Patent Rule Amendments 2024: Who gained who lost in amendment of FORM 27?

Essay relates to main amendments of 2024 relating to FORM 27, compares with erstwhile requirements to find out who gained and who lost in the bargain.: Main amendments related to Form 27 were

a) Extending the filing duration of Form 27 from annually to once every three financial years,

b) Exact quantum of worked inventions and specific sales/revenue data no longer required.

c) Details about licensees and sub-licensees no longer demanded.

Reasons for amendments often cited were in fact non-starter ones.

Details of quantity and value are objective terms without any ambiguity and by no means dent the confidentiality. In the simplest terms, it was the condition put by sovereign. By succumbing to unworthy pressure and eliminating quantum and value disclosures, the very sovereign is compromised.

Deletion of this requirement has contradicted TRIPs Article 7 dictating “…..in a manner conducive to social and economic welfare, and to a balance of rights and obligations”.? Is it consistent with Section 83(c)(f)(g)? and support 83(e)?

If interval of 3 months after calendar year was short, it could have been reset to 6 months after end of calendar year.

Old Form 27 necessitated Multiplicity of filing is not sustainable. Mutually exclusive patents protect different aspects of the same product and hence same data on quantity and value can be provided.

Applicants indulging in complex inventive activities find it easy to provide this information.

Major advantages of the earlier yearly filing of Form 27 (working of patents) in India, with quantitative and Rupee details of working of invention and of Licensees and sublicensees:

1. Greater Transparency and Reduced Ambiguity: The annual filing of quantum/value depiction ensured availability of yearly up-to-date records of the working of patents on the Patent Office website, to the public and stakeholders i.e. researchers, competitors, industry associations depicting quantitative and financial clarity on patent’s commercial status. Quantum/value requirement is dropped in the 2024 amendments.

2. Facilitated Effective Compulsory Licensing (CL): India’s patent system prioritizes public access to essential technologies, life-saving medicines. The annual working statement under Form 27 was a crucial tool to monitor if patent is adequately worked to satisfy public needs, helping interested parties to invoke CL if the data demonstrated non-working or insufficient working.

3. Encouraged Local Manufacturing and ‘Make in India’: Earlier Form 27’s rationale reflected India’s broader industrial ambitions, embodied in the ‘Make in India’ campaign. With annual filings, public, competitors, and policymakers had more accurate data regarding availability of patented technologies and products domestically. It pressurized patentees to actively work their inventions in India, fostered domestic technology transfer, assisted India ’s ambitions to become an innovation and manufacturing hub and supported “Make in India”.

4. Regular Monitoring of Public Interest Obligations: CL, public procurement, and market access programs depend heavily on reliable data and tracking of available, affordable, licensed and locally worked patented technologies. Annual statements ensured systematic monitoring of the “reasonable requirements of the public” mandated by Section 83 of the Patents Act, protecting consumer interests and prevented patent abuse.

5. Increased Accountability: Annual accountability prevented abuse/misuse of patents deterring evergreening, holding patentees responsible for utilizing patents in a meaningful way for societal benefit.

6. Easier Data Compilation for Policy and Research: Annual rich, granular datasets contributed to better policymaking, research, and enabled economists to analyze trends in technology transfer, R&D spin-offs, supply-chain development, and local capacity-building, market analysis, allowing evidence-based adjustments to the patent ecosystem. Amendments rendered it difficult.

2024 amendments to FORM 27 have significant disadvantages compared to the previous system and have far-reaching consequences for transparency, innovation policy, industrial growth, public interest, and India’s global credibility. Amendments reduced administrative burden for patentees, reduced the frequency and granularity of reporting, hampered transparency, oversight, and the objectives underlying strong patent working disclosures.

1. Increased Ambiguity and Reduced Transparency: Immediate profound disadvantage of the amended FORM 27 is the erosion of transparency regarding the working of patented inventions. Three-year reporting created intervals of ambiguity. These opaque periods, make it impossible to track technology trends, market access, and local manufacturing. Patent Office or the public can’t know whether a patent is being worked at any specific point within those years. The increased ambiguity undermines the core public policy objectives, societal and developmental role of patents and of Indian patent law.

2. Hurdles in Invoking CL Provisions: Longer interval hampers detection of non-working or underworking, timely intervention and accurate assessments for CL, potentially delaying remedies for unmet public needs by impeding and complicating CL, diminishing the leverage of regulators and applicants in safeguarding the public interest, in health emergencies or cases of patent abuse/misuse. Suppression of annual disclosures, has emboldened patentees to “sit” on their IP without fear of timely intervention.

