PATENTS AND EFFECTS ON INDIA

Introduction Modern world is marked by Globalisation and Liberalisation. Hence economic reforms have been introduced by many countries like India which has to compete with other countries in the world market. Patent law plays a very significant role in the development of a country. More so because of the advent of the World Trade Organisation in which India has to compete with developed countries like U.S.A. The Paris convention for the protection of industrial property, 1883 was the first convention for the protection of Intellectual Property. It is said the nationals of the signatory country would have equivalent rights and status in all other signatory countries.

Though India was not a member of Paris convention, but having signed the TRIPS agreement, India is now obliged to recognise and implement the provision of “national treatment to nationals of other members” as has been incorporated in the TRIPS agreement. The law of patents has also become an important discipline of international trade and commerce due to great advancement in science and technology, revolutionary changes in computer software development and with the shift from process to product patent, the patent law has been striving to keep pace with the changes in technology. The importance of the subject has grown due to lack of adequate legal literature. The Indian patent system has been modelled on British system to a great extent and the system of the U.S.A to some extent. Meaning and Object of Patent A patent is a set of exclusive rights granted by a state to an inventor or his assignee for a fixed period of time in exchange for the disclosure of the invention. It refers to a grant of some privilege, property, or authority made by a government or the sovereign of the country to one or more individuals. The instrument by which it made is known as Patent. An invention is the creation of intellect applied to capital and labour to produce something new and useful. Such creation becomes the exclusive property of the inventor on the grant of patent.

The procedure for granting patent, the requirements placed on the patentee and the extent of exclusive rights vary between countries according to the national laws and international agreements. Typically, however a patent application must include one or more claims defining the invention which must be Novel, Inventive and Useful. In many countries certain subject areas are excluded from patents such as business methods and mental acts. A patent is a negative right which grants exclusive rights to a patentee to prevent or exclude others from making, using, selling, offering to sell or importing the invention. The patent law recognises the exclusive right of a patentee to gain commercial advantage out of his invention. This is to encourage the investors to invest their creative faculties, knowing that their invention would be protected by law and no one else would be able to copy their inventions for certain period during which the respective investors would have exclusive rights. International Character of Patent

1. Paris Convention A key international convention relating to patents is the Paris convention for the protection of industrial property, initially signed in 1883. The Paris convention sets out a range of basic rules relating to patents, and although the convention does have direct legal effect in all national jurisdictions, the principles of the convention are incorporated into all notable current patent system. The most significant aspect of this convention is the provision of the right to claim priority i.e., filing an application in any one member state, and receive the benefits of the original filing date. Because the reference to a patent is intensely date driven, this right is fundamental to modern patent usage

2. TRIPS Agreement The WTO was established through the agreements known as ‘MARKKESH’ agreement establishing the WTO. Intellectual property was not a part of WTO until the Uruguay round. It was introduced in the Uruguay round especially by the developed countries to be a part of WTO and it got the status in the WTO in the form of an agreement which is known as trade related aspect of intellectual Property rights (TRIPS). Intellectual property was opposed by some developing countries to be a part of WTO as they argued that “it is a tool used by the developed countries for exploiting the developing countries and colonizing them”. However their opposition failed and TRIPS agreements was finally signed on 15th April 1994 by nearly 125 member countries. However it came into effect on 1st January 1995.

3. Conflict between Product and Process patent Under the WTO (world trade organisation) regime, one of the most debated issues in the international negotiations is the issue of standardising and strengthening the patent systems across the world. The debate gathered momentum due to the DUNKEL proposal related to TRIPS. The issue of similar patent standards across the countries led to a sharp division between the advanced developed countries (North) and the developing countries (South). In the southern countries (e.g., India), the governments usually practice process patent regime and that too with varying degree of enforcements under their laws. The North, on the other hand always insisted on the product patent regime in the South as practiced in the North. The issue created lots of discussions since many southern countries has to comply with the product patent in near future under the current WTO regime. The question of whether the north prefers product or process patent in the south is very important. The conventional economic reason underlying the conflict of interest between Northern and Southern countries is easy to see. Northern countries are the major producers of newer technologies. Southern countries on the other hand depend a lot on the North for technologies needed for their growth and development. In case of process patent in the South, it is often be the case that the southern firm develops a different process of production that uses some of the cheap resources available in the South. As a result the Northern firm faces competition from the Southern firm in the Southern market and thereby it is derived of some of the monopoly benefits it could derive from selling the products in the south. On the other hand, if south practices product patient, Northern firm is protected from any competition in the same product in the southern market. Thus, product patent in the South would allow northern firm to get the monopoly benefit in the South. Hence, Northern firm would prefer product patent in the South.

4. Transitional period TRIPS agreement came into effect on 1st January 1995 and was applicable to all member countries. However, the agreement allowed member countries different periods of time to delay applying its provisions in their respective countries. These delays define the transition from before the agreement came into force (before 1 January 1995) until it is applied in member countries.

The main transition periods are:

• Developed countries were granted a transition period of one year following the entry into force of the WTO Agreement, i.e. until 1 January 1996. • Developing countries were allowed a further period of four years (i.e. to 1 January 2000) to apply the provisions of the agreement other than Articles 3, 4 and 5 which deal with general principles such as non-discrimination.

• Transition economies, i.e. members in the process of transformation from centrally-planned into market economies, could also benefit from the same delay (also until 1 January 2000) if they met certain additional conditions.

