than four decades as per the provisions of the Trade and Merchandise Mark Act, 1958. India joined the World Trade Organisation from its inception. One of the agreements in that related to the Intellectual Property Rights (TRIPS). In December 1998 India acceded to the Paris Convention.

Also, The Trade Mark Bill which was introduced in 1994, is the result of the vast modification made in the Trade and Merchandise Marks Act, 1958. The said wide can be called modernisation made for easy trading and commercial practices, to increase trading overseas by globalisation and bring investment from abroad and most importantly to make trademark management system as simple as possible and more recognition of the same in the judicial system.

The bill could not be passed but pointed out the areas where huge changes were required, thereafter the Trademarks Bill of 1999 was introduced with the fresh review of the required development in various area, such as trade and commercial practices, globalisation etc., the same was later passed in the Parliament and replaced with Trade and Merchandise Act, 1958 with assent of the President on the date of 30th December, 1999; the introduction of Trade Marks Act, 1999 has been proved to be very fruitful to India for going global in trade and commerce area.

The salient features of the Act mainly include as follows:

  • Earlier only goods and services covered was by way of registration, but in this Act, the infringement has broadened the meaning as it also includes unauthorised use of a similar mark or confusingly similar mark where the goods and services which are very similar and create confusion or chance of confusion stands.
  • Where the unauthorised use of a well-known trademark of India is made, and the interest of the owner is in any way infringed, the action of infringement can be taken against the same.
  • Further, it gave more power to the police by authorising them to seize infringing material without any warrant issued.
The Designs Act, 2000 

Science and technology started boosting up at the beginning of the 20th century, and the urge to provide more reliable judicial system came in place for the better protection of this field and the protection of the industrial designs. Steps were required to be taken to promote more and more development in design industry by providing protection under registered design. Though it was essential to protect the design only to the extent, it was required and not any more than that and to allow the use of available design for free too. The current Act is in line with the TRIPS agreement and therefore in line with the globalisation of trade and commerce.

The Industrial product includes two factors, i.e. artistic work and functioning part of the product. Though in Design Act only artistic work is covered and not functioning part of the product, though the artistic work should be unique and not usual. For example, table with for legs and top would not be considered as design, but the table with unique top and unique style of the bottom can be registered.

Day by day, industrial design is becoming an essential part of a consumer’s life by catching the consumers eyes through unique designs. For the same reason, it has become essential to provide protection to such industrial designs.

The salient features of the Design Act, 2000 can be drawn as follows:

  • Definition of the terms “article”, “design” has been given vide scope.
  • The scope given to the term “prior publication”.
  • An introduction of a provision for delegation of powers of the Controller to other officers and stipulating statutory duties of examiners.
  • Provision of identification of non-registrable designs.
  • Provision for substitution of the applicant before registration of a design.
  • Substitution of Indian classification by an internationally followed system of classification.
  • Provision for inclusion in a register to be maintained on the computer as a Register of Designs.
  • Provision for the restoration of lapsed designs.
  • Provisions for appeal against orders of the Controller before the High Court instead of Central Government.
  • Revoking of the period of secrecy of two years of a registered design.
  • Providing for compulsory registration of any document for transfer of right in the registered design.
  • The introduction of additional grounds in cancellation proceedings and provision for initiating the cancellation proceedings before the Controller in place of High Court.
  • Enhancement of quantum of penalty imposed for infringement of a registered design.
  • Provision for grounds of cancellation to be taken as a defence in the infringement proceedings to be in any court not below the Court of District Judge.
  • Enhancing initial period of registration from 5 to 10 years, to be followed by a further extension of five years.
  • Provision for allowance of priority to other convention countries and countries belonging to the group of countries or inter-governmental organisations apart from the United Kingdom and other Commonwealth Countries.

Provision for Avoidance of certain restrictive conditions for the control of anti-competitive practices in contractual licenses.

The Geographical Indications of Goods (Registration and Protection ) Act, 1999 

Geographical Indication is new in India and recently introduced as a result of the event where persons outside India patented turmeric, neem and basmati. To avoid letting outsiders misusing Indian Geographical Indications and indicating that the goods are not indicated from Indian locality, the Act was passed.

After such an instance, it became necessary to have legislation for registration and to provide adequate protection to geographical indications. The bill introduced in the Parliament and passed with the assent of the president the Geographical Indication of Goods (Registration and Protection) Act, 1999, came into force. The Geographical Indication Registry administers the Act under the jurisdiction of the Controller General of Patents, Designs and Trade Marks.

The salient features of this legislation are as under:

  • Provision of definition of several important terms like “geographical indication”, “goods”, “producers”, “packages”, “registered proprietor”, “authorized user” etc.
  • Provision for the maintenance of a Register of Geographical Indications in two parts-Part A and Part B and use of computers etc. for maintenance of such Register. While Part A will contain all registered geographical indications, Part B will contain particulars of registered authorised users.
  • Registration of geographical indications of goods in specified classes.
  • Prohibition of registration of certain geographical indications.
  • Provisions for framing of rules by Central Government for the filing of an application, its contents and matters relating to the substantive examination of geographical indication applications.
  • Compulsory advertisement of all accepted geographical indication applications and for inviting objections.
  • Registration of authorised users of registered geographical indications and providing provisions for taking infringement action either by a registered proprietor or an authorised user.
  • Provisions for a higher level of protection for notified goods.
  • Prohibition of assignment etc. of a geographical indication as it is public property.
  • Prohibition of registration of geographical indication as a trademark.
  • Appeal against Registrar’s decision would be to the Intellectual Property Board established under the Trade Mark legislation.
  • Provision relating to offences and penalties.
  • Provision detailing the effects of registration and the rights conferred by registration.
  • Provision for reciprocity powers of the registrar, maintenance of Index, protection of homonymous geographical indications, etc.
Copyright Act, 1957

The Copyright Act, 1957 is one of the oldest existing intellectual property rights act. It has been amended quite a few times to align with global trade and commerce. The Act relates to a person’s creativity, it protects the right of, artistic, musical works and sound recordings and cinematograph films. For instance, it provides the copyright to author for his lifetime and 60 years after his death. It is not required to be qualitative work for being eligible to be registered under this act, any unique work with very little in common with any other work can be considered as eligible for this purpose.

