How To File Patents In India?

A patent is a form of intellectual property defined as “a government authority or licence conferring a right or title for a set period, especially the sole right to exclude others from making, using, or selling an invention.” The purpose of a patent is to protect the intellectual property created by an inventor for a period of time so that the inventor has first rights over how he wishes to use his patent. A patent can be sold, leased, be used in exchange for royalties, equity, etc. A patent holder however, does not become the holder of the invention unless he has invented it first.

The then British Government of India, during the year 1856, tried to encourage and propagate new inventions termed as ‘exclusive privileges’ in the manufacturing sector. The first invention to be granted Intellectual Property Protection in India was by the Government of India under the petition special privileges to George Alfred DePenning for inventing the ‘Efficient Punkah (fan) Pulling Machine.’

The Indian Patents Act, 1970

Patentable Inventions

The list of inventions patentable are:

  • Process, manner, or method of manufacture or Art
  • Machine, apparatus or other articles
  • Product patent for medicines, food, drugs and chemicals
  • A substance should be produced by manufacturing
  • Computer software  used with hardware or with technical application to industry

Inventions Not Patentable (Sec 3)

The following is a list of inventions that cannot be patented:

  • Any invention obviously contradictory to established laws or that is superficial.
  • Any invention that could be used to exploit the population, contrary to morality, public order, or causes prejudice to life or health (of animals, plants, natural resources, humans,etc).
  • The discovery of a scientific principle, any substance occurring naturally (living or nonliving) or any abstract theory.
  • If no new product is formed nor a new reactant is formed using machines or apparatus. The discovery of a new property or new form of a substance.
  • Mere mixture of chemicals.
  • The duplication, rearrangement or arrangement of known devices.
  • A method of horticulture or agriculture.
  • Any surgical, medical, diagnostic, therapeutic, etc. process for the treatment of humans or animals (to render them free from disease).
  • Animals and plants in part or whole (other than microorganisms).
  • Algorithms, computer programmes, business or mathematical methods.
  • Musical, literary, artistic, dramatic, cinematographic (aesthetic productions or works), or television productions.
  • The mental strategy in playing a game, a mental act, rule, method or scheme.
  • Topography of integrated circuits
  • An invention that is traditional knowledge or which is a duplication or aggregate of known components properties.
  • Inventions related to atomic energy cannot be patentable under Sec 20 (1) of the Atomic Energy Act, 1962.

Application For Patents

The person applying for a patent should apply jointly with another person or alone and can be:

  • The first and true inventor of an invention.
  • An assignee can make an application on behalf of the first and true inventor of the invention.
  • The legal representative of a deceased applicant provided that before death, the applicant was entitled to make such an application.

Form Of Application

  • Every application made shall be for one patent only at the patent office in the prescribed form.
  • An international applicant applying for a patent in India under the Patent Cooperation Treaty must file a corresponding application before the Controller in India. No patent is valid for the entire world because patent law is territorial in nature. Filing an application in India enables a person to file for application at convention member countries which makes the application process easier when applying to multiple countries.

Amendments To The Patents Act And Rules

The Indian Patent Act was amended in 1999, 2002 and 2005. The need for patenting marks of patent agent examination, and chemicals and drugs under Trade Related Intellectual Property Rights (TRIPS) brought about the need for an amendment to the Patent Act.

The Indian Patent Rules were amended in 2003, 2005, 2006, 2012, 2013, 2014 and 2016. The rules were amended to include a fixed fee structure, patent agent exam qualification, appointment of the patent office as searching and examining authority, third category for applicants that are small entities.

The Indian Patents Office

The Office of the Controller General of Patents, Design and Trademarks (CGPDTM) administers the Indian Patent Office, which is an Office of the Government of India that is entitled with administering the laws of patents, trademarks and designs. It is important to note the distinction between patents, designs and trademarks.

Patent Duration

The duration of any patent filed in India is valid for a period of 20 years (irrespective of filing with complete or provisional specification) from the date of filing the application. If an applicant wishes to file an application under PCT, then the term of 20 years begins from the date of international patent filing. If an applicant wishes to file a patent in another country, then he must file the patent with the Patent Office of that respective country (through the conventional filing of an application or through the PCT route) since patents granted in India are valid only throughout the territory of India.

How To Get A Patent?

