TechnologyStart-upsandIPProtection

inIndia

December2019

TechnologyStart-upsandIPProtectioninIndia

LinkagesbetweenIPProtectionandStart-upsinIndia

Published by

CUTS Institute for Regulation and CompetitionstA1,1 �loor,KheharSinghEstate,Saidulajab,Saket,NewDelhi–110030

Email:circ@circ.in

Website:http://www.circ.in

©CUTSInstituteforRegulationandCompetition

AuthorsGarimaSodhi,AkritiJain&RinkiSingh(CIRC)

ThisreporthasbeenpublishedbyCIRCundertheprojectentitledCompIPimplementedbyCIRCandCUTSInternational.CIRCwouldappreciatereceivingacopyofanypublicationwhichusesthispublicationasasource.NouseofthispublicationmaybemadeforresaleorothercommercialpurposeswithoutpriorwrittenpermissionofCIRC.

Table of Content

Executivesummary 1

Chapter 1

Indian IPR Ecosystem and Government Policies 4

1.1. India'sStart-upEcosystem 6

1.2. India'sIntellectualPropertyRights(IPRs)Regime 6

1.3. InitiativesbyGOItoPromoteInnovation 8

Chapter 2

IPR Use by Small Firms: Evidence from Literature 10

2.1. ExtentofIPRusebystart-ups 10

2.2. FactorsdeterminingIPRusebystart-ups 11

2.3. GovernmentpoliciesimpactingIPRusebystart-ups 12

2.4. Conclusion 13

Chapter 3

IPR Use by Indian Start-ups: Survey Results 14

3.1. Firm'scharacteristicsandIPR�iling 14

3.2. IPRawarenessandimportanceamongtech-start-ups 18

3.3. IPRprotectionandmanagement 19

3.4. RoleofIncubators 20

3.5. AwarenessofgovernmentinitiativeslikeStart-upIndia 21

3.6. Challengesidenti�iedbystart-upsinIPRusage 22

Chapter 4

Conclusion and Way Forward 24

4.1. Conclusion 24

4.2. Recommendations 24

4.2.1. StrengtheningJudicialProtectionofIPinIndia 24

4.2.2. HumanResources 25

4.2.3. UseofInformationandCommunicationTechnology(ICT) 26

4.2.4. CapacityBuilding 26

4.2.5. IPFacilitationCentres 27

4.2.6. IPRConsultationandAwarenessatDPIIT 27

4.2.7. IPStrategy 28

References 29

Annexure1:Surveymethodology 32

Annexure2:Questionnaire 33

List of Figures and Tables

Figure1.1 NumberofIPRapplicationsduring2012–2018

Figure3.1 Proportionoftechstart-upsindifferentindustrialsectors

Figure3.2 Proportionoftech-start-upsindifferentbusinesssectorsforIPR�ilings

Figure3.3 Start-ups'classi�icationbasedonbusinessofferings

Figure3.4 PerceptionofIPRimportanceamongtech-start-ups

Figure3.5 IPR�ilingbytechstart-upsthatgivehighimportancetoitsdifferentforms

Figure3.6 Proportionoftechstart-upsthatareactive/inactiveinprotectingdifferentformsof

IPRs

Figure3.7 Involvementoftechstart-upsinIPmanagementactivities

Figure3.8 Techstart-upsthathaveIPpolicyandconductIPsearches

Figure3.9 Proportionoftechstart-upsengagedinlicensingactivity

Figure3.10 Challengesfacedbystart-upsinregisteringIP

Table3.1 Characteristicsof�irmscategorisedasactiveandinactiveinIPR�iling

Acronyms and Abbreviations

AI Arti�icialIntelligence

Assocham AssociationofChambersofIndustry

BCLT BerkeleyCentreofLawandTechnology

B2C BusinesstoCompany

B2B BusinesstoBusiness

CGPDTM ControllerGeneralofPatents,Designs&TradeMarks

CIPAM CellforIPRPromotionandManagement

DPIIT DepartmentforPromotionofIndustryandInternalTrade

GI GeographicalIndications

GoI GovernmentofIndia

ICT InformationandCommunicationTechnology

IP IntellectualProperty

IPR IntellectualPropertyRights

IoT InternetofThings

ITeS InformationTechnologyenabledServices

Nasscom NationalAssociationofSoftwareandServicesCompanies

NIS NationalInnovationSystem

PE PrivateEquity

PPV&FR ProtectionofPlantVarietiesandFarmers'Rights

R&D ResearchandDevelopment

RGNIIP RajeevGandhiNationalInstituteofIntellectualPropertyManagement

SICLD SemiconductorIntegratedCircuitsLayout-DesignAct

SIDCO SmallIndustriesDevelopmentCorporation

SIPP StartupsIntellectualPropertyProtection

SMEs SmallandMediumEnterprises

STIP Patent,TradeMark,IndustrialDesigns

TRIPS Trade-RelatedAspectsofIntellectualPropertyRights

TISCs TechnologyandInnovationSupportCentres

VC VentureCapital

WIPO WorldIntellectualPropertyOrganisation

WTO WorldTradeOrganisation

Executivesummary

Innovationhasledtoenormoustechnologicaladvancement,resultinginanexponentialgrowthoftheworldeconomy.It'snotonlylargebusinessesthatinvestinResearchandDevelopment(R&D),start-upsalsobringinnovation and promote economic growth with new business ideas capital formation, and employmentgeneration.However,inIndia,morethan90%ofstart-upsfailintheir�irst�iveyears,mostlyattributabletolackofinnovation,skilledworkforceandfunding.

Withregardtoinnovation,protectionofIntellectualPropertyRights(IPR)becomesimportantifthecompanywishestoextractcommercialbene�itfromtheidea.IPplaysanimportantroleinfacilitatingtheprocessoftaking innovative technology to the marketplace and enhancing competitiveness of technology-basedenterprises.LiteratureshowsthatIPRuseby�irmsresultsinhighperformance,increasedsale,highcredibilityandincreasedoutsideinvestments.However,empiricalevidencefortheUSandotherOECDcountriessuggeststhatstart-upinnovatorsrefrainfromutilisingIPRtoolsduetohigh�inancialcostandadministrativeworkofpatenting,lackofknowledgeaboutIP'srelevanceandotherinformationde�icit.

Topromotestart-ups'growth,providethemasupportiveandrobustecosystemandencourageprotectionofIntellectualPropertyRights(IPR), theIndiangovernmenthas introducedmanysigni�icantmeasures.Keystepsweretakenin2016withthelaunchofStart-upIndiainitiative,formationoftheNationalIntellectualRights(IPR)policyandPatent(Amendment)Rules.

InIndia,thetrendofIPR�ilinghasbeendocumentedforscienti�icagenciesoracademicinstitutions,�irmsinthesoftwareindustry,manufacturingsector,handicrafts,glasswareandothersmall-scaleindustries.However,theIPR�ilingbehaviourorprotectionofIPRsbyIndianTechnologyStart-upsleavesmuchtobedesired.TheydonothavemuchawarenessaboutIndianIPRsystemandgovernmentinitiativestopromotesuchasystem.Atthegovernmentendtoo,thereisaknowledgede�icit.Indianregulatoryandlegislativereformsshouldbebasedonananalysisofthegrowthpatternandcharacteristicsofstart-ups;awarenessandengagementofstart-ups in IPRprotection; challenges facedby themwhile applying for suchprotection; and also, theirawarenessandopinionaboutvariouspolicyreformsandschemes.

Withthisbackdrop,theobjectivesofthisreportaretwo-fold.First,itexaminesthelevelofawarenessamongIndiantechnologystart-upsaboutvariousformsofIPRandtheireffortsforitsprotection.Secondly,itexploresifthetechstart-upsareavailingthebene�itsofIndiangovernmentinitiativeslikeStart-upIndiaandsimilarotherprogrammes/schemes.Thisreportpresents�indingsfromasurveybasedontheviewsof249techstart-uprepresentativesfromacrossIndiaabouttheirawarenessofIPandengagementinitsprotection.Buildingon�irst-handaccountoftechstart-upsabouttheirexperienceindealingwiththeIndianIPof�ice,thisreportalsoidenti�ieskeychallengesthattechstart-upsfaceduringIPRprotection.TakinglessonsfromthebestpracticesinIPof�icesinothercountries,thereportprovidesrecommendationsonpotentialareasofimprovementtomakethesystemmoreuser-friendlyandtransparentandrobust.

Key�indingsofthereportaresummarisedbelow:

· Thereisnosigni�icantdifferencebasedonpaid-upcapital,employeestrengthand�irms'ageamongstart-upsthat�ileIPRprotection(IPRactive)andthosewhodonotprotecttheirintellectualproperty(IPRinactive).However,start-upswithrelativelylowpaid-upcapitalshowslightlyhigherpropensitytoapplyforprotectionofpatentandindustrialdesignrights.

· A very large proportion of tech start-ups (almost 90%) are active in copyright and trademarkprotection. Trademark is the second most popular IP form, particularly among agritech and e-commercestart-ups.Thoughstart-upsineverysectorconsiderpatentsasveryimportantformofIPprotection,only47%start-upsactually�ileforthisprotection.

· Industrialdesignprotectionis�iledbyaverysmallproportion(37%)ofstart-upsineachsector.Averylargeproportionoftechstart-ups(62%)areunawareoftheimportanceofindustrialdesignprotectionfortheir�irm.

1

· Morethanhalfofstart-ups(52%)donothaveaformal�irm-levelIPpolicy.However,theyorganiseIP

trainingfortheiremployees,conductIPsearches,andalsoseekthehelpofIPprofessionalswhile�iling

IPprotection.ThelikelihoodofforminganIPpolicyandconductingIPsearchesisparticularlyhigh

amongagritech(60%and91%respectively)andrelativelylowforhealthtech�irms(38%and57%

respectively).

· Technologytransferthroughlicensing/saleofIPislessprevalentamongIndiantech-start-ups(18%).

Morethanhalfofthestart-upsindicatedthattheyownanIPprotectionbutdonotlicenseit.Sectoral

classi�icationindicates�irmsine-commerceandtechnologysolutions(e-ticketing,InternetofThings,

etc.)aremoreactiveinlicensing-outthan�irmsinothersectors.

· Almost20%start-upsaresupportedbyincubatorssuchasIITs,CareerLauncher,ManipalUniversity

TechnologyBusinessIncubators,andBiotechnologyIndustryResearchAssistanceCouncil(BIRAC)in

India.

· Althoughapproximately90%start-upsinIndiaareawareofStart-upIndiainitiativeoftheIndian

government,only35%ofthemhavebeenabletoregisterunderthisandmerely20%start-upsare

awareofspeci�icbene�its,schemes,taxexemptionsandfacilitiesprovidedbythegovernment.

· 70%start-upsbelievethatconductingawarenesscampaigns,outreachprogrammes,IPtrainingfor

studentsandestablishmentofCellforIPRPromotionandManagement(CIPAM)bythegovernment

havebeenhelpfulinbringingupandmanagingthestart-ups.

· Themostnotablehurdles,aspointedoutbytechstart-upsin�ilingIPRapplicationsare:time-taking,

lengthyand costly.Theaverage time lagbetweenpatent �iling and itsdisposal (granted, refused,

abandonedu/s21(1)),until2016,was�ivetosevenyearswhichwasreducedtotwo-and-a-halfyears

in2017.

KeyrecommendationsofthereportbasedonlessonsfromthebestpracticesinIPof�icesinothercountriesare

summarisedbelow:

· India needs to take steps to strengthen the judicial protection for IPR protection focusing on

modernisingIPadjudication.Thereisaneedtoestablishanoptimallyresourcedandhighlyef�icient

judicialsystemwithasingleappellateIPboardforalltheIPswithseatsinmultiplecitiesandmore

judicialandtechnicalmembersontheboard.

· Improvethestrength,ef�iciencyandtechnicalabilitiesofhumancapitalinvolvedintheprocessofIP

examinationinIPof�icesbyprovidingadequatetrainingtothem.ForIPof�icialandadministrative

staff, training in of�ice administration, budgeting and other relatedmatters can be provided. To

facilitate this, international exchange programmes for IP of�icials could be planned. This can

considerably reduce the overall time required for patent grant and clear themassive backlog of

examinationofpatentapplicationsinIndianIPof�ices.

· IndianeedstofocusonenhancingtheICTcapabilitiesofIPof�icessoastoensuretransparency,smooth

processandfasterdisposal.WIPO'ssoftwaresolutionscanbeadoptedforend-to-enddigitisationofIP

applicationsandprocessing.

· Thereisaneedtoconductcapacitybuildingbythegovernmentinordertosensitisestart-upson

varioustypesofIPRprotection,technicalrequirementsfortheir�iling,IPevaluationandmanagement.

EducationalinstitutesshouldbeencouragedtointroduceIPReducationintheircurriculum.Focussed

training and educational programmes on patent examination of the frontier and emerging

technologieslikeInternetofThings(IoT),Arti�icialIntelligence(AI)shouldbedesigned.

2

· Under theSIPP, foreffective implementation, theCGPDTMempanelled facilitators toprovide freeconsultation/guidanceandassistancein�ilinganddisposalofIPapplicationstostart-upsforfree.Instanceshavebeenreportedoffacilitatorsignoringfacilitationtostart-upsordemandingextrafeefromthem.StricterenforcementofDepartmentforPromotionofIndustryandInternalTrade(DPIIT)empanelled facilitators is required along with involvement in consultation and guidance, andassistancein�ilinganddisposalofIPapplicationtothestart-ups.

