The Legal and Business The Legal and Business

environment: IPRsenvironment: IPRsAmir Ullah KhanAmir Ullah Khan

Intellectual Property and India: Intellectual Property and India: Protecting Knowledge and Promoting Innovation Protecting Knowledge and Promoting Innovation

19 February 201519 February 2015

LegislationLegislation 1876, 1963 – Dramatic 1876, 1963 – Dramatic

Performances ActPerformances Act 1914, 1957 – Copyright Act1914, 1957 – Copyright Act 1918, 1952 – Cinematograph 1918, 1952 – Cinematograph

ActAct 1981 – Cine-workers welfare 1981 – Cine-workers welfare

Cess Act, Cine-workers Cess Act, Cine-workers welfare Fund Act, Cine-welfare Fund Act, Cine-workers and Cinema Theatre workers and Cinema Theatre workers (Regulation of workers (Regulation of Employment) Act.Employment) Act.

1995 – Cable Television 1995 – Cable Television Networks (Regulation) ActNetworks (Regulation) Act

Multilateral agreementsMultilateral agreements Berne Convention,1886 - protection to literary and Berne Convention,1886 - protection to literary and

artistic works. Revised seven times in 1896 (at Paris), artistic works. Revised seven times in 1896 (at Paris), 1908 (at Berlin), 1928 (at Rome), 1948 (at Brussels) , 1908 (at Berlin), 1928 (at Rome), 1948 (at Brussels) , 1967 (at Stockholm) and 1971 (at Paris) and finally in 1967 (at Stockholm) and 1971 (at Paris) and finally in 1978. 1978.

The 1971 revision (the Paris Act) is of particular The 1971 revision (the Paris Act) is of particular importance to the developing countries importance to the developing countries

Provides special concessions to these countries in Provides special concessions to these countries in making translations and reproduction of foreign literary making translations and reproduction of foreign literary works for educational purposes. Ninety countries are at works for educational purposes. Ninety countries are at present member of the Berne Convention.present member of the Berne Convention.

In August, 1952 the Universal Copyright Convention In August, 1952 the Universal Copyright Convention (UCC). India is a member of both the Berne Convention (UCC). India is a member of both the Berne Convention and the UCC.and the UCC.

Indian Copyright ActIndian Copyright Act Enforcement is possible through (1) the Copyright Board and Enforcement is possible through (1) the Copyright Board and

(2) the Courts. (2) the Courts. The 1984 amendment made copyright infringement a The 1984 amendment made copyright infringement a

cognisable non-bailable offence. Any person who knowingly cognisable non-bailable offence. Any person who knowingly infringes or abets the infringement of copyright is punishable infringes or abets the infringement of copyright is punishable with a minimum of six months imprisonment which may with a minimum of six months imprisonment which may extend to three years and a fine between fifty thousand and extend to three years and a fine between fifty thousand and two lakh rupees. two lakh rupees.

The 1994 Amendment on using an infringing computer The 1994 Amendment on using an infringing computer software. Imprisonment for seven days to a maximum of software. Imprisonment for seven days to a maximum of three years and a fine between fifty thousand and two lakh three years and a fine between fifty thousand and two lakh rupees. If used not for pecuniary gain, the imprisonment can rupees. If used not for pecuniary gain, the imprisonment can be relaxed and fine can be maximum of fifty thousand rupees.be relaxed and fine can be maximum of fifty thousand rupees.

  A Copyright Enforcement Advisory Council has been set up A Copyright Enforcement Advisory Council has been set up for advising the Government on measures for improving the for advising the Government on measures for improving the copyright enforcement. copyright enforcement.

GIPCGIPC

The Global Intellectual Property Centre of The Global Intellectual Property Centre of the US Chamber of Commercethe US Chamber of Commerce

GIPC 3GIPC 3rdrd index – India improves index – India improves 1% improvement in IP environment leads 1% improvement in IP environment leads

to 2.8% increase in FDIto 2.8% increase in FDI Innovation, High skill employment, R and Innovation, High skill employment, R and

D in the private sector all go up D in the private sector all go up

IndicatorsIndicators

Patents, Related rights and limitationPatents, Related rights and limitation CopyrightsCopyrights TrademarksTrademarks

Trade secretsTrade secrets EnforcementEnforcement Membership and ratification of Membership and ratification of

International treatiesInternational treaties

OverallOverall

Leaders – UK, US, Japan, South Korea Leaders – UK, US, Japan, South Korea and Singaporeand Singapore

Laggards – India and Thailand, Vietnam Laggards – India and Thailand, Vietnam and Indonesiaand Indonesia

Middle – China, Chile and PeruMiddle – China, Chile and Peru

New entrantsNew entrants

Singapore and South Korea way ahead in Singapore and South Korea way ahead in PatentsPatents

Copyrights – Indonesia and MalyasiaCopyrights – Indonesia and Malyasia Trademarks – India does betterTrademarks – India does better So also in Trade secrets because of So also in Trade secrets because of

amendment in the Preferential Market amendment in the Preferential Market Access and forced disclosure clauseAccess and forced disclosure clause