Get an Idea for a Patent

First get an idea of what has to be patented, and the same has to be presented on paper with a description, drawings and sketches (if necessary) explaining the work of the invention.

Patentability Search

Next, an individual must check the list of patentable inventions. The Patent Act (as mentioned above) entails what constitutes a patentable invention and what doesn’t. Only if an idea is patentable can an individual move forward to the next step. It also enables an individual to search for existing patents in case the idea or patent already exists.

Patent Application

If a patent is at the early stages of its development, then an inventor can file a provisional patent. This enables an inventor to secure a filing date (12 months of time to file complete specification) and it is also lower in cost to file a provisional patent as compared to the cost of filing a complete patent. If an inventor has complete specifications about the invention, then the individual can file for complete specification.

Publication of the Application

After an inventor has filed for complete specification, the application is published 18 months post first filing. If an inventor feels that they cannot wait for the period of 18 months from the date of filing the application, then s(he) can file for an early publication request along with the prescribed fees and the patent would take about a month to be published under an early publication request.

Request for Examination

The controller, upon receiving an RFE request from the applicant, hands over the patent to the patent examiner for examining criteria such as novelty, enabling, inventive step, patentable subject-matter and industrial application. All steps covered till now (from patent application till grant) is termed as patent prosecution. The patent examiner then submits a first examination report to the controller and the applicant which consists of documents of the claimed invention.

Response and Clearing of Objections

Based on the examination report, most patent applicants would receive objections. A patent agent can help create a response to the objections raised in the application. An inventor can communicate to the controller as to why his invention is patentable.

Grant of Patent

After all objects raised in the report are resolved and the patent is deemed to be in order of grant after meeting all criteria requirements, the patent is granted to the applicant as early as possible. The grant of a patent is published in the patent journal.

As we move towards becoming a Product Nation, it is important that companies and individuals own their IP. A Patent can become a competitive advantage in itself and is to be ignored at your own peril!

IPR Workshop for Product Companies

Are you protecting your Intellectual Property (IP) ?, Learn how to Secure your IP and Monetize @  IPR Workshop for IT Industy | Venue : Gulmohar, India Habitat Centre, New Delhi | Date  :  5th June 2014
Intellectual property (IP) is considered a magical word that can be understood only by the experts or the skilled people.

The objective of this Workshop is to bring awareness amongst SME’s / SMB’s / Start-ups of IT Industry on IPR protection & security
and value to them as a business which will help them in protecting their brand for better monetization.

iSPIRT, pioneering the spirit of taking Indian IT products global, in partnership with Exhibitions India Group and NextGen
Telesolutions and supported by Anand & Anand, as Knowledge Partner, bring this knowledge based workshop, educating the industry on:

Intellectual Property rights on all IT and related products
Trade Marks
Copyrights
Appropriately termed as iSMAC – K , the prime objective is to help the expansion and fortification of the Indian Intellectual Property knowledge base, with protection & security of business to venture globally, securely and safely.
Workshop Agenda
Sponsorship Opportunities
Register as Delegate
INR 1500/ Delegate
KEY OBJECTIVES OF THE WORKSHOP
Provide guidelines on building internal systems to meet the challenges in software piracy.
Register and fortify Trade Marks and their appropriate, authorized and legal use.
Register product copyrights and the enforcement in authorized usage.
Build internal and external product / legal documentation to help take the services global and with full protection.
Appropriate formalities available and processes to achieve the above.
Challenges in detecting violations .
Legal resources available within the country and globally in violation, detection and enforcement.
Who should attend?
Entrepreneurs – to protect their rights and build protective systems into their organization.
Start-up companies – to ensure that their solutions and services are well protected in the competitive scenario.
SME’s – to create protection systems before they leapfrog to the future.
FOR MORE INFORMATION, PLEASE CONTACT
Yash Menghani, Senior ManagerMob: +91 99901 67229
Email: [email protected]
ECO-SYSTEM PARTNER KNOWLEDGE PARTNER ORGANISERS
Exhibitions India Group Group Anand & Anand NextGen EIG

Sustaining India’s IT Exports Growth: Why Products are the Way?

Going by its 12th five year plan projections, the Indian government expects that the IT/ITES exports from the country would reach $130 billion by FY 2016-17, up from $69 billion in FY 2011-12. That is a CAGR of 13.6%.

