It is mandatory under the (Indian) Patents Act, 1970 (“Act”) for every patentee and every licensee to file a statement as to the extent of commercial working of a granted patent in the Indian territory. This working statement is embodied in Form 27 of the Patents Rules, 2003 (“2003 Rules”). Non-compliance with the requirement of filing the working statement within the prescribed timelines as per the Rules may invite penalty of imprisonment which may extend to six months, or with fine, or with both, as provided under section 122(1) (b) of the Patents Act. Noncompliance is routine and public interest petition directions of High Court resulted in Patent Amendment 2020 streamlining the procedure.
The question is why not do away with this requirement of working of patent?
History of Local working
The first working requirements implemented by countries were consistent with the countries’ initial approaches to their patent systems, which were guided by the notion that patents were expected to serve domestic industry.The interest in promoting domestic industry also prompted countries to impose a working requirement to ensure that the patented invention was practiced locally. A patent owner who failed to work his patent in the country that granted the patent faced a forfeiture of the patent, or later, when forfeiture was replaced by compulsory licensing, a compulsory license for the patent.
The United Kingdom tightened its working requirement in 1902 by allowing the revocation of a patent for nonworking not only if the patent was not being worked in the United Kingdom. It was prompted primarily by concerns about the influence of the German chemical industry in the United Kingdom and its monopolization of an entire industrial sector in the United Kingdom.The U.K. law prompted German companies to purchase chemical plants in the United Kingdom, and the companies did not suffer mass revocations of their U.K. chemical patents.
In India Intellectual Property Appellate Board in 2013, and the High Court of Judicature in the same year confirmed that “worked in India” does not have to “mean only manufactured in India.
It is clear threat of revocation of patent and compulsory license does not lead to local manufacture of innovative product with the patent granted. Why not abolish this inspector raj provision?
Reference:
https://www.natlawreview.com/article/india-patent-amendment-rules-2020-streamlining-form-27-filings
http://nopr.niscair.res.in/bitstream/123456789/15742/1/JIPR%2018%281%29%2015-27.pdf
https://www.law.uci.edu/lawreview/vol6/no3/Trimble.pdf
