On 25th January 2021, the Government of India notified an amendment to the Design Rules, 2001, in the Official Gazette, which was deemed to be in effect from that date itself.
The Central Government exercised the powers given to it under section 47 of the Designs Act, 2000, which was previously done in 2014 via the Designs (Amendment) Rules, 2014.
Key features of the amendment
Some key feature of the amendment and the changes brought to the rules through it have been the adoption of the latest Locarno Classification. Further, the streamlining of the process of applying for and prosecuting design patents in India and treating start-ups, small entities, and natural persons on equal footing.
Industrial Design Classification
The amendment provides that the articles that are being claimed under any design application need to be classified as per the current edition, i.e., the 13th edition, of the ‘International Classification of Industrial Designs (Locarno Classification’ that has been published by the World Intellectual Property Organisation (WIPO), which contains 32 classes and 237 subclasses, along with the explanatory notes of the same.
Some examples of these include class 1, which is related to Foodstuff but does not include packaging; class 5 includes textiles and other similar articles. And class 29 deals with devices and equipment against fire hazards and accident prevention (This is a non-exhaustive list and only for illustrative purposes.)
Before this amendment was brought in, the applicants were expected to rely upon the Indian Classification of Industrial Designs based on the 10th edition of the Locarno classification. They only had 31 classes with a miscellaneous class of 99.
The 10th edition of the Locarno classification came out in 2013 and did not cover any classes dealing with the latest technological developments.
The 13th edition of the Locarno Classification brought in a new class to the Indian design regulations, which included Graphic symbols and logos, surface patterns, and ornamentation, which will hopefully bring a new aspect to India’s design applications. This change also allows applicants to use the most suitable Class/Sub-class for their product and may help bring further uniformity to the design applications made in multiple jurisdictions.
Benefits To Startups
The introduction of section 2(eb) to the rules has also brought a new dimension to the regulations. The section defines a “startup” as any entity recognized as a startup under the Startup India initiative. It also includes foreign entities that fulfill the criteria for turnover and period of incorporation or registration as per Startup India Initiative and submitting and declaring to that effect. Such recognition aims to provide startups with an extended rebate on the official fees payable for such entities. To be recognized as a startup, the foreign entity must fulfill the following criteria:
● It must be a private limited company, a limited liability partnership, or a partnership firm.
● Its turnover must not exceed INR 100 crores during the course of business.
● It can only be considered a startup for a period of 10 years from the date of its incorporation.
● It can be formed by splitting up or reconstructing an existing business.
Benefits To Small Entity
The amendment has also reduced the fees payable for design registration if the applicant is a small entity, which previously used to be higher than the fees payable by natural persons but higher than those paid by other entity types.
Under the 2021 amendment, the fees payable by natural persons, small entities, and startups shall be the same, and because of this, the fees payable by small entities have been cut down by almost 50%.
Another major amendment brought in by the amendment has been the difference in fees paid upon transferring rights about a registered design. If the transfer is between a natural person, startup, or natural entity and a person not falling within this category’s ambit, the difference between the fees chargeable to the natural persons, startups, or small entity and the fees applicable to the new entity.
The fourth schedule of the 2001 Rules deals with the design costs associated with proceedings before the Controller of Designs, which has been modified under the amendment. The revisions to the schedule now provide different costs that may be applicable depending on the entities involved.
For example, on an application for registration, natural persons, startups, or small entities may have to pay INR 1000, while other entities may have to pay INR 4000. This trend of natural persons, startups, or small entities having to pay a quarter of the amount other entities have to pay extends to other proceedings, and can be considered a general rule to some extent.
The new amendment rules could have a generally positive impact on India’s design regulation. They will streamline and simplify the process of protecting one’s designs while bringing the Indian design regime up to scratch with the rest of the world and further modernizing it.
The changes brought in will also benefit startups and smaller entities, furthering the Indian government’s agendas to bring entrepreneurship and ease of doing business in India to the forefront.
