Financial Prosperity Through Intellectual Property

6 Jan

P. Mohan Chandran

Thursday, August 16, 2007

Dr. Raghunath Anant Mashelkar, former Director-General of Indian Council for Scientific and Industrial Research (ICSIR), and ex-Chairman of the Standing Committee on IT of World Intellectual Property Organization (WIPO), Geneva, once said, “Tomorrow’s wars will be fought not by conventional weapons, guns, missiles and so on, but in the knowledge markets with new thermonuclear weapons called information and knowledge.” Information and knowledge are just one of the crucial components of Intellectual Property Rights (IPRs) that has assumed increasing significance in today’s knowledge economy.

Intellectual Property Rights is all-pervasive in life. It is found in books, movies, software, cars, computers, medicines, plants, beverages, etc. If you are drinking a cup of tea or coffee while reading this, you are very much encompassed within the boundaries of Intellectual Property (IP). The cup that you are holding may have a unique design and shape protected by Intellectual Property Rights (product designs). The coffee beans or tea leaves must have originated from a popular place and a particular variety of plant that could qualify under Geographical Indications, which again is Intellectual Property. If you are reading this article in a newspaper, the content is again protected under Copyrights, which is Intellectual Property. The name of the newspaper is protected under Trade Mark, which is Intellectual Property. If you are driving a car, the car might have been patented for its engine design, technology, the design of its tyres, the size, etc. If you are using a computer, the brand name of the computer is given protection under Trade Mark, while the software is protected by copyright (in India), and the design and technology of the computer is protected by product designs and patents/copyrights, all of which are Intellectual Property. Similarly, if you are watching a movie, the contents of the movie are protected under copyrights. So, Intellectual Property Rights is everywhere around us. What then is this Intellectual Property Rights?

Intellectual Property Rights is not an alien subject. As people claim ownership rights over their material possessions, they have claim over the rights of their intellectual creations, such as product inventions, books, poetry, designs, brand names, etc. Humans understood that stamping their identity on their creations could benefit them financially in the long run. Intellectual Property Rights now makes it possible for you to claim the ownership of creation/innovation and also benefit you from that ownership.

Intellectual Property Rights is the special protection given to inventors/creators of Intellectual Property for a limited period. Intellectual Property covers Patents, Copyrights, Product Designs, Trade Marks, Geographical Indications, Plant Varieties, layout and design of Integrated Circuits, and undisclosed information (Trade Secrets). The most popular of Intellectual Property Rights are Patents, Copyrights, Trade Marks, Product Designs, and Geographical Indications. Now, let us examine each of these in brief.

Patent: A patent is an ‘exclusive right’ granted by the government of a country to the inventor/creator of the invention to make, use, produce, sell or market the invention, provided that the invention fulfils the criteria of patentability, i.e., novelty, innovativeness or non-obviousness, and industrial use. ‘Exclusive right’ means that, other than the patent-holder or without his prior permission, no one has the right to make, manufacture, use, sell or market the invention, which may otherwise constitute infringement. However, the exclusive right is confined to a limited period, which in the case of India, and most of the other countries, is 20 years from the date of filing of the patent application. A patent is regarded as a property, and it can be inherited, gifted, sold, assigned, or licensed. However, even after manufacturing, selling, licensing, and marketing of the patent, the government reserves the right to cancel the patent, under emergency/certain special circumstances. Infringement of patent is both a civil and criminal offence.

Copyright: Copyrights are given to the author/creator of literary, dramatic, and musical works. It also covers computer programs, software, artistic works, cinematography and films. Copyrights protect the author’s work from infringement by prohibiting reproduction, storage, translation, and public circulation of the work without the author’s prior consent or licensing. In case of computer programs, copyrights protect selling, offering for sale, or giving on hire of the computer programs. In case of artistic work, reproduction, public communication or circulation, adaptation, or translation of the original work is protected by copyrights. For a literary work, copyright protection is given for the lifetime of the author plus 60 years. For cinematographic films, copyright protection is granted for 60 years from the date of publication of the work. Unauthorized use, sale, reproduction, translation, storage, or circulation of the copyrighted work would account for infringement. Infringement of Copyright is both a civil and criminal offence, punishable with a minimum of 6 months and a maximum of 3 years imprisonment, and a fine of Rs. 50,000 – Rs. 2 lakhs or both. For a second time infringement, the minimum imprisonment is 1 year and minimum fine is Rs. 1 lakh.

