Patent Rights Under the India-New Zealand FTA: A Practical Exporter’s Guide
Introduction : The India-New Zealand Free Trade Agreement started working on 20 October 2026. It was signed in New Delhi on 27 April 2026 a little over a year after discussions began again in March 2025. New Zealand now allows all Indian products to enter without any duty and the Department of Commerce believes that pharmaceuticals and engineering goods will benefit the most. The two customs departments signed a paper about sharing information about where products come from electronically on 19 October