UNIT -1 INTELLCTUAL PROPERTY

• DEFINITATION OF INTELLECTUAL PROPERTY

Intellectual Property refers to the creations which are made using the mental labours of

individuals. This includes a variety of creations such as literary works, technological inventions,

performances, traditional practices etc. Intellect means Mind, Creativity and property means

assets, bundles of rights and right means power of use etc. Intellectual property is the property

which is the creation of human intellect (mind). These can be broadly divided into two

categories.

•  Intellectual property used for protecting industrial inventions such as Patents,

Trademarks etc.

•  Intellectual property used for protecting literary interests such as copyright, related

rights etc.

• TYPES OF INTELLECTUAL PRPERTY

• PATENTS
Patents are the rights that are granted to an individual for the invention of a product or a process

that offers a new way of solving a problem or for doing something. The main test for the grant of

a patent is the novelty of the invention. An individual claiming a patent for his invention is

required to show that his invention new. It adds to the technology that is already in existence in

the field of his invention.

A Patent is granted for a fixed period of time. After the term period of a patent expires, it

becomes free to use for the general public without paying any fees for it. Different countries
have different term periods for which a patent is valid. The term for a standard patent in India,

United States of America, Europe, and China is 20 years.

Other countries such as Canada, Japan, and Australia have different term period for different

types of patents.

In India, the grant of patents is governed by the Patents Act, 1970

• TRADEMARK

A trademark is a distinctive mark by which the identity of a manufacturer, producer or service

provider is known. These can be in the form of a logo, sign or written name. The recent trends

have seen that form of packaging can also be trademarked. A trademark helps the consumer to

associate a certain standard of quality to his products which can be easily relied upon by the

consumer while choosing the products in an open market.

Trademark is granted for a certain term period. But unlike patents, a trademark can be renewed

for as long as the owner wants by paying renewal fees in the concerned office. Both, as well as

companies, can have trademarks.

Trademarks are country-specific i.e. they protect the identity of a company only in the country in

which it has been filed. But this can be circumvented by organizations such as the World

Intellectual Property Organization (WIPO) which has an international registration system for

trademarks.

In India, the grant of Trademarks is governed by the Trademarks Act, 1999.

 • INDUSTRIAL DESIGN
Industrial design refers to the visual aspects of a product that cannot be protected by a patent. It

can be a surface or a three-dimensional design. It should be non-functional in nature i.e. it shall

be purely in the nature of aesthetics and not utility. Product form a wide category such as

technical instruments, medical instruments, garments, ornaments etc. can be protected under

Industrial Design.

To be eligible for protection, the Industrial Design shall be new i.e. no similar design shall exist

in the market. Some examples of Industrial designs are Coca Cola Contour bottle, iconic VW

Beetle car and most recently the round-edged design of an iPhone which was the subject matter

of a lawsuit between technology giants Apple and Samsung.

• GEOGRAPHICAL INDICATION

Geographical Indications indicates the place where a product originates from. Such products

have certain traits that can be found in the products that originate from that particular

geographical location.

For products that can be produced in a specific region only, an “Appellation of Origin”

geographical indication is used. It indicates that product with such GI can be produced only in

that part of the world and not anywhere else owing to the special geographical condition of that

place. Some example of such products is “Bordeaux Wine” for wine produced in the Bordeaux

region of France and “Basmati Rice” for rice produced in India.

Geographical Indication, in addition to protecting the manufacturer’s right of enjoying certain

returns, also helps the consumer by protecting him from buying counterfeit products that are not

related to the claimed geographical origins.

 • COPYRIGHT

Copyright is the rights which are granted to the creators of creative works. Creations such as

literary works (literature, poetry, and non-fiction) and artistic works (paintings, music) are

protected under Copyright laws. Newspapers, as well as architecture designs, are protected by

copyright laws as well.

