By Akshaya D from The Tamil Nadu Dr. Ambedkar Law University
With the advent of digitalization in the 21st century there is a high risk of information and technology being stolen away and there arises a demand for regulation of the law and that is Intellectual Property law. Intellectual property rights play a key role in every sector and have become the basis for crucial investment decisions. Intellectual Property Rights (IPRs) are exclusive rights given to the innovators and also enable them to avail sole monopoly over their creations.
MEANING OF IP AND DISRUPTIVE INNOVATION
In simple words, Intellectual property refers to a kind of intangible, non-physical goods and includes any product of the human intellect. This includes ideas, names, designs, symbols, artwork, writings, and other creations.
Indeed covid-19 is likely to provoke a storm of change and disruption. Disruptive innovation is not a breakthrough innovation but it creates a major change and eventually disrupts existing market and value networks. It leads to the creation of a new market by overtaking an existing one.
CONCEPT OF IPR
Since there was a technological and scientific development in the country, the need for publication of knowledge became unavoidable.
This gave rise to some form of protection to the creator or innovator. Incentive for the disclosure was the way for encouraging disclosure and that incentives would be called as royalty. Intellectual property does not mean idea but the expression of idea is going to be protected. Intellectual property gives two different rights to the holder, one is positive and another is a negative right. The positive right is the right to exploit commercially the idea he expressed earlier. The negative right is to prevent others from doing what his positive rights permits him.
TYPES OF INTELLECTUAL PROPERTY RIGHTS
In India, there are mainly five types of Intellectual Property
- Trademark is regulated by Trademarks Act,1999
- Patent were regulated under The Patents (Amendment) Act,2005
- Copyright under the Copyright Regulation Act,1957
- Geographical Indication under The Geographical Indications of Goods(Registration and Protection) Act, 1999.
- Industrial Designs under the Designs Act,2000.
NEED FOR IPR LAW
With the advent of the information revolution knowledge and skills have become the sole source of sustainable long-term competitive market.In the 21st century, the Commercialist says that “Information is Wealth”, means information plays a very crucial role in every sector
of the economy. Companies’ success or failure would always be decided by the innovative idea, expression or techniques in the firm.
TRANSFER OF TECHNOLOGY
In the digital era, technology has become valuable and it can be achieved through IPR. IPR provides the inventor’s to protect their invention and have the negative right to exclude others to make, sell or manufacture for a period of 20 years.
- IPR’s allow innovators to get rewards and to compensate for the investments. If IPR becomes weak, protection will lead to repercussion by domestic firms. The result of IPR protection varies differently in different countries and depends on the level of development and domestic capacity for innovation.
- Transfer of technology can be made through two different channels one is formal which may include franchising, joint ventures, foreign direct investment, etc. Another is an informal channel which may include imitation and technology spillover.
- Inventions are the bedrock of innovation and that invention is a solution to a technical problem which can be protected through patents and that can last up to 20 years.
- The legal protection to the innovator encourages the commitment of additional resources for further innovation
- A patent is a private right and by filing a single international application via the WIPO’s Patent Cooperation Treaty (PCT), the inventor can obtain patent protection in up to 152 different countries easily and at cheaper cost.
- IPR protection turns an inventor’s know-how into a commercially tradable asset.
- In getting royalty through IPR protection make it possible for the inventor to finance further technological research and development (R&D), as a result of improving access to better technology.
CREATION OF PROFIT
- IPR helps in creating profit by way of royalty for the invention being used by other than the inventor.
- IPR convert creative idea into profit
- Any IP right holder can monetize and commercialise the IP assets via licensing, sale, as collateral for debt financing, and also for raising public funding, loans and to get government subsidies.
- IPR protection through patents in getting royalty makes it possible for the inventor to finance further technological research and development (R&D), as a result of improving access to better technology.
- Through IPR protection, the inventor creates a monopoly in the market and receives a due advantage over other competitors.
BENEFIT TO ENTREPRENEUR
- Owning an IP makes even a start up company to compete even with leading companies and allows it to grow at a pace faster than those without any IP rights.
BENEFIT TO ECONOMY
- The income received as royalty by the transfer of IP is treated and taxed under the Income Tax Act, 1961. To promote innovation in the country, royalty income is given tax incentives.
- Section.32(1)(ii) of the Income Tax Act accounts for depreciation of intellectual property as expenditure for the purpose of calculation of income tax.
- Technology Acquisition and Development Fund under the Manufacturing Policy will be utilised for licensing or procuring patented technologies.
- IPR acts as an important tool in developing their business to emerging companies to exhibit their invention.
- To the emerging companies, IPR is a tool through which they can exhibit their new invention or ideas and thereby overtaking the existing business and to acquire a dominant position in the business. A strong IPR protection is needed for the good progress in the country.