How realistic is it?
The Planning Commission’s (it  has got those figures from IT ministry which in turn would have consulted with the industry before suggesting it) projection is obviously based on the past trends. Between 2002-07, IT exports from India grew by a CAGR of 32.6%. In the next five years, between 2007-12, the IT exports registered a CAGR of 17.2%. Purely going by those number, a 13.6% growth does not seem too unrealistic for the period 2012-17.

But that does not give the real picture. While the government has its own five-year plan periods, and all its numbers are synchronized to those blocks of periods, the industries do not necessarily work that way, least of it, an exports industry.

Indian IT services exports industry had its distinctive growth periods. The period between 2003-04 to 2007-08, was the high growth period when, on an average, the exports grew 30% year on year, growing by a whopping 37.2% in 2004-05. Of course, the industry was much smaller.

The new phase began in 2008-09. From that year onwards, the industry has grown between 5-19%. In short, the growth of FY 2007-08, which belonged to another era, skews the figure for the five year period that the government has taken—2007-08 to  2011-12. A better idea, hence, would be to compare with the CAGR of the four year period 2008-09, which was 14.2%.

On a much bigger scale, is is possible to replicate that kind of growth, with business as usual. The current year growth is not likely to be more than 10-11%, considering that the top companies have grown by 9% in the first nine months. If the first year of the block shows a growth of 10%, it will be panglossian to believe that the exports will grow by 13.6% in the five year period.

That is, if we go on doing business as usual. The 12th Plan document also does not mention any new initiatives in this area that would make one hopeful, unlike in case of semiconductor and electronic design segments, where a lot of new initiatives are listed.

So, how do we sustain the growth? It is difficult to believe that changing a tax structure here or duty structure there for IT/ITES exports would help the industry grow. We need to look at comppletely new areas/new dynamics to make the industry growth accelerate.

I believe engineering services and software products are two such areas which have potential to drive the next phase of growth for Indian IT. Here are the reasons why I bet on these two

  1. Both these areas are not really completely new areas for Indian IT. There are some leve of action already and the world has noticed the ability of Indians in both these areas
  2. The opportunity and scope available to expand is immense. Hence, the growth will be sustainable for some time
  3. There are passionate people and organizations trying to furher the cause of both these segments.

With a little help from government in terms of incentives and promotion, these two segments, I believe, can drive the growth for the industry in the medium term.

This year’s budget could be a great beginning. The government could well begin by announcing some concrete incentives for encouraging creation of software products from India. Here are some of the ideas that are worth exploring (in the area of software products).

  • Creating direct tax incentives for companies engaged in creating software products
  • Incentivizing government department, agencies and private companies in India to buy made-in-India products through a mix of fiscal and non-fiscal incentives
  • Creating product-only SEZs
  • Instituting awards and honors for software products made in India
  • Encouraging software companies to create products for solving e-governnce problems in the country
  • Creating a comprehensive policy statement to encourage creation of Intellectual Property in computing/information sciences in India 

Product Business is Very Different from Services

What is the difference between software services and products? Why is it important for India to be developing products?

First Invest, and Then Reap

The business cycle in a services company starts with sales, and ends with project or product delivery. On the other hand, a product company must first invest in building the solution. Then begins a long and complex business cycle to sell, support and continuously evolve the product. This reversal of sales and engineering sequence has a profound impact on how product organizations get built.

Services industry provides manpower to build software apps and products, which belong to the customer. Typically, IT departments of retail, manufacturing, financial, insurance and other businesses require new applications, or enhancements to existing ones, for in-house use. They turn to Indian companies for design and implementation. Needing long-term support, global product companies establish extension engineering teams at Indian subsidiaries or services companies.

In services, clients own the Intellectual Property (IP). All gains (cost savings, productivity improvements, revenue) and risks are entirely the clients’. The service provider gets paid in proportion to the cost of development, irrespective of whether the pricing model is fixed cost or time and material (T&M).

This means that the services revenue growth is directly linked to number of engineers. The industry’s competitiveness is determined by cost of engineers. But the number of trained software engineers in India, cannot scale indefinitely. Even today, good talent is becoming scarce. Salaries are rising to a point where low-cost economies such as China, Vietnam and Philippines have started to compete. Nevertheless, superior talent, project management expertise, processes, and English language skills continue to provide an edge to India. However, others are catching up, thereby causing a slowdown in the industry’s growth rate.