It also protects rights which originate out of such creative creations. They are known as Related

Rights. These are rights which have been accrued due to the availability of the copyrighted

content. Some examples of related rights are right of an artist to their performances, rights of a

music producer to the digital rendition of their music etc.

Copyrights can be held by individuals as well as companies. Unlike other forms of Intellectual

Property, the Copyright holders enjoy the rights in his creation for the lifetime. Even after their

death, Copyright continues to exist for a period of 50-60 years depending upon the jurisdictions.

In such a scenario, the holder of the Copyright exercises controls over the Copyright.

Related rights, on the other hand, don’t enjoy such duration of protection as Copyright does.

Subject to the jurisdiction Related rights are generally valid for a period of 50 years from the

date of performance or broadcast.

Unlike the other types of Intellectual Property, Copyright holders are not required by the law

register their creations as they are automatically protected under the Copyright laws from being

exploited of their creative creations. But there do exist laws that allow the creators the option of

registering their creations with the concerned authorities.

 • ROLE OF INTERNATIONAL INSTITUTIONS
• Paris Convention for the protection of Industrial Property 

When there was no existence of any international convention in the field of industrial property, it

was difficult to obtain protection for inventions in different countries of the world due to the

diversity of laws. In addition, patent applications were filed at the same time in all countries to

prevent a publication in one country destroying the novelty of the invention in other countries.

These practical problems constituted a strong objective to overcome such problems in the case of

IPR. In the late nineteenth century, the development of a more international-oriented flow of

technology and increased international trade increased the need for harmonization of industrial

property laws in both the patent and trademark sectors. The Paris Convention is also

administered by WIPO. It came into existence to provide some international harmony in

intellectual property laws and was adopted on March 20, 1883, at Paris and enforced on July 7,

1884. It provides basic guidelines for the protection of intellectual property such as patents,

utility models, industrial designs, trademarks, service marks, trade names, sources of

information or signs of appeal, and some provisions for harassment and national treatment of

unfair competition. This treaty came into existence in India on December 7, 1998. Under the

convention, in the anti-discrimination principle, a member country is empowered to grant

nationals of other member countries the equal protection and advantages as it grants to its own

nationals. This anti-discrimination policy of the convention is also a fundamental principle of

many other intellectual property agreements and treaties. 

• National Treatment:

National treatment can be defined with regards to the protection of industrial property as each

country who is a member of the Paris Convention must grant equal protection of their invention
to nationals of the other member countries as it grants to its own nationals. The relevant

provisions are included in Articles 2 and 3 of the Convention. Equal national treatment should

be given to citizens of countries that are not members of the Paris Agreement if they are

domiciled in a member country or if they have “legitimate and efficient” industrial or

commercial establishments in the country concerned. However, there is no requirement to be the

domicile of the country where protection is claimed may be imposed upon nationals of member

countries as a condition for benefiting from an industrial property right. The doctrine of national

treatment not only guarantees that the foreigners will be protected, but also that they will not be

discriminated on any basis. Example: A Russian national applying for a patent in China will

have the same patent rights and level of protection in China as a Chinese national. 

• Right of Priority:- 

Another fundamental principle of the Paris Convention is a ‘Right of priority’. Under the Paris

Convention, an invention can be protected at the same time in various countries. This also means

of access to national patent systems to foreign applicants. An inventor has the authority to claim

the filing date of his first patent application in respective convention country as an effective

filing date for further subsequent applications (regarding the same invention) in any other

member country. Further, the applications must be filed within 12 months of the earliest

application in a matter to claim the priority date.

Example: A USA patent application is lodged on 10 March 2000. On 10 March 2001, the same

patent application is filed in China. China is a convention member and as a result, the Chinese

application is treated as though it was filed on 10 March 2000. If without the treaty, the patent in

the example was treated as though it was filed on 10 March 2002 in China, the invention would

likely already have been disclosed and thus un-patentable in China. 

The meaning of the right of priority means that in the foreign country, the application of patent

will be filed from the earliest date of filing in the home country for purposes of the prior art.

