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A note on foreign filing license requirement in India
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Foreign filing license (FFL) is mandatory for person(s), who are resident of India, to apply for patents outside India without first applying in India. The guidelines for same are presented in Section 39 in The Patents Act, 1970. The provision states that a person (Applicant or Inventor) who is a resident of India has to request for an FFL in India if he/she wishes to file a patent outside India without first applying in India. Typically, the Applicants resort to applying for patents directly outside India when the invention does not have a commercial value in the Indian market, or the invention is being considered as a non-patentable subject matter in India. In such cases, a written permission has to be sought from the Indian Patent Office (IPO) for applying for patents outside India.
Section 39 of the Patents Act, 1970 reads:
“Residents not to apply for patents outside India without prior permission
(1) No person resident in India shall, except under the authority of a written permit sought in the manner prescribed and granted by or on behalf of the Controller, make or cause to be made any application outside India for the grant of a patent for an invention unless—
(a) an application for a patent for the same invention has been made in India, not less than six weeks before the application outside India; and
(b) either no direction has been given under sub-section (1) of section 35 in relation to the application in India, or all such directions have been revoked.
(2) The Controller shall dispose of every such application within such period as may be prescribed:
Provided that if the invention is relevant for defense purpose or atomic energy, the Controller shall not grant permit without the prior consent of the Central Government.
(3) This section shall not apply in relation to an invention for which an application for protection has first been filed in a country outside India by a person resident outside India.”
Above mentioned Section 39 applies to the residents of India. It shall be noted that the residential status of the applicant(s)/inventor(s) is considered and not the nationality of the person(s). However, since the term ‘resident’ is not defined in the Patents Act, 1970, we rely upon Section 6 of the Income-tax Act 1961-2017 for defining ‘resident’.
According to Section 6 of the Income-tax Act 1961-2017, an individual is said to be a resident of India:
- Is in India in that year for a period amounting in all to one hundred and eighty-two days or more; or
- Is in India for a period of at least 60 days during the relevant year and at least 365 days during the four years preceding that previous year.
The primary motive behind the foreign filing license requirement is to strengthen the national security. Many defense organizations of the government of India have deemed a few technologies important for military purposes and/or potentially detrimental to the national security if exported. Examples of such technologies may include biological warfare agents, explosives so on and so forth. By receiving a FFL from the IPO, the person(s) ensures that the patent application does not belong to any sensitive matter related to defense or atomic energy.
If the IPO deems the subject matter of the patent application to be sensitive and may endanger the national security of India, the FFL may be denied by the IPO. Many a times, to avoid complications of filing a request or the waiting period, people directly file in the foreign country. What the person(s) needs to understand is that as per the Indian Patents Act, it is mandatory for Indian residents to obtain the FFL to file the patent application outside India and when failed to meet such requirements, as per Sections 40 and 118 of the Patents Act, the person(s) may be punishable with imprisonment for a term which may extend to two years, or with fine, or with both. Also, the person(s) may face a risk of rejection of subsequent Indian applications.
However, if the person(s) who is a resident of India has filed a patent application in India, then after six weeks from the date of filling of the patent application, the person(s) is allowed to file the same patent application outside India without requiring a written permission from the IPO. The person(s) also need to ensure no secrecy direction has been issued by the IPO for the submitted patent application.
To file for a FFL, Form 25 (Application for permission for filling the patent application outside India) along with complete disclosure of the invention with the reason for submitting such application has to submitted to the India Patent Office.
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Precautions to be taken before filing a foreign patent application by Indian residents
Many companies operating from India cater to foreign markets, especially US. Hence, such companies are keen on filing patent applications outside India. Such companies generally contemplate adopting two options:
1. File patent applications in foreign countries without filing a patent application in India
2. File a patent application in India, and soon after, file patent applications in foreign countries
1. File patent applications in foreign countries without filing a patent application in India
When the first option is adopted, patent applicants have to complete a formality with the Indian Patent Office (IPO) before proceeding with patent application filing outside India. This formality has to be completed if one or more inventors in the patent application are residents (we are not referring to citizenship) of India. The formality requires the patent applicant to request the IPO to grant permission to apply for patent outside India. The IPO grants the permission within 21 days from the date of making the aforementioned request. Permission may be rejected by the IPO if the subject matter is relevant for defence purposes and atomic energy.
