Pretentious Report Reviews: GIPC Index ranks India Second-to-Worst in IP Protection

Ritvik M. Kulkarni

The United States Chamber of Commerce (USCC) has yet again awarded a dismal rank to the Indian IP Regime in the 4th Global IP Index released on February 10, 2016. The Global Index, which is prepared annually by the Global IP Chamber of the USCC (GIPC), has set out a total of 30 indicators for assessing the effectiveness and strength of IP law and enforcement in 38 countries. The GIPC also released on February 5, 2016 its Special 301 Report as an evaluative precursor to its Global Index. The Special Report and the Global Index are available here and here respectively.

The Special Report purports to serve as a comprehensive guide to all the factors that make up a robust intellectual property and enforcement system. At the very outset it expresses the American apprehension towards a concerted effort across the world to change the public perception and debate on IP, often based on distorted and inaccurate claims and in contradiction to the careful balance already integrated into the system. It further observes that:

“Globally, there are increasing calls to limit how innovators are able to protect the property rights in their inventions and creations and even calls to limit the scope of what can be protected[1].”

Graphical representations of the Overall Economy Scores, as awarded in the Global Index, are reproduced herein below[2]:

Figure 1
All rights with the US Government

Figure 2
All rights with the US Government

India’s Report Card

India has managed to score an abysmal 7.05 out of a possible 30, a regression from its 7.23 in 2015. India scored 1 out of 7 in patents, 1.47 out of 6 in copyright, a comparatively impressive 2.75 out of 5 in trademarks, 0.5 out of 2 in trade secrets, 1.33 out of 6 in IP enforcement and a big fat zero out of 4 in membership and ratification of international treaties. The last one is because of India’s failure to join the WIPO Internet Treaties, the Singapore Treaty on the Law of Trademarks, the Patent Law Treaty and because India has not entered into a single free-trade agreement with IP chapters in place.

After a sugar coating of conversational flattery the Report moves into a raging criticism of the Indian IP Regime, which is affectionately referred to in the Report as that of the Modi Government. It has slammed the Modi Government for having failed to bring in any substantive change to improve India’s statutory or regulatory IP framework as it has not enacted any new laws or brought in any policy change to ameliorate the IP barriers previously identified by the US International Trade Commission in its 2014 Report on “Trade and Investment Policies in India 2014-15[3]. On the “unfortunate” suspension of the Computer Patent Guidelines[4], the Report emotionally observes that:

“Reports that the suspension of the Final Guidelines was triggered by a complaint filed with the Prime Minister’s office, if accurate, are a blot on the transparency and predictability of the Indian administrative system[5]

However, the Report does identify a silver lining to the seemingly loathsome Indian IP Regime. It applauds the Indian judiciary and recognizes the “competency of Indian judges to resolve patent infringement disputes” Delhi High Court’s decisions in MSD (Merck) v. Glenmark[6] and Roche v. Cipla[7]. Furthermore, it celebrates the Controller General’s decision in refusing Lee Pharmaceuticals’ application for a compulsory license against AstraZeneca for its diabetes drug, Saxagliptin.

Patently Unprotected

India has performed the worst in patent protection. In fact the only mark the Modi Government has managed to garner is for the term of patent. In addition to the revocation of the Computer Patent Guidelines[8], the Index has slammed the Indian judiciary’s decision in Novartis[9] for setting the seemingly “unfair and unreasonable” precedent for a requirement of therapeutic efficacy for patentability; which the GIPC holds inconsistent with TRIPS requirements.

Anti-Piracy Measures, DRM Protection and Trade Secrecy Blues

The Index then moves on to highlight India’s deficit of legislation and its inability to tackle online piracy, especially in relation to software and cinematograph films. It also points out that the Indian system cannot be effectively used because:

the 2000 Information Technology Act, 2008 amendments, and the 2011 Information Technology (Intermediaries Guidelines) Rules appear to be in conflict with the 2012 Copyright Act amendments. The former puts forward relatively clear guidelines and requirements of expeditious removal of infringing material; the latter, conversely, only requires removal for a period of 21 days, with a court order required for any further action.

India clearly lacks guidelines, codified protection measures, and more importantly a robust enforcement mechanism in relation to trade secrets and confidential information. At present Indian trade secrecy laws are dangerously hinging only on the support of common law developments and constitutional elaborations on the right to information and privacy. The Report is also correct in stating that commercially indispensable and valuable proprietary data is highly vulnerable to theft and misuse in the absence of laws governing the matter.

However, the Report is also averse to the Controller General’s historic decision in the Nexavar Compulsory License Case[10] which set a precedent of requiring foreign innovators to manufacture in India as a condition of working the patent in India.

A Complicated Relationship

Lastly, the Report conveys its sheer unhappiness with India’s dismal attitude towards making international commitments in protecting IP. It denotes that:

“In 2015, the Indian delegation at the UNFCCC,  sought to undermine the incentives to develop green technologies by compromising intellectual property protections through the use of forced technology transfer mechanisms and enhanced patentability standards”

However, the Index hopes that India will open its account in this section once the Modi Government concludes the India-EU Free Trade Agreement.

Concluding Remarks

It is more than clear that both, the Special Report and Index, are undercurrents of the immense pressure which the Modi Government is facing from the Obama Administration for the purpose of concluding an FTA favorable to the latter. It would be wise on Modi’s part to not cave into these pressures and try to strengthen the Indian IP scenario in keeping with public interest and the ends of social justice.

 

[1] Special 301 Report, Global Intellectual Property Chamber, USTR, p.9.

[2] Both representations so produced in this post have been extracted from the Executive Summary of the 4th GIPC Index. All rights in relation to both pictures (graphs) vest in the US Government; subject of course to the law of fair dealing prevailing in India.

[3] The ITC’s Report can be accessed here: https://www.usitc.gov/publications/332/pub4566.pdf

[4] Guidelines for the Examination of Computer Related Inventions (CRIs), issued by the Indian Patent Office.

Can be accessed here: http://www.ipindia.nic.in/iponew/CRI_Guidelines_21August2015.pdf

[5] Special 301 Report, Global Intellectual Property Chamber, USTR, p. 91. .

[6]Merck Sharp And Dohme Corporation … vs Glenmark Pharmaceuticals, FAO (OS) 190/2013, C.M. APPL. 5755/2013, 466/2014 & 467/2014

Can be accessed at: http://indiankanoon.org/doc/57798471/

[7] Cipla Ltd. vs F.Hoffmann-La Roche Ltd. & Anr., RFA(OS) 92/2012

Can be accessed at: http://indiankanoon.org/doc/57798471/

[8] Supra, at 4.

[9] (2013) 6 SCC 1

[10] Bayer Corporation v. Natco Pharma Ltd., Order No. 45/2013 (Intellectual Property Appellate Board, Chennai), available at http://www.ipab.tn.nic.in/045-2013.htm

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