This is profitable for an inventor , as it allows the inventor to prevent detrimental effects of

public disclosure of his invention that occurred after the earliest application and before filing in

foreign countries. 

• Berne Convention (Protection of Literary and Artistic Works)

Copyright protection on the international level took its first step in the middle of the nineteenth

century on the basis of bilateral treaties. India became a signatory of the Berne Convention on

April 1, 1928. A number of such treaties providing for mutual recognition of rights were

concluded but they were neither comprehensive enough nor of a uniform pattern. The need for a

uniform system led to the formation of the Berne Convention for the preservation of Literary and

Artistic Works. The Berne Convention is the primeval international treaty in the field of

copyright. It is open to all states. Adopted on September 9, 1886, at Berne and entered into force

on December 4, 1887. Originally signed in 1886 at Berne, Switzerland, it was revised in 1914,

1928, 1948, 1967, 1971, and 1979. This Convention is based on three fundamental principles:

• Works in one of the contracting states (works of which the author is a national of

such state or a work already published in such a state) should be given equal

protection to each of the other contracting or non contracting states(the principle of

“national treatment”).

• Protection should not be conditional upon compliance with any formalities (the

principle of “automatic” protection).

 • Protection must be independent of the existence of protection in the origin country of

the work (principle of “independence” of protection). If a contracting State provides

protection for a longer term than the minimum term prescribed by the Convention

and the work ceases to be protected in the country of origin, protection may be denied

once if protection in the country of origin ceases.

The minimum standards of protection relate to the works and rights to be

protected, and to the duration of protection:

• As to works, protection must include “every production in the literary, scientific and

artistic domain, whatever the mode or form of its expression” (Article 2(1) of the

Convention).

• Subject to certain allowed reservations, limitations or exceptions, the following are

among the rights that must be recognized as exclusive rights of authorization: 

• the right to translate, 

• the right to make adaptations and arrangements of the work, 

• the right to perform in public dramatic, dramatic-musical and musical works,

• the right to recite literary works in public,

• the right to communicate to the public the performance of such works,

•  the right to broadcast,

• the right to make reproductions in any manner or form, 

• the right to use the work as a basis for an audiovisual work, and

• the right to reproduce, distribute, perform in public or communicate to the public that

audiovisual work.
 • World Intellectual Property Organization

The World Intellectual Property Organization (WIPO) is an international organization which

grants worldwide protection to the rights of creators and owners of intellectual property. It was

adopted on July 14, 1967, at Stockholm and enforced on April 26, 1970. WIPO came into

establishment under this Convention with two main objectives: 

• For the promotion of the protection of intellectual property worldwide and;

• to safeguard administrative cooperation among the intellectual property Unions

established by the treaties which are under WIPO administration. 

India became an official member of WIPO on May 1, 1975. WIPO’s origin dates back to 1884

when the Paris Convention entered into force with 14 member States, which set up an

International Bureau to carry out administrative tasks, such as organizing meetings of the

member States. Like the Paris Convention, the Berne Convention also set up an International

Bureau to carry out the tasks of administration. In 1893, these two small bureaux came together

and form an international organization known as the United International Bureaux for the

Protection of Intellectual Property. Based in Berne, Switzerland, with a staff of seven, this small

organization was the predecessor of the World Intellectual Property Organization of today – a

dynamic entity with 185 member States, number of staff who are around 938, from 95 different

countries around the world, and with a mission and a mandate that are constantly flourishing.

This International Bureau emerged over time to be recognised in 1970 as WIPO. In 1974, WIPO

became a specialized agency of the United Nations and in 1996, WIPO expanded its role into

globalized trade by entering into a cooperation agreement with the World Trade Organization.

WIPO administers 25 treaties (three of those jointly with other international organizations) and

carries out a rich and varied program of work, through its member States and the secretariat, that

seeks to: 
 • To integrate national laws and procedures related to intellectual property.

• To provide an international registration service for the industrial property. 