· ThegovernmentshouldstrengthentheIPawarenessprogrammeatDPIITregistrationlevelitselfbysensitisingthestart-upsaboutimportanceofIPRfortheirbusiness.Thiscanbedonethroughfreeandcompulsoryconsultationalongwithvariousothermethodsofinformationdissemination.

· Thestart-upshouldhaveanIPstrategyfromtheoutsetasthatcanhelpthe�irmcomparethecostofIPwith its bene�its in the long run. Firms should also provide staff training on IPR and conduct IPvaluation.ItmayalsobeusefultoexpandtheIPfacilitators'scopetoprovideconsultationsforbuildingIPstrategytothestart-ups.

· ProperenforcementoftheinitiativescanmaketheIPenvironmentofIndiarobustandcomparabletointernationalstandards.

3

Chapter 1

Indian IPR Ecosystem and Government Policies

Innovationhasledtoenormoustechnologicaladvancement,resultinginanexponentialgrowthoftheworldeconomy.Innovationisalsocrucialfornationalcompetitiveness.ApartfromlargebusinessesinvestinginResearchandDevelopment(R&D),start-ups¹orentrepreneurs²alsobringinnovationandpromoteeconomicgrowthwithnewbusinessideastothemarket,capitalformation,employmentgeneration,etc.(Verheulet al.,2002).However,researchsuggeststhatinIndia,morethan90%ofIndia'sstart-upsfailinthe�irst�iveyearsdue to lack of innovation, skilled workforce and funding³. Thus, to propel start-ups, there is a need toencourageinnovation.

Withregardtoinnovation,protectionofIntellectualPropertyRights(IPRs)becomesimportantifthecompanyexpectscommercialbene�itsfromtheidea.IPplaysanimportantroleinfacilitatingtheprocessoftakinginnovativetechnologytothemarketplaceandenhancingcompetitivenessoftechnology-basedenterprises.⁴IPRisanimportantstrategicand�inancialassetforbusinessorganisations(SprusonandFerguson,2007).ExistingevidenceincountriesliketheUS,Finland,Austria,andGermanysuggestthatIPRuseby�irmsleadstohighperformance(Mareschet al.,2016),increasedsale(Ernst,2001),highcredibility(SichelmanandGraham,2010)andincreasedoutsideinvestments(Linda,2013).

However, alongside these bene�its, IPR also presents the risk of accusation of infringement leading tosubsequentheavylitigationcosts.FiguresofpatentlitigationcasesintheUSsuggestariseinthelitigationratiofrom1.6%in2005(2,706patentcasesoutof1,65,485issuedpatents)to2.2%(6,386patentcasesoutof290,083issuedpatents)in2013(CzarnitzkiandCriekingen,2018).Also,thereisevidencethatthecostofsuchlitigationfallsmoreheavilyonsmall�irmsascomparedwithlargeones(LanjouwandLerner,2000).

Therefore,itisimportantforsmaller�irms,especiallystart-ups,toensurethattheirproduct/serviceofferingsarenotintheviolationofothers'IPR.EmpiricalevidencefortheUSandotherOECDcountriessuggeststhatstart-up innovators refrain fromutilising IPR toolsdue tohigh �inancial costandadministrativeworkofpatenting(SichelmanandGraham,2010),lackofknowledgeabouttheIP'srelevanceandotherinformationde�icit(Burrone,2005).Insuchascenario,governmentinterventionplaysapivotalroleinstimulatingIPRusethrough policy assistance like establishing patent facilitation centres, organising programmes for IPRawareness,andotherrelaxednormsandprocedureforstart-upsetc.

¹AspertheDepartmentforPromotionofIndustryandInternalTrade(DPIIT),GovernmentofIndia,anentityisconsideredasa

start-upif,“itisincorporatedorregisteredasprivatelimitedcompanyorpartnership�irmorlimitedliabilitypartnershipinIndia,

operateduptosevenyearsfromthedateofitsincorporationandhasturnovernotmorethan25crore(250million)INRforany

�inancialyearsinceitsinception”.Thisde�initionwasfollowedtoidentifythestart-upsinthesurveyusedinthereport.However,

theDPIITrelaxedtheconditionsforeligiblestart-upsviaanoti�icationdatedFebruary2019relaxedbyextendingthetimeperiod

ofrecognitionfromseventotenyearsfromthedateofincorporationandincreasingtheceilinglimitofmaximumturnoverinany

�inancialyear(FY)fromINR250milliontoINR1billion.

²Thisreportwillusethetermsstart-upsandentrepreneursand�irmsinterchangeably.

³77%ofventurecapitalistssurveyedbelievethatmanyIndianstart-upslackpioneeringinnovationbasedonnewtechnologiesor

uniquebusinessmodels.Indianstart-upsarepronetoemulatealreadysuccessfulglobalideas.Availableathttps://www-

03.ibm.com/press/in/en/pressrelease/52424.wss

⁴https://www.wipo.int/sme/en/documents/ip_innovation_development_fulltext.html

4

5Realisingstart-ups'roleintheNationalInnovationSystem(NIS) ,thegovernmenthasbeentakinginitiatives

topromotestart-upecosystem,includingsupportiveIPRlegislation.Forexample,in2016theStart-upIndia

initiative was launched to provide handholding, funding support, incubation and industry-academia

partnershipforgrowththroughvariousschemes.Oneoftheschemes,forexample,enablesstart-upstoself-

certify (through mobile app) their compliance with nine labor and environment laws to reduce their

regulatoryburden.Anotherschemeensuresrelaxednorms(intermsofpriorexperienceandturnover)for

public procurement from Small and Medium Enterprises (SMEs) and start-ups. Start-up ecosystem, in

additiontopolicyreformsforhandholding,�inancingandmentoring,isalsostrengthenedbyatransparent,

user-friendlyandef�icientIPsystem.

In2016,NationalIntellectualPropertyRightsPolicywasformedwithsevenobjectives⁶outliningspeci�ic

actionplanforeachoneofthem.In2016,TheMinistryofCommerceandIndustry,DepartmentforPromotion

ofIndustryandInternalTrade(DPIIT)–(DIPPearlier)amendedThePatentRule,2003in2016and2017.The

newrule,calledthePatent(Amendment)Rules,2016,hasprovisionofrequestforexpeditedexaminationof

IPRapplication⁷,andalsoaddsanewclausetorecognisestart-upsasaseparateentityto�ileIPRapplications.

ThePatent(Amendment)Rules,2017changedthestart-upde�initionasan“entity in India recognised by the

competent authority under Start­up India initiative”.Thisinitiativeincentivisesprotectionofinnovationby

start-upsthroughIPRusingschemeslike“legal support and fast tracking of patent examination at low cost”.

Theseregulatoryandlegislativereformsnecessitateananalysisofthegrowthpatternandcharacteristicsof

start-ups;awarenessandengagementofstart-upsinIPRprotection;challengesfacedbythemwhileapplying

forsuchprotection;andalso,theirawarenessandopinionaboutvariouspolicyreformsandschemes.

Withthisbackdrop,theobjectivesofthisreportaretwo-fold.First,itexaminesthelevelofawarenessamong

IndiantechnologyentrepreneursaboutvariousformsofIPRandtheirengagementforitsprotection.Secondly,

itexploresiftheIndiantechstart-upsareavailingthebene�itsofIndiangovernmentinitiativeslikeStart-up

Indiaandsimilarotherprogrammes/schemes.Buildingon�irst-handaccountofIndiantech-start-upsabout

theirexperienceindealingwiththeIndianIPof�ice,thisreportidenti�ieskeychallengesthattechstart-ups

face during IPR protection. Taking lessons from the best practices in IP of�ices in other countries, it

recommendspotentialareasofimprovementtomakethesystemmoreuser-friendlyandtransparentand

robust.

Thisreportisdividedintofourchapters.ThepresentchapterprovidesthebackdropoftheIndianstart-up

ecosystem,IPRregime,overviewofcurrenttrendsinIPR�ilingandinitiativestakenbytheIndiangovernment

topromoteIPRactivityamongstart-ups.Chapter2providestheliteratureoverviewofevidencesoftheextent

ofIPRusebysmall�irmsindevelopednations.Chapter3discussesthesurveymethodologyandpresentsthe

surveyresults.Chapter4providesconclusionandrecommendations.

⁵networkofinstitutionsinthepublicandprivatesectorswhoseactivitiesandinteractionsinitiate,import,modifyanddiffusenew

technologies.”(Freeman,1987),availableathttps://www.oecd.org/science/inno/2101733.pdf⁶Theseobjectivesinclude(1)IPRawareness:outreachandpromotion,(2)generationofIPR,(3)legalandlegislativeframework,

(4)administrationandmanagement,(5)commercialisationofIPR,(6)enforcementandadjudication,and(7)humancapital

development.7Rule24CofthePatentsRule,2013:Anexpeditedapplicationcanbe�iledbyastart-upforaspeedyexaminationandgrantof

patentso�iledascomparedtoanormalapplicationwhichcantakeasmanyas48monthsforexaminationandgrantofthepatent.

5

1.1. India's Start-up Ecosystem

India'sstart-upecosystemhasevolvedinthepastfewyears⁸.TheGovernmentofIndia(GoI)hastakenvarious

initiatives todevelopahealthy start-up ecosystem to encourage innovation andentrepreneurship in the

country.

SeveralpoliciesbytheIndiangovernmentlike–TheScience,Technology&InnovationPolicy(STIP),2013;The

NationalIntellectualPropertyRightsPolicy,2016;ThePatent(Amendment)Rules,2017,andschemeslike

Start-upIndia,MakeinIndia,Start-upsIntellectualPropertyProtection(SIPP),SchemeforIPRAwareness–

CreativeIndia;InnovativeIndia',etc.–havecontributedtowardthegrowthanddevelopmentofstart-ups,and

innovationecosysteminIndia.Indiawasranked37thoutof125countriesinglobalstart-upecosystemsin

2016-17,placing it tobea leadingnation inAsianstart-upecosystembesideChina⁹.Withrespect to the

rankingofthecities,threeIndiancities–Bangalore,DelhiandMumbai–havemadeittothetop40listglobally.

AccordingtoNasscomStart-upReport,2018,theIndianstart-upbaseisthethirdlargestintheworldpreceded

bytheUSandUK¹⁰,anditsstart-upecosystemcloselyresemblesthatofIsraelandUK.Thestart-upbasein

Indiaisgrowingat12-15%.Morethan1,200newstart-upshavebeenaddedin2018.Thesameyear,the

numberofadvancedtechstart-upsincreasedby50%,investmentsincreasedfrom$2billionin2017to$4.2

billionin2018,andaround40,000newdirectjobswerecreatedthroughthesestart-ups.Eightstart-upslike

Oyo,Swiggy,PaytmallandByjumadetheirwaytothelistofunicorns,placingIndiainthirdpositionwith18

unicornstart-upsoutof250+totalunicornsglobally,leavingbehindUK,GermanyandIsrael.

1.2. India's Intellectual Property Rights (IPRs) Regime

IPreferstocreationsofthemind:inventions;literaryandartisticworks;andsymbols,namesandimagesused

incommerce¹¹. Itisintellectualcapitalwhichdifferentiatesone'sproductsandservicesfromthatofothers.

IPR is a general term for assignment of property rights to such intellectual creations through patents,

trademarks, copyright, geographical indication, among others. IP law grants the owners of intellectual

creationanexclusiverighttouse,assigningotherstouse,andbene�itingfromtheircreation.Thekeyconcept

ofIPRliesinthenotionofputtingtheinventionin“publicdomain”andgivingtherighttotheinventorto

restrict its commercial use by others for a “�ixed period”. Themain objective is to safeguard creators of

intellectualgoodsandservicesbygrantingthemtime-boundrightstocontrolthecommercialproductionand

distributionofprotectedrights.Bystrikingtherightbalancebetweentheinterestsofinnovators(through

time-bound exclusive territorial right) and thewider public interest (by putting the invention in public12domain),theIPsystemaimstofosteranenvironmentinwhichcreativityandinnovationcan�lourish.

⁸India'srankintheGlobalInnovationIndex(GII)hasimprovedfrom81stin2015to57thin2018.TheGlobalInnovationIndex(GII)isanindexformeasurementoftheinnovationcapabilitiesof126economiesprovidingadatabaseofdetailedmetricsofinnovationdriversandresults.CountriesacrosstheworldusetheGIIrankingandinnovationmetricstoimprovetheirinnovationperformancebyidentifyingtheirstrengthsandchallengesbyalteringtheirpoliciesandschemes.Availableathttps://www.globalinnovationindex.org/analysis-indicator

⁹Thisreportranks125countriesbaseduponfactorslike(1)quantityofstart-upecosystem(numberofstart-ups,co-working,accelerators,etc.(2)qualityofstart-ups(successandpopularity),(3)businessenvironmentslikeeaseofdoingbusiness,governmentpolicyetc.availableatStart-upBlinkReport2017,Availableathttps://www.start-upblink.com/blog/start-up-ecosystem-rankings-start-upblink/

¹⁰Availableathttps://www.nasscom.in/knowledge-center/publications/indian-tech-start-ecosystem-2018-approaching-escape-velocity

¹¹Availableathttps://www.wipo.int/edocs/pubdocs/en/intproperty/450/wipo_pub_450.pdf

¹²Availableathttps://www.wipo.int/edocs/pubdocs/en/intproperty/450/wipo_pub_450.pdf

6

IPRsareterritorialinnature.Thatmeanssuchrightsarecountry-speci�icandthelawregulatingitisenacted

byeveryjurisdictiontodeterminetheambitofIPprotectionaccordedbyit.IPRsareoftwotypes:industrial

rights and copyright. Industrial rights are provided for inventions, trademark, industrial designs and

geographicalindicationforwhichfoundationwaslaidintheParisConventionfortheProtectionofProperty

Rights,1883.Copyright,ontheotherhand,isprovidedforliteraryandartisticworks,�ilmsandmusic;the

foundationwaslaidintheBerneConventionfortheProtectionofLiteraryandArtisticWorks,1886.Among

variousformsofIPRs,thepresentreportspeci�icallyfocusesonthreeforms,i.e.,patents,trademarksand

copyright.

