Parliamentary Standing Committee Recommendations for Expanding the Innovation Ecosystem in India

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In an attempt to strengthen the IPR regime in India a comprehensive national IPR policy was adopted in May 2016. Further, a Parliamentary Standing Committee on Commerce was assigned with a task to evaluate the progress achieved at the end of five years since the time the national IPR policy was adopted. The Committee submitted a review report on the Intellectual Property Rights Regime in India after reassessing the Policy to identify the gaps in its implementation and strategize the way forward. In its exhaustive review report, the Committee has recommended ways to incentivize innovations and creativity, strengthen the IPR regime through IP financing, encourage IPRs in agriculture, tribal cures, etc., and ways to protect new and emerging trends in the latest technologies.

Some of the key features identified by the Committee for protecting the overall public interest in innovation are as listed below:

  1. Economic contribution of IPR.
  2. Marking published patent applications as ‘Patent Pending’
  3. Spreading awareness of IPRs across all strata of societies in India.
  4. Handling Counterfeiting and piracy in a more stringent manner
  5. Filling up the pending vacancies in the IPR offices to speed up the examination and disposal of IP applications.
  6. Amending IP related law to address cutting edge technologies such as Artificial Intelligence (AI) and machine learning.
  7. Reconsideration of the abolition of the IPAB
  8. Impact assessment of the Japan PPH model to strategize the way forward for establishing PPH with other countries.
  9. Encourage IP backed financing in India.
  10. Amendments to section 3(b) of Indian Patent Act, 1970.
  11. Reduce the timeline to file an examination report request.
  12. Provide flexibility in patent law concerning patent abandonment.
  13. Amendment to Section 104 of the Indian Patent Act, 1970.
  14. Temporary Compulsory license for IP related to COVID vaccine manufacturing in India.
  15. Amendments in Form 27 of Indian Patent Act, 1970.
  16. Use the ‘Thirds Model’ from the Catapult system of UK, for linking academia and industry.
  17. Communities or individuals exhibiting traditional knowledge must reap the benefits from the IPR regime.
  18. Encourage IPR in agriculture.

One of the major takeaways from this report is the emphasis on accelerating IP financing. The Committee emphasized that financing in IPR must be encouraged in a comprehensive manner. The Committee has recommended to treat IP as an intangible asset based on which either loans can be provided, or tax exemptions may be made to attract more and more inventors to protect their inventions lawfully.

Also, the Committee has observed that despite adopting a National IPR policy, very little was done on ground in relation to funding for research and development. To address the same the Committee recommended the use of ‘Thirds model,’ that dealt with a ‘Catapult system’ of UK for funding research. The ‘Thirds model’ involves one third of the funding to be from a core grant from the Government, one third of the funding from industry partners and the remaining one third of the funding from a grant from collaborative R&D funds for and by consortia involving Catapults.

Further, the Committee has recommended State governments to extend tax rebates and provide incentives to companies and innovators at the local level on filing of patent and grant additional rewards on the approval of the patents.

Also, the Committee has suggested to label the patent applications that are published as ‘Patent pending’, to acknowledge the credibility of the patent application that in turn would assist the patentee as a marketing tool.

IP Financing in particular, has been observed as the key factor for expanding the IPR ecosystem. Typically, protection of inventions using patents is cost intensive process, wherein the cost includes attorney fees and patent office fees. The high costs involved in patenting inventions is a major hurdle that keeps many small entities from pursuing the IPR. Therefore, financial benefits either by providing incentives, funding for research or by reducing the patent office fees for certain entities like startups, may motivate the entities to protect their innovations using IPR. Further, by easing the affordability of patenting inventions, innovators from different socio-economic backgrounds and different age-groups can be included into the IPR ecosystem.

It is imperative that the Government considers the proposals of the Committee to strengthen the IPR regime and makes changes to the IPR policy to increase the participation in innovation that will result in a fair competition in industrial, economic, social, scientific, and technological spheres.

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