• To exchange information about intellectual property.

• To provide legal and technical assistance to developing countries and others. 

• To assist during the settlement of disputes related to intellectual properties among

individuals. 

• To keep a check on the use of information technology as an instrument for access and

exploit valuable information about intellectual property. 

According to the Convention held at Stockholm on 14th July 1967 and Article 2(viii) of the

convention following rights are included in Intellectual Property Rights:

• Literary, artistic and scientific works;

• Performances of performing artists, phonograms and broadcasts;

• Inventions in all fields of human behaviour;

• Scientific discoveries;

• Industrial designs;

• Trademarks;

• Service marks;

• Commercial names and designations;

• Protection against unfair competition;

 • All other rights resulting from Intellectual activity in industrial scientific, literary or

artistic fields; etc. 

• Trade-Related Aspects of Intellectual Property Rights

(TRIPS)

The Uruguay Round of multilateral trade negotiations held in the framework of the General

Agreement on Tariffs and Trade (“GATT”) was concluded on December 15, 1993.The

agreement which established the World Trade Organization (“WTO Agreement”), was enforced

on April 15, 1994, in Marrakech. For the first time the negotiations included within the GATT,

discussions on aspects of intellectual property rights of international trade. The result of those

negotiations, given in an Annexure of WTO Agreement was the agreement on Trade-Related

Aspects of Intellectual Property Rights (the “TRIPS Agreement”).

The WTO Agreement, including the TRIPS Agreement (which is binding on all WTO

Members), enforced on January 1, 1995. A new organization was established by the former

agreement known as the World Trade Organization, which came into force from January 1,

1995. Member States of WTO were granted a specific period of time after the enforcement of

the agreement establishing the WTO before being obligated to apply the TRIPS Agreement.

Trade-Related Aspects of Intellectual Property Rights (TRIPS) is the most global and essential

international agreement on intellectual property rights. The member countries of the WTO are

automatically binded by the agreement. The agreement consists of most of the forms of

intellectual property like patents, copyright, trademarks, trade secrets, geographical indications,

industrial designs, and exclusionary rights over new plant varieties. 

TRIPS proved to be one of the most important agreements to promote intellectual property at the

international level. TRIPS mainly introduced the global minimum standard for the protection

and enforcing of all forms of intellectual property but it failed to specify the global minimum

standard for the patent. The main object of the trade related aspect of intellectual property is to

promote effective and adequate protection of intellectual property rights and ensuring that

measures and procedures to enforce intellectual property rights do not themselves become

barriers to legitimate trade. 

• Issues covered by the TRIPS

• How basic principles of the trading system and other international intellectual

property agreements should be applied. 

• How to give adequate protection to intellectual property rights.

• How countries should enforce those rights adequately in their own territories.

• How to settle disputes on intellectual property between members.

• Special transitional arrangements during the period when the new system is being

introduced.

• Features of the TRIPS 

There are three main feature of the TRIPS agreement which are as follow: 

• Standard 

• Enforcement 
 • Dispute settlement 

Standard: The main element of trade related aspect of intellectual property is to protect the
subject matter.

Enforcement: The second element is about domestic procedure and remedies provisional

measure special related to border measure. 

Dispute settlement: The agreement makes dispute between world trade organization members
arising with respect to the trade related aspect of intellectual property obligation subject to the

world trade organization dispute settlement procedure. 