Apatentisanexclusiverightgrantedforaninvention–anewproductorprocessinvolvinganinventivestep

andcapableofindustrialapplication¹³.UndertheIndianPatentAct,theprotectionisgrantedforalimited

periodof20yearsfromthe�ilingdateoftheapplication¹⁴.Onceapatentexpires,protectionendsandthe

inventionentersthepublicdomain.Atrademark,ontheotherhand,isadistinctivesignthatidenti�iescertain

goodsorservicesproducedorprovidedbyanindividualoracompany.Trademarksmayconsistofdrawings,

symbolsorthree-dimensionalsigns,suchastheshapeandpackagingofgoods.Trademarksareregisteredfora

termof10yearsbutmayberenewedfromtimetotime.Copyrightisalegaltermusedtodescribetherights

thatcreatorshaveovertheirliterary,dramatic,musicalandartisticworks.Itisarightgivenbythelawto

creatorsofliteraryandartisticworksandproducersofcinematograph�ilmsandsoundrecordings.

A robust IPR regime and effective enforcement mechanism is imperative to increase the global

competitivenessofindustries.IPRlegislationinIndiaiswellestablishedandiscompliantwiththeAgreement

on Trade-Related Aspects of Intellectual Property Rights (TRIPS)¹⁵. All forms of IPR are protected and

enforcedbyeightstatutesasgivenbelow:

1. TheTradeMarksAct,1999

2. TheCopyrightAct,1957

3. ThePatentsAct,1970

4. TheDesignsAct,2000

5. TheGeographicalIndicationsofGoods(RegistrationandProtection)Act,1999

6. TheSemiconductorIntegratedCircuitsLayout-Design(SICLD)Act,2000

7. TheProtectionofPlantsVarietiesandFarmersRightsAct(PPV&FR),2001

8. TheBiologicalDiversityAct,2002

Theof�iceoftheControllerGeneralofPatents,Designs,TrademarksandGeographicalIndications(CGPDTM)

undertheMinistryofCommerceandIndustry,administersthe�irstsixofthelawslistedabove,i.e.,relatedto

patents, trademarks,design, geographical indication, copyright andSICLD.Theother two legislations i.e.

PPV&FR,2001andtheBiologicalDiversityAct,2002aregovernedbytheMinistryofAgricultureandthe

MinistryofEnvironmentandForestrespectively.Thereisnospeci�iclegislationinIndiatoprotectandenforce

IPrightsconcerningtradesecrets;however,itiscoveredundertheambitofcommonlaw.

¹³Section2(1)(j)ofIndianPatentAct,1970.Availableat

¹⁴http://www.ipindia.nic.in/writereaddata/Portal/IPOAct/1_31_1_patent-act-1970-11march2015.pdf

¹⁴Section53ofIndianPatentAct,1970

¹⁵TheAgreementonTrade-RelatedAspectsofIntellectualPropertyRights(TRIPS)isaninternationallegalagreementbetweenall

themembernationsoftheWorldTradeOrganisation(WTO).TheTRIPSAgreementintroducedglobalminimumstandardsfor

protectingandenforcingnearlyallformsofintellectualpropertyrights(IPR),includingthoseforpatents.TheTRIPSAgreement

hasbeeninforcesince1995andistodatethemostcomprehensivemultilateralagreementonintellectualproperty.

7

ThetrendinIP�ilingsinthepastsevenyearsasnotedinthereportsandCIPAM'swebsiteisshowninFigure16

1.1.AspertheannualreportsofCGPDTM(2012-2018) andIPtrendsdataofCellforIPRPromotionand

Management(CIPAM)¹⁷, Indiaexperiencedastagnantrateof IPapplicationsuntil2015-16.However, the

numberofIPapplicationshasshownincreaseintheyears2017and2018,particularlyinTrademark.With

regardtostart-ups,asperthereportreleasedbytheCIPAM(2018)¹⁸,693patentapplications(normaland

expedited)were�iledbythem.AsofDecember2017,outof323expeditedapplicationsreceived,45were

grantedpatents;ofthose,nineweregrantedtostart-ups.¹⁹Since2016total450start-upshave�iledexpedited

applicationsoutofwhich120start-upshavebeengrantedpatents.²⁰

Figure 1.1Number of IPR applications during 2012 – 2018

¹⁶http://www.ipindia.nic.in/annual-reports-ipo.htm

¹⁷http://cipam.gov.in/iptrends/

¹⁸https://spicyip.com/wp-content/uploads/2018/01/IPR-Regime-In-India-Government-Initiatives.pdf

¹⁹https://spicyip.com/wp-content/uploads/2018/01/IPR-Regime-In-India-Government-Initiatives.pdf

²⁰https://www.livemint.com/companies/start-ups/120-start-ups-get-patents-under-expedited-examination-process-dpiit-secy-

1556274720741.html

²¹DataconcerningCopyright�ilingforyears2012-14notavailableasCopyrightadministrationshiftedtoDPIIT/CGPDTMin2016-

17

²²https://www.start-upindia.gov.in/content/sih/en/start-upgov/about-us.html

²³https://pib.gov.in/newsite/PrintRelease.aspx?relid=190914

²⁴https://dipp.gov.in/sites/default/�iles/ru2402.pdf

1.3. Initiatives by GOI to Promote Innovation

ThegovernmentofIndiahastakenmanypolicyinitiativestocreateaconduciveenvironmentforinnovation

andentrepreneurship.Toimprovethestart-upecosystem,theStart-upIndiaschemewaslaunchedin2016²²

with19actionpoints²³asaguidingdocumentfortheinitiative.Theinitiativesincludesettingupincubation

centres,IPR�iling,taxexemption,fasterexitsforstart-ups,relaxednormsofpublicprocurementforstart-ups,

launchofinnovationcoreprogrammesforstudents,etc.TheFundsofFundsschemeforstart-upsatSmall

IndustriesDevelopmentBankofIndia(SIDBI)wasintroducedtoprovidefundingsupportofRs10,000crore

forstart-ups.²⁴WithanaimtocultivateonemillioninnovatorsinIndia,AtalInnovationMission,AtalTinkering

LabsandAtalIncubationCentreswerealsolaunchedundertheStart-upIndiascheme.

Source:TheCGPDTMAnnualReport(2016-17)²¹

8

TospreadIPRawareness,CIPAM²⁷organised19IPRawarenessroadshowsin2016,andlaunchedtheIPR

awareness campaign in schools. In addition, IPRwasalso included in the school syllabusof classXII.To

strengthenIPRenforcement,26policetrainingprogrammerswereconductedandIPRenforcementtoolkit

dealingwithIPcrimes,trademarkcounterfeitingandcopyrightpiracyforpoliceof�icialswaslaunched.In

addition,variousTechnologyandInnovationSupportCentres(TISCs)wereestablishedbythegovernmentin

collaborationwiththeWorldIntellectualPropertyOrganisation(WIPO)acrossIndiatofacilitateonlineaccess

topatentandnon-patentresources,capacitybuilding,commercialisationofIP,etc.²⁸TocreateIPRawareness

among children, India adopted an animated IPmascot named “IPNani”. In July 2017, a Scheme for IPR

Awareness–CreativeIndia,InnovativeIndiawaslaunchedbyCIPAMundertheaegisoftheDPIITinTier1,2&

3citiesincludingtheruralareas.

For this study, therespondentsweresurveyedon theirawarenessabout thesegovernmentschemesand

initiatives.The�indingsarediscussedinChapter3.

²⁵UptoDecember2018,start-ups�iled1,346newpatentapplicationsavailing�ilingfeeconcession,whereas297patent

applications�iledpriortonoti�icationoftheamendedrules,otherwisenoteligiblefor�ilingfeebene�it,havebeenconvertedto

start-upstatus.(DPIITannualreport2018-19)

²⁶361applicationsforexpeditedexaminationhavebeen�iledupto31-12-2018bystart-ups.(DPIITannualreport2018-19)

²⁷https://spicyip.com/wp-content/uploads/2018/01/IPR-Regime-In-India-Government-Initiatives.pdf

²⁸http://pib.nic.in/newsite/PrintRelease.aspx?relid=161624

9

Chapter 2

IPR Use by Small Firms: Evidence from Literature

This chapter reviews and provides empirical and survey-based evidences of IPR activity by start-ups in

differentregionsandcountries.Italsoexplorestheroleofstart-ups'age,size,capital,IPrelatedactivitiesand

awarenessaboutgovernmentpoliciesontheactual�ilingofIPRs.Thischapterisdividedintofoursections.

Section 1 reviews literature that provides evidence of the limited use of IPRs by start-ups in advanced

countries.Section2identi�iesvariousfactorsthataffectIPRusebystart-ups.Section3dealswithdifferences

inthemotivationofsmallandlarge�irmsin�ilingIPRs.Thelastsectiongivesevidencefromvariouscountries

oftheeffectofpolicyinterventionsonIPRusebysmall�irms.

2.1. Extent of IPR use by start-ups

Entrepreneurialsuccessdepends,amongotherthings,onef�icientutilisationoftheIPlegalsystemtoprotect

innovators'productsandprocesses.Earlystageentrepreneurs,however,�inddif�icultiesinapplyingforIP

protectionduetofactorslikeresourceconstraints,informationopacityandlimitedaccessoflegalknowledge

ofIPRs(CoteiandFarhat,2017).Somestart-upswillinglyoptoutofpatentsystemduetohighcostofpatenting

andlitigation.Relatedliteratureinthe�ieldgivesevidenceofverylimitedinvolvementofstart-upsin�iling

applicationsforIPRprotection(especiallypatentsandindustrialdesign)indifferentcountries.

IntheU.S.,BerkeleyCentreofLawandTechnology(BCLT),throughawidespreadsurveyofhigh-technology

start-upsin2008,�indsthat60%oftechnologystart-upsoptoutofpatentsystemaltogether(Grahamet al.,

2009).Amongthereasonswhytheseenterprisesdonotconsiderpatentsapplicationasaviableoptionare

non-patentabilityoftheirproductsorhighcostofpatentenforcementandlitigationascomparedtoother

formsofprotectionliketradesecrets.

The�indingsofFeldman(2014)basedonasurveyof200venturecapitalistsintheU.S.andtheirportfolio

companiesindicatethatpatentdemandsmostlycomefromstart-upswhosecoreactivityinvolveslicensingor

litigatingpatents.AstudybyIversen(2003)showsthatinNorway,smallcompaniesarelesslikelyto�ilefor

patentapplicationsandalsohavelesschancesofgettingagrantofpatent.Thisisdueto�irms'limitedaccessto

legalandtechnologyknowledgerelatedtotheIPR�iling.InSweden,Holgersson(2013)revealsthatentrepreneurs

inhighgrowth²⁹andtechnologybased³⁰SMEsgivelittleimportancetopatentstoprotecttheirIPRs.

InPoland,Skala(2018)providesresultsofaseriesofwidespreadsurveys(ofaround400-1,000start-ups)

conducted during the years 2015 to 2018. The study �inds thatmost start-ups that provide digital and

manufacturingsolutionsintheareaofbigdata,IoT,andbusinessanalyticsdonotregisterpatentsduetonon-

patentabilityoftheirproductsor lackof �inancialresources.While19%ofallstart-upsthatmanufacture

productsintheareaofhealthcare,biotechnology,electronicsandroboticsand�ilepatentapplications.Unlike

lowpatentactivityinPoland,intheCzechRepubliconeineverythreestart-upsandinSlovakiaeveryfourth

start-uphasregisteredtrademarksorpatentedinvention(BeauchampandSkala,2017).

²⁹Theincluded�irmspublishedatleastfourannualreports;havetotalsalesgreaterthan10MSEK;haveatleast10employees;

haveduringthelastthreeyearscontinuouslyincreasedtheirtotalsales;haveduringthesameperiodatleastdoubledtheirtotal

sales;andhaveacollectedpro�itoverthefouryearsthatisgreaterthanzero.

³⁰Theseinterviewed�irmswereallwithintraditionalengineeringindustries,includingmechanical,electrical,computer

10

Due to resource constraints (like limited tangible assets, lack of production,managerial and operational

expertise),intangibleassetslikeIPprotectionbecomestrategicallyimportantforsmall�irms(Andersonand

Eshima,2013).Thatiswhylimitedinvolvementofstart-upsinIPRactivitiesarebecomingamatterofconcern

forpolicymakersandotherstakeholders.ArecentpaperbyChien(2019)³¹reportsthatintheU.S.,smaller

companies(thatgeneraterevenueoflessthan$10millionperyear)aremorelikelytobetargetedorsuedby

patent“trolls”orPatentAssertionEntity(PAE³²)thanthelargerones.Thesesmallcompaniesaresuednot

because of production of patented technology but due to unknowingly using or applying the patented

technologiesofothersintheirownbusinesses.

