Introduction:
Climate technology refers to solutions designed to address the climate crisis, including innovations aimed at decarbonization, energy transition, and emissions reduction. These technologies are vital in the fight against climate change, as reports from the International Energy Agency (IEA) indicate that 40% of the emissions reductions needed rely on technologies that have yet to be deployed commercially. Tackling climate change requires a comprehensive transformation across various industries. A compulsory license is a government-granted authorization that allows third parties to use, produce, or sell a patented product or process without the patent holder’s consent, aiming to benefit the public. While intellectual property rights (IPR) include patents, copyrights, trademarks, and trade secrets, compulsory licenses primarily relate to patents but may extend to other rights. In the context of India, compulsory licensing has been explored as a means to facilitate access to climate technologies, especially in developing countries. This article delves into the intersection of climate technology and compulsory licensing in India, examining its legal framework, potential benefits, challenges, and future possibilities.
Understanding Climate Technology
Climate technologies encompass a wide array of tools, systems, and practices designed to combat climate change. These include renewable energy systems (like solar, wind, and hydroelectric technologies), energy efficiency innovations, carbon capture and storage, and sustainable agricultural practices. The development and deployment of these technologies are pivotal for countries like India, which face the dual challenge of achieving economic growth and reducing carbon emissions.
Intellectual Property and Climate Technology
Intellectual property rights (IPRs), particularly patents, play a significant role in the development and dissemination of climate technologies. By granting exclusive rights to inventors, patents incentivize innovation and investment in research and development (R&D). However, they can also create barriers to access by making technologies expensive and restricting their use through licensing agreements.
The Legal Framework for Compulsory Licensing in India
Compulsory licensing is a provision under the Indian Patents Act, of 1970, that allows the government to authorize a third party to produce a patented product or process without the consent of the patent holder. The mechanism is governed by Section 84 of the Act, which lays down the grounds for granting a compulsory license:
A compulsory license can be granted on specific grounds to ensure public access to patented inventions. These include situations where the reasonable requirements of the public are not being met, such as when the demand for the invention is not adequately fulfilled, or access is limited. Additionally, if the invention is not available to the public at an affordable price, or if it is not being sufficiently worked in India, a compulsory license may be issued. This ensures that patents serve the public interest by promoting accessibility, affordability, and local utilization of essential innovations. Additionally, Section 92 of the Act provides for compulsory licensing in circumstances of national emergency, extreme urgency, or public non-commercial use. The provision is in line with the flexibilities allowed under the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) of the World Trade Organization (WTO).
Application of Compulsory Licensing to Climate Technology
India’s experience with compulsory licensing has primarily been in the pharmaceutical sector, notably in the case of Natco Pharma vs. Bayer Corporation, where a compulsory license was granted for a life-saving cancer drug.
The Natco Pharma vs. Bayer Corporation case is a landmark legal battle in India centered around compulsory licensing. In 2012, the Indian Patent Office granted Natco Pharma a compulsory license to produce Sorafenib Tosylate, a cancer drug patented by Bayer Corporation under the brand name Nexavar. Due to its high price, the drug was unaffordable for many patients in India. The Indian Patent Office allowed Natco to manufacture and sell a generic version at a significantly lower cost, citing that the drug was not available to the public at a reasonable price and was not adequately addressing public health needs. This was the first instance of compulsory licensing under Section 84 of the Indian Patent Act, 1970, which allows the issuance of a license if the patent is not meeting certain conditions like affordability or availability in India. Despite Bayer’s appeal, the case reinforced India’s approach to balancing patent protection with public health, emphasizing the importance of affordable access to essential medicines. It set a crucial precedent for future compulsory licensing cases, particularly concerning life-saving medications in India, and was seen as a win for public health advocacy.
The question arises whether similar provisions can be effectively applied to climate technologies.
Potential Benefits of Compulsory licensing on Climate Technology.
Compulsory licensing can play a key role in addressing climate challenges by enhancing access to critical technologies, making them more affordable, and enabling their widespread adoption. It encourages local manufacturing, reducing reliance on imports and promoting the growth of domestic industries. Additionally, it ensures equity in technology transfer, preventing developing countries like India from being excluded from the global progress in green innovation. By facilitating access to clean technologies, compulsory licensing also supports India’s ability to fulfill its international climate commitments, such as those outlined in the Paris Agreement.
Challenges and Concerns in compulsory licensing.
The potential impact of compulsory licensing on innovation is a concern, as it may discourage multinational companies from investing in research and development or introducing their technologies in India. The implementation of compulsory licensing can also be complex, as determining fair terms, including royalty payments, can lead to disputes. Additionally, frequent use of compulsory licensing may provoke trade conflicts or sanctions from developed nations. Furthermore, the application of compulsory licensing to climate technologies is relatively unexplored, as there is limited precedent, particularly compared to its use in the pharmaceutical industry.
Balancing Interests: A Pragmatic Approach
While compulsory licensing has its merits, it should not be viewed as a standalone solution. Instead, it should be part of a broader strategy that balances the interests of patent holders and the public. Key measures could include, Promoting voluntary agreements between technology providers and local companies that can facilitate technology transfer without the need for compulsory licensing. Additionally, investing in research and development, skill development, and infrastructure can boost India’s ability to create homegrown climate technologies. Global cooperation, especially through platforms like the United Nations Framework Convention on Climate Change (UNFCCC), can promote the exchange of knowledge and resources. Furthermore, advocating for differential pricing models that take into account the economic conditions of developing countries can help make technologies more affordable and accessible.
Looking ahead, prospects and challenges.
India’s commitment to combating climate change is evident in its ambitious targets, such as achieving 500 GW of non-fossil fuel capacity by 2030 and reaching net-zero emissions by 2070. Achieving these goals requires a concerted effort to overcome barriers to climate technology adoption.
The role of compulsory licensing in this context should be carefully calibrated. While it can serve as a powerful tool to address urgent and critical needs, its application must be judicious to avoid unintended consequences. Policymakers should focus on creating an enabling environment that promotes innovation, encourages collaboration, and ensures equitable access to climate technologies.
Conclusion
The nexus between climate technology and compulsory licensing in India presents both opportunities and challenges. As the country strives to balance its developmental aspirations with environmental sustainability, leveraging legal and policy mechanisms like compulsory licensing can play a pivotal role. However, this must be complemented by robust international cooperation, domestic innovation, and equitable market practices to ensure a just and sustainable transition to a low-carbon future.
Written by Nithila Kovai, Legal Intern at Intepat IP