• Obligations under TRIPS Agreement 

The TRIPS agreement outlines various important business-related aspects of intellectual

property. In particular, this requires Member States to follow their own criteria for intellectual

property monopoly grants for limited period along with adherence to the Paris Agreement, the

Berne Convention and other WTO conventions. The norms are the minimum standards for

granting monopolies over any kind of IP, as well as duration limits, enforcement provisions, and

methods of IP dispute settlement. When the TRIPS agreement was enforced on 1 January 1995,

all developed countries were given twelve months from the date of signing the agreement to

implement its provisions. Developing countries and transition economies (under certain

conditions) were granted five years until 2000. As of 2006, least developed countries (LDCs)

were given 11 years to comply. Some countries have indicated that the long term should be

achieved. For pharmaceutical patents in these LDCs, the compliance period has been extended to

2016.
Currently, there are 30 LDCs within the WTO organization bound by TRIPS and another 10

LDCs are awaiting accession. The Most Favoured-Nation Principle (MFN) – The TRIPS

Agreement contains the most favoured nation doctrine, which has not traditionally been

provided in the context of intellectual property rights at the multilateral level. This doctrine

provides that any advantage, favour, privilege or immunity granted to the citizens of any other

country shall be immediately unconditional to all other members (whether or not a member)

with a specified exemption. As is the case for national remedies, the procedures provided in the

multilateral agreements discussed under the aegis of the WIPO relating to the acquisition or

maintenance of intellectual property rights are exempt from this principle.

• WTO AND DISPUTE REDRESSAL MECHANISM

• DEFINATION OF WORLD TRADE ORGANIZATION

The World Trade Organization (WTO) is responsible for maintaining the free flow of trade

between its member countries. WTO, in the form of Dispute Settlement Undertaking (DSU),

provides an instrument for the settling of trade disputes between the parties. The dispute

generally arises when any member country violates any provision of WTO agreement which

other member countries think unreasonable. 

This dispute settlement process is the outcome of the Uruguay round (1996-1994). This

mechanism provides a speedy resolution of a trade dispute. This settlement system applies to all

disputes covered under the WTO agreement. The Dispute Settlement Body (DSB) is responsible

for DSU to resolve a dispute between parties.

 • STAGES IN SETTLEMENT OF TRADE DISPUTE:-

1: Consultations (Article 4 of the DSU)

Before referring any dispute to mediation or taking any other actions, both the WTO member
countries shall affirm to resolve their disputes through consultation. If a WTO member requests
for consultation with another Member concerning measures affecting the operations of the
former member, the latter member must accept such request within a period 10 days after the
date of receipt of such request and shall enter into consultation within 30 days. 
If the consultation fails to provide a satisfactory solution to the problem within 60 days after the

date of receipt of the request for consultation, then the complaining party may request for

construction of the panel. All such requests for consultation and construction shall be notified in

writing including reasons for such requests to the Dispute Settlement Body by the complaining

member.

2: Establishment of Panels (Articles 6, 8 and 11 of the DSU)

If no satisfactory solution is reached through consultation between the member countries, the

complaining member may request for the establishment of panels in writing to the Dispute

Settlement Body including a summary of the case and issues involved. The panel is established

at the second meeting of DSB at which request appears as an agenda item of the meeting.

The function of the Panel is to aid the Dispute Settlement Body in resolving the matter in

dispute. The panel assesses the entire dispute, including the facts of the case and issues involved

therein and examines whether it conforms with the covered agreement between the member

countries. The Panel shall provide its final report to the parties within 6 months from the date

when panel procedures start.

3: Selection of panellists (Article 8 of the DSU)

After the establishment of the panel, the next step is to select panellists. The panellists are

selected by the WTO Secretariat. The parties cannot oppose the selection unless they state

reasons satisfactory to the Secretariat. The panel shall consist of three panellists. The parties can

agree to have five panellists on board if they consider necessary within 10 days from the

establishment of the panel. 

The WTO Secretariat assists the parties in the selection of panellists by creating a list of all

governmental and non-governmental individuals having certain qualifications from which

panellists may be chosen by the parties. 

Members may, at any reasonable time, make an addition to the list of individuals by suggesting

the name of individuals who can assist the parties by providing any information related to

international trade law or any of the matter as covered in the agreement because of which dispute

arose in the first place. The addition to the list can be made only after the approval of the Dispute

Settlement Body.