Therefore,itisessentialfortechnologystart-upstonotonlyprotecttheirinnovativeideasbutalsotosearchfor

the information of existing patented technology to avoid patent infringement and hence subsequent

involvementinlawsuits.Inaddition,itisalsoimportantforstart-upstogeneratestreamsofeconomicreturns

bytranslatingtheirIPRsintomarketabletechnologyorbysaleandlicensingoftheirpatents(Rajamaki,2013).

2.2. Factors determining IPR use by start-ups

IPRuseof�irmsvariesfromoneindustryandbusinesstypetotheother(ArundelandKabla,1998;Thornhill,

2006).DifferentformsofIPRslikepatentsandtrademarksre�lectdifferentprotectionintentions(DeVrieset

al.,2017).Patents,ononehand,areusedtoprotecttechnologicalinventions(newproducts/processes);

trademarks,ontheotherhand,areusedtoprotectbrand-namethatisassociatedwiththemarketingaspect

(Srinivasan et al., 2008). Therefore, a �irm that is involved in consumer service sector like Information

TechnologyenabledServices(ITeS)orcomputersoftwareindustryorinbusinesstoconsumer(B2C)markets

relymoreoncopyrights,trademarksandtrade-secretswhile�irmsinmanufacturingsectorlikeelectricaland

electronics, pharmaceutical, biotech or those operating in business to business (B2B)markets aremore

inclinedtowardspatentsasintellectualprotection(Grahamet al., 2009;Skala,2018;DeVrieset al.,2017;

OECD,2011).

A �irm'spropensityto innovateandexploit IPRsprotections isalsostudied inrelationto itssizeandage

(Heimonen,2012).Literatureprovidesmixedevidenceinthisregard.Forexample,studieslikeBhhattacharya

andBloch(2004),Hanel(2008),andRocheskaet al.,(2017)favourtheSchumpeterianviewthatthe�irm's

propensityto�ileIPRsincreaseswiththeincreaseinitssize.Theyarguethatlarger�irms(intermsofsalesand

employeestrength)haveresourceadvantagesoversmall�irmsandthushavehighpropensitytoinnovateand

useIPRprotection.Thecounterargumentisthatsmallandnew�irmsaremoreactiveingeneratinghigh

qualityinnovativeR&Doutputs(Nelson,1993)andthushavehighernumberofpatentsperemployee.They

aremoreactive inusing thosepatentsascompared to larger �irms(Audretch,2003;Rassenfosse,2012).

Amidstthisscholarlydebate,Heimonen(2012)suggestthattheimpactofsizeandageof�irmsontheirIPRuse

isindecisiveandhencecannotbeusedasfactortodifferentiatebetweenIPRactiveandinactive�irms.

31https://digitalcommons.law.scu.edu/cgi/viewcontent.cgi?article=1554&context=facpubs

³²Theterms'patenttroll'and“PatentAssertionEntity”(PAE)hasbeenusedinterchangeablybymanyscholarsincludingChien

(2019).Theterm“troll”wascoinedbyDetkin,AssistantGeneralCounseloftheIntelCorp.,toindicate�irmsthat�ileaggressive

patentlawsuits,tomakemoneyforpatentsthattheyhaveneverpractisedorhavenointentionofpractising.Suchentitiesdonot

produceorsellproductsortransfertheirtechnology.PAEexcludesuniversitiesandstart-ups.

11

IncubationsupportorVentureCapital(VC)fundingisanotherimportantfactorthatisassociatedwiththe

likelihoodofIPR�ilingbytechstart-ups.VCfundingnotonlyimpacts�irms'IPR�ilingdecisionsbutalsogets

impactedbythe�irm'sIPRportfolios.InarecentreviewofempiricalstudiesontheeffectofIPR�ilingonVC

�inancing,Hall(2019)showedthatpatentapplications(grantedornot)helpinattractingmoreVC�inancing,

thatisinturnassociatedwiththe�irms'survivalandfuturegrowth.Conversely,studieslikeSandneret al.

(2016)throughasurveyof531Germanstart-upsshowedthepositiveeffectofVCfundingonthestart-ups'IPR

portfolio.Notonlythis,theevidenceregardingtheroleofVCfundingonthepatentsandtrademark�iling

decisionsof�irmsarealsomixed.WhileHirukawaandUeda(2011)�indthatVC-backedU.S.�irmsaremore

likelyto�ilepatentsapplications,Vrieset al.(2016)ontheotherhand�indthatVC-backed�irmsintheU.S.are

morelikelyto�iletrademarksinsteadofpatents.

2.3. Government policies impacting IPR use by start-ups

GovernmentsstimulateR&Dinvestments,innovationandIPRusagethroughawidearrayofpublicpolicies,

and interventions likeR&D tax incentives, subsidies and grants. (Edleret al., 2013). In addition, various

supportmeasuresarealsointroducedthroughIPoutreachandawarenessprogrammes,capacitybuilding

campaigns,andIPadvisoryschemesetc.(MacDougall,2003;RadauerandWalter,2010)

Within Organisation for Economic Cooperation and Development (OECD) countries, governments have

introduceddirectpolicymeasurestoremovebarriersthatsmall�irmsfaceinIPRusage.Forexample,East

Germanyintroducedschemeslike'JointTaskforthePromotionofIndustryandTrade'andthe'Promotionof

JointResearchProjects' in 2004, to foster innovation andpatent applicationsby technology start-ups. It

involved several bene�its like R&D grants, subsidised loans and subsidised mediation and information

services.Aleckeet al. (2011)demonstratedasubstantialriseintheprobabilityofR&Dintensityandpatent

applicationofsmall�irmsthatreceivedR&DsubsidyinEastGermanyascomparedto�irmswhichdidnot

receivesuchsubsidies.

Similarly,Australiaintroducedan“InnovationPatentSystem”schemein2001,speci�icallydesignedtoprotect

inventionsthatdonotmeettheinventivethresholdrequiredforstandardpatents.ItalyintroducedIPcodein

2005toincreasepatentqualityandtoimproveIPRenforceability.UKalsosigni�icantlystreamlineditsIP

applicationandlitigationprocedures.IntheUnitedStates,apatentreformbillwaspassedin2011andIPlaw

clinicswereintroducedinlawschoolswherestudentscan�ilepatentandtrademarkapplicationsonbehalfof

earlystageinnovators(HintonandHowe,2015;ShettyandRahman,2015).

In linewith global efforts of strengthening IPR infrastructure, developing countries like India andChina

strengthenedtheirIPRlegalframeworkandundertookvariousinitiativestopromoteIPRusageamongstart-

ups.AsmentionedinChapter1,IndiaintroduceditsNationalIPRpolicyin2016withsevenbroadobjectives

associatedwithspeci�icactionplans.Inthesameyear,Start-upIndiainitiativewaslaunchedtopromotean

ecosystem of innovation. Further, Rajeev Gandhi National Institute of Intellectual PropertyManagement

(RGNIIP)andCIPAMundertheadministrationofCGPDTMconductnation-wideIPpromotion,awarenessand

capacitybuildingprogrammestopromoteIPRusageamongstart-ups.

12

Effectiveness and outreach of the policy interventions have been examined from developed country's

perspectives (MacDougall,2003;RadauerandWalter,2010).For instance, incountries like theAustralia,

Denmark, Sweden, Japan and the U.S., stakeholders of IP system consider internet-based IP education;

awarenessandoutreachprogrammesoftheirrespectivepatentof�icesasthebestIPdisseminationstrategyas

comparedtoothermodeslikecustomercallcentres,publicationbrochures,etc.InIndia,despiteconcerted

efforts to strengthen IPR regime and streamline administrative and institutional structure, literature

evaluatingtheeffectivenessandoutreachofvarioussupportschemesandmeasuresislimited(exceptafew

bibliometry-basedstudieslikeKarki,1993;andNauriyalandSahoo,2008).KumarandJain(2003)studyin

detail, the practice of commercialisation of new technologies in India based on the survey of multiple

stakeholders.ButthepracticeofIPRprotectionby�irms,inter-alia,andthechallengesinexistingIPsystem

remainedunexplored.Thisreportisanattempttoaddressthesegapsusingsurvey-basedevidenceoftech

start-upsinIndia.

2.4. Conclusion

ThetheoreticalandempiricalliteratureonIPRsusagebystart-upspointstothefactthat,incountrieslikeU.S.,

Sweden,PolandandNorway,small�irmsandstart-upsarelessinvolvedinpatentingactivity,butarelargely

engagedin�ilingfortrademarkprotection.Also, IPR�ilingbehaviourvariesbroadlyfromoneindustryto

another. Policy intervention in every country has helped in increasing IPR awareness among different

stakeholders and associated patenting activity. The corresponding evidence regarding IPR awareness,

engagementandeffectsofpolicyinterventionsfromadevelopingcountry'sperspectiveislimited.Thisreport

contributestotheliteraturebyprovidingtheIPRawarenessandusageamongIndiantechnologystart-ups

basedon�irsthandaccountoftheirexperienceindealingwithIPRsystem.

13

Chapter 3

IPR Use by Indian Start-ups: Survey Results

Thisreportpresents�indingsfromasurveybasedontheviewsof249technologystart-up³³representatives34

fromacrossIndia. Theanalysisstartedwithidentifyingthe�irm'sdemographicpro�ileintermsofpaid-up

capital, employee strength, age, location and industrial sector of their business operations. These

characteristicsarethenstudiedinrelationtotheirawarenessaboutIPRforms,�ilingofIPRprotection,and

involvementinmanagementofIPRsthroughtraining,IPsearch,IPvaluation,licensing-inandlicensing-out

activity.Thelastsub-sectioninvestigatesstart-ups'awarenessaboutthegovernment'sinitiativestopromote

IPR�ilingbystart-upsandalsoidenti�iesproblemsfacedbytechstart-upsinIPRapplications.

3.1. Firm's characteristics and IPR �iling

Theaverageageandpaid-upcapitaloftechstart-upsinthesampleisthreeyearsandRs11millionandtheir

average employee strength is 50 (with very large variance)³⁵. The observations show no signi�icant

difference³⁶betweenIPRactive³⁷andinactivetechnologystart-upsbasedontheiraveragesize(asmeasured

byemployeestrengthandpaid-upcapital)andaverageage.Table3.1showstheanalysisofpaid-upcapital,

employeestrengthandothercharacteristicsof�irmthatarecategorisedasactiveandinactiveinIP�iling.The

tableprovidesthefollowingobservations:

● Averagepaid-upcapitalof�irmsthatareactivein�ilingpatentsandindustrialdesignsprotectionislow

incomparisonto

o Averagepaid-upcapitalof�irmsthatareinactivein�ilingpatentsandindustrialdesignsprotection,

and

o Averagepaid-upcapitalof�irmsthat�iledtrademarkandcopyrightprotection(i.e.Rs12millioneach).

● Smaller �irms with average employee strength of 30 are more active in �iling Industrial Design

protectionascomparedtorelativelylarger�irmswithaverageemployeestrengthof55.Conversely,the

employeestrengthof�irmsthatareactiveincopyrightprotectionishigher(average53employees)as

comparedto�irmsthatareinactive(average31employees).

● Age and employee strength of �irms that are active in patent and trademark protections is not

signi�icantlydifferentfrom�irmsthatareinactivein�ilingapplicationforsuchprotection.

³³Technologystart-upsareidenti�iedbasedontheirservicesectoroffering(technologysolutions)

³⁴ReferAnnexureIforsurveymethodology

³⁵Thelargevarianceinpaid-upcapitalshowsalargedistanceoftheindividualdata-point(i.e.�irm'spaid-upcapitalvalueinthe

presentcase)withthesamplemean(i.e.averagepaid-upcapitalofall�irms).ItismeasuredbythesamplestatisticcalledStandard

Deviation(SD).InthepresentcaseSDofpaid-upcapitalis114andSDofemployee'sstrengthis110.

³⁶Thisstatementisbasedonthe�indingofthet-test,thatis,astatisticaltesttocomparethesamplemeansoftwogroups(i.e.IPR

activeandinactive�irms)

³⁷Term“IPRactive”indicates�irmsthat�ileatleastoneapplicationfortheprotectionofIPRslikepatent,copyrightandtrademark.

Theterm“IPRinactive”signi�ies�irmsthathavenot�iledasingleapplicationforIPRprotection.

14

Audretch (2003) andRassenfosse (2012) suggest that smaller �irms have higher number of patents per

employeeandaremoreactiveinusingthosepatentsascomparedtolarger�irms.Theobservationinthisstudy

thatpatentactive�irmshaveloweraveragepaid-upcapitalascomparedtothepatentactive�irmsisinlinewith

thegivenargument.However,thestatisticaltest(t-test)ofthedifferencebetweenthesamplemeanoftwo

groupsshowsnosigni�icantdifferencebetweenpatentsandtrademarkactiveandinactive�irmsbasedon

parameterslikeaveragepaid-upcapital,numberofemployeesandageofthestart-ups.Itindicatesthatthese

parameterscannotbethedecisivefactorstodistinguishbetween�irmsthatareactiveandinactiveinIPR

protection(Heimonen,2012).Other�irm-levelcharacteristicsthatarestudiedinrelationtotheIPR�iling

behaviorarebusinesssectorandbusinesstype.