• Least-developed countries are granted a longer transition period of a total of eleven years (until 1 January 2006), with the possibility of an extension. For pharmaceutical patents, this has been extended to 1 January 2016, under a decision taken by ministers at the Fourth Ministerial Conference in November 2001.

5. Introduction of Pharmaceutical Product Patent in India Issue of pharmaceutical product patent as per TRIPS agreement was once again a cause of concerns for India and international community. India being a social welfare state, the Indian Patent act was framed in a manner that ensured that the patents rights relating to pharmaceuticals could be regulated by the government. The patent act, 1970 also excluded agricultural products from patentability. Both the above provisions were aimed at keeping the prices low, ensuring adequate supply and growth of the Indian industries. Now, India being a member of WTO has to implement TRIPS agreement in totality. However by virtue of Article 65(1), (2), (3) and (4) India has to provide within 10 years effective product patent in pharmaceutical industries. Principles Underlying the Patent Law in India The Indian Patents act, 1970 and the patent rule, 2003 regulate the grant, the operative period, the revocation and infringement, etc, of the patents. The patent act was amended in 2005 and 2006 for the purpose of contemporary adjustment in patent laws. The principle upon which the Indian patent law is based is enumerated below:

Novelty or inventiveness: The element of novel invention is dependent upon the state of prior art, i.e. the existing knowledge and similar inventions already known in the particular field. There would be no novelty if there has been prior publication and prior use of the same or an identical invention. E.g. The recent grant of patent in USA to Turmeric products was challenged on this ground, the Indian council of scientific and industrial research (CSIR) challenged the grant of patent on Turmeric by the US patent office on the ground that patent could not be granted since there was no novelty in the invention. Also, that what was patented was already published in Indian texts and use of Turmeric preparations has been made in our country since time immemorial. The CSIR was successful in getting the grant of patent to an American company revoked.

Usefulness or utility: The invention besides being new and non-obvious must also be useful. An invention which is new and also non-obvious but which cannot be put to any beneficial use of mankind cannot be patented. In some countries, not so useful inventions are protected as utility models. But that concept is not statutorily recognised in India.

Non-obviousness: The invention must be non-obviousness to a person reasonably skilled in the art to which the invention relates. Provisions in U.S: How Different From India Patentability in USA:

Novelty: In US novelty implies to absolute enquiry on the invention. A single reference can be made to all the elements of the applied claims. First to invent/first to file: In USA, a person who has invented first gets the priority i.e. novelty is established to that person over the one who invented later on but files the application before the first who invented. The prior art i.e. any predated reference available before filing is applicable in US. In case of two persons making an invention differently on the same day, the person who files first gets the seniority, this is called Striking Interference. In India however, a person who files the application first, gets the priority. There is no concept of first to invent in India.

Inventive entity (non-obviousness): Unlike India where patent is granted only for inventions, in US patent is granted for inventions as well as discoveries. Utility: In US invention has to useful to be patented. Procedure:

Who can apply: In India, only true and first inventor or his assignee may apply for the patent whereas in US, only the inventor may apply for the patent.

Opposition: Unlike India, where concept of both pre-grant as well as post-grant opposition is there. In US, only post grant opposition is allowed. India’s Position in Patent Globally Patent Cooperation Treaty: A treaty establishing a system for international patent filing which allows for a single international patent application to have effect in multiple designated States, international search, international publication and optional preliminary examination.

The PCT system is a patent filing system and not an international patent granting system. Patents are granted at the national level. The Patent Cooperation Treaty (PCT) is an international patent law treaty, concluded in 1970, amended in 1979, and modified in 1984 and 2001. It provides a unified procedure for filing patent applications to protect inventions in each of its Contracting states. A patent application filed under the PCT is called international application or PCT application. The treaty makes it possible to seek patent protection for an invention simultaneously in each of a large number of countries by filing an "international" patent application. Such an application may be filed by anyone who is a national or resident of a Contracting State. It may generally be filed with the national patent office of the Contracting State of which the applicant is a national or resident or, at the applicant's option, with the International Bureau of WIPO in Geneva. Any Contracting State to the Paris Convention for the Protection of Industrial Property (1883) can become a member of the PCT. A majority of the world's countries are signatories to the PCT, including all of the major industrialized countries. As of November 1, 2008 there were 139 Contracting States to the PCT. India became a member of PCT on December 7, 1998.

International Searching Authority: The International application or PCT application is subjected to what is called an "international search." That search is carried out by one of the major patent offices appointed by the PCT Assembly as an International Searching Authority (ISA). The World Intellectual Property Organization (WIPO) has granted the Indian Patent Office the status of International Search Authority (ISA) and International Preliminary Examining Authority (IPEA) from January 01, 2008 onwards.

Total number of application filed, patent granted etc: In the year 2006, more than 1.7 million patent applications were filed worldwide, out of which 727,000 patents were granted across the world. United States patent and trademark office (USPTO) was the largest recipient of patent applications with a total of 425,966 applications. The non residents filing share of total patent filings increased to 45.6 % in 2006. By the end of 2006, approximately 6.1 million patents were in force. In India, 28,940 patent applications were filed in 2006-07. The total number of patents granted was 7539 out of which only 1,907 were given to Indians. The total numbers of foreign applications was 19,768. U.S.A led the foreign applications with a total of 6,955 applications. The majority of applications were filed by the non residents. The total number of patents in force was 17,066 by end of March 2007 of which 3,473 patents stands in the names of Indians.
*Courtesy Legal Service India