Trade Mark: Trade Mark is a mark that can be represented graphically, and which distinguishes the goods and services of one seller from the other. Trade Mark includes the shape of the goods, packaging, logos, combination of colours, punchlines/baselines, and brand names. Trademark registration is initially given for 10 years but is renewable from time to time for an unlimited period on payment of annual registration fees. Failure of renewal or payment of registration fees makes the trademark protection invalid, which means it can be used by anyone without the fear of infringement. In some countries protection is also provided to ‘Service Mark’ similar to Trade Mark. A Service Mark identifies the services of a business, industrial or commercial service provider. False registration of a Trade Mark may attract a minimum fine of Rs. 50,000 and a maximum fine of Rs. 2 lakhs, or an imprisonment of 6 months to 3 years or both. False representation of a Trade Mark, falsely applying for a Trade Mark, unauthorized making or possessing a Trade Mark, tampering or selling of a registered Trade Mark, and applying the country of origin falsely are allconstrued as infringement. In cases of infringement, the penalty may include imprisonment up to 2 years, or fine or both. In case of infringement pertaining to drugs or food, the imprisonment term is 3 years, or fine or both.

Product Design: Design includes features such as shape, size, pattern, ornament, and composition of lines or colours. These features may be in any form (two-dimensional or three-dimensional or both), and may be manufactured by any process (manual, chemical or mechanical). However, the finished product must satisfy the registration criteria of novelty and industrial applicability. The design should be original, distinctive, appealing, and visible to the naked eye. Moreover, the design should not include anything that suggests the involvement or usage of a mechanical device. A registered design is initially valid for a period of 10 years and can be further extended up to another 5 years by renewing it before expiry. False representation of a product design as registered one is punishable with imprisonment of six months or a fine of up to Rs. 50,000 or both. Infringement of a registered design is a criminal offence and may attract imprisonment of up to 3 years or a fine between Rs.50,000 and Rs.10 lakhs or both.

Geographical Indication: A Geographical Indication is any indication that identifies any goods (agricultural, manufacturing, or natural goods) originating from a particular territory, area, region, or locality of a registered user, and possesses unique characteristics, quality, or reputation, attributed to its geographic region. The Geographical Indications of Goods Act grants the right to use the Geographical Indication to the person(s) or entities, of a specific geographic area from where the goods are originated, manufactured, processed, and prepared. A Geographical Indication can initially be registered for a period of 10 years, and can be protected perpetually by renewing it from time to time by paying the renewal fees. Infringement of a Geographical Indication can lead to an imprisonment term of a minimum of 6 months and a maximum of 3 years, and a fine between Rs. 50,000 and Rs. 2 lakhs. Some examples of Geographical Indication are Kolhapuri chappal, Agra ka peta, Kanchipuram saris, Benares saris, Nagpur oranges, Basmati rice, etc.

Even in today’s dynamic scenario, many businesses still miss the opportunities of Intellectual Property creation, as there is no coherent policy to capture the flash of creativity or the moment of innovation. Most of the innovative ideas in several companies simply go unreported!

Intellectual Property is the essence of innovation. Intellectual Property promotes innovation and also gives protection to it. Innovation and creation ignite economic development. By encouraging innovation and protecting Intellectual Property, the society provides impetus for creative people to invest their time and resources in developing novel ideas. Intellectual Property benefits not just the creator/inventor but the whole society, and so it is a win-win situation for both. Intellectual Property allows the creator to exploit his creation for a limited period by commercializing it, while the society learns new methods/techniques of innovation from the inventor, who makes it public in lieu of the protection granted to him by the government. In this way, Intellectual Property creates a balance between the needs of the inventor and the society, thereby harnessing growth and development. Without protection to Intellectual Property, it would have been impossible to think about new products and technologies entering the market, as they would be copied easily by imitators without investing considerable resources. In fact, it is not an exaggeration, but an understatement, to state that Intellectual Property is the foundation for a growth-oriented economy.

(c) 2007. P. Mohan Chandran. All Rights Reserved.

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