Table 3.1 Characteristics of �irms categorised as active and inactive in IPR �iling

Total Number of respondents = 249

Patent Filing (%) Trademark �iling (%)

Copyright (%) Industrial Design (%)

Firm’s characteristics Overall

average

Active Inactive Active Inactive Active Inactive Active Inactive

Samplerespondents 42 58 74 26 90 10 18 82

Age(averageinyears) 3.00 3.28 3.18 3.19 3.31 3.18 3.54 3.43 3.17

AveragePaid-upcapital

(inmillionINR)

11.25 5.00 15.73 11.95 9.24 12.38 1.55 6.97 12.22

Averagenumberof

employees(incount)50.41 50 51 51 48 53 31 30 55

Location Total percent

Active Inactive Active Inactive Active Inactive Active Inactive

DelhiNCR 33 47 53 76 24 93 7 14 86

Gujarat 41 38 62 75 25 95 5 12 88

Others 26 42 58 69 31 77 23 34 66

Business sector Total percent

Active Inactive Active Inactive Active Inactive Active Inactive

Agritech 12 61 39 81 19 87 13 3 97

Healthtech 16 40 60 63 37 95 5 9 97

Edutech 26 74 74 26 90 10 5 95

E-commerce 8 40 60 85 15 95 5 10 90

TechnologySolutions 50 41 59 74 26 89 11 10 90

Others 6 36 64 79 21 79 21 0 100

Business type Total

percent

Active Inactive Active Inactive Active Inactive Active Inactive

Product 24 45 55 80 20 95 5 20 80

Process 16 60 40 75 25 88 12 30 70

Service 38 23 77 80 20 88 12 12 80

Multiple 22 56 44 56 44 89 11 20 80

15

Therespondentswereaskedaboutthemainsectoroftheirbusinessactivity.Halfofthetech-start-ups(i.e.50%) in the sample categorised themselves under the 'technological solutions' sector. Firms under thiscategoryareinvolvedine-ticketing,e-mobility,smartwatch,IoT,softwareandITsolutions.Proportionof�irmsthatindicatedtobeinagritech,healthtechandedutechsectorsis12%,16%and8%respectively(refer�igure3.1).

Figure 3.1Proportion of tech start-ups in different industrial sectors

WithregardtoIPR�ilingactivityineachbusinesssector,overallitisnoticedthataverylargeproportionoftech

start-upsareactiveincopyrightprotection(79%-95%),irrespectiveofthesectorofoperation(referFigure

3.2). Sector-wise analysis shows that a very large proportion of start-ups (i.e. 95%) in e-commerce and

healthtechsectorsregistercopyrightprotectionthantheproportionof�irmsinothersectorslikeedutechand

agritech.Trademark is found tobe the secondmostpopular IP form,particularlyamongagritechande-

commercestart-ups,wheremorethan80%�irmsoptforthisformofIPprotection.Greaterpropensityfor

copyrightandtrademarkprotectionbystart-upsinhealthtechande-commercesectorscanbeattributedto

thenatureoftheirbusinessandproduct/serviceofferings.

Industrialdesignprotection is �iledbyaverysmallproportionof �irms ineachsector i.e.7-26%.A large

proportionof�irmsinagritechsector(61%)�ilepatentapplicationsascomparedto40%�irmsinhealthtech,

Technology Solution and e-commerce sectors. India, being an agrarian society, housesmany agricultural

universitiesandinstitutes³⁸governedbytheCentralandtheStateGovernment.Also,governmentundertakes39variousinitiativeslikeAGRI-UDAANprogrammetoaddresschallengeslikelowcropyieldperhectare ,poor

waterresourcemanagement,andlimiteduseofdigitaltechnologiesinagriculture(MinistryofAgricultureand

FarmerWelfare,2017).⁴⁰Therefore,ahigherpropensityto�ilepatentprotectionbyagritech�irmsmaybe

attributedtotheimpetusfromthegovernmenttopromoteR&Dandcollaborationinthissector.

³⁸Examplesare:likeTamilNaduAgricultureUniversity,G.B.PantAgricultureUniversityetc.³⁹http://www.agritechindia.com/⁴⁰http://pib.nic.in/newsite/PrintRelease.aspx?relid=169569

16

Figure 3.2Proportion of tech start-ups in different business sectors for IPR �ilings

Techstart-upswereaskedtoindicatetheirbusinessofferings.Basedontheresponses,theirinnovationsin41

businessofferingsareclassi�iedintooneormoreofthethreecategories:products ,processes⁴²,and/or

services⁴³innovationofferings.Firmsthatreportedtohaveintroducedanewdeviceandmachineareincluded

under'product'categoryandcomprise24%ofthetotaltech-start-ups(referFigure3.3).Theproportionof

�irmsthatindicatedtohaveintroducedanewmobileapporweb-basedservicesolutionsincludedunder

'service'categoryis38%.Only16%oftech-start-upsreportedtohaveintroducedanewprocessapplicationor

softwareandareclassi�iedunder'process'category.Techstart-upsthatreportedprovidingbothproductand

process,processandservice,productandserviceorall threeareclassi�iedunderthecategory 'multiple',

comprising22%ofthetechstart-ups.

Figure 3.3Start-ups' classi�ication based on business offerings

⁴¹Productinnovationofferingistheintroductionofneworsigni�icantlyimprovedgoodsthatinvolvesneworimprovedtechnicalspeci�ications,componentsandmaterials,easeofuseandtheincorporationofsoftwareandotherfunctionalcharacteristics(OsloManual,2005)⁴²Processinnovationofferingistheimplementationofaneworsigni�icantlyimprovedmethodofproductionordelivery.⁴³ Servicesinnovationofferingsincludetheprovisionofnewservices.

17

A relatively large proportion (60%) of �irms that fall under 'process' category �ile patent protection ascompared to �irms that offer a new “product” (45%) or “multiple” (56%) categories. Trademark �ilingpropensityof�irmsthatarecategorisedunder'multiple'category(56%)isfarlessthanthetrademark�ilingpropensityof�irmsthatfallexclusivelyunder'product'and'service'(80%each),and'process'(75%)category.Asagainstthis,copyright�ilingpropensityof�irmsthatfallunderdifferentbusinesscategoriesdoesnotdiffermuchfromeachother.

3.2. IPR awareness and importance among tech-start-ups

ToassesslevelsofknowledgeandawarenessaboutIPprotection,techstart-upswereaskedwhattypeofIPprotectionshouldbeappliedfordifferentcategoriesofnovelties/innovation.Itisobservedthataround60-75%techstart-upscorrectlyidenti�iedtheitemsthatcanbeprotectedbytrademarkandcopyright.However,only44%respondentscouldcorrectlyidentifytheitemsthatcanbeprotectedbypatents.

Further,thetechstart-upswereaskedtorateeachformofIPRonascaleofthreebasedontheir levelofimportanceforthem(3beingthemostimportant).Itisnotedthataround44-48%respondentsgiveveryhighratingtopatents,copyrightandtrademarkprotectionfortheirbusiness,whileonly13%considerindustrialdesigntobeofhighimportance(refertoFigure3.4).Averylargeproportionoftechstart-ups(62%)areunawareoftheimportanceofindustrialdesignprotectionfortheir�irmwhilethisproportionisrelativelylessforotherIPformslikepatents(16%),trademark(12%)andcopyright(4%).

Figure 3.4Perception of IPR importance among tech-start-ups

Figure3.5showstheproportionofIPRactiveorinactivestart-upsamongthosethatgivehighratingtoaparticular IPR form. It indicates that,among thosewhoconsiderpatents tobeofhigh importance (mostimportant)fortheirbusiness,only47%actually�ileforitsprotection,while53%areinactiveinpatent�iling.Amongtechstart-upsthatconsidertrademarkandcopyrighttobeofhighimportance,70%and96%actually�ilefortheseformsofIPprotection,respectively.Forindustrialdesign,thisproportionisverylow:37%.

18

Figure 3.5IPR �iling by tech start-ups that give high importance to its different forms

3.3 IPR protection and management

Asubstantialproportionoftechstart-upsinIndiaprotectoneortheotherformofIPRs.Around74%and90%start-ups�iledfortrademarkandcopyrightprotection,respectively.Theproportionoftechstart-upsthatapplyforpatentsandindustrialdesignprotectionis42%and19%(refertoFigure3.6).

Figure 3.6Proportion of tech start-ups that are active/inactive in protecting different forms of IPRs

19

Besides�ilingIPRprotection,theancillarypracticesforIPRmanagement,valuationandpromotionareequallyessentialtoincreasethe�irm'svalueandreducerelatedcostsinthelongrun.Forexample,beforeinvestinginanynewideaorlaunchinganynewproduct,IPsearchoftheexistingpatentliteratureisvitalfortechnologyentrepreneurs(Grahamet al.,2008).ItensuresnotonlytheavoidanceofIPdisputes(i.e.IPinfringementrisksandthusmassivelitigationcosts),butalsothepreventionofduplicateinnovation.IPsearch,therefore,leadstoareductioninoverallcostofinnovationtosociety. Similarly,otheractivitiesrelatedtoIPmanagementlikeprovidingstafftrainingonIPRs,conductingIPvaluation,seekingIPadviceorconsultationofprofessionalexpertsareequallyimportant.

TheFigure3.7indicatesthatmorethanhalfofthetechstart-upsconductIPsearches(58%)andseekthehelpofIPprofessionals(60%)while�ilingIPprotection.Asmanyas52%oftechnologyentrepreneursinthestudysampleindicatetheabsenceofaformal�irm-levelIPpolicy,andnearly72%providedIP-relatedtrainingtotheiremployees.Around8%�irmswereinvolvedinIP-relateddisputesand17%�irmsreportedtohavebeenevaluatedbyvaluationprofessionals.

Figure 3.7Involvement of tech start-ups in IP management activities

Sectoralclassi�ication(refertoFigure3.8)indicatesthatthelikelihoodofforminganIPpolicyandconductingIPsearchesisparticularlyhighforagritech�irms(nearly60%and90%�irms,respectively)andrelativelylowforhealthtech�irms(nearly38-60%�irms).Inresponsetothequestionrelatedtotheexperienceofmorein�lowof investment,businessproposalsandsalesafter IP registration,around43%�irms,majorly ine-commerce(52%)andtechnologysolutionsector(49%),providedapositiveresponse.

20

Figure 3.8Tech start-ups that have IP policy and conduct IP searches

It isalsonoteworthythat technologytransferactivitiesare lessprevalentamongIndiantechstart-ups ingeneral(refertotheFigure3.9).Almost61%respondentsindicatedthattheyownIPprotectionbutdonotlicenseit.Interestingly,among�irmsthatareinvolvedintechnologytransferactivities,licensing-outappearstobeslightlymorecommon(12%ofcases)thanlicensing-inoftechnology(6%cases).Sectoralclassi�icationindicates�irmsine-commerceandtechnologysolutions(e-ticketing,IoT,etc.)aremoreactiveinlicensing-outthan�irmsinothersectors.

Figure 3.9Proportion of tech start-ups engaged in licensing activity

3.4 Role of Incubators

Moststart-upshave innovative ideas,but lack �inances togrow.The IPRprotectionbystart-upsnotonly

preventsthemfrominfringementsbutalsoattracts�inancialsupportandincentivisesinnovation.VariousVC/

PrivateEquity(PE)�irmsandincubators⁴⁴lookforstart-upswithvaluableIPassetstoinvestin.Duringthe

survey,thetech-start-upswereaskediftheyhaveexperiencedin�lowofmoreinvestments,bettersales,and

businessproposalsafterIPRapplicationorregistration.Itwasfoundthat43%ofthetechstart-upsreceived

investmentfundsafterapplyingforIPRprotectionorafterregistration,20%indicatednosignofincreased

investmentfundsfromoutsideafterIPprotectionwhile,35%arenotawareiftheyhaveattractedinvestment

fundsasaresultofIPrightsheldbythem.

⁴⁴AccordingtoNationalBusinessIncubationAssociation(NBIA),“Businessincubatorsarefacilitiesthatprovidesharedresourcesforyoungbusinesses,suchasof�icespace,consultants,andpersonnel.Theymayalsoprovideaccessto�inancingandtechnicalsupport.Fornewbusinesses,theseservicesprovideamoreprotectedenvironmentinwhichtogrowbeforetheybecomeself-sustaining.”

21

Thetechstart-upswerealsoaskediftheyweresupportedbyanyincubators.Itwasnotedthatonly18%of

start-upsweresupportedbyincubatorssuchasIndianInstituteofTechnology(IIT),CareerLauncher,Manipal

UniversityTechnologyBusinessIncubators,BiotechnologyIndustryResearchAssistanceCouncil(BIRAC).

Furthermore,nostatisticaldifferenceisfoundinthepatent�ilingbehaviouroftechstart-upsbasedonVC

support.Majorityrespondentsinthesample,i.e.,51-60%inbothcategories(i.e.patentactiveandinactive)are

notbackedbyVCfunds.

3.5 Awareness of government initiatives like Start-up India

Topromotestart-upgrowthandbuildarobustecosystem,theGoIlaunchedStart-upIndiainitiativeon16

January2016.Throughthisinitiative,GoIfacilitatesstart-ups'growththroughsimpli�iedprocedures(likeless

complianceregime),relaxednorms(forpublicprocurement,patentexamination),legalandfundingsupport

(through credit guarantee funds), capacity building and awareness programmes. The study shows that

althoughover90%tech-start-upsinthesampleareawareofthisinitiative,only35%haveregisteredunder

thisinitiative,andhardly20%areawareofspeci�icbene�its,schemes,taxexemptionsandfacilitiesprovided

bythegovernment.Majorityoftherespondents(around70%)believethatprogrammesunderthisinitiative

likeconductingawarenesscampaigns,outreachprogrammes,IPtrainingforstudentsandestablishmentof

CIPAMbythegovernmenthavebeenhelpfulinnurturingandmanagingthetechstart-ups.

