Protecting patents abroad: jumping Section 39 may prove fatal

Abhai Pandey and Priya Anuragini of LexOrbis analyse the hurdles to be overcome when filing PCT applications in India

With innovation and creativity being identified as the key thrusts of India’s intellectual property landscape in the recently circulated first draft of the National IPR Policy, patent filings by Indian inventors, who are working with Indian industry and in the development centres of many multi-national companies, are set to significantly increase in the coming days.

Many of these inventors would also seek international protection as expeditiously as possible. It is here that they would need to tread cautiously or risk losing precious days of priority as highlighted by the Division Bench of the Delhi High Court in a recent judgement.

Section 39 requirement

With around 150 member states, the PCT (Patent Cooperation Treaty) is one of the most efficient and cost-effective mechanisms for securing international protection for patents, as a PCT application meeting all of the specified requirements has the effect of a regular national application in each designated PCT member state. This ensures the all important ‘priority’ to the inventor without the trouble of filing an application in each country.

Making it further convenient, PCT regulations leave the choice of forum for filing an international application to the applicant. Accordingly, PCT applications can be filed with the national office of the contracting state of which the applicant, or the first mentioned applicant, is a resident or national, or directly with the international bureau (IB) of the World IP Organization (WIPO).

As a result, Indian residents who want international protection may file directly with the IB, or they may opt to go with the Indian Patent Office, as the receiving office. Irrespective of the route chosen, Section 39 of India’s Patents Act 1970 makes it mandatory for Indian residents to seek the approval of the patent controller before international protection is sought.

Even those who do not choose the PCT route and file an Indian application have to wait six weeks before they can make any international application, while PCT applicants usually need to wait a maximum of 21 days to obtain approval under Section 39, so long as the invention is not related to defence or atomic energy.

Puneet Kaushik v Union of India: not just a matter of 13 days

Recently, both the Single and Division Bench of the Delhi High Court enunciated the relevance of Section 39 for Indian residents seeking international protection for their patents.

While deciding a letters patent appeal (LPA 884/2013) arising out of the order of the single judge in a writ petition (1631/2013), the Division Bench of the Delhi High Court not only concurred with the order passed in the writ petition but unequivocally stated that any international/PCT application filed in the Indian IP Office as receiving office amounts to an “application filed outside India” for all purposes. Consequently, it can be accorded a filing date only when it is complete, ie, the requisite permission under Section 39 of the Patents Act has been granted.

The appellants, in this case, claimed to have filed a PCT application with the Indian IP Office on 14 September 2012. However, the purported PCT application was filed without obtaining the requisite permission under Section 39 of the act, and consequently, the Indian IP Office neither took the application on record nor assigned it an international filing date. The applicants had, however, filed a Form 25 for obtaining Section 39 permission, along with the PCT application, which was granted on 27 September 2012.

Aggrieved by the stance of the Indian IP Office, appellants filed a writ before the Delhi High Court, which ruled 27 September 2012 as the international filing date. The delay of 13 days, however, did not go too well with the appellants, who claimed 14 September to be their international filing date, but they again remained unable to convince the Division Bench of High Court in the Appeal.

In a well-reasoned order, the court analysed the legislative intent behind Section 39 of the act and observed that the section, which was reintroduced in the Patents Amendment Act 1999 on the recommendation of the joint committee after being initially deleted, is essential for meaningful operation of Section 35, which aims at preventing the flow of sensitive information outside of India by enabling the patent controller to impose secrecy directions, in case the invention is relevant for defence purposes.

In view of this, the court stated, it no longer remains open to the Indian IP Office to accept PCT applications without the requisite permission of the patent controller, in as much as the Indian IP Office only acts as the transmitter and merely accords a filing date to the PCT applications received before transmitting them to the IB or an international searching authority (ISA) for further processing.

Grey areas in the provision

While the judgement explains the legislative intent behind Section 39, the modus operandi of the section, in case Indian residents directly approach the IB of WIPO for international protection, at best remains unclear. Article 11 of PCT does mandate the receiving office to ensure that the PCT application is in compliance with the specified requirements, or to seek requisite correction from the applicants and accord the date of receipt of required correction as the filing date. But compliance with Section 39 requirement, being a local requirement for India, is not one of the specified requirements under PCT rules. So, if Indian residents approach the IB directly, there would obviously be no Section 39 objection, although they would incur liability under Section 118 of the Patents Act.

Nonetheless, the legislative intent behind Sections 35 to 39 of the Patents Act (of subjecting defence related invention to secrecy directions) is rendered nugatory. In fact, even in the case of Indian residents going via the India IP Office, although courts have approved the office’s practice of raising Section 39 objections, is it permissible for the Indian Patent IP to raise Section 39 objections merely in the capacity of transmitter. This clearly underlines the need to devise a suitable procedural mechanism for operation of Section 39, which at present is lacking.

Furthermore, the section has been interpreted to mandate that Indian residents seeking international protection via PCT should be ready with Section 39 approval before they file the application with the Indian IP Office in its capacity as receiving office, or it would be deemed incomplete. The international filing date and consequent priority will be accorded only after the requisite approval is given, which may take anywhere up to 21 days (in the above discussed case it was 13 days).

Contrary to this, in the case of Indian application priority accorded from the date of filing, applicants merely need to wait for six weeks before they can go for international filing. To bring the two classes of applicants on par for the purposes of priority, it is only fair that the date of priority should be the date of filing for all classes of application, although in the case of PCT applications, transmission of an application by the Indian IP Office may take place after requisite approval under Section 39 has been given.

For balanced and effective operation of the section to the mutual satisfaction of all categories of all stakeholders, these areas need to be taken in account and resolved at the earliest opportunity.
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