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Patents and Geographical Indication: An Overview

Written by: Ramendra Kumar Sharma IV BSL, LLB. Symbiosis Law College Pune
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A patent is a monopoly right granted to person who has invented a new and useful article or an improvement of an existing article or an improvement of an existing article or a new process of making an article. It consists of an exclusive right to manufacture the new article invented or manufacture an article according to the invented process for a limited period. During the term of patent the owner of the patent, i.e. the patentee can prevent any other person from using the potential invention. But the creation of patent is territorial in extent where it has been created by a statute.

Object of a Patent Law: In the case of Bishawanath Prasad Radhey Shyam V/s Hindustan Metal Industries, (1979) 2SCC, 511 it has been held by the Supreme Court,the object of patent law is to encourage scientific research, new technology and industrial progress. Grant of exclusive privilege to own, use or sell the method or the product patented for a limited period stimulates mew inventions of commercial utility. The price of the grant of monopoly is the disclosure of the invention at the Patent Office, which after expiry of the fixed period of monopoly, passes into the public domain."

History of Patents

The term 'patent' has been derived from the word "Letters Patentissued by the British Crown". The history of patents can mainly be traced in Britain. But the history of patents goes back to thousand-year back. Although we often think of information commodification as a new process, the history of intellectual property goes back to some of the farthest reaches of our recorded history. In fact, according to a scholar the book was one of the very first commodities. Greece in the 5th century B.C and its active book trade, for the first examples of buying and selling information. The rise of this intellectual market coincided with a renewed acknowledgment within the culture of the existence of the individual creative self, as well as with the development of commerce and urban societies. Previously, it had been not originality, but craftsmanship within established forms, that had been valued; oral cultures like that of the earlier Greek societies had viewed creative works as collectively produced, and as entities to be imitated and built upon by others. Later on medieval era patent system was present in some form or other in every society. There were communities and persons who were only authorized to make a particular product.

The patent history can be well illustrated by following time line.
1200s 10-year monopolies granted in Venice, Italy to inventors of silk-making devices
1449 First recorded patent granted in England for a glass-making process First patent statute passed in Venice
1624 Statute of Monopolies issued in England
1790 First American patent statute passed
1791 First French patent statute passed
1880-1882 Patent statutes introduced in most European countries
1883 Paris Convention for the Protection of Industrial Property - cornerstone of the modern international patent system
1947 International Patent Institute (IIB) established at the Hague
1970 Patent Cooperation Treaty signed in Washington, D.C.
1978 International Patent Institute integrated into the European Patent Office (EPO)
1979 Bayh-Dole Act passed-granted permission to U.S. universities to license and profit from federally sponsored research
1980 International Patent Documentation Center (INPADOC) integrated into the EPO

A number of international conventions on intellectual property have been adopted since last century covering different areas of industrial property, copyright law and other specialized matters (such as breeders' rights). The World Intellectual Property Organization (WIPO) and UNESCO are responsible for administering the main conventions in force.

The TRIPS negotiations were conducted within GATT, and the provisions of the resulting Agreement are enforceable within the framework of the WTO -- a forum without any tradition of work in the field of IPRs.

International Treaties/ Conventions

The Paris convention created by treaty in 1886 whose primary function is to guarantee a uniform worldwide priority date across all member countries. An applicant may file in any member country of the convention up to one year after an initial filing, without losing the priority date of the initial filing. The last revision of the convention took place in 1970 known as the Stockholm revision. By 1982 , 93 countries had ratified to the same including U.K, U.S.A. India is signatory to it. China has so far not opted for it. However, it could not provide the much-required International Patent system in legal and organizational term.

 So, was born the Patent cooperation treaty (Washington, 1970). It allows an applicant to institute applications in numerous countries by a single procedure and to delay his final decision to apply in a number of countries (official fee etc) for a period of 20 months after his priority date. Thus, it streamlines the filing of multiple national patent applications. However it does not provide for an international patent .In 1995, 98 states participated in it with U.S.A, U.K, CHINA as its other members. As per the European patent convention (EPC) of 1973, a successful applicant would secure at the end of the process a bundle of national patents (normally in common form) for such participant countries as is designated in the application. Amongst other countries U.K and U.S.A are its members.
Two years later was signed the community patent convention by the EEC states including The Great Britain. As per this convention, if a patent is sought for any ECC state, a single patent for the whole community will be granted by a single main proceeding. However, it becomes inevitably complex, as process would involve national courts.

