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The Federation of Indian Chambers of Commerce and Industry (FICCI) has urged the patent office to amend Form 27 and update Patent Rules in line with international best practices so as to befit emerging technological fields, make commercialization of patented invention more easier and facilitate ease of doing business.
Form 27 needs to be submitted by patentees under Section 146 (2) of The Patents Act, 1970 providing details of commercial working of a patent in India.
Said Dipankar Barkakati, additional director and head - IPR & FICCI CASCADE at FICCI, “Existing Form 27 requirement has become redundant, burdensome, hampers ease of doing business, makes commercialization of patented invention more difficult and is not aligned to international best practices. There is thus an urgent need to remove Section 146 (working statement requirement from statute book). While, such a change in the law may take some time, meanwhile, may we request patent office to consider updating the Patent Rules and amend ‘Form 27’ befitting the emerging technological fields.”
Existing Form 27 is based on presumption that one product is equivalent to one patent. However, such a model is non-existent in ICT sector where one product is not based on one patent but is actually covered in portfolio of patents and such portfolios are owned by different patentees. There may be cases where the patent portfolio, of which the patent in questions is a part, is huge and thus all numbers cannot be provided.
To remove this hurdle, FICCI stated that provision should be there in Form 27 for single statement for multiple patents. Instead of providing the numbers of all patents being worked together, a simple statement may be given stating that the patent is worked not singly but in a portfolio, and details of all such patents can be provided when asked for or specifying that the single patent forms a part of the portfolio license.
Existing requirements of Form 27 impinges upon confidentiality, said additional director, FICCI. Under a Licensing model, the IP owner is under a contractual obligation to keep important business data concerning licensees as confidential. Form 27 impinges upon that “confidentiality obligation” required to be maintained by licensors and licensees alike.
This will increase litigation costs substantially where IP owner will be sued by licensees for the breach of confidentiality or for not been able to secure confidential business information such as sales figures, anticipated revenue/profit. This will threaten businesses, hurt global licensing model and will potentially chill innovation cycle.
Its contrary to Section 69(4) which mandates non-disclosure of registered PLAs when accompanied with a confidentiality request at the time of such registration through Form 16.
FICCI suggested that the working statements ought not mandate the disclosure of amount of revenue or license fee earned by working a patent. Thus, patentees should be asked to provide such information only if a specific request is made by patent office and that too under a confidentiality arrangement. Further, while the requirement of notifying whether worked through manufacturing or licensing or by importation could be retained, the requirement for providing quantum and valuation needs to be removed, the industry association said.
In order to simplify filing of Form 27 which is compulsory for all patents, FICCI suggested that there should be two sections of the Form, one for first time filing (for patents granted within the last three years) and another section for those cases where the working statement had already been filed in the previous year and being continued. There might be a sub-section in this section for those cases in which the mode of working has changed (e.g. from manufacturing to licensing).
It further suggested in the multiple options (in range form) in the Form, for entering the value of quantum of goods sold as well as for the revenue achieved by the Patentee during the financial year.
Shedding light on difficulty in determining whether the patented invention has been worked or not, Barkakati said “The applicant should be allowed to file a simple Form 27 indicating whether an invention has been worked or not along with providing exemplary details and not exhaustive. Further, a patentee can only provide details of adequate working and affordable pricing from its perspective and also the feedback received in general. Thus, a patentee ought to be permitted to aver that we have not received any feedback from anyone in India that the patented invention is not available in India adequately or at affordable price.”
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