The patent regime in India is governed by the provisions of The Patents Act, 1970 read along with The Patents Rules, 2003. The primary purpose for granting a patent is to confer monopoly rights on an inventor to exploit his/her invention subject to the provisions of the Act for a limited duration. These exclusive rights conferred by the Patents Act on the inventor can also be exercised by a person other than the inventor with the latter’s previous authorization. However, it is mandatory for the patent holder to utilize the invention to meet the needs of society and to ensure that the patentees have not merely acquired rights over the invention but they are actually working the same. Hence, the provisions are laid down regarding the submission of a working statement under the Indian Patent regime.
BACKGROUND
Patent laws in India have undergone major substantial changes since the initial Act of 1856 on Protection of Inventions which was primarily enacted on the basis of the British Patent Law of 1852. Further, the Indian Patents and Designs Act was enacted in 1911 prior to the principal Act of 1970. However, due to the substantial changes in the political and economic conditions of the country, Justice Rajagopala Ayyanagar was appointed by the government in order to stimulate inventiveness among Indians and to encourage the development and exploitation of new inventions for industrial purposes in the country so as to secure the benefits thereof to the public at large.[1] These objectives of the patent law would have been defeated if the patent holder abused his right by non-working or insufficiently working the patent. In order to prevent the abuse of the exclusive rights conferred and to ensure the working of the granted patents, the Patents Act, 1970 lays down specific provisions thereby conferring power on the Controller of patents to call for information or periodical statement from patentees/licensees as to the extent to which the patented invention has been commercially worked in India.[2] Section 146 of the Act read along with Rule 131 of the Patent Rules, 2003 mandates the patentees/licensees to provide the required information in accordance with Form 27 annexed to the Second Schedule of the Rules. Non-compliance with the statutory requirements invites penalties and criminal action as prescribed under Section 122 of the Patents Act, 1970.
However, on referring to the Annual IP Report 2018-19, it can be observed that only 51,104 statements on working of patents out of 64686 (patents in force) were received in Form 27 during the year and 14,277 patents were reported as working. These statistics, hence, point out the insufficient disclosure regarding the actual working of patents and under-utilization of patented technologies.
Various issues and concerns revolving around the submission of working statements under the Patent Act, 1970 were brought before the Delhi High Court in Shamnad Basheer vs. Union of India, wherein the writ petition was filed for non-compliance with the provisions of the Patents Act, 1970 on the part the Controller General of Patents.[3] The court in the case observed that there can be no exemption from statutory compliance and the patentees/licensees, as the case may be, are required to submit the information in a timely manner. The court also dealt with the issue of amending Form 27 in order to remove the vague elements and consequently, gave an adjournment with regard to the status of the amendment of the rules.
AMENDMENT
The recent Patent (Amendment) Rules, 2020 notified on 19th October make an effort to address the issues pertaining to the submission of working statements. The amendment specifies the scope of duration for submitting the working statements by substituting sub-rule (2) of Rule 131 as “(2) The statements referred to in sub-rule (1) shall be furnished once in respect of every financial year, starting from the financial year commencing immediately after the financial year in which the patent was granted, and shall be furnished within six months from the expiry of each such financial year.”[4] Further, it substitutes the earlier Form 27 with the new amended Form 27. The amended Form 27 attempts to change the skeleton of the earlier Form thereby allowing the Controller of Patents to retrieve all the relevant information in order to ensure appropriate disclosure of patents.
CONCLUSION
The recent amendment in Patent Rules can be said to have been made in the right direction towards a better and transparent patent regime. However, voluntary compliance from patent holders and appropriate actions in case of statutory non-compliance is necessary on the part of the administrative authority for a fair and rewarding patent regime.
[1] Dr VK Ahuja, Intellectual Property Rights in India, 457 (2nd ed.)
[2] Section 146 of the Patents Act, 1970.
[3] Shamnad Basheer vs. Union of India and Ors. (10.01.2018 – DELHC) : MANU/DE/0752/2018.
[4] Section 3 of The Patents (Amendment) Rules, 2020.