A discussion the international conventions and treaties would be in complete with the mention of WTO's Trade related aspects of intellectual property rights which was proposed in the Uruguay round which by 1993 had become one of the principal components in the overall package of changes. Under the TRIPS agreement, the members thereof ( which include China, U.K, U.S.A and India) must:

Include virtually all-important commercial fields within the ambit of patentable subject matter, a major change for countries that have traditionally refused to enforce pharmaceutical patents on public health/ access grounds.

Test patent applications for the presence of an initiative step and for industrial application.

Include in patentees' bundle of exclusive rights the right to control the market for imports of the patented products.

Eliminate or severely curtail the practice of granting compulsory licences for patented technology.

History of Patents Laws in India

1856 The Act Vi Of 1856 On Protection Of Inventions Based On The British Patent Law
1852 Certain Exclusive Privileges Granted To Inventors Of New Manufacturers For A Period Of 14 Years.
1859 The Act Modified As Act Xv; Patent Monopolies Called Exclusive Privileges (Making. Selling And Using Inventions In India And Authorizing Others To Do So For 14 Years From Date Of Filing Specification).
1872 The Patents & Designs Protection Act.
1883 The Protection Of Inventions Act.
1888 Consolidated As The Inventions & Designs Act.
1911 The Indian Patents & Designs Act.
1999 On March 26, 1999 Patents (Amendment) Act, (1999) Came Into Force From 01-01-1995.
1972 The Patents Act (Act 39 Of 1970) Came Into Force On 20th April 1972.
2002 The Patents (Amendment) Act 2002 Came Into Force From 2oth May 2003

Trips And Developing Countries

Technology-holders from industrialized countries, which generally possess the resources to protect and enforce their rights globally, will be able to trade under the exclusive rights conferred by IPRs. Firms from developing countries, in contrast, generally lack the means to seek and enforce protection for their innovations in foreign countries, because of the high cost involved and their lack of specialized knowledge. The TRIPs Agreement could have an asymmetric impact on North-South trade flows.

Special value is attached by large pharmaceuticals firms to the availability of patent protection both for processes and for products. They have pursued unilateral action and have been among the most vigorous protagonists of multilateral negotiations with respect to intellectual property in order to extend and reinforce such protection. This is partly explained by the heavy expenditure involved in the development of new drugs, estimated to average around US$ 200 million per new chemical compound, as also by the fact that new products may be imitated relatively easily, as suggested by short imitation time-lags Many developing countries did not begin to grant patent protection for pharmaceutical products until the late 1980s, though the majority did recognize process patents in the field.

The enforcement or threatened enforcement of section 301 of the US Trade Act by the US Government and the GATT negotiations were intended to secure changes in the legislation of these countries. Facing the threat of trade retaliation, due to what was considered to be their lack of or inadequate protection for pharmaceuticals, many developing countries have thus responded in recent years by changing their laws accordingly (Chile, Mexico, South Korea and others). Others (e.g. Egypt, India, Jordan), however, have not so far granted product protection and are considering availing themselves of the possibility of the additional transition period provided by the TRIPs Agreement. This would permit a delay in providing patent protection for pharmaceutical products of up to ten years for developing countries and sixteen for least developed countries. Many developing countries are also introducing or strengthening provisions concerning compulsory licences on grounds of competition, health or public interest.

There are strong arguments favouring such an approach. Pharmaceutical products have wide social implications and governments are particularly concerned with health aspects and with the impact of patents on consumer prices and government health expenditures. Developing countries also fear that the most dynamic segments of the pharmaceutical market, where the prospects of growth are highest, will be excluded for domestic firms as a result of the new patenting rules. This is likely to be the case with respect to drugs based on biotechnology, where `inventing around' (i.e. developing drugs based on similar compositions) is more difficult, particularly to the extent that the drug in itself replicates a substance existing in nature.

