India well on the way to granting protection for utility patents

By Manisha Singh Nair and Zoya Nafis, LexOrbis
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Utility patents are relatively short-term rights granted for inventions that may not qualify under the stringent criteria of patentability like inventive step, or non-obviousness, but are inventions in their own consideration. Like patents, utility patents also give exclusive rights to the inventor, allowing him or her to prevent others from commercially using the invention without consent, for a limited period of time.

Many international instruments have recognised the importance of utility patents. Paris Convention recognises utility patents as industrial property and states “this convention applies to industrial property in the widest sense, including patents, trademarks, industrial designs, utility models (a kind of ‘small-scale patent’ provided for by the laws of some countries)”.

The concept

The concept of utility patent is also well recognised under the Patent Co-operation Treaty (PCT). Article 2 (ii) says “references to a ‘patent’ shall be construed as references to patents for inventions, inventors’ certificates, utility certificates, utility models, patents or certificates of addition, inventors’ certificates of addition, and utility certificates of addition”.

Manisha Singh Nair LexOrbis Partner
Manisha Singh Nair
LexOrbis
Partner

However, the Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement does not specifically mention utility patents, and in addition provides strict requirements for patent grant. It says that any invention, either product or process, which demands to be protected as a patent must qualify three criteria of novelty, inventive step and non-obviousness.

India’s Patents Act 1970, in compliance with TRIPS, provides for the same three-fold criteria for a product or process to qualify as patentable subject matter. Following the stringent criteria of patentability, India to date does not recognise utility patent.

What others are doing

Various countries across the globe, both developed and developing, have extended recognition and second-tier protection for useful articles or other inventions under the banner of utility patents. Different terms are used by different countries for utility patents, like utility models, utility innovations, innovation patents, utility solutions and short-term patents.

The German Utility Model Law governs the protection of utility models in Germany. The subject matter of utility patent includes technical inventions that are new, with some inventive step and some industrial use. However it does not protect processes as utility patents.

Japan has also extended protection to utility patents but only to devices relating to shapes, or construction of articles, or a combination of these.

Australia, in addition to other technical inventions, includes processes for protection as utility patents. However biological processes are not recognised.

China recognises utility patents, but does not have a distinct law to govern protection for utility patents. They are covered only under the patent laws.

It is pertinent to note that countries recognising utility patents witnessed a rise in the number of filings as soon as they started protecting them. These models may prove to boost the economy of a country by protecting minor inventions that benefit society.

The need in India

India is growing at a faster rate, and there has been a rise in development across all fields of endeavour. It has also become a research hub for many multinational companies. However, the country still lags in domestic patent filings. A recent study found that 78% of patent filings in India are from non-residents of India.

Zoya Nafis LexOrbis Associate LexOrbis
Zoya Nafis
LexOrbis
Associate
LexOrbis

Small and medium-sized enterprises (SMEs) and micro, small and medium-sized enterprises (MSMEs) have a prominent position in India. They hold about 44% of the gross value of industrial production, in addition to providing employment for about 60 million people. India’s economy largely depends on the input of these SMEs and MSMEs. They also invent various products that fail to qualify for patent protection because of the stringent patentability criteria.

Hence, they require protection for their inventions that does not demand strict examination and qualification requirements – utility patents are the perfect solution for them. The rights granted under utility patents are quite similar to those given by the patent. Their grant requires less formality checks, but lasts for a shorter period of time. Utility patents are considered to be suitable particularly for SMEs, which tend to invent minor improvements on existing inventions.

Minor inventions

In India, utility patents can be advantageous for minor inventions as there is a delay in granting a patent, which eventually shortens the term of the patent. However, utility patents can be granted without following the lengthy process of examination and granted for a shorter period of time – six or 10 years – without renewal or extension possibility. The SMEs and MSMEs are also encouraged to undertake research on incremental innovations that are less capital-intensive because of the less strict qualifications of non-obviousness and inventiveness.

However the protection period for such innovations should always remain short, as prolonged monopoly over such patents would negate the very concept of utility patents. Utility patents must aim to supplement the patent system and facilitate the flow of innovation and creativity.

How far have we reached?

The recently released draft of the National IPR Policy, by the IPR Think Tank, highlighted the need for utility patents in India. The policy clearly stated that it is high time that India’s government should facilitate creation and protection of “small inventions” through a new law on utility patents, and that it must enact laws to address national needs and fill gaps in the protective regime of IPRs such as utility patents, to keep up with advancements in science and technology.

The incorporation of this system in the first draft of the National IPR policy is a welcoming move, and implementation of this system in India would effectively encourage innovation and development in the country.

Manisha Singh Nair is a partner and Zoya Nafis is an associate at LexOrbis

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E-mail: manisha@lexorbis.com

zoya@lexorbis.com

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