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28 Oct 2020

Brief Analysis of the Patents (Amendment) Rules, 2020

The Government of India, Ministry of Commerce and Industry (Department for Promotion of Industry and Internal Trade) vide its notification dated October 20, 2020, has published the Patents (Amendment) Rules, 2020 (hereinafter the “Amended Rules”) amending the Patents Rules, 2003 (hereinafter the “Principal Rules”). The amendment came into force from the date of the notification i.e. October 20, 2020. The highlights of the amendments are as follows:

 

Rule 21: Filing of the Priority document:

The amended rules provide for a substituted Rule 21.

 

Amended Rule 21(1) 

This amendment is merely clarificatory in nature with respect to the filing of the Priority document. In the principal rule, the applicant/assignee had to provide the Priority document before the expiry of 31 months from the date of priority and it remains the same post amendment.

The only change to the sub section is the addition of sub-rule ‘b-bis’ of Rule 17.1 of the Patent Cooperation Treaty (PCT) which offers flexibility to applicants to submit the Priority document through the digital library.

Amended Rule 21(2)

This amendment is again clarificatory in nature with respect to furnishing of the English translation of the Priority document, which is in compliance with the PCT.

Amended Rule 21(3) 

There have been no changes to this sub-rule with respect to the filing of the Priority document and/or English translation of the Priority document. In case the said document is not filed within 31 months from the priority date, the applicant is required to furnish the Priority document and/or English translation of the Priority document within 3 months from the date of invitation to avoid dismissal of priority claim

Rule 131: Form and manner in which statement required under Section 146(20) is to be furnished

The amendment substitutes Sub-Rule (2) of Rule 131 thereby revising the time period for which the statement of working must be filed.

Earlier, an applicant was required to file the statement of working for every Calendar Year (i.e. Jan-Dec) within three months of the end of each Calendar Year once the patent was granted.

With the amendment, now the applicant is required to file the statement of working for every Financial Year (i.e. Apr-Mar) within six months from the expiry of the previous Financial Year. For clarification, the applicant is obligated to furnish the details with respect to the working of the invention from the Financial Year in which the patent is granted.

The changes were made to facilitate ease in business and to simplify the process thereby encouraging patent filing by interested individuals. The requirement of furnishing statements for a Calendar year was putting an undue burden on the patentee to maintain record differently from those maintained in regular business and there were also many tax benefits or differential taxation applied for income from the sale or licensing of IP assets which were also not available for calendar year, therefore, it was reasonable to change it to Financial Year.

Second Schedule: Form 27

The amendment brings out certain crucial changes in Form 27 which are:

(a) The new Form enables Patentee(s)/Licensee(s) to file the statement of working for more than one patent that are related to each other and granted to the same Patentee(s), in a single Form 27.

The change was brought about to ensure filing convenience, reduce paperwork and search costs in cases where there were potentially multiple patents covering the same product.

(b) The Patentee/Licensee is required to furnish approximate revenue / value accrued in India in the previous Financial Year for one or more related patents granted to the same Patentee.

With this amendment, the obligation to provide details with respect to the quantum of a product has been waived. However, calculating the approximate value accrued in India especially for complex high-tech products with components being sourced and sold across borders might be difficult.

(c) The Patentee/Licensee has to mention the Financial Year, instead of Calendar Year, for which the statement of working is filed.

(d) The earlier form asked a patentee to ‘give whatever information was available’, however, the revised form introduces a word limit of 500 words to describe worked or not worked invention in ‘brief’.

(e) A clarification has been added that every patentee and every licensee is required to file this form. Where patent is granted to two or more persons, they may file it jointly. However, licensees are required to file the form individually.

This change may encroach upon the confidentiality requirement that is the essence of a patent in general.


Image Credits: Photo by Wallace Chuck from Pexels

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