India: Utility Model In India: Soon To Be A Reality

Last Updated: 17 January 2015
Article by Zoya Nafis

The first draft of the National IPR Policy submitted by the Think Tank highlights the need of utility model in India. It says that in a country like India, there are innumerable inventions that may not fulfil the stringent requirements of patentability but are novel, utilitarian and inventive in their own spheres. Such 'petty patents' or `utility models' are also a form of Intellectual Property only. Such inventions are already given recognition and protection in many countries under 'utility model law' but no such protection is available in India. This affects a large number of inventors who fail to protect their inventions by IPRs, particularly the Micro, Small and Medium Enterprises (MSMEs) and in the unorganized/informal sectors. In India, MSMEs hold for about 45% of manufacturing output, but their potential IP assets are recognized only in a limited, often informal, manner. In order to reap the full benefits of such inventions the need exists for a new law on utility models.

The policy clearly states that it is high time that Indian Government should facilitate creation and protection of 'small inventions' through a new law on utility models and it must enact laws to address national needs and to fill gaps in the protective regime of IPRs such as Utility Models to keep up with advancements in science and technology.

What are Utility Patents?

Utility Patents are relatively short term rights granted for inventions that may not qualify the stringent criteria of patentability like inventive step, or non-obviousness but are inventions in their own consideration. Like patents, utility model is an exclusive right granted to an invention. This right allows the inventor to prevent others from commercially using the protected invention, without his consent and permission, for a limited period of time, that is to say 6 to 10 years. It is very similar to patents and is often referred to as, "petty patent" or "innovation patent" as they require less stringent qualifications and their duration is shorter as compared to that of patents.

Any invention, either product or process, which demands to be protected as a patent must qualify a threefold criteria of novelty, inventive step and non-obviousness, as prescribed by The Agreement on Trade Related Aspects of Intellectual Property Rights ("TRIPS").

The Indian Patents Act, 1970, follows the TRIPS provision, providing the same threefold criterion for a product or process to qualify as patentable subject matter. Following the stringent criteria of patentability, India till date does not recognize utility patent. However, the incorporation of this system in the first draft of the national IPR policy submitted by the Think Tank is a welcoming move and implementation of this system in India would effectively encourage innovation and facilitate development in the country.

Need for Utility Model in India

The basic objective behind patent law is to encourage innovation and development by granting monopoly to the creator for a limited time. It serves as an incentive for the creator who invests his time and energy for the creating something new.

India is growing at a faster rate and there has been a rise in number of developments in all the fields. It has also become a research hub of many multi-national companies. However, the country still lags behind in patent filings by its own residents. In recent study it was found that 78% of the patent filings in India are by the non-residents of India.

The Small and Medium Enterprises (SMEs) and MSMEs acquire prominent position in a developing country like India. They hold for about 44 % of the gross value of industrial production, in addition to providing employment for around 60 million people. Indian economy largely depends on the inputs of these SMEs and MSMEs. These SMEs and MSMEs invent various products that fail to qualify for patent protection because of the stringent patentability criteria. Hence, they require a protection for their inventions which does not demand for strict examination and qualification requirements and utility model would be the perfect solution for them. The rights granted under the utility model are quite similar to those given by the patent but are more considerable for using the term 'incremental inventions'. They require lesser formality checks and lasts for a shorter period of time. These models are considered to be more suitable particularly for the SMEs, which invent making the 'minor' improvements in the existing inventions.

It is quite evident that Indians still lag behind in protecting their inventions through patents. Lot many applications are rejected as they fail to qualify the stringent requirements of the Patent Law. Once these incremental inventions would be recognised under utility model in India, it can be expected that number of inventions protected in India would be more.

There are many advantages of the utility patent system. Utility model can be granted without following the lengthy process of examination and granted for a shorter period of time of 6 or 10 years without the renewal or extension possibility. This system comes with many advantages for a country like ours. In India, there is a delay in granting a patent which eventually shortens the term of the patent, as the term of the patent is calculated from the date of application. A utility model law would effectively shorten this period and provide protection for innovations more rapidly. The SMEs and MSMEs would also be encouraged to undertake research on incremental innovations which is less capital-intensive because of the less strict qualifications of non-obviousness and inventiveness, which would ultimately lead to development and progress of the nation.

Nonetheless, certain safeguards would have to be incorporated into the proposed system as the system has some disadvantages also. The protection period for such innovations should be short as prolonged monopoly over such patents would negate the very concept of this model for SMEs. The model should aim at supplementing the patent system and not erode it. Therefore the drafters of national IPR policy must keep all the aspects of this system in mind while introducing it. They should make sure that this system does not impede the way of innovation by providing an easy protection for incremental inventions. It should facilitate the flow of innovation and creativity in the nation.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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Zoya Nafis
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