Under the Copyright Act, the author not only get the right to the authorship but also gets the right under which without his prior permission his work cannot be amended. If any amendment is done against his will he can be brought into the court by the author, and the Author can get an order to recover any kind of damages and stop such an act immediately.

The digital industry sees Copyright as a very big role. Therefore, computer programming was added in the Act in 1984 as a literary work to give recognition to computer programming and provide protection to the same. Though, the separate definition was provided for the same later in 1994.

Introduction of Computer programming created a lot of confusion for the inbuilt programmes without which a computer cannot run, which could not be transacted for free with the computer. Later in 1999 with an amendment, it was possible to allow selling computers and other similar equipment with the inbuilt programmes for free. It also ensured the growth of the newly introduced internet.

The Protection of Plant Varieties and Farmers’ Rights Act, 2001

India has seen the growth in the industry of research of plant breeds, to give protection to a researcher and to encourage their interest in discovering better breed of plants idea of the Plant Breeders’ Right came in existence. It promises to sustain agricultural progress, as India has a vast portion of land that is agricultural in nature. This makes it very essential.

In the wake of TRIPS under Article 27, it was necessary to provide protection of plant varieties by patenting or by an effective sui generis system or by any combination thereof, to the effect of the same, the Government introduced the Protection of Plant Varieties and Farmers’ Right Act, 2001, to encourage development of new breeds of plants. Though, the act requires more investment in research in both the private and the public sectors to discover or develop new breeds. Further, it also promises to provide better growth in the seed industry and making available to the Indian farmers better quality of seeds.

The Semi-Conductor Integrated Circuits Layout-Design Act, 2000

In past three decades, information technology and digital industry has seen the biggest development, this development gains pace day by day, and can be called the fastest growing sector of the century. The industry has seen a significant change in electronic equipments, computers, telecommunication, etc., and it has also affected human life in the biggest manner by providing advancement in many ways. Microelectronics, which primarily refers to Integrated Circuits (ICs) ranging from, Small Scale Integration (SSI) to Very Large Scale Integration (VLSI) on a semiconductor chip – has rightly been called the core, strategic technology world-over, especially for Information Technology (IT) based society. Integrated circuits require expertise knowledge and the effort to create one depends on the complexity of the output. Hence, it is very necessary to cover the same under IPR and it is also necessary to encourage continuous Research and Development in the field of microelectronics.

As the concept of originality is important, irrespective of the fact that the same is a novelty or not unlike patent law which requires both original and novel ideas. Whereas the copyright law was too general to accommodate the original ideas of scientific creation of Layout-Designs of Integrated Circuits. Due to the same, the necessity to provide protection for Layout-Designs of Integrated Circuits was felt and to reward and encourage an adequate level of investment of human, financial and technological resources. 

Trade Secrets 

Confidential business information that provides a business edge to a competition can be considered as Trade Secret. Such information can be both a manufacturing and/or a commercial secret.

A trade secret can be protected for an unlimited period of time but a substantial element of secrecy must exist so that, except by the use of improper means, there would be difficulty in acquiring the information. Considering the vast availability of traditional knowledge in the country, the protection under this will be very crucial in reaping benefits from such type of knowledge.

Utility Models

A utility model is an exclusive right granted for an invention, which allows the right holder to prevent others from commercially using the protected invention, without his authorization for a limited period of time. In its basic definition, which may vary from one country (where such protection is available) to another, a utility model is similar to a patent. In fact, utility models are sometimes referred to as “petty patents” or “innovation patents.”

Only a small but significant number of countries and regions provide the option of utility model protection. At present, India does not have legislation on Utility models.

The main differences between utility models and patents are the following:

  • The requirements for acquiring a utility model are less stringent than for patents. While the requirement of “novelty” is always to be met, that of “inventive step” or “non-obviousness” may be much lower or absent altogether. In practice, protection for utility models is often sought for innovations of a rather incremental character which may not meet the patentability criteria.
  • The term of protection for utility models is shorter than for patents and varies from country to country (usually between 7 and 10 years without the possibility of extension or renewal).
  • In most countries where utility model protection is available, patent offices do not examine applications as to substance prior to their registration. This means that the registration process is often significantly simpler and faster, taking on an average six months.
  • Utility models are much cheaper to obtain and to maintain. In some countries, utility model protection can only be obtained for certain fields of technology, and only for products but not for processes. Utility models are considered suitable particularly for SMEs that make “minor” improvements to, and adaptations of, existing products. Utility models are primarily used for mechanical innovations.
  • The “Innovation patent,” launched in Australia was introduced as a result of extensive research into the needs of small and medium-sized enterprises, with the aim of providing a “low-cost entry point into the intellectual property system.”

 

Conclusion

To conclude, the various modifications and amendments to earlier Intellectual Property Laws are an indication of India’s move towards a new IPR regime so as to prepare ourselves for global trade competition.

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