Inthesurvey,themostcommonlycitedschemeforStart-uppromotionistaxexemptionforthreeyears,which

facilitatesbusinessgrowthandhelpsinmeetingtheworkingcapitalrequirement.AMumbai-basedtechn

start-upthatprovidesIoT-basedsolutionstoenterprisesstates:

“Tax exemptions on capital gains and investment above fair market value are really good that could help start­ups

to grow when they are under bootstrap mode”.

AnotherBangalore-basedstart-upthatprovidesonlinepaymentsolutionstobusinessescites:

“Tax exemptions on income tax are really helpful to have more cash in hand which can be invested to expand the

operations.”

NotonlyDPIITregisteredstart-ups,butmanyunregisteredstart-upsalsogaveaccountofstategovernment's

initiativesthatpromotestart-upecosystem.ToquoteoneDelhi-NCRbasededutechstart-up:

“It is really good to see that many state governments are promoting start­ups and even have taken some great

initiatives in line. For example, Rajasthan government plans to support 500 innovative start­ups. Also, one good

initiative that I can recall is marketing assistance of INR 10 lakhs to be provided by the Rajasthan's government to

start­ups to launch their product in the market”

Start-upecosystemnotonlyinvolvespolicyregimesorregulatoryinfrastructureforsupportiveIPsystembut

alsoentailsinstitutionalset-upsthatprovidetechnical,legal,administrativeandtrainingsupportforbusiness

growthandcollaboration.ToincreasegeneralawarenessofIPusersandful�ilthetrainingneedsoftechnicalIP

personnel, CIPAM and RGNIIPwere established. These two organisations conduct, in collaborationwith

international agencies and external IP of�ices, various IPR awareness programmes in schools, colleges,

universities;andorganiseconferences,workshops,meetingsandseminars fordifferentstakeholders like

enforcementof�icials,judiciaryof�icials,industry,SMEandstart-ups.Ascitedbyaround20%respondentsin

thesurvey,theseawarenesscampaigns,alongwithstart-upfestsandtalk-showsorganisedbythegovernment

notonlyhelpincreatingthecultureofentrepreneurshipbuthasalsohelpedbuddingentrepreneurstoknow

moreaboutIPRs.

22

3.6 Challenges identi�ied by start-ups in IPR usage

Theresults,asgiveninSection3.1.3onIPRprotectionandmanagementbytechstart-ups,indicatethatnot

evenhalf of these �irmsusepatents and industrial design for IPprotectionwhile almost all of them �ile

applications to register copyright and trademark protection.We asked respondents to shed light on the

challenges facedby themwhileaccessing the IP system.Almost25%technologystart-ups in thesample

noti�iedhurdlesthattheyfacedwhileregisteringtheirIPrights.Inputsprovidedbytherespondentsaregiven

inFigure3.11throughwordcloud,wherethesizeofthewordsorphrasesindicatesthefrequencyornumberof

timestheyarecitedbythestart-ups.

FilingofIPRapplicationsisseenbytechstart-upsasatime-taking,lengthyandcostlyprocess.Theaverage

timelagbetweenpatent�ilinganditsdisposal(granted,refused,abandonedu/s21(1)),until2016,was�iveto

sevenyearswhichwasreducedtotwo-and-a-halfyearsin2017.

Otherchallengespointedoutarelimitedadministrativestaff,patentexaminersandIPRof�ices.Atpresent,the

Patent,Designs,TrademarkandGeographicalIndicationof�icesarelocatedinKolkata,Ahmedabad,Delhi,

MumbaiandChennai.Further, lackoftransparencyandadministrative inef�iciencyintheprocesscreates

problems.Otherchallengesarelackofquali�iedandtechnicallystrongpatentexaminersandbureaucratic

interventions.Citingoneofthechallenges,arespondentsays:

“Improving on the manpower number is something which government should focus on. IPR of�ice in India does not

have suf�icient patent examiners and hence the delays are there”.

Figure 3.10

Challenges faced by start-ups in registering IP

23

Chapter 4

Conclusion and Way Forward

4.1. Conclusion

Thisstudyprovides�irst-handinformationonIPawareness,useandmanagementbyIndiantechstart-ups.It

isfoundthattheaverageageoftechstart-upsinIndiaisthreeyearsandmajorityofthemarelocatedinDelhi

andGujaratregions.Halfofthetechstart-upsinthesamplecategorisedthemselvesunderthe'technological

solutions'sectorthatincludee-ticketing,e-mobility,smartwatch,IoT,softwareandITsolutions.

The results indicate low awareness level among Indian tech start-ups about IPR forms like patents and

IndustrialDesigns.Itisobservedthatalargeshareoftechstart-upsusecopyrightandtrademarkregistration,

whileothertypesofIPRarelargelyignored.Majorityoftherespondentscouldnotevencorrectlyidentifythe

items that can be protected by patents. Around 44-48% respondents considered patents, copyright and

trademarkprotectionimportantfortheirbusiness.Amongstart-upsthatconsidertrademarkandcopyrightto

beofhighimportance,70%and96%techstart-upsactuallygofortheseformsofIPprotectionrespectively

whereas,ofthosewhoconsiderpatentstobeofhighimportancefortheirbusiness,only47%�irmsactually�ile

forprotection.

Incontrasttothis,morethanhalfofthetechstart-upsappeartobeaggressivelyconductingIPsearchesand

seekingexpertadvicebeforeproductlaunch.TheyalsoprovideIP-relatedtrainingtostaff.Among�irmsin

differentsectors,healthtech�irmsappeartobelessactiveinIPmanagementascomparedto�irmsinother

sectors.Further,itisobservedthatIPprotectionhelpedmanytechstart-upsattractinvestments;however,

about35%�irmswerenotsureiftheyreceivedanyfundsasaresultofIPprotection.Onlyasmallnumberof

techstart-upsweresupportedbyincubatorssuchasIITs,CareerLauncher,ManipalUniversityTechnology

BusinessIncubatorsandBIRAC.

Thegovernmenthastakenmanyinitiativestopromotestart-ups,includingIPprotection.Thisstudyindicates

thatthoughIndianstart-upsareawareoftheexistenceofgovernmentinitiatives(likeStart-upIndia),the

knowledgeaboutvariousbene�its,exemptionsandsupportprovidedthroughtheseinitiativesislow.However,

government initiatives like providing networking platform through trade fairs, conducting outreach

programmesandawarenesscampaignsarefoundtobehelpfulbystart-upsinIndia.

Keychallengesfacedbytechstart-upswhileregisteringtheirIPandindealingwiththeIPsystemare:highcost

ofIPregistration,administrativeinef�iciency,lackoftransparencyinthepatentexaminationprocess,longer

time taken in the patent examination, inadequate number of patent of�ices and patent examiners. The

followingsectionprovideskeyrecommendationtoaddresssomeofthesechallenges.

4.2. Recommendations

4.2.1. Strengthening Judicial Protection of IP in India

IndiacanlearnfromtheparadigmshiftinChina'sIPenvironment.Recently,Chinahastakenseveralstepsto

reformandstrengthenitsjudicialprotectionofIP.InFebruary2018,theChinesegovernmentcameupwithits

'Opinionson Several IssuesConcerning StrengtheningReformand Innovation in theFieldof Intellectual

PropertyAdjudication'primarilyfocusingonreformingandmodernisingtheIPadjudicationandestablishing

an optimally resourced, highly ef�icient IP judicial systemwith a national-level appealmechanism. The

SupremePeople'sCourtinChinareleasedthe'OutlineofJudicialProtectionofIPRinChina(2016-2020)'to

reformeighttargetedareasincludingrulesrelatingtoevidenceandcompensationondamagesandestablish

anIPcourtsystemwitharegionalperspective.ChinaestablishedIPtribunalsinmorethan18citiesandIP

courtsasapermanentagencytohandlehighlytechnicalcivilandadministrativeIPappealcasesfromacross

thecountryrelatingtoinventionpatents,utilitymodelpatents,newplantvarieties,integratedcircuitlayout

designs,technicalknow-how,computersoftwareandmonopoly,etc.

24

Atpresent,Indiadoesn'thaveanorganisedIPappellatetribunalsystem.Appealsareheardeitherbycivil

courts,highcourtsorbyvariousappellateboardsestablished.Appealsarisingfromthedecisionsofregistrars

andcontrollersundertheIndianTrademarksAct,1999,theGeographicalIndicationsofGoods(Registration

andProtection)Act,1999,theCopyrightAct,1957andthePatentsAct,1970areheardbytheIntellectual

PropertyAppellateBoard(IPAB). TheIPABwasestablishedbytheGoIin2003tohearappealsconcerning

trademarksandGIonly,whichwaslaterextendedtocopyrightandpatents.AppealsundertheSemiconductor

IntegratedCircuitsLayout-DesignAct,2000areheardbytheLayout-DesignAppellateBoardorbycivilcourtin

itsabsence.AppealsundertheProtectionofPlantVarietiesandFarmersRightsAct,2001areheardbythe

PlantVarietiesProtectionAppellateTribunal.AppealsundertheDesignsAct,2000areheardbythehigh

courts.

These appellate tribunals mostly face operational challenges like vacancy of technical member, website

operationalissues,etc. TheIPABcomprisesonejudicialandonetechnicalmember.Avacancycreatedby

eitherofthemembersresultsinimbalancedquorumanddelayinadjudication,andthereby,pendencyofcases

atvariousboardsandcourtsforappealwhichresultsinmajorhardship.Toaddressthisproblem,arobust

appellatejudicialsystemcouldbeformedwithasingleappellateIPboardforalltheIPswithseatsinmultiple

citiesandmoretechnicalmembersintheboard.ThejudgesshouldbetrainedintechnicalknowledgeandIP.

ThiscanbedonebysettingupacommitteetorevamptheIPjudicialsysteminIndiaandgetinplaceauniform

systemofcourts/tribunalsforIP-relatedissues.

4.2.2. Human Resources

AlongwithreformingIPRlegislation,itisalsoimportanttoprovideadministrativeef�iciency,responsiveand

smooth patent disposal processes, augmented or trained human resources, among others. For this, it is

importanttoensurethatalltheinitiativesandreformstakenbythegovernmentshouldbebasedontheinputs

receivedfrommultiplestakeholders.

Thegovernmentisalreadytakingstepsinthisregard.Atpresent,therearefourpatentof�icesinIndia:New

Delhi,Mumbai,ChennaiandKolkata.⁴⁵During�inancialyear2016-17,therewereonly132examinersforall

patentapplicationsacrossthecountry,resultinginadelayof�iveormoreyearstoexamineandgrantpatents.

TheEconomicSurveyreport2018indicatedabacklogofaround2lakhpatentapplications.Duringtheyears

2016to2019,650additionalpatentexaminerswereappointed,increasingthetotalexaminercounttocloseto

800.⁴⁶Onanaverage,onepatentexaminerisabletoexamine12-15patentapplicationpermonth.⁴⁷Therecent

appointmentsofpatentexaminersareasigni�icantsteptocovertheshortageofexaminerstoenabletimely

examinationofnewapplicationsandclearthepreviousbacklogaswell.From1Aprilto31December2018,as

manyas37,706patentapplicationswere�iled,while61,740wereexaminedduringthesameperiod.⁴⁸

To improve the system further, training of patent examiners would be helpful to ensure the quality of

examinationaswellastospeedupthepatentexaminationprocess.Currenttrainingsystemcanbeupgradedto

match and respond to technology evolution. For IP of�icial and administrative staff, training on of�ice

administration,budgetingandotherrelatedmatterscanbeprovided.Tofacilitatethis,internationalexchange

programmesforIPof�icialscouldbeplanned. Thismovewillimprovebuildarelationshipoftrustwiththe

start-ups,therebyencouraginginnovationandpromotingpatent�ilings.

⁴⁵http://www.ipindia.nic.in/address-of-patents-of�ices.htm

⁴⁶http://mofapp.nic.in:8080/economicsurvey/pdf/119-130_Chapter_08_ENGLISH_Vol_01_2017-18.pdf

⁴⁷https://www.businesstoday.in/magazine/features/we-can-clear-the-patent-backlog-within-next-two-years/story/249173.html

⁴⁸https://dipp.gov.in/sites/default/�iles/annualReport_2018-19_E_0.pdf

25

4.2.3. Use of Information and Communication Technology (ICT)

Intoday'stechnology-driveneconomy,IPof�icesshouldincreasetheiruseofInformationandCommunication

Technology(ICT)toensuretransparency,smoothprocessandfasterdisposal.

In the past few years, Indian IP of�ices have undergone some improvement andmodernisation, such as

computerisationofIPof�icesandcreationofIPdatabasesforonlinestorageandretrievalofIPinformation.

The Patent (Amendment) Rule, 2016 speci�ies online �iling and online payment for patent applications,

streamlining the timeline for patent disposal (i.e. granted, refused, abandoned u/s 21(1)), and online

communicationoftheexaminationreports,generationofe-certi�icatesfordisposaltoreducepaperwork,

delaysandadministrativeglitches.From1Aprilto31December2018,37,706patentapplicationswere�iled,

outofwhichmorethan90%werereceivedthroughe-�iling.