39. Residents not to apply for patents outside India without prior permission
(1) No person resident in India shall, except under the authority of a written permit sought in the manner prescribed and granted by or on behalf of the Controller, make or cause to be made any application outside India for the grant of a patent for an invention …
(2) The Controller shall dispose of every such application within such period as may be prescribed:
PROVIDED that if the invention is relevant for defence purpose or atomic energy, the Controller shall not grant permit without the prior consent of the Central Government.
71. Permission for making patent application outside India under section 39
(2) The time within which the Controller disposes of the request made under subrule (1), except in case of inventions relating to defence and atomic energy applications, shall ordinarily be within a period of twenty-one days from the date of filing of such request.
Once the IPO grants permission to apply for patent outside India, patent applications can be filed in one or more countries outside India.
2. File a patent application in India, and soon after, file patent applications in foreign countries
39. Residents not to apply for patents outside India without prior permission
(1) No person resident in India shall, except under the authority of a written permit sought in the manner prescribed and granted by or on behalf of the Controller, make or cause to be made any application outside India for the grant of a patent for an invention unless—
(a) an application for a patent for the same invention has been made in India, not less than six weeks before the application outside India; and
(b) either no direction has been given under sub-section (1) of section 35 in relation to the application in India, or all such directions have been revoked.
40. Liability for contravention of section 35 or section 39
Without prejudice to the provisions contained in Chapter XX, if in respect of an application for a patent any person contravenes any direction as to secrecy given by the Controller under section 35, or makes or causes to be made an application for grant of a patent outside India in contravention of section 39 the application for patent under this Act shall be deemed to have been abandoned and the patent granted, if any, shall be liable to be revoked under section 64.
Significance of Seeking Permission To File Patent Applications Outside India
Introduction
A resident of India might be interested in filing a patent application outside India, driven by various reasons. In such a scenario, one may choose to:
1. File a patent application outside India without filing a patent application in India; or
39. Residents not to apply for patents outside India without prior permission-
(1) No person resident in India shall, except under the authority of a written permit sought in the manner prescribed and granted by or on behalf of the Controller, make or cause to be made any application outside India for the grant of a patent for an invention unless—
(a) an application for a patent for the same invention has been made in India, not less than six weeks before the application outside India; and
(b) either no direction has been given under sub-section (1) of section 35 in relation to the application in India, or all such directions have been revoked.
(2) The Controller shall dispose of every such application within such period as may be prescribed: Provided that if the invention is relevant for defence purpose or atomic energy, the Controller shall not grant permit without the prior consent of the Central Government.
(3) This section shall not apply in relation to an invention for which an application for protection has first been filed in a country outside India by a person resident outside India.
Interpretation of governing statute
Even though not explicit from the above statute, our interpretation is that, the term “person” in the above section refers to “inventors” and not necessarily the “applicants” of the patent. Further, it shall be noted that, if at least one of the inventors who may be named in the patent application is a resident of India, then the above section is of relevance. Note that, a foreign citizen can be a resident of India, and likewise, an Indian citizen can be a resident of a foreign country. Hence, one will have to consider where the inventors are residing and not necessarily their citizenship, while applying the above section.
Further, one will have to procure a FFL if one of the inventors is a resident of India, and the first patent application is being filed outside India. It shall be noted that a PCT application, with the Indian Patent Office as the receiving office, can still be considered as a patent application filed outside India.
Another scenario in which FFL will have to be procured is when a patent application has been filed in India, and a subsequent patent application has to be filed within 6 weeks from the date of filing the Indian patent application. On the other hand, a FFL will not be required if 6 weeks have passed since the filing of the Indian patent application, and there has been no secrecy direction issued by the Indian Patent Office.
Obtaining permission to file the patent application outside India
A FFL can be obtained by disclosing to the Indian Patent Office the subject matter on which patent application is sought to be filed. The request is made in a particular form and a fee of INR 4000 (INR 1000 if applicant is a natural person) is applicable. The time within which the IPO grants permission is twenty one (21) days of filing the request. In cases the invention is related to defense or atomic energy, such permission may be denied by the IPO.
Consequences contravening section 39
Contravention of Section 39 can result in criminal liability under Section 118 and abandoning of Indian Patent Application or revocation of Indian Patent, if any, under Section 40.
Under Section 118, contravention of Section 39 shall be punishable with imprisonmentfor a term, which may extend totwo years, or with fine, or both. However, those in the known can provide examples of contravention of Section 39, but enforcement of penalties under Section 118 is yet to be seen.
Filing a national phase patent application in India after filing a PCT application
Precautions to be taken before filing a foreign patent application by Indian residents
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