The Patents Act, 1970, is a vital law in India that supports creativity by giving inventors special rights to their new ideas for 20 years. It started in 1972 and was updated in 2005 to match global rules. The law protects new, unique, and useful inventions, such as products (like a new medicine) or methods (like a new way to make something). By encouraging people and companies to create new things, the patent in business law helps grow India’s economy, especially in industries like medicine. It also includes rules, like compulsory licensing, to ensure important items, such as affordable medicines, are available to the public. This makes the law important for both businesses and everyday people in India’s fast-changing economy.
Step into the future of legal expertise! Join our Advanced Certification Program in Intellectual Property Law, created by The Legal School in collaboration with Khaitan & Co. Designed for fresh law graduates and professionals, this unique course boosts your legal career. Don’t miss this opportunity—enquire today to secure your spot!
Meaning of Patents in Business Law
The Patents Act, 1970, is India’s law that explains how patents, special rights for new inventions are given and protected. A patent lets an inventor control their creation, like a new product (e.g., a medicine) or a new process (e.g., a way to make something), for 20 years. This motivates companies to come up with new ideas because they know they can earn money from them.
The law helps businesses safeguard their inventions, which is especially important in fields like medicine. However, there’s a debate about making sure new ideas don’t make things like medicines too expensive for regular people.
Historical Background and Changes Over Time
The Patents Act, 1970, began on April 20, 1972, replacing an older law called the Indian Patents and Designs Act, 1911. This was a big change for India’s patent system. The new law was based on a report by a committee led by Rajagopala Iyengar, which suggested giving patents for how things are made (process patents) in areas like medicine, food, and chemicals. Over time, the law has been updated to follow international agreements, like the Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement, part of the World Trade Organization.
A major update happened in 2010 with the Patents (Amendment) Act, which allowed patents for products (not just processes) in areas like food, medicine, chemicals, and even tiny living things like microbes. This update removed older rules about exclusive marketing rights and added ways to balance creativity with public needs, like compulsory licensing (allowing others to make a patented item under certain conditions) and ways to challenge patents before or after they’re granted. Other updates in 1999, 2002, and 2006, plus rule tweaks since 2006, have kept the law up-to-date with global changes.
Key Rules and What Can Be Patented?
The law says a patent is a special right given for an invention: something new, like a product or a new way to do something. To get a patent, an invention must:
Be New (Novelty): It can’t have been shared or used publicly before the patent application is filed (Section 2(l)).
Have an Inventive Step: It must be a clever improvement that isn’t obvious and offers a new technical or money-making advantage (Section 2(ja)).
Be Useful in Industry (Industrial Applicability): It must work in a real-world industry, like manufacturing (Section 2(ac)).
However, some things can’t be patented under Sections 3 and 4, including ways to treat people medically, new types of plants or animals, discoveries (like finding something that already exists), scientific theories, math formulas, artistic creations, or computer programs by themselves.
Types of Patents and Rights They Give
Patents are categorized based on the nature of the invention, each granting specific protections. Knowing the types and their associated rights helps inventors safeguard their innovations effectively.
Utility Patents: For new methods, machines, or products.
Design Patents: For the unique look or shape of an object.
Plant Patents: For new types of plants, though these are rare and have strict rules.
The rights depend on the patent type:
For process patents, the inventor can stop others from using the same method or selling/importing products made with it.
For product patents, the inventor can prevent others from making, using, selling, or importing the product in India.
These rights only work in India, but inventors can apply for patents in other countries using the Patent Cooperation Treaty (PCT).
How Long Patents Last and How They are Enforced?
A patent lasts for 20 years from the day it’s filed. For international applications under the PCT, the 20 years start from the international filing date. If someone uses a patented invention without permission (called infringement), the inventor can take them to court. The law includes rules for appeals, punishments, and the role of patent agents (experts who help with patent applications), covered in Chapters I to XXIII.
Compulsory Licensing and Public Needs
One important rule, especially after the 2005 update, is compulsory licensing. This lets the government allow someone else to make or sell a patented item if the inventor isn’t using it properly or if it’s needed for public health, like making medicines affordable. This rule follows the Doha Declaration, which focuses on ensuring access to essential items in countries like India, where many people need affordable medicines.
Impact of Patent in Businesses and the Economy
The Patents Act has greatly influenced industries, especially medicine. The 2005 update worried some people because it might raise medicine prices, but compulsory licensing has helped keep essential drugs affordable. This has made India’s medicine industry stronger, allowing companies to make generic (low-cost) drugs and invest in research. India is now a global leader in pharmaceuticals. Big international companies have also set up research centers in India, creating jobs and boosting the economy.
The law encourages businesses to spend money on research because they know their ideas will be protected. However, there’s still a debate about ensuring everyone can afford patented products, especially medicines, since high costs could make them out of reach for some people.
Also, Get to Know About Infringement of Geographical Indication.
Comparing Changes and their Effects
The following table shows the major updates to the Patents Act and what they did. This table shows how the law has evolved to support businesses while ensuring public access:
Year | Key Changes | Effects |
1999 | Started following TRIPS rules | Set the stage for matching global patent standards. |
2002 | More TRIPS alignment, added mailbox system for applications | Helped process pending applications and prepare for product patents. |
2005 | Allowed product patents for food, drugs, chemicals, microbes; added compulsory licensing | Boosted innovation, raised some prices initially, but kept essential drugs affordable through licensing. |
2006 | Finished TRIPS compliance, improved ways to challenge patents | Made patent reviews stronger, balanced inventor and public rights. |
2012, 2013, 2014 | Updated rules for better processes | Made applying for patents faster and clearer. |
Summary
The Patents Act, 1970, with its updates, is a flexible law that protects new inventions, encourages creativity, and helps India’s economy grow. It gives businesses strong protection for their ideas while including rules like compulsory licensing to meet public needs. For anyone involved in business law, understanding the law’s rules, changes, and effects is key to succeeding in competitive industries, especially those driven by technology.
Related Posts:
Patent in Business Law: FAQs
Q1. What is a patent in business law?
A patent is a legal right given to an inventor to protect their new, useful invention, stopping others from using it without permission.
Q2. What is a patent for a business?
A patent helps a business protect its new products or methods, giving it exclusive control for 20 years, encouraging investment, and making it more competitive.
Q3. What is a patent and its types?
A patent protects a new invention. Types include utility patents (for products or methods), design patents (for an object’s look), and plant patents (for new plants, though rare in India).
Q4. Why is it called a patent?
The word “patent” comes from the Latin word patere, meaning “to be open,” because inventors share their invention details in public documents to get exclusive rights.
Q5. What is the law of patents?
The Patents Act, 1970 (updated in 2005), is India’s patent law. It ensures inventions are new, unique, and useful while balancing creativity with public access to essentials like medicines.