Trips And Patent Act

India being a member to the WTO has to implement the TRIPS agreement. This requires the modifications in patent law in India to come in lines with the TRIPS agreement. But in making modifications the issue of public interest should be a prime consideration. In consonance of TRIPS India has amended the law governing patents i.e. Patents Act, 1970 by Patent (Amendment) Act, 2002.

Patents (Amendment) Act 2002:

With the obligation to bring the law in consonance of TRIPS and obligation under WTO, the amendment of Patent Act, 1970 has been amended. This law came into force on 20th May 2003. This Act makes the Indian patent law in compliance of TRIPS but incorporates other safeguards. Several provisions have been incorporated with the view to simplifying and rationalizing procedures. There are provisions in the Act by which Govt. can extinguish the patentees' exclusive right immediately and acquire it if occasion warrants.
However, product patent regime for drugs, pharmaceuticals and agro-chemicals, has not been contemplated in the present amendment. The opportunity has also been utilized to harmonize the patent granting procedures with procedures with international practices and make the system user friendly.

Indian Stand Today
The sensitive issues such as product patents for drugs, all agricultural chemical product, exclusive marketing rights are still to be addressed as far as Indian law on patent stands today. Therefore a separate legislation in this regard will be necessary before 01.01.2005 WTO deadline. This span of time has to be harmonized the patent granting procedures with international practices and to make the system user friendly. The implications will not be evident overnight. The new amendments still do not provide for Patent protection to drugs. India is required to provide such protection only by 2005, and the minister for commerce has indicated that a subsequent amendment shall provide for this. When this happens Indian companies will lose the opportunity to develop processes for patent protected drugs in the country. India will become dependant on MNCs for technology to produce new drugs. Votaries of the new Patents Act argue that old drugs will not be affected by this Act. While this is true, it must be understood that the rate of obsolescence of old drugs are extremely fast today. Further, technological dependence on MNCs is the proverbial "thin edgewhich will be used by the MNCs to establish their dominance over the Indian drug market once again (a position they had lost after the mid seventies). They will then again start charging exorbitant prices for drugs in the Indian market. Since the early eighties, the categories of drugs which show the maximum rise in sales are categories which include overwhelming majority of drugs still under Product Patent or whose Product patents have expired recently. In other words if we had a product patent regime today, the drugs showing fastest growth would have been priced way beyond the capacity of the average consumer.

Geographical Indications

Under Articles 1 (2) and 10 of the Paris Convention for the Protection of Industrial Property, geographical indications are covered as an element of IPRs. They are also covered under Articles 22 to 24 of the Trade Related Aspects of Intellectual Property Rights (TRIPS) Agreement, which was part of the Agreements concluding the Uruguay Round of GATT negotiations.

Section 2(e) of the Geographical Indications of Goods (Registration and Protection) Act has defined the geographical indication, 1999. The "geographical indication", in relation to goods, means an indication which identifies such goods as agricultural goods, natural goods or manufactured goods as originating, or manufactured in the territory of country, or a region or locality in that territory, where a given quality, reputation or other characteristic of such goods is essentially attributable to its geographical origin and in case where such goods are manufactured goods one of the activities of either the production or of processing or preparation of goods concerned takes place in such territory, region or locality, as the case may be".

Some Basic Questions Regarding Geographical Indication

Every region has its claim to fame. Christopher Columbus sailed from Europe to chart out a new route to capture the wealth of rich Indian spices. English breeders imported Arabian horses to sire Derby winners. China silk, Dhaka muslim, Venetian Glass all were much sought after treasures. Each reputation was carefully built up and painstakingly maintained by the masters of that region, combining the best of Nature and Man, traditionally handed over from one generation to the next for centuries. Gradually, a specific link between the goods and place of production evolved resulting in growth of geographical indications.
In December 1999, the Parliament had passed the Geographical Indications of Goods (Registration and Protection) Act, 1999. This Act seeks to provide for the registration and better protection of geographical indications relating to goods in India. The Act would be administered by the Controller General of Patents, Designs and Trade Marks- who is the Registrar of Geographical Indications. The Geographical Indications Registry would be located at Chennai.

