Nishant Sharma assesses the government’s efforts to build an intellectual property eco-system that works for IP creators, buyers and the country at large

India has one of the most forward-looking sets of IP legislation in the world. However, a need has always been felt for a strong support framework that would provide a firm foundation to all IP creators and IP buyers alike. Bill Gates once remarked – “Intellectual property has the shelf life of a banana.” In this fast-paced techno-centric world it is imperative that India, which is one of the biggest test-beds for burgeoning intellectual capital, should have an environment that supports the three arms of any IP regime – intellectual property protection, enforcement and monetization.

Realizing an ambitious dream

To begin with, a lot has been done to strengthen the IP protection arm by way of the Patents (Amendment) Rules, 2016, which introduced sweeping changes in reducing the time period for obtaining a patent in India, at least for a limited class of patent applicants. This makes one think – what is in store for strengthening the other two arms? Well, help is definitely in sight. A recent intriguing proposal by the government, according to various news reports, is to start an IP exchange under the auspices of the Ministry of Science and Technology and the National Research Development Corporation (NRDC). The announcement, which came in July 2017, was followed by a statement from the chairman and managing director of the NRDC as per which the IP exchange may be up and running in a period of eight-to-nine months until which time the NRDC would be collecting relevant information regarding the existing IP pool in India. The inclusion of the NRDC in this plan ticks all the right boxes as the organization is adept in facilitating commercialization of technical know-how in India, which is evident from the fact that the NRDC has facilitated signing of close to 350 licences in the last 10 years. This ambitious plan augurs well for the country’s IP ecosystem in view of the National IPR Policy formulated by the government.

The proposed IP exchange appears to be a step towards realization of some key action points (see box). While modalities and scope of work of the proposed IP exchange have not yet been divulged by the government, a quick review of the proposals in the National IPR Policy provides some insight. Specifically, the IP exchange may facilitate access to a database of Indian IP as well as a global database of creators/innovators, market analysts, funding agencies, IP intermediaries and the like; identify opportunities for marketing Indian IPR-based products, especially geographic indicators and services to a global audience; and facilitate investments in IP-driven industries and services for bringing investors/funding agencies and IP owners/users together. In the coming few months it would be interesting to see how the NRDC gives a tangible form to this ambitious dream of the government. However, a tougher challenge would be to convert this proposition into a value chain that returns good financial results for all its stakeholders. Perhaps the NRDC could take cues from the successes/failures of some up and running, though smaller, IP exchanges like those started by the Federation of Indian Micro and Small and Medium Enterprises, and identify and smoothe out potential hurdles that may come their way. Additionally, IP creators and buyers would have to take an equal interest in this initiative, and collaborate with the government to suggest ways and means and also the best industry practices to effectively bring the IP exchange from paper to reality.

The US International Trade Commission (USITC) in a September 2015 report reviewed the significant changes made to India’s trade and investment policies by the current Indian government. It mentioned of the huge backlog of litigation in various Indian courts that impede the timely resolution of IP disputes. The USITC remarked that a weak IP environment in India was causing US and other foreign companies to move their IP out of the country rather than suffer at the hands of a weak IP system. Alarmed by such a critique by a foreign body and with a view to address the concerns of various IP stakeholders, the Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Ordinance 2015 was promulgated in October 2015. It was soon enacted as a law in the form of Commercial Courts, Commercial Division and Commercial Appellate Division of the High Courts Act, 2015, (Commercial Courts Act). The government’s seriousness to settle the issue of delays in adjudication of IPR matters is evident from the first draft of the National IPR Policy in December 2014, which had suggestions regarding specialized IP benches in various high courts to expedite the adjudication of IP disputes.

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Nishant Sharma is the lead counsel (India) – IP & litigation at Dolby Laboratories.