In comparison, products have the potential to fetch non-linear revenue. A product business creates intellectual property. Once developed, the same solution is sold repeatedly to a large number of buyers.

The graph above shows the famed hockey stick revenue model for a successful product company. A services organization can have positive revenue from day one, and grow very quickly too, but the headcount-centric model will eventually become a drag.

Reprinted from From Entrepreneurs to Leaders by permission of Tata McGraw-Hill Education Private Limited. 

Does India provide a supportive environment for getting value out of innovation?

When we talk about supporting innovation in India, the first things that come to mind are the availability of capital and people with the right skills. But, the efforts and risks involved in innovation don’t make sense unless inventors and firms can get value out of their innovative activity.

When will innovation make money for inventors? That depends on issues like: Are users willing to try out new products and services? Do the capital markets place a premium on companies that are more innovative? Can an inventor protect his innovation from being copied by others, i.e., can he be sure that he (and he alone) will be able to capture the value from the innovation he creates? The right hand side of the framework below captures these “demand-side” factors.

In this article, I will focus on the last question – the issue of value appropriation – and ask a broad question: Does India provide a supportive environment for appropriating value from Innovation?

Appropriating Value from Innovation

To answer this question, I will investigate whether the Indian system for protecting intellectual property provides an effective mechanism for protecting inventor rights. Please remember that there is an exchange relationship at the bottom of the intellectual property system: the State gives an inventor a limited time monopoly to exploit her idea in return for the inventor sharing her knowledge or idea with society. So, a good intellectual property system has to balance the needs of both inventors and society at large.

Of course, I must add that from a firm-strategy perspective, appropriating value does not depend on intellectual property alone. As the graphic below (adapted from VK Narayanan’s book Managing Technology and Innovation for Competitive Advantage) shows, a firm’s ability to appropriate value from innovation also depends on its product market actions as well as its ability to innovate continuously and stay ahead of competitors. But, the intellectual property environment, and IP strategies followed by the firm form an important third prong, and these are the focus of this post.

A Historical Perspective

Independent India started off with a fairly strong intellectual property protection system. This should not surprise us because this was intended to protect the rights of British inventors under the colonial regime. However, there was growing disquiet about this system in the first two decades after independence, particularly in the area of pharmaceuticals where strong patent protection was seen as enabling multinational drug companies to extract monopoly profits from a poor country. As is well known, this culminated in our making important amendments to the Patents Act including removal of provisions to patent new molecules, and providing relatively short periods of patent protection in all cases. The new legislation – the Indian Patents Act of 1970 – is commonly credited with the growth of India’s generic pharmaceutical industry (based on an ability to create new processes for known drugs and scale them up effectively) and some of the lowest priced drugs in the world.

By the 1990s, many things had changed. Globalization was the order of the day, and India had climbed on the globalization bandwagon. International talks were on to provide a supportive environment for global trade. These talks expanded in scope to incorporate intellectual property protection. In 1995, India signed up for the GATT treaty and promised to put in place stronger intellectual property laws by January 1, 2005. India kept its promise, though not everyone is happy about this! But, the timing was right – by 2005, many Indian companies were taking innovation more seriously, and were therefore looking for stronger intellectual property protection for their inventions.

Where do we stand today?

Information

While the law changed, the procedural aspects of patenting have taken time to catch up. One of the important characteristics of a good patent system is easy availability of information about what patents have been issued. For several years this was a major bottleneck in India with such information not available online, and available only through a set of CDs compiled by TIFAC in Delhi. Even now, though there is an online database, it is nowhere as powerful or as comprehensive as the US PTO’s website. I would have thought that with all our software and IT prowess we should have been able to build something better than what the US PTO offers but…

Procedures and Process

Another important procedural issue is the speed with which the Patent Office considers applications, and the quality of the examination process. The importance of this dimension was recognized some years ago and a drive to hire and train patent examiners was launched. But, I saw a recent advertisement of the Controller General of Patents, Designs & Trademarks calling for applications for trademark examiner positions in which they are offering a consolidated salary of Rs. 25,000 per month to people with a degree in law and 3 years experience. I am sure it will be a challenge to get well qualified people at that level of compensation.