1. What is a Geographical Indication? X It is an indication
It originates from a definite geographical territory.
It is used to identify agricultural, natural or manufactured goods
The manufactured goods should be produced or processed or prepared in that territory.
It should have a special quality or reputation or other characteristics

2. Examples of possible Indian Geographical Indications
Basmati Rice Darjeeling Tea
Kanchipuram Silk Saree
Alphanso Mango
Nagpur Orange
"Kolhapuri Chappal
Bikaneri Bhujia
Agra Petha

3. What is the benefit of registration of geographical indications?

It confers legal protection to Geographical Indications in India Prevents unauthorised use of a Registered Geographical Indication by others. It provides legal protection to Indian Geographical Indications, which in turn boost exports. It promotes economic prosperity of producers of goods produced in a geographical territory.

4. Who can apply for the registration of a geographical indication?

Any association of persons, producers, organisation or authority established by or under the law can apply:
The applicant must represent the interest of the producers
The application should be in writing in the prescribed form
The application should be addressed to the Registrar of Geographical Indications along with prescribed fee

5. Who is a registered proprietor of a geographical indication?

Any association of persons, producers, organisation or authority established by or under the law can be a registered proprietor.
Their name should be entered in the Register of Geographical Indication as registered proprietor for the Geographical Indication applied for.

6. Who is an authorized user?

A producer of goods can apply for registration as an authorized user
It must be in respect of a registered geographical indication
He should apply in writing in the prescribed form along with prescribed fee

7. Who is a producer in relation to a Geographical Indication?

The persons dealing with three categories of goods are covered under the term Producer:
Agricultural Goods includes the production, processing, trading or dealing
Natural Goods includes exploiting, trading or dealing
Handicrafts or Industrial goods includes making, manufacturing, trading or dealing.

8. Is a registration of a geographical indication compulsory and how does it help the applicant?

Registration is not compulsory
Registration affords better legal protection to facilitate an action for infringement
The registered proprietor and authorised users can initiate infringement actions
The authorised users can exercise the exclusive right to use the geographical indication.

9. Who can use the registered geographical indication?

An authorised user has the exclusive rights to the use of geographical indication in relation to goods in respect of which it is registered.

10. How long the registration of Geographical Indication is valid?

The registration of a geographical indication is valid for a period of 10 years.

11. Can a Geographical Indication be renewed?

It can be renew from time to time for further period of 10 years each.

12. What is the effect if a Geographical Indication if it is not renewed?

If a registered geographical indication is not renewed it is liable to be removed from the register.

13. When is a registered Geographical Indication said to be infringed?

When an unauthorised user uses a geographical indication that indicates or suggests that such goods originate in a geographical area other than the true place of origin of such goods in a manner, which mislead the public as to the geographical origin of such goods.
When the use of geographical indication result in an unfair competition including passing off in respect of registered geographical indication.
When the use of another geographical indication results in false representation to the public that goods originate in a territory in respect of which a registered geographical indication relates.

14. Who can initiate an infringement action?

The registered proprietor or authorised users of a registered geographical indication can initiate an infringement action.

15. Can a registered geographical indication be assigned, transmitted, etc?

No. A geographical indication is a public property belonging to the producers of the concerned goods.
It shall not be the subject matter of assignment, transmission, licensing, pledge, mortgage or such other agreement
However, when an authorised user dies, his right devolves on his successor in title.

16. Can a registered geographical indication or a registered authorised user be removed from the register?

Yes. The Appellate Board or the Registrar of Geographical Indications has the power to remove the geographical indication or an authorised user from the register. Further, on application by an aggrieved person action can be taken.

17. How a geographical indication is different from a trademark?

A trademark is a sign, which is used in the course of trade, and it distinguishes goods or services of one enterprise from those of other enterprises.
Whereas a geographical indication is an indication used to identify goods having special characteristics originating from a definite geographical territory.

India's perspective in WTO regime is to harmonize with national interest and international obligation. But no compromise should be at the cost of public interest. Areas like pharmaceuticals, agro-chemical products should be taken into consideration while changing Indian law as regards to patent. On the international front India should raise its stand to endeavor to curb the exploitative aspects in international patent regime. The geographical indications should also be effectively implemented and efforts should be made at international level to stop abuse of geographical indications.

Patent law Articles:
Patenting of Micro-Organisms in India
Patent & Its Effect In India
Challenges to India Patent Regime
Whether Patent Law Protects Biotechnological Inventions

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