For further improvement in the system, India can request WIPO's software solutions for end-to-end

digitisationandautomationofIPapplicationandprocessing.WIPO'sprogrammeofassistancetointellectual

property(IP)of�icesprovidesbusinesssystemsforof�icesandnational/regionalinstitutionsindeveloping

andleastdevelopedcountries(LDCs),enablingthemtoparticipateeffectivelyintheglobalIPsystem.⁴⁹It

offerssoftwaresolutionslikeWIPOScanSoftware,WIPOIndustrialPropertyAdministrationSystem(IPAS)

Software,WIPOElectronicDocumentManagementSystem(EDMS),WIPOCentralisedAccesstoSearchand

Examinationsystem(WIPOCASE)andWIPODigitalAccessService(DAS),WIPOPublishSoftware,WIPOFile,

WIPO Connect and/or related IP business software to such countries at no cost. Their generic and

customisablesolutionssupportthemainbusinessprocessesincludingreception,classi�ication,examination,

publication,noti�ications,registrationanddigitisationofalldocumentation.

Theyintroducesimpli�icationofworkproceduresandcoverend-to-endprocessingoftrademark,patentsand

industrialdesignthroughouttheirlife-cycle.WIPOalsoprovidestrainingandknowledgetransfertoIPstaffto

increase their self-reliance.This can reduce theadministrativebottlenecks facedby start-ups. Indiahas

alreadyadoptedWIPOCASEandWIPODASinJanuary2018.⁵⁰Itmaybeusefultoadoptothersoftwareasper

theneed.

4.2.4. Capacity Building

Asthisstudybringsoutthelowawarenessoftheimportanceandbene�itsofIPRprotectionamongIndian

start-ups, it indicatesaneed to sensitise themonvarious typesof IP rightsprotectionand the technical

requirements for their �iling. This can be done through various capacity building programmes by the

government.TheyshouldalsobesensitisedaboutIPvaluationandmanagementtoattractinvestmentfunds

andmarketcredibility.

TheNationalIPRPolicy,2016mentionsIPRawarenesscampaignsinschools,colleges,highereducational

institutions,universitiesandindustrialclusters.Theeffectivenessofthesecampaignsneedtobeevaluated

fromtimetotimetoexaminetheirimpactongrowthofstart-upsandtheirIPRactivities.Also,educational

institutes should be encouraged to introduce IPR education in their curriculum. Currently, in India, IP

⁴⁹https://www.wipo.int/global_ip/en/activities/ip_of�ice_business_solutions/

⁵⁰http://www.ipindia.nic.in/writereaddata/Portal/IPOAnnualReport/1_110_1_Annual_Report_2017-18_English.pdf

⁵¹InstituteofNationalImportance(INI)isastatusthatmaybeconferredtoapremierpublichighereducationinstitutioninIndia

byanactofParliamentofIndia,aninstitutionwhich"servesasapivotalplayerindevelopinghighlyskilledpersonnelwithinthe

speci�iedregionofthecountry/state".

26

educationislargelyundertheaegisofInstitutesofNationalImportance⁵¹likeIndianInstitutesofTechnology

(IITs)andNationalLawUniversities(NLUs).But,inaknowledge-basedeconomy,formaleducationonIPRsis

requiredatabroaderandwiderlevel.Studentsofallagesshouldbeintroducedtocareeroptionsandother

aspectsofIPR,notonlytobuildaneffectivehumanresourcebaseforIPsystem,butalsoraiseawarenessto

avoidIPpiracy.TakingacuefromJapan,universitiesinIndiacouldintroduceMaster'sleveldegreeordiploma

courseonIPRthatcouldimpartskillsforbecomingapatentexaminer.Focussedtrainingandeducational

programmesonpatentexaminationofthefrontierandemergingtechnologieslikeIoTandAIshouldbedesigned.

4.2.5. IP Facilitation Centres

Under the SIPP, for effective implementation, the CGPDTM empanelled facilitators to provide free

consultation/guidanceandassistancein�ilinganddisposalofIPapplicationstostart-upsforfree.Facilitators

aredirectlypaidbytheCGPDTMfortheirservices;however,thestatutoryfeesfortheIParebornebythestart-

upsthemselves.

Thisschemewasrunonapilotbasistill2017andhadbeenextendedforthreeyearstillMarch2020.⁵²Asof

March2019,DPIITregistered208facilitatorsinpatents/designand240facilitatorsintrademarkmainlyin

Chennai,Delhi,MumbaiandKolkataforvariousareasofspecialisation.⁵³Thesefacilitationcentresshouldbe

empanelledinothercitiestoo.

Furthermore,instanceshavebeenreportedoffacilitatorsignoringfacilitationtostart-upsordemandingextra

feefromthem.⁵⁴AnoticehadbeenissuedbyCGPDTMtofacilitatorstoavoidsuchpractices.Thisindicatesthat

havingaschemeinplaceisnotsuf�icient.Itsproperenforcementisjustasimportant.Inaddition,thereisno

dataavailableontheconsultationand�ilingassistanceprovidedbythesefacilitatorstoascertainitsbene�itto

thestart-ups.

4.2.6. IPR Consultation and Awareness at DPIIT

ThegovernmentshouldstrengthenitsIPRawarenessprogrammeatDPIITlevelaswell.InIndia,start-upsare

requiredtoobtainapprovalfromDPIITtoberecognisedasastart-upandavailthebene�itsoftheStart-up

Indiascheme.⁵⁵

Atthatstageitself,DPIITcansensitisethestart-upsabouttheimportanceofIPRfortheirbusinessusingthe

followingmethods:

• Free and compulsory consultation:DPIITmayengageIPRconsultants/expertsforaddressingIPR-

relatedqueriesofstart-upsandadvisethemonIPRmanagementandstrategy.Suchconsultationwill

bebene�icialasitwillhelpthemdevelopanIPstrategyandmanagementatthebuddingstageitselfand

helpthemavoidIPRinfringementofotherholders,andthus,escapetheriskoflitigationandheavy

damages.

• Dissemination of Information Booklets: Tospreadawareness,informationbookletsonIPRsshould

bedisseminatedatthetimeofregistrationwithDPIITcontaininginformationonthetypesofIPR,IP

strategy,IPportfolio,IPmanagementandIPlitigationsandrelatedgovernmentschemes.

⁵¹InstituteofNationalImportance(INI)isastatusthatmaybeconferredtoapremierpublichighereducationinstitutioninIndia

byanactofParliamentofIndia,aninstitutionwhich"servesasapivotalplayerindevelopinghighlyskilledpersonnelwithinthe

speci�iedregionofthecountry/state".

⁵²http://www.ipindia.nic.in/writereaddata/Portal/News/323_1_Scheme_for_facilitating_start-ups.pdf⁵³https://dipp.gov.in/sites/default/�iles/annualReport_2018-19_E_0.pdf⁵⁴http://www.ipindia.nic.in/writereaddata/Portal/News/315_1_public-notice-dated-17.03.2017-SIPP_facilitators.pdf

⁵⁵https://www.start-upindia.gov.in/content/sih/en/start-up-scheme.html

27

4.2.7. IP Strategy

Beforeinvestinginanynewideaorlaunchinganynewproduct,IPsearchoftheexistingpatentliteratureisalso

vital for technology entrepreneurs. As a precautionary measure, �irms should also have all documents

reviewedbyalawyer.Thestart-upshouldhaveanIPstrategyfromtheoutsetasthatcanhelpthe�irmcompare

thecostofIPwithitsbene�itsinthelongrun.FirmsshouldalsoprovidestafftrainingonIPRandconductIP

valuation.ItmayalsobeusefultoexpandtheIPfacilitators'scopetoprovideconsultationsforbuildingIP

strategytothestart-ups.

TopromoteawarenessregardingIPRsandIPStrategy,theNationalInstituteforMicro,SmallandMedium

Enterprises (NI-MSME), through its Intellectual Property Facilitation Centre (IPFC), conducts training

programmesforentrepreneurs,directors,andstart-upstocreateIPawarenessandIPstrategyatHyderabad.

Suchtrainingprogrammes,seminarsandeventsonIPstrategy,IPmanagement,andtypesofIPRsshouldbe

conductedbythegovernmentasroadshowswiththemandatetocreateawarenessandimparttrainingonIP

issuesinmultiplecities.Thisincreasestheaccessibilityofthesetrainingstostart-upssituatedindifferent

citiesasnotmanywouldtraveltoanothercitytoattendthem.Theseroadshowsshouldbewelladvertisedin

newsandsocialmediatoencourageparticipation.

Inthelastthreeyears,thegovernmenthasalreadytakenmanyinitiativestopromotestart-upsandimproveIP

environmentinthecountry.Properenforcementoftheinitiativesalreadytakenandsomemorechangescan

maketheIPenvironmentofIndiarobustandcomparabletointernationalstandards.

28

References

Anderson,B.S.,&Eshima,Y.(2013).Thein�luenceof�irmageandintangibleresourcesontherelationship

betweenentrepreneurialorientationand�irmgrowthamongJapaneseSMEs.Journal of Business Venturing,

28(3),413-429.

Arundel,A.andKabla,I.(1998),“Whatpercentageofinnovationsarepatented?Empiricalestimatesfor

European�irms”,Research Policy,Vol.27No.2,pp.127-41.

Audretsch,D.B.(2001):TheDynamicRoleofSmallFirms:EvidencefromtheU.S.Washington,D.C.:The

InternationalBankforReconstructionandDevelopment/TheWorldBank.

Beauchamp,M.,&Skala,A.(2017).VisegradStart-upReport2016/2017.Warszawa: Start­up Poland.

Bhattacharya,M.,&Bloch,H.(2004).Determinantsofinnovation.Small Business Economics,22(2),155-162.

Burrone,E.(2005).IntellectualpropertyrightsandinnovationinSMEsinOECDcountries.Journal of

Intellectual Property Rights,10:34-43

Cotei,C.,&Farhat,J.(2017).Theleasingdecisionsofstart-up�irms.Review of Paci�ic Basin Financial

Markets and Policies,20(04),1750022.

Cohen,W.M.,Nelson,R.R.,andWalsh,J.P.(2000).Protectingtheirintellectualassets:Appropriability

conditionsandwhyUSmanufacturing�irmspatent(ornot).

Czarnitzki,D.,&vanCriekingen,K.(2018).NewevidenceondeterminantsofIPlitigation:Amarket-based

approach(No.18-018).ZEW-ZentrumfurEuropaischeWirtschaftsforschung/CenterforEuropean

EconomicResearch.

DeRassenfosse,G.(2012).HowSMEsexploittheirintellectualpropertyassets:evidencefromsurveydata.

Small Business Economics,39(2),437-452.

DeVries,G.,Pennings,E.,Block,J.H.,&Fisch,C.(2017).Trademarkorpatent?Theeffectsofmarket

concentration,customertypeandventurecapital�inancingonstart-ups'initialIPapplications.Industry and

Innovation,24(4),325-345.

DeWilton,A.(2011).PatentValue:ABusinessPerspectiveforTechnologyStart-ups.Technology Innovation

Management Review,1(3).

Edler,J.,Cunningham,P.,Gok,A.,&Shapira,P.(2013).Impactsofinnovationpolicy:Synthesisand

conclusion.Compendium of evidence on the effectiveness of innovation policy,(20).

Ernst,H.(2001).Patentapplicationsandsubsequentchangesofperformance:evidencefromtime-series

cross-sectionanalysesonthe�irmlevel.Research Policy30,143–157

Feldman,R.(2013).Patentdemands&start-upcompanies:Theviewfromtheventurecapitalcommunity.

Yale JL & Tech.,16,236.

Frietsch,R.,Neuhausler,P.,&Rothengatter,O.(2013).SME patenting: An empirical analysis in nine countries

(No.36).

29

FraunhoferISIDiscussionPapersInnovationSystemsandPolicyAnalysis.

Godinho,M.M.,&Ferreira,V.(2012).AnalyzingtheevidenceofanIPRtake-offinChinaandIndia.Research

Policy,41(3),499-511.

Graham,S.J.,Merges,R.P.,Samuelson,P.,&Sichelman,T.(2009).Hightechnologyentrepreneursandthe

patentsystem:Resultsofthe2008Berkeleypatentsurvey.Berkeley Technology Law Journal,24(4),1255.

Hall,B.H.(2018).Is there a role for patents in the �inancing of new innovative �irms?(No.w24370).National

BureauofEconomicResearch.

Hanel,P.(2008).Theuseofintellectualpropertyrightsandinnovationbymanufacturing�irmsinCanada.

Econ. Innov. New Techn.,17(4),285-309.

Heimonen,T.(2012).WhatarethefactorsthataffectinnovationingrowingSMEs?European Journal of

Innovation Management,15(1),122-144.

Hirukawa,M.,&Ueda,M.(2011).Venturecapitalandinnovation:Whichis�irst?Paci�ic Economic Review,

16(4),421-465.

Holgersson,M.(2013).PatentmanagementinentrepreneurialSMEs:aliteraturereviewandanempirical

studyofinnovationappropriation,patentpropensity,andmotives.R&D Management,43(1),21-36.

Iversen,E.J.(2003).Norwegiansmallandmedium-sizedenterprisesandtheintellectualpropertyrights

system:Explorationandanalysis(Vol.890).WIPO.

