The ugly in our IP regime

The ugly in our IP regime

SpicyIP undertook a study into the AWS report that Mint had referred to in its investigation, Cozy deals and conflict of interest mark Indian patent grant process, published on 7 October.

Austria Wirtschaftsservice inquired on behalf of the Austrian ministry of commerce and labour between 11 and 29 February with several official IPR institutions and private IPR service providers in India on the IPR situation with regard to foreign entities.

The report has found that there is almost a two-year patent application backlog in the Delhi patent office, which could be attributed to the fact that there are a large number of vacancies in patent offices.

These vacancies and increasing filing rates have forced the patent office to recruit many new examiners during recent years—several of whom have not yet acquired enough experience and “therefore, may respond with incoherent and inconsistent objections to an application". This has led to increasing workload despite new recruitments—the report claims that first substantive examinations and first objections are carried out by junior examiners, and only after this process will senior examiners (assistant controller or higher) take over from the juniors. The wave of newly staffed examiners might worsen this.

Stating that the patent backlog is great, the report however acknowledges that in cases where a patent official is well known to the patent agent, the time taken to grant a patent may not be as much. Similar to what was stated in an earlier SpicyIP post on the Mint report, the AWS report also has found “widespread collaboration" between patent attorneys and IP officials. The report suggests that official examiners have a “clear dependency" on patent searches previously carried out in other national IPR jurisdictions.

Inquiring into the quantum of official fees and fees charged by private service providers, there was found to be a difficulty in obtaining precise charges for each service. Since procedures are standardized by law, this was very disconcerting.

For private service providers, the fees were found to be paid not as a lump sum, but at every step of IPR registration—something the report found lacking in transparency, further making it difficult for an enterprise seeking to file an application to estimate costs. Upon direct inquiry, the law firms quoted quite different prices—for patents, around ­€600-3,500 (Rs37,680-2,19,800); trademarks, €200-1,200; designs, €500-1000; copyright, €300-500. While acknowledging that a legal service provider rarely offers a fixed price for its services, the lack of precise cost and disparate services by firms (vis-à-vis other areas of law as well as other firms) create perceptions of “non-existent transparency and very vague pricing" (the report also took into account that there are additional unforeseen costs under Indian patent law due to pre-grant opposition, and these cannot usually be calculated beforehand).

Reported by SpicyIP, the AWS report also chronicles the problem of “double patent granting" and blames this on the failure of a cross-verification system.

Interestingly, while several people (including this blogger) initially thought the report was the basis of the Mint investigation, both Mint journalist C.H. Unnikrishnan as well as our own study of the report have made it apparent that Mint has, by way of its investigation, come up with most of the hard-hitting findings. But, all this also raises valid questions on the shying away of foreign entrants from the Indian scene due to alleged “collaboration" and lack of “transparency", as well as the backlog in several cases.

SpicyIP hopes that greater transparency will be ensured. The two reports (Mint and AWS) have brought focus to a larger problem that may exist in India’s IP regime.

Edited excerpts from Comment at