India: Government sets up IPR think-tank

By Santosh Vikram Singh, Partner, Fox Mandal, Bangalore 

The Department of Industrial Policy and Promotion (DIPP), Ministry of Commerce & Industry, Government of India, through a press release dated 22 October 2014 announced setting up an IPR Think Tank to draft a National Intellectual Property Rights Policy and to advise it on IPR issues. The committee will also give its views/opinions on possible implications of demands placed by negotiating partner countries. This becomes essential especially when India and the US are trying to find a common ground on the prickly IPR issues in the working group to be set up under the bilateral trade policy forum.
IPR Think Tank is a six member committee chaired by Justice (Retd.) PrabhaSridevan, who had in 2012 figured among the 50 most influential persons in the world in the IPR field, Ms. Pratibha Singh (Senior Advocate)-Member, Ms. Punita Bhargava (Advocate)-Member, Dr. Unnat Pandit of Cadila Pharmaceuticals-Member, Sh. Rajeev Srinivasan (Director Asian School of Business, Thiruvananthapuram)-Member and Sh. Narendra K. Sabarwal (Retired DDG, WIPO)-Member and Convener.

This move comes at a time when the Government of India has launched a ‘Make In India’ campaign in order to raise the capabilities of the country’s manufacturing sector while also generating employment. A strong and favorable IPR regime will doubtlessly augment this programme by attracting foreign investment. Most large western pharma majors already have a manufacturing base in India; they are ready to set up additional units and invest in R&D facilities provided India amends its IPR regime suitably.

India’s move to constitute this think tank must also be seen in the backdrop of recent Patent Judgments in the pharmaceuticals sector, where Indian Courts prevented frivolous patenting as well as the extension of patents held by pharma companies just by tweaking existing drugs and passing them off as innovations. The US pharma industry has not taken kindly to these judgments and many companies have again attacked India’s IPR regime.

DIPP’s move is thus welcome, as it is in this context of growing concerns voiced by developed countries over India's level of protection to intellectual property rights over drug and agricultural products, and Prime Minister Modi’s promise (during his recent visit to the USA) to create a more investment and business friendly environment in India.

The think tank is expected to highlight instances where India has respected innovation in patent cases, while deciding to fast-track and finalize the policy road map by early next year. In its first meeting held on October 29, the committee decided to finalize the draft IPR policy by March 2015. The committee will advise the government on best practices to be followed in trademark offices, patent offices and other government offices dealing with IPRs to create an efficient and transparent system of functioning. The committee will also keep the government regularly informed of developments taking place in IPR cases that are likely to have an impact on India’s IPR policy. It will examine the current issues raised by industry associations and those that may have appeared in media and advice the government on addressing issues.

Copyright: new permitted acts

Two new statutory instruments came into operation on 1 October 2014, creating new permitted acts under the Copyright, Designs and Patents Act 1988, which is now so heavily amended that demands for a complete new codification and root-and-branch reform of copyright law are getting louder and louder (recently being added to in Mr Justice Arnold’s Herchel Smith lecture). They have exciting (that’s irony, incidentally), but admirably descriptive, titles: the first is the Copyright and Rights in Performances (Quotation and Parody) Regulations 2014 (SI no 2356). The words in brackets in the title of the second (SI no 2361) are ‘(Personal Copies for Private Use)’. Although they do similar jobs, they work in subtly different ways, and it is yet to be seen whether the private copying regulations comply with the relevant EU directive (the so-called information society directive) and therefore whether they are legal: interested parties are considering their position and a legal challenge may follow.

There are already many permitted acts, often inaccurately referred to as ‘exceptions’, in UK copyright law. Several of them fall under the general heading ‘fair dealing’, creating the impression that perhaps they are similar to the ‘fair use’ exception in US copyright law. Far from it: whereas ‘fair use’ is a powerful and widely-usable ‘get out of jail free’ card, the UK law’s notion of ‘fair dealing’ is inherently more limited and restricted to certain specific activities. Fair dealing must be for private study, non-commercial research, ‘criticism and review’ (must it be simultaneously for both?) or reporting current events. Recent grafts onto this limb of the Act (Chapter III of Part 1) deal with making versions of certain works adapted to the requirements of visually-impaired people. Now they are joined by provisions allowing parodies and quotations, provided they amount to r dealing.

How do you know what amounts to fair dealing? First, it is important to note that it is not the same as fair use. When the law uses a different word, it is safe to assume that it intends to say something different. One might argue that it is fair use, for example, to show a film to a small invited audience who do not pay for the privilege, but perhaps make a donation to charity. The charitable aspect immediately reveals possible arguments that the use of the film is fair: the promoter is not making a profit from the activity. But that is not the question we have to answer under our law: we have to ask whether it amounts to fair dealing. Has it interfered with the normal exploitation of the copyright by its owner? Has it deprived the owner of the opportunity to earn remuneration from the activity? It is perfectly possible that the owner would, had they been asked, have given permission to show the film in exchange for a payment which they would themselves donate to charity – paying the money straight to charity effectively makes the decision for the copyright owner that a particular charity will benefit from a showing of the film, and whether it might be classified as ‘fair use’ it is not ‘fair dealing’. The English courts have developed tests for fair dealing, asking whether the act complained of adversely affects the market for the work, and in appropriate cases whether the amount of the work used is reasonable and appropriate. The law tries to strike a balance between the interests of the copyright owner and users of the copyright work.

The first of the new fair dealing provisions permits acts done for purposes of parody, caricature or pastiche. The three expressions were not previously known to UK copyright law, but a recent Court of Justice decision, in Case C-??/???, Deckmyn, tells us (making unfortunate use of the word ‘original’, in a different sense from its normal copyright sense) that a parody must ‘fulfil a critical purpose; … display humorous traits; seek to ridicule the original work; and not borrow a greater number of formal elements from the original work than is strictly necessary in order to produce the parody’. So parody is concerned with poking fun at (or what in my childhood we would have called ‘macking gam’ of) a work rather than its creator.

The UK Intellectual Property Office has published guidance on the new regulations in which it states:

In broad terms: parody imitates a work for humorous or satirical effect. It evokes an existing work while being noticeably different from it. Pastiche is musical or other composition made up of selections from various sources or one that imitates the style of another artist or period. A caricature portrays its subject in a simplified or exaggerated way, which may be insulting or complimentary and may serve a political purpose or be solely for entertainment.

The Hargreaves Review concluded that the uncertainty about whether parody, caricature or pastiche required the copyright owner’s permission was restricting the activity of creative people and businesses. But there was little uncertainty: under the law as it stood then, these activities required the copyright owner’s consent if the whole or a substantial part of a work were taken. If the parody did not take enough of a work to amount to infringement, there would be no infringement. Why should a parody ever take a substantial part of a copyright work? If the parodist is doing their job properly, the parody will put the reader, listener or viewer in mind of the work being parodied but without taking anything from it in a way that might constitute and infringement.

The scope of the exception will depend to a great extent on the interpretation placed on certain expressions by the courts – the Regulations have done little to create legal certainty. In particular, the judges’ view of what amounts to ‘fair dealing’ and how they balance the interests of the copyright owner and the user. The wording of the provision does not expressly exclude commercial use, so one interesting matter will be the extent to which the courts permit commercial activities under this head: if the use deprives the copyright owner of income, it is unlikely to be treated as fair dealing.

Quoting from a copyright work is permitted provided a number of conditions are met. First, the work must have been made available to the public. The use of the quotation must amount to fair dealing with the work, the extent of the quotation must be no more than is necessary for the specific purpose for which it is used, and the quotation must be accompanied by a sufficient acknowledgement. The last requirement, which reflects conditions attached to other fair dealing uses and for which the courts have developed detailed rules, will not apply if ‘impossible for reasons of impracticality or otherwise’. To treat something which is merely impracticable as an impossibility stretches the point: this is a new meaning of the word ‘impossible’, perhaps. At least the ‘otherwise’ bit is vague enough that it is qualified by the ‘impossible’.

The rule about quotations from a performance or sound recording (in the modern world, one of the most important areas for quotation) is much the same, but there is no ‘sufficient acknowledgement’ requirement.

Private copying by an individual is now permitted provided that they have lawfully and permanently acquired the copy from which the copy is made. The new copy must not be made for commercial ends – which surely hardly needs to be stated expressly, as it would not be a private copy if it were. Private copies of computer programs will not be permitted under this provision.

The new private copying provisions have been controversial. The relevant EU directive stipulates that there must be a mechanism for compensating the copyright owner in any system for private copying introduced by a Member State. A parliamentary committee warned earlier this year that the UK might be in breach of its treaty obligations if it did not include such a mechanism, but the government after further reflection went ahead without one, claiming it is unnecessary. It relies on the fact that the directive says no mechanism is needed if the harm done to rights owners would be ‘minimal’. The government seems to be taking an optimistic view of how the new permitted act might work – and UK Music, claiming that musicians will lose £58 million in revenue, is considering whether to launch a legal challenge to the new legislation.