3. Undermining the ‘Make in India’ Initiative: Amended FORM 27 discouraged patentees to commercialize inventions locally, undermining conditions of grant, shifting the equilibrium towards importation rather than local production. This, a step backward from the previously enforced pro-manufacturing orientation, diminished government’s ability to monitor and, if necessary, compel domestic production, and have threatened broader economic and employment goals tied to indigenous IP exploitation.

4. Weakening of Public Interest Safeguards: Amended FORM 27 disabled regulators to know for years if a critical patent is worked at all, let alone on reasonable terms; weakened check on abusive patent practices, including withholding technologies from the market or charging exorbitant prices, keeping public-interest groups, patient alliances, and industry competitors in the dark about true market dynamics. The policy foundation for addressing pressing societal needs in pharmaceuticals, agriculture, and green technology is compromised.

5. Difficulties in Monitoring and Policy Planning: Triennial filings erode the reliability, timeliness, and accuracy of data. Decision-makers will find it harder to design timely interventions or craft informed responses. Undoubtedly India risked its ability to monitor the market and/or revise patent policies responsively, as data collection shifted to sporadic and outdated submissions, impacting public policy and India’s innovative climate.

6. Loopholes for Strategic Non-working: Triennial filings provide opportunities for strategic patent behavior detrimental to the public good, withholding exploitation data, engage in patent abuse, or maintain dormant/defensive patents, acquiring “de facto” market exclusivity without fulfilling domestic working requirement. New climate stifles competition, investment, and consumer welfare.

7. Diluted Accountability and Reduced Information Disclosure: Triennial filings disallowing key details needed for real accountability created escape routes for patentees to avoid rigorous submission. This self-certification model allows compliance without offering substantial proof, with limited factual substantiation, undermining the verifiability of patent working.

8. Adverse Effects on Technology Transfer and Licensing: Triennial filings hinder transparency, making it difficult to track diffusion of patented technologies to Indian industry, lowering opportunities to indigenous firms to identify chances for acquiring rights to dormant or under-utilized patents.

9. Deviation from Global Best Practices: Earlier system, prioritized transparency and public interest, with meaningful working requirements, supporting socially responsible innovation, seeking to balance strong IP protection with local developmental goals. Triennial filings moved away from these best practices.

10. Potential Legal and Judicial Uncertainty: Diluted statutory requirements of triennial filings provide bigger room for interpretation, litigation. Vague disclosures, may create confusion in enforcement, lead to more legal wrangling, and greater uncertainty for patentees and challengers alike, undermining the efficacy of the patent system as a whole, and could erode public trust in the regulatory apparatus.

Conclusion: The move from annual to triennial Form 27 filings, easing the nature of required disclosures have helped patentee unilaterally with profound disadvantages to others. Increased ambiguity, reduced transparency in patent working status; hinders the invoking CL; weakened safeguards aligned with public interest and ‘Make in India’ objectives; complicated pro-public policymaking and data-driven intervention; created new loopholes for anti-competitive behavior; and diminished the accountability of patentees.

The reduced reporting burden came at the cost of weakening India’s distinctive stance as a defender of public welfare within patent law, threatening its broader socio-economic goals and international credibility. These amendments appeased some global actors pushing for patent deregulation, but have risked failure to protect the socio-industrial aspirations that underpinned India’s approach to patent working disclosures. The legal infrastructure of India’s patent system is intimately tied to development and so the consequences could be far-reaching, ultimately benefiting patentee at the expense of local industry, the public, and the innovation ecosystem.

Under the disguise of simplification, amendments diluted the practical effectiveness of Form 27 as an instrument of patent policy, unilaterally enabling patentees to systematically prevent critical information from entering public domain, debilitating sovereign to take prompt action and putting the public, potential licensees, and the sovereign itself into longer periods of uncertainty if a patent is being meaningfully worked.

A government approved void of up-to-date and granular information is created, disabling public bodies and courts to intervene quickly to correct abuses and or misuse jeopardizing public needs. Form 27 is now “toothless” for those seeking to monitor or enforce public interest safeguards embedded in Indian patent law.

It might have compromised India’s dream of a five trillion economy by 2027 and third largest economy by 2030.