If panellists are not selected within 20 days after the date of establishment of the panel, the

Director-General, in consultation with the Chairman of Dispute Settlement Body and Chairman

of relevant Council or Committee appoint panellists which they consider appropriate. The

chairman of the Dispute Settlement Body, then informs the members of the composition of the

panel within 10 days. 

4: Procedure of Panel (Articles 10 and 12 of the DSU)

The panellists shall, within one week after the composition of the panel fix a timetable for the

panel process. After this, the panel decides a deadline for written submission to be made by each
party. Each party has to submit its submissions with the secretariat which shall transfer each

submission to the panel and submission made by one party shall be sent to the other party as

well. At the first substantive meeting of the panel, the complaining party shall be the first to

present their case ahead of the responding party. 

The third parties who have notified the Dispute Settlement Body having substantial interest in

the subject matter of the dispute are also asked to present their views during the same meeting.

Any rebuttals between the parties shall be made at the subsequent meeting of the panel. Here, the

responding party shall be the first to respond against the complaining party. The parties, before

that meeting, have to submit their written rebuttals to the panel. The panel, if they consider

necessary, put any questions before the parties to be answered in the duration of that meeting.

Where after the examination, a solution has been reached between the parties, the panel shall

submit a written report to the Dispute Settlement Body which shall have a brief description of

the case along with the solution which has been reached. Where the solution has not been found,

the panel shall send a written report to the Dispute Settlement Body mentioning its findings of

the case and recommendations, if any, it makes. 

The report has to be sent within six months of its examination. In case of urgency, including the

case of perishable goods, the report has to be sent within three months. The maximum period

during which the report has to send is nine months from the establishment of the panel. 

5: Interim report (Article 15 of the DSU)

Following the oral arguments and rebuttal that has been performed and examination has been

made, the panel shall issue a draft report to the parties. The parties have to submit their

comments in writing after receiving the draft report within the period set by the panel.
After the expiration of the said period for receiving the comments from the parties, the panel

shall issue an interim report, including its findings in the draft report and its new findings and

conclusion. Both the parties, within the time given the panel may submit its written request to

revise its interim report accordingly. 

At the request made by the parties, the panel shall call for a further meeting to discuss the

comments made by the parties to the dispute. If both the parties are satisfied with the solution

reached, then such a revised interim report shall be the final panel report and is circulated among

the members.

In case, the parties are not satisfied with the outcome of the report reached then any objections of

the members shall be considered at the meeting of the Dispute Settlement Body. Such objections

have to be reported at least 10 days before the meeting of the Dispute Settlement Body. 

The final report shall be adopted by the Dispute Settlement Body within 60 days from the date

panel report is circulated to the members unless any party to the dispute is unsatisfied with such

report and notifies its decision of appeal to Dispute Settlement Body or the Dispute Settlement

Body unanimously decides not to adopt such report, as the case may be. In case of an appeal, the

report shall deem to be invalid for adoption by the Dispute Settlement Body unless the Standing

Appellate Body provides its Appellate Body Report. 

6: Appeal (Article 17 of the DSU)

Either of the parties unsatisfied with the ruling of the panel report can appeal to the Standing

Appellate Body established by the Dispute Settlement Body. Only parties to the dispute can

appeal to a panel report and not the third parties. Third parties can be allowed to be heard only in
case such third party has notified in writing to the Dispute Settlement Body of its substantial

interest in such dispute.

The proceeding of the Appellate Body shall not exceed 60 days from the date a party to the

dispute notifies its intention of appealing to the Appellate Body to the Dispute Settlement Body.

In case of delay, the maximum period granted to the Appellate Body is 90 days. The Appellate

Body has to submit in writing to the Dispute Settlement Body its reasons for the delay together

with the period within which the final decision is notified. 

The Appellate Body will not re-examine any shreds of evidence, issues or previous arguments

but its examination shall be limited to laws covered in the panel report or legal interpretation

evolved by the panellists. The Appellate Body has the power to uphold, modify or reverse the

panel report and provide a conclusive report.