PMA now exempts the private sectorPMA now exempts the private sector

EnforcementEnforcement

India does much better than China, India does much better than China, Ukraine, Thailand, Vietnam, Nigeria and Ukraine, Thailand, Vietnam, Nigeria and IndonesiaIndonesia

Seriously tackling issues of counterfeitingSeriously tackling issues of counterfeiting

However data protection and patent term However data protection and patent term restoration still missingrestoration still missing

R and D spend goes upR and D spend goes up

India improves score – 7.23 from 6.95India improves score – 7.23 from 6.95

Increased IPR protection translates to Increased IPR protection translates to higher firm level R and D spendinghigher firm level R and D spending

Unsupportive IP policy = lower levels of Unsupportive IP policy = lower levels of clinical level activity as a proxy for pharma clinical level activity as a proxy for pharma investmentinvestment

Indian patentsIndian patents

Very small numbersVery small numbers Make in India: IP an important component Make in India: IP an important component

and so says the PMand so says the PM Software product patents, no claritySoftware product patents, no clarity Traditionally under copyrights where Traditionally under copyrights where

implementation is poorimplementation is poor The Copyright software authority a great The Copyright software authority a great

step forwardstep forward

DelaysDelays

Court cases for ten years…Court cases for ten years… Judicial reform onJudicial reform on Electronic content market boomingElectronic content market booming Sector regulation works at cross proposes Sector regulation works at cross proposes

with copyright actwith copyright act TRAI – the telecom regulator controls TRAI – the telecom regulator controls

broadcasting!broadcasting! Tariff regulations for TV channels!!!Tariff regulations for TV channels!!!

The novelty issueThe novelty issue

Competition Act exempts Copyright etcCompetition Act exempts Copyright etc

However sectoral regulators do notHowever sectoral regulators do not

Mandatory signal sharing actMandatory signal sharing act

Working statementsWorking statements

Need to file applicationsNeed to file applications Showing the patent works and what the Showing the patent works and what the

revenues generated wererevenues generated were Onerous for those with a large number of Onerous for those with a large number of

patentspatents These are then published…..These are then published…..

EntertainmentEntertainment Copyright issuesCopyright issues PiracyPiracy Legislation is high class, technology lags Legislation is high class, technology lags

behind and impacts enforcementbehind and impacts enforcement

Sports signal mandatory sharing ActSports signal mandatory sharing Act Channel pricing – no incentive to improve Channel pricing – no incentive to improve

content, but incentivise maximising ad content, but incentivise maximising ad revenuesrevenues

Section 3Section 3

3(d) changes the rules of the game??3(d) changes the rules of the game?? What is not patentableWhat is not patentable Software inventionsSoftware inventions

Why do we further complicate patenting? The Why do we further complicate patenting? The basics are novelty, usefulness and non basics are novelty, usefulness and non obviousness. Then whyobviousness. Then why

Inventive stepInventive step Capable of industrial applicationCapable of industrial application

Compulsory licensingCompulsory licensing

Flexibilities within TRIPSFlexibilities within TRIPS Public health emergenciesPublic health emergencies The Glivec caseThe Glivec case Only India refuses a patentOnly India refuses a patent

Steps…Steps…

Regulatory data protectionRegulatory data protection

Software patentsSoftware patents

Improving loopholes in the Copyright Improving loopholes in the Copyright systemsystem

Software piracySoftware piracy

The five principal types of software piracy The five principal types of software piracy involve (1) counterfeiters (2) resellers (3) mail involve (1) counterfeiters (2) resellers (3) mail order houses (4) bulletin boards and (5) end-order houses (4) bulletin boards and (5) end-user piracy. user piracy.

According to a survey conducted jointly by According to a survey conducted jointly by Business Software Alliance (BSA) and Business Software Alliance (BSA) and NASSCOM, total losses due to software piracy NASSCOM, total losses due to software piracy in India stood at about Rs. 5000 crores (US $ in India stood at about Rs. 5000 crores (US $ 900 million) showing a 60 per cent piracy rate in 900 million) showing a 60 per cent piracy rate in India. India.

The publishing industryThe publishing industry 11,000 publishers produce more than 57,000 new titles 11,000 publishers produce more than 57,000 new titles

every yearevery year India exported Rs.1120 million worth of books and other India exported Rs.1120 million worth of books and other

printed material. printed material. The print media in India comprising daily newspapers The print media in India comprising daily newspapers

and numerous other periodicals e.g. weekly, monthly and numerous other periodicals e.g. weekly, monthly and annual journals/magazines, had a total circulation of and annual journals/magazines, had a total circulation of 10,57,08,191 and the turnover from print media is 10,57,08,191 and the turnover from print media is estimated to be as high as Rs. 18000 crores.estimated to be as high as Rs. 18000 crores.

The International Intellectual Property Alliance (IIPA) The International Intellectual Property Alliance (IIPA) estimated that in trade loss due to piracy of US books in estimated that in trade loss due to piracy of US books in India amounted to $ 125 million.India amounted to $ 125 million.