Kiran,R.,&Jain,V.(2012).Enhancinginnovationandintellectualpropertycultureinmanufacturingsmall

andmediumenterprises.African Journal of Business Management,6(4),1234-1243.

Levin,R.C.,Klevorick,A.K.,Nelson,R.R.,Winter,S.G.,1987.AppropriatingtheReturnsfromIndustrial

ResearchandDevelopment.BrookingsPaperonEconomicActivity18(3),783–831

Maresch,D.,Fink,M.,&Harms,R.(2016).Whenpatentsmatter:Theimpactofcompetitionandpatentage

ontheperformancecontributionofintellectualpropertyrightsprotection.Technovation,57,14-20

Miric,M.,Boudreau,K.J.,&Jeppesen,L.B.(2019).Protectingtheirdigitalassets:Theuseofformal&

informalappropriabilitystrategiesbyAppdevelopers.Research Policy.(Forthcoming)

Nauriyal,D.K.,&Sahoo,D.(2008,October).ThenewIPRregimeandIndiandrugandpharmaceutical

industry:Anempiricalanalysis.In3rdAnnualConferenceoftheEPIPAssociation,Bern,

Switzerland—GurtenPark/October(pp.3-4).

OECD.(2010).OECDStudiesonSMEsandEntrepreneurship.OECD.

Rajamaki,L.(2013).Start-upIPRstrategies:Whyshouldstart-upcompaniesprotecttheirintellectual

property?

Rigby,J.,&Ramlogan,R.(2012).TheImpactandEffectivenessofSupportMeasuresforExploiting

IntellectualProperty.Compendium of Evidence on the Effectiveness of Innovation Policy Intervention. MU

Press. Manchester, Manchester University Press.

30

Rocheska,S.,Nikoloski,D.,Angeleski,M.,&Mancheski,G.(2017).FactorsAffectingInnovationandPatent

PropensityofSMEs:EvidencefromMacedonia.TEM Journal,6(2),407.

Rosenbusch,N.,Brinckmann,J.,&Bausch,A.(2011).Isinnovationalwaysbene�icial?Ameta-analysisofthe

relationshipbetweeninnovationandperformanceinSMEs. Journal of Business Venturing,26(4),441-457.

Sandner,P.,Dufter,C.,&Geibel,R.(2016).DoesVentureCapitalInvestmentLeadtoaChangeinStart-Ups'

IntellectualPropertyStrategies?American Journal of Industrial and Business Management,6(12),1146.

Skala,A.(2018).CharacteristicsofStart-ups.Digital Start­ups in Transition Economies,41–91.

doi:10.1007/978-3-030-01500-8_2

Spruson,D.,&Ferguson,N.(2007).Intellectualpropertymanagement:Apracticalguideforelectricaland

electronicsrelatedindustries.

Srinivasan,R.,G.L.Lilien,andA.Rangaswamy.(2008).“SurvivalofHighTechFirms:TheEffectsofDiversity

ofProduct–MarketPortfolios,Patents,andTrademarks.”International Journal of Research in Marketing25

(2):119–128.

Thornhill,S.(2006),“Knowledge,innovationand�irmperformanceinhigh-andlow-technologyregimes”,

Journal of Business Venturing,Vol.21No.5,pp.687-703

Verheul,I.,Wennekers,S.,Audretsch,D.,&Thurik,R.(2002).Aneclectictheoryofentrepreneurship:

policies,institutionsandculture.InEntrepreneurship: Determinants and policy in a European­US

comparison(pp.11-81).Springer,Boston,MA.

WIPO.(2003).WIPOSurveyofIntellectualPropertyServicesofEuropeanTechnologyIncubators.

31

Annexure1:Surveymethodology

Thisreportpresents�indingsfromasurveybasedontheviewsof249technologystart-uprepresentatives

fromallacrossIndia.Thestart-upswereidenti�iedbasedontheDepartmentforPromotionofIndustryand

InternalTrade(DPIIT)de�inition.Fromastackof8,000+start-upsinIndia(Assocham,2016),thesamplewas

selectedusingstrati�iedsampling.⁵⁶Fourstratawereformedbasedonlocation:

● CompaniesinDelhi–NCR–StrataI

● CompaniesinMumbai/Pune–StrataII

● CompaniesinBengaluru–StrataIII

● CompaniesinOtherLocations–StrataIV

Theproportionofeachofthesethreecitiesis30%andotherlocationsare10%.Belowistheparameterusedto

selecttheelementsfromeachstratum:

• Location

• BusinessneedforIPRapplication–Baseduponproductline/portfolioofcompanies

• Paid-upcapital

• Investments

• Geographicpresenceasperoperations

TheCEOs/seniorof�icialsof thesecompaniesweresurveyedthoughthreemodes:one-to-one interviews,

telephonicinterviewsandthroughelectronicmeans,suchasemails.

Thegeographicaldistributionofthestart-upinthesurveycloselycorrespondstothedistributionoftotal

start-upsinIndia,mainlycomprisingDelhi-NCRregioninthenorth,Mumbai&PuneinthewestandBengaluru

inthesouth.Inthesample,around86%start-up�irmsarebasedintopthreeTier1citiesi.e.,Bengaluru,Delhi-

NCRandMumbaiwhileremaining14%�irmsarebasedinTier2andTier3citieslikePune,Ahmedabadand

Indore.

Thesestart-upsarecategorisedunderhealthtech,edutech,agritech,e-commerce,TechnologySolutions,and

others.Itisobservedthat40%ofstart-upsbelongtoagritech,healthtech,edutech,ande-commercesectors

while40%technologicalsolutionssuchase-ticketing,e-mobility,smartwatch,IoT,softwareandITsolutions,

etc.,andremainingfallunder“Others”category.

⁵⁶Instrati�iedsampling,thepopulationispartitionedintonon-overlappinggroups,calledstrataandasampleisselectedbysomedesignwithineachstratum.Inthissurvey,4stratawereformedbasedonlocationofcompaniesinDelhi-NCR.StrataI;CompaniesinMumbai/Pune-StrataII;CompaniesinBengaluru–StrataIII;Companiesinotherlocations-StrataIV.Theproportionofeachofthesecitiesis30%andotherlocationsis10%.

32

Annexure2:Questionnaire

SectionI:

Name

Yearofestablishment

RegisteredOf�ice

Mainsectorofyourbusiness

Typeofthecompany

PaidUpCapital

Numberofemployees

Name&Designation

Section II:

Questions1: What is the scopeofworkof your start-up?Haveyou introducednew inventionsornew

technology/format/process to the existing market? Please share with us your start-up's

innovative factor (idea)and thoseproductswhicharecompletelyneworaresigni�icantly

improvedfromexistingtechnology.

ScopeofWork

InnovativeFactor

ProductDetail

Questions2: WhichofthefollowingcategoriesofIPyourStart-up'sinnovationfallsin?

Yes ProtectedIP

Copyright

Patent

TradeSecret

IndustrialDesign

TradeMark

PlantVarietyProtectionandbreeder

Geographicalindication

IntegratedCircuit

Noneofthese

Anydetailsyouwouldliketoshare?

Questions3: Haveyoubeensupportedbyanyincubator/s? Yes

No

Ifyes,pleasespecifythenameofthesaidincubatorwhileexplaininghowithashelpedyou(in100

characters).

33

Questions4: Howwouldliketoclassifyyourstart-upinaccordancewiththeproducts/servicesoffered

byyou(chooseallthesuitableanswers).Feelfreetogivedetailsintheblankspace.

Introducedanewdevice,machineorsolutioninthesector

Introducedanewtechnology,processapplicationorsoftware

Introducedanewmobileapporweb-basedservicessolution

Details(in100characters)

Section III:

Questions1: On a scale of 1-3, 1 being the lowest, howmuch importance does your start-up give to

protectingthegivencategoryofIntellectualProperty?

1 2 3 NA

Patents

TradeSecrets

Trademarks

Copyright

IndustrialDesign

PlantVarietyandBreeder'sright

GeographicalIndication

Questions2: Try to specify before each kind of innovation mentioned below, the kind of IP that you

wouldapplyforprotection.TrytoexplainyourunderstandingaboutthatIPinfewwordsin

thegiventextboxes.

AnExpression

Amethodorprocedure

Aproduct'sname

Blueprintsofdesign

Aproductdesign

Abook

Anidea

Anewinnovation

Company'sname

Questions3: WhichofthefollowingformsofIPneedstoberegisteredwiththegovernmentauthorities

inordertoprotectthem?(Chooseallthesuitableanswers)

Patents

Trademarks

Copyright

Designs

Plantverities

Tradesecrets

34

Questions4: In India, which of the following forms of IP do you think you can yourself apply for

registrationof(withouthiringalawyer/expert)?(Chooseallthesuitableanswers)

Patents

Trademarks

Copyright

IndustrialDesigns

Plantverities

Tradesecrets

Questions5: After incorporation of your �irm, in how many years did your start-up focus on

protecting/registeringIPs?Pleaseexplainthefactorsthatin�luencedyour�irm'sstrategyin

protecting(ornotprotecting)theIP/s.

Years

Factors

Questions6: Has your company ever used or searched existing IP (Patent, Trademark, or other IP)

Database?

Yes

No

Ifyes,pleasespecifythenameofthedatabase

Questions7: Haveyouoryourcompanyeverbeeninvolvedinalegalorcommercialdisputeinvolving

IPRs?Pleasesharewithussomedetails.(Detailsareoptional)

Yes

No

Section IV:

Questions1: Incase,yourstart-upownsanyIPs,inwhichcountry/ieshaveyouregisteredyourIP/s?

(Chooseallthesuitableanswers).AlsoselecttheIP/sthatyouhaveregisteredineachof

thesecountries.

Country Patent Trademark Copyright Design Plant Integrated

Varieties Circuits

India

China

Europe

UnitedStates

UK

Japan

Brazil

Others

35

Questions2: Does your company have any overall IP policy and any person or a team speci�ically

assigned responsibility for managing IP/s and checking for IP infringement? Please give

details.

Yes

No

Details(within100Characters)

Questions3: IsanytraininginIPprotectionand/ormanagementprovidedbyyourcompanytoitsstaff?

Yes

No

Details(within100Characters)

Questions4: DoesyourcompanytakehelpofanyIPexpertsorlawyersfor�ilingpurposes?Please

specifythedetailsofthesefacilitators.(Detailsareoptional)

Yes

No

Details(within100Characters)

Questions5: Haveyouexperienced in�lowofmore investments,better sales,betterbusinessproposals

afterapplyingforanIPregistrationoraftertheregistration?

Yes

No

Can'tSay

Ifyes,pleasespecifythecircumstanceandtheprotectedIP/s(within100characters)

Questions6: Hasyour�irm'sIPeverbeenevaluatedbyValuationProfessionals?

Yes

No

Ifyes,pleasegivedetails(within100Characters)

Questions7: Hasyourcompanyeverlicensedin/licensedoutanyIPfrom/tootherparties?Isthereany

IPthatbelongstoyoubutyouhavenotbeenusingitornotbeenabletouseit?(Chooseall

thesuitableanswers)

'Licensedin'anIP

'Licensedout'anIP

OwnsanIPbutnotabletolicense

DonotownanyIP/s

36

Questions8: HasyourcompanyeversoughtadviceonIPbeforelaunchingnewproductsorenteringnew

geographies?

Yes

No

Ifyes,pleasegivedetails(within100Characters)

Section V:

Questions1: AreyouawareofStart-upIndiainitiative?Isyourstart-upregisteredunderthisscheme?

AwareaboutStart-upIndiaandregisterunderit

AwareaboutStart-upIndiabutnotabletoregisterunderit

AwareaboutStart-upIndiabutnotregisteredunderit

Notawareaboutstart-upIndia

Pleasesharecommentsifany

Questions2: Areyouawareofanyofthefollowingbene�itsgivenunderStart-upIndiaProgramme?

Pleasechooseallthesuitableanswers.

Notawareofanyofthesebene�its

Awareofalltheabovebene�its

Taxexemptionsoncapitalgains&oninvestmentsaboveFairMarketValue

Taxexemptionsonincometaxfor3years

INR2,000crorecreditfundforstart-upsthroughNationalCreditGuaranteeTrustCompany/SIDBIover4

years

INR10,000crorefundforinvestmentintostart-upsthroughalternateinvestmentfunds

Windingupofcompanyin90daysunderinsolvency&bankruptcy

code2016

Fasttrackofpublicprocurementunderthecriteriaof“priorexperience/turnover”forstart-upsinall

CentralGovernmentministries/departments

Fasttrackofstart-uppatentapplicationandupto80%rebatein�illingpatents

Self-certi�icationandcomplianceunder9environmentalandlabourlaws

Questions3: AreyouawareofanyothergovernmentinitiativestakenbytheCentralGovernmentorState

GovernmentforcreatingIPawarenessamongststart-ups?

Yes

No

Ifyes,pleasespecify(within100Characters)

37

Questions4: Haveanyofthegovernmentinitiatives(apart fromabove)beenhelpfultoyouinbringing

upormanagingyourstart-up?Ifyes,pleasespecifywhichonesandhowdidtheyhelp?

Yes

No

Ifyes,pleasegivedetails(within100Characters)

Questions5: HaveyoufacedanyprobleminregisteringIPs/enteringintolicenses/givingoutlicenses

withinIndiaorabroad?WhatareyourexpectationsfromtheIndianGovernmentvis-a-vis

IPregimeforstart-ups?

Yes

No

Pleasegivecomments(within100Characters)

38