In an alternate effort to speed up the process, there was a proposal to involve the CSIR in preliminary screening and evaluation. But this was objected to by many as the CSIR itself is an active player in the intellectual property space and is, in fact, the Indian entity with the largest number of US patents.

While it’s difficult to judge the quality of patent examination, what we do know is that after an initial spurt in the speed of examination and grants, the process has slowed down again at a time when the number of applications is on the increase. Mint newspaper carried a useful graphic recently summarizing the challenge:

The Law Itself

As far as I can make out, there has been reasonably widespread acceptance of the amendments to the Patents Act made in 2004, 2005 and 2006 except for a couple of issues. The first issue is the now infamous Section 3 (d) that seeks to prevent evergreening by pharmaceutical companies by requiring a major inventive step as reflected in enhanced therapeutic value for a molecule to be awarded a patent. This has been a contentious issue almost since Day 1 of the new patents legislation, and a series of refused / cancelled patents to big name pharmaceutical companies has shown that the law has bite.

The second issue has been the issue of compulsory licensing. On March 9, 2012, the Controller General of Patents issued the first post – 2005 compulsory licence to Natco Pharma to manufacture its equivalent of Bayer’s Nexavar, a drug for treatment of kidney cancer. This has raised a hornet’s nest, as it has raised contentious issues like (1) what is a reasonable price for a drug? (2) what constitutes “working” a patent? and (3) what is the appropriate royalty to be paid to the inventor company in the event of compulsory licensing?

It’s fascinating to note that most of the controversies regarding the new patent law in India have centered around the pharmaceutical space. Globally, the big debates on intellectual property in recent times have been in the smart phone space involving companies like Apple, Samsung, and Google (Motorola Mobility). It’s almost as though we live on two separate planets! I suppose the reason for this is that India is still not a big market for high end smartphones and therefore the patent and design wars of this industry have not spilt over into India. But this is also another indication that India has failed to find a place at the high table of the most active innovation domains (see my earlier post on the areas in which India has the most active researchers).

In our obsession with the healthcare domain, we might be missing out on developments in other sectors that call for changes in our intellectual property protection laws. A new generation of software product companies is emerging from India (see my recent article in Outlook Business), and large companies like TCS and Infosys are embracing products and platforms in their quest for “non-linear” growth. But we continue to deny software products patent protection and limit their intellectual property protection to the Copyrights Act.

Awards & Enforcement

Consistent with their position in other matters, Indian courts tend to be conservative in penalties and awards for intellectual property violations unlike the multi-million dollar (or even multi-billion dollar) awards of American courts. In a way that’s good because it prevents intellectual property from becoming a separate game of corporate strategy. But the flip side of this is that there is the distinct possibility that an inventor may not receive adequate compensation for infringement of his intellectual property rights.

This become particularly critical in the case of the small inventor who anyway fights a David vs Goliath battle if the infringer is a large company with the ability to exploit all the procedural opportunities for delay available in the Indian legal system. In fact, if I were an inventor in India that would be my main fear – I may be able to obtain a patent and other forms of intellectual property protection, but will I be able to enforce my patent rights in a meaningful and timely way? Even in the US, the inventor of the intermittent windshield wiper, Robert Kearns had to struggle for years in his battle with large US auto companies (see the graphic below); I shudder to think what would happen to an equivalent inventor in India!

As we go forward, there will also be a need to ensure greater consistency in judicial decisions in the intellectual property domain. Without any disrespect meant to our honourable judges, I can see that in some of the recent judgements they have struggled to cope with the technicalities involved. Not too far in the future, when we have a critical mass of intellectual property cases, it will help to have a single court at the appellate level as has been done in the US.

Conclusion

In the 1950s and 1960s, we saw companies like Xerox and Pilkington Glass that established monopolies in their respective industries based on technologies which had strong patent protection. Today, the pace of innovation in most industries has hastened to the extent that companies need to innovate continually to derive maximum benefit from their innovations. But, intellectual property rights continue to provide the first-level protection for innovator companies.

As India develops a modern industrial economy, and more companies depend on innovation for their competitive advantage, our need to provide an appropriate level of legal support to enable innovative companies to capture the benefit of their innovations will grow. In this, our priority should be on improving IPR-related information flows, better processes and procedures, and enforceability, and on shifting our attention beyond the healthcare industry.

Original article can also be accessed here(from Juggad to Systematic Innovation).