THE BOLLYWOOD PHENOMENONTHE BOLLYWOOD PHENOMENON

1921 – 150 cinema halls1921 – 150 cinema halls 60 films made annually60 films made annually 1947 – 3000 cinema halls1947 – 3000 cinema halls 250 films produced annually250 films produced annually 2000 – 12800 cinema halls (4000 traveling or 2000 – 12800 cinema halls (4000 traveling or

temporary) temporary) 1000 films made annually1000 films made annually"If there is any challenge to Hollywood, it is "If there is any challenge to Hollywood, it is

from Bollywood" Jean Le Carrier, French from Bollywood" Jean Le Carrier, French scriptwriter and authorscriptwriter and author

Time line - 1918Time line - 1918

Indian Cinematograph Act – Censorship Indian Cinematograph Act – Censorship and cinema licensing systemand cinema licensing system

Provocation to crime, nudity, love scenes Provocation to crime, nudity, love scenes (including kissing) forbidden.(including kissing) forbidden.

Indian Cinematograph Committee Indian Cinematograph Committee (Rangachariar committee) to further (Rangachariar committee) to further “Empire films” to counter American “Empire films” to counter American dominance.dominance.

Time line - 1943Time line - 1943

Information films of India Information films of India Indian News ParadeIndian News Parade Factual films produced by Government of Factual films produced by Government of

India for promotion of war effortIndia for promotion of war effort Showing of news reels and documentaries Showing of news reels and documentaries

made compulsorymade compulsory Theatres obliged to pay rental feeTheatres obliged to pay rental fee Restriction on raw film stock and length of Restriction on raw film stock and length of

films(11000 square feet)films(11000 square feet)

Time line 1947 - 63Time line 1947 - 63

1948 - Censor codes in Bombay and 1948 - Censor codes in Bombay and MadrasMadras

1949 – All India protest day against taxes1949 – All India protest day against taxes Formation of Patil Film Enquiry CommitteeFormation of Patil Film Enquiry Committee Cinematograph Act amended to provide Cinematograph Act amended to provide

for ‘A’ and ‘U’ certificatesfor ‘A’ and ‘U’ certificates 1951 – Central Board of Film Censors1951 – Central Board of Film Censors 1963 – Indian Motion Picture Export 1963 – Indian Motion Picture Export

Corporation establishedCorporation established

Time line 1970 - Time line 1970 -

1972 –1975 - Film imports from United 1972 –1975 - Film imports from United States stoppedStates stopped

1980 - NFDC – To encourage production 1980 - NFDC – To encourage production of 16 mm filmsof 16 mm films

Video boom – Piracy flourishes in 100,000 Video boom – Piracy flourishes in 100,000 video librariesvideo libraries

Satellite boom – estimated 30 million cable Satellite boom – estimated 30 million cable connections - Piracy flourishes even moreconnections - Piracy flourishes even more

Film financingFilm financing

World Rights (Controller) – Bharat World Rights (Controller) – Bharat Shah/Jhamu SugandhShah/Jhamu Sugandh

Self financeSelf finance Shared risk modelShared risk model Commissioned filmsCommissioned films Speculative InvestmentSpeculative Investment

Most rights granted for 7 yearsMost rights granted for 7 years

DistributionDistribution

Mumbai – Gujarat, Parts of Maharashtra, Mumbai – Gujarat, Parts of Maharashtra, Gujarat, KarnatakaGujarat, Karnataka

Delhi – UP, UttaranchalDelhi – UP, Uttaranchal East Punjab – Haryana, Himachal, J & KEast Punjab – Haryana, Himachal, J & K Eastern circuitEastern circuit CP Berar CP Berar CICI Nizam, Mysore, Tamil Nadu, AndhraNizam, Mysore, Tamil Nadu, Andhra

The size of the marketThe size of the market

40 million strong South Asian Diaspora40 million strong South Asian Diaspora Hindi films now watched in 130 countriesHindi films now watched in 130 countries Exports of films – US $2000 millionExports of films – US $2000 million Expected to grow to $5000 million by 2020Expected to grow to $5000 million by 2020 Over 100 million people watch a Hindi film Over 100 million people watch a Hindi film

every day – either on the small or the big every day – either on the small or the big screenscreen

RightsRights

The original producers of a cinema, who are The original producers of a cinema, who are the sole right holders, can sell the sole right holders, can sell

Cinematographic rights, Cinematographic rights, Video rights, Video rights, Cable rights, Cable rights, Commercial rights and Commercial rights and Satellite rights. Satellite rights. Commercial Rights (Ancillary rights)Commercial Rights (Ancillary rights)

ViolationsViolations

Home VideoHome Video Cable TVCable TV Commercial violation (Hotels)Commercial violation (Hotels) Camera printsCamera prints Music piracy (Largely on account of it Music piracy (Largely on account of it

being in the Sbeing in the Small scale category - volume mall scale category - volume of a record company's cassette production of a record company's cassette production restricted to 300,000 units per annum.) restricted to 300,000 units per annum.)