India Business Law Journal – May 2010

Re-imagining our world

“Innovation linking the world”, the theme of World IP Day on 26 April, could almost be the tagline for a device that might never have been if it had not been patented – the BlackBerry

For like many a smart idea, this too required the protection of the World Intellectual Property Organization-administered Patent Cooperation Treaty before it could flourish. Ironically it is devices like the mobile phone that, in connecting the planet and so transforming the paradigms by which we live, have also fuelled our move into a world without gatekeepers. And while the benefits are legion, the challenges to the owners of intellectual assets are daunting.

Especially so in India, where as our Cover story (On your marks) reports, investors confront an environment in which piracy is rampant, cyber-squatting is rife and IP protection appears impossible. However, as our editor, Vandana Chatlani, observes, over the next few years as India strives to raise protection levels to international standards, investors can expect to benefit from a more robust IP regime.

India will soon accede to the Madrid Protocol and as a result is required to make significant improvements to its IP protection and enforcement mechanisms. “Trademark registries across India are working at breakneck speed to upgrade their infrastructure,” says Dipak Rao, a partner at Singhania & Partners. In addition, a certain amount of judicial activism has crept in. As Sanjay Chhabra, a partner at Archer & Angell, has observed, “the courts have been regularly passing path-breaking judgments, recognizing the global reputation of marks and affording them protection in India.”

But this is a country where the wheels of justice turn slowly and even high-profile insiders are concerned that harsh economic realities are suppressing creativity. Ronnie Screwvala, a prominent film producer and founder of the UTV Group, writing in this month’s Vantage point (The real Bollywood villains), focuses on the lack of synergy between copyright enforcement agencies and the judiciary, which makes it possible for anyone to get a court order to restrain the release of a film. Combine this with high taxes directed at the film industry and the result is an environment where only financially “safe” projects see the light of day. In addition, Screwvala says, “various statutes criminalize the dissemination of infringing content, but there has been no significant judicial pronouncement in this regard.” Clearly, much needs to change to safeguard Bollywood’s creativity.

Indian IP owners would make a fatal miscalculation in dropping their guard as they venture outside the country to conquer new markets. As this month’s Intelligence report (Trouble overseas) reveals, although India may be seen as a perpetrator of IP abuses, Indian companies are equally at risk of falling prey to pirates in other countries. M Ravindran, a partner at Ravindran Associates in Singapore, believes this is because “most Indian companies are first-generation owners of IP” and have only recently realized the hidden value of their intellectual assets. As our story suggests, this lack of experience, combined with the fact that individual IP regimes have their own unique characteristics, means Indian IP owners must be alert to infringement possibilities at all times.

The special coverage of intellectual property protection that fills many of our pages this month has been timed to coincide with the International Trademark Association’s (INTA) annual meeting in Boston on 22–26 May 2010. India Business Law Journal and its sister publication China Business Law Journal are proud to be media sponsors of this important event. Copies of both magazines will be distributed widely at the conference and we trust that many INTA delegates will become our regular readers in the future.

The first of this month’s Spotlight features (The key to success) highlights important procedures for new entrants to India. A must read for companies considering setting up shop in the country, legal practitioners describe how pain-free the process can be, but also caution that a clear blueprint goes a long way to achieving a successful outcome.

In the second of this month’s Spotlight features (Reporting for duty) we present an exclusive interview with Gopal Subramaniam, the recently appointed chairman of the Bar Council of India. In a frank and freewheeling conversation, Subramaniam, who is also India’s solicitor general, speaks candidly about the future role of foreign law firms, the need to reform the country’s legal education system and his aspiration to boost the self esteem of Indian lawyers.

Subramaniam is mindful of the divergent agendas that face him. While arguing that “the case for the entry of foreign law firms is somewhat overstated,” he also claims to be “not oblivious to the demands of international business.”

Such dichotomies are not confined to the legal sector. Indeed, a serious conflict of interest in the pharmaceuticals market is set to have global ramifications. As our incisive coverage reveals (What’s the deal?) a significant number of best-selling drugs, such as Pfizer’s Lipitor, will fall off the so called “patent cliff” in the next few years. With the IP protection of these products nearing expiry, Indian generics manufacturers are jostling for position, eager to grasp the unprecedented opportunities that await them. So large is the pool of products approaching the end of their patent protection that this may well prove to be a defining moment for the global pharmaceuticals industry.