IP protection in India for Japanese businesses

By Joginder Singh and Rajeev Kumar, LexOrbis
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India is the second-largest country in the world by population, the world’s largest democracy, and the largest English-speaking nation in the world. Its population is expected to rise from 1.211 billion to 1.522 billion during 2011-2036, an increase of 25.7% in 25 years. The country has the largest youth population and the third-largest group of scientists and technicians globally.

IP protection in India for Japanese businesses Joginder Singh
Joginder Singh
Partner
LexOrbis in New Delhi
Tel: + 91 97 1126 2818
Email: joginder@lexorbis.com

India has jumped 79 positions from 142nd in 2014 to 63rd in 2019 in the World Bank’s Ease of Doing Business 2020 rankings. The country has jumped two positions and ranks 46th in the Global Innovation Index 2021. The pandemic may have been an unwanted obstacle, but most experts believe the worst is over for India’s economy.

India has already started one of the world’s biggest vaccination programmes, and policymakers have started working on the recovery process. The country is likely to avoid recession and may see decent economic growth this year. Already one of the world’s fastest-growing economies, India’s economy is projected to grow at 6.7% in 2022, the fastest in the world during the year. India’s GDP is projected to grow in real terms by 8-8.5% in 2022-2023.

India-Japan relations have traditionally been extraordinarily strong, and the people of both countries have engaged in cultural and business exchanges for centuries. In today’s world, the partnership between India and Japan needs to be further strengthened. The influence of a robust IP regime on propensity towards business investment is widely acknowledged. Bilateral co-operation in IP protection has been very impressive so far.

The impact of IP rights may vary across industries, but there is no doubt about the importance of obtaining IP rights and enforcing them to safeguard business interests, especially after making huge financial investments. On that note, obtaining IP protection in India is easy through the Office of the Controller General of Patents, Designs and Trademarks (CGPDTM), and offers multiple benefits.

India is a huge market with a massive consumer base. Registering IP rights in India should not be ignored for that reason alone. Besides, the overall cost of obtaining IP protection is far lower when compared to advanced jurisdictions like the US and EU. The official fees are minimal compared to major foreign jurisdictions, and the professional fee for IP services is also reasonable, with India being an incredibly competitive market. Another good thing is that the CGPDTM office accepts English, which means no translation in native languages is needed for filing and prosecuting IP applications in India. This leads to a significant reduction in the overall cost of IP protection compared to comparable jurisdictions like China, Brazil and South Korea, which all require native-language translations.

IP protection in India for Japanese businesses Rajeev Kumar
Rajeev Kumar
Partner
LexOrbis in New Delhi
Tel: + 91 99 1175 8776
Email: rajeev@lexorbis.com

The annual report issued by the CGPDTM office for the fiscal year 2019-2020 illustrates its continued efforts in strengthening the IP rights framework and aligning it with that year’s global standards. Simplification and IT-enabled functioning of procedures, as well as growth in the technical workforce, have considerably improved the timeliness of processing applications and reduced existing backlogs.

During the year, the filing of patent applications has increased by 11.1%. Domestic filing has increased to 37.05% from 33.6% in 2018-2019, while grant and disposal in patents increased by 63.16% and 9.95%, respectively. In 2019-2020, 24,936 patents were granted compared to 15,283 in 2018-2019, showing a tremendous increase of 63.16%.

In trademarks, pendency in examination continued to be less than a month despite a steady increase in the filing. Procedural reforms brought in by an amendment in rules and process re-engineering have resulted in increased acceptance of trademark applications at the first stage to about 50%.

In designs, the examination time needed for new applications continued to be less than a month. During 2019-2020, filing of design applications has shown a 13.55% increase over the past year, and examinations have increased by 7.76%, while registration and disposal of design applications have increased by 29.2% and 28.8%, respectively, as compared to last year.

The copyright office continued to show improved performances due to computerisation and re-engineering of processes. During the year, the examination of new applications continue to be processed after the mandatory one-month waiting period for objections to be lodged. The filing of copyright applications has increased by 20.02% and copyright registration increased by 9.6%.

Various initiatives have been taken in the past few years to improve the overall Indian IP ecosystem. One of the most important improvements is the significant reduction of time taken by the Indian Patent Office (IPO) for examining a patent application under the normal route. As of now, the average time to begin examination is less than 12 months from the date of filing of a request for examination, and patents are generally granted within two to three years from the date of filing, as against the seven to eight years it used to take not so long ago. Likewise, the backlog has been cleared for other forms of IPs with continuous recruitment, process improvements and systematic adoption of technology.

India and Japan also have a patent prosecution highway (PPH) agreement in place, on a trial basis, for three years. Japanese applicants can seek an expedited patent examination in India based on a corresponding patent allowed by the Japanese Patent Office (JPO). The PPH trial has already entered its third year and has been successful so far. It would be reasonable to expect that an India-Japan PPH will be permanently implemented once the trial period is over. It would be reasonable to expect that the PPH with other major patent offices, such as the US Patent and Trademark Office (USPTO) or the European Patent Office (EPO), will be considered after the success of the PPH between the IPO and the JPO.

In the case of applicants availing of an expedited examination procedure subject to eligibility criteria, the grant time can be further reduced to about a year from the date of filing. With the issuance of examination guidelines specific to the field of inventions, the IPO is also trying to improve the quality of patent examinations, particularly in computer-implemented inventions, pharmaceuticals and biotechnology.

The IPO has also revised its manual of patents to streamline various practices and procedures concerning the patents act and rules, to supply a better experience for patent applicants. The IPO keeps on conducting discussions with various stakeholders to find and resolve various issues and streamline divergent practices. Similar discussions and improvements have been made for other forms of IPs, including trademarks, designs, copyrights, etc.

The government, in July 2021, initiated the “Review of the Intellectual Property Rights Regime in India”, where the Department Related Parliamentary Standing Committee on Commerce issued a report for stakeholders’ inputs. The report recognised the importance of the influence of innovation and creativity on different spheres of society for the country’s holistic growth and development. Accordingly, we may expect significant positive changes in the IP laws of India soon.

The Supreme Court of India has been extending the limitation period since 15 March 2020, taking cognisance of disruptions caused by the global health crisis due to the pandemic. The court has recently held that the period between 15 March 2020 to 28 February 2022 will not be counted towards timelines prescribed under all general and special laws in India. The court has also held that if the timelines have expired between this period, then at least 90 days shall be given from 1 March 2022 to follow the timeline. If the duration falling during the pandemic period is more than 90 days after 15 March 2020, then they would be given the balance duration starting 1 March 2022 onwards.

Some of the noticeable trends that have become clearer in recent years include the reduced waiting time for examination, the faster disposal of IP applications, a steady increase in the number of IP applications filed, continual and progressive legislative reforms, and an increase in the number of IP litigations for either enforcement or invalidation, leading to landmark judgments. All these trends signify the development of a conducive IP system in India, to incentivise technology transfer and to boost foreign direct investment at a rapid rate.

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