Growth of Start Ups under IPR

While developing a new idea as a product, pioneers naturally put a considerable measure of time into the innovative work of the product. They concentrate on building a business model, getting an increasing number of investors to put resources into the business believing that the product will pick up an early footing in the market. What they overlook is to have a sound Intellectual Property Protection set up before they introduce their product in the market. In spite of the fact that individuals are currently winding up progressively mindful about their IP rights, it is constantly fitting to have a sound IPR administration set up before propelling items into the market.

As 'Make in India' approach is changing this work culture in India, it has also been pushing start up culture in the India to another level. For this purpose, the Government of India initiated the Scheme for Facilitating Start-Ups Intellectual Property Protection (SIPP) in January 2016, with the motive to contact new businesses, ensure and advance their Intellectual Property Rights (IPR) and promote IPR awareness among the start-ups.   Thereby, making IPR as one of the most basic and important aspect for the start-ups, which is also being recognized by the Government. Even the IPR Policy have illustrated in its objective to encourage the utilization of the IPRs and to inculcate a devise mechanism in order to make IPR regime beneficial to all the investors, MSMEs, start-ups and grass root innovators.

It is very essential for the new age entrepreneurs’ to understand the IP cycle i.e. the process to create, manage and protect their IP, which can be one of the wealthy drivers in future. Every start up has a brand name, logos, designs as well as product or inventions that must be protected through IP rights. As per IP lifecycle, prior to bringing any product in the market, the start-ups must ensure that is not infringing any third party’s IPR that can lead to any litigation thwarting its business. In addition, the entrepreneurs should be proactive in creating and securing their intellectual property for increasing valuation, attaining competitive advantage, goodwill, and utilizing the resources for generating revenue streams through licensing and cross-licensing.

According to Scheme for Facilitating Start-Ups Intellectual Property Protection (SIPP),  a start-up has been defined as an entity, incorporated or registered in India not prior to five years, with an annual turnover not more than INR 25 Crores in any preceding financial year, working towards innovation, development, deployment or commercialization of new products, processes or services driven by technology or IP. The start up must also be certified by the Start up certification Board as having an innovative business.

There has been many amendments in IPR Laws in order to support these start ups and to give more incentives to the future pioneers to come up with their ideas as well as build their start ups.

Trade Mark Law The Trademark rules of 2002 were repealed in 2017, which gave few exclusive benefits to the individuals, start ups and small enterprises. The amendment was done to make the trademark registration process easier, faster and better. Moreover, the biggest relief for the start-ups is that they are exempted to pay the attorney fees until the stage of opposition.

  • Despite the fact that the administrative charges for different procedures related with the trade marks and service marks have been increased for the physical filings, the new companies and small undertakings have been given as much as 50 % rebate on the official fees for the trademark registration and expedited procedure of their registration applications. Therefore, they are required to pay only INR 4,500/- for making e-filing of their respective registration application, unlike the older companies who is required to pay INR 9000/-
  • The new rule also provides for the facility of fast track processing of Trademark application on an online request. The official fees of this particular request is also given on a 50% concession to the start-ups, i.e. at INR 20,000/- , where as the official fee for old companies is INR 40,000/-

Patent Law In order to, push the start ups for getting the patent protection, the amendment of patent rules in 2016 has made the patent registration much easier, faster and cost effective for the start ups.

  • Start-ups has been recognized as a separate entity and is entitled to 80% fee reduction on the official charges for registration applications. As a result of which the start up is required to pay only INR 1600 as compared to Companies which  to pay INR 8000/-
  • The fast track registration process is now available only for ‘start-ups’, the the controller is required to issue the First Examination Report within 105 days, thereby reducing the time for the whole procedure. The expedited examination fee for start-ups is INR 8000/-
  • Patent fees can be reimbursed up to 90% of the patent fees, when the application is withdrawn after filing the request for examination but before issuance of FER
  • The foreign filing license request will be disposed of within 21 days from the date of request where the applicant opts for filing patent application in foreign country without filing the application in India. This will enable the new businesses to prosper internationally

Conclusion For any start up, a strong IPR regime is of utmost importance, especially when the start ups are involved with lot of Intellectual properties assets. This would avoid the possibilities of infringement and thereby reduce the risk of loss. Moreover, start-ups world be free to exploit licensing and cross licensing as well.  Thus, the main objective of SIPP scheme was to raise IPR awareness among start-ups and help them in protection and commercialization of innovative and emerging technologies. The program was designed to help startups in understanding different types of IPRs, filing and disposal of IP applications related to patents, trademarks, etc. Thereby, providing a comparatively easy protection to Patents, Trademarks and designs of creative start-ups, thereby encouraging innovations and creativity among them and to provide the conducive environment to the start-ups.

Author: Pratistha Sinha, Associate at at Global Patent Filing,  and can be reached at  support@globalpatentfiling.com.

References:

[1] http://www.ficpi.org/_/uploads/files/6983/indian_trade_mark_rules_2017.pdf

[2] http://www.gip-india.in/introduction-of-new-indian-trademark-rules-2017/

[3] http://www.ipindia.nic.in/writereaddata/images/pdf/statupUps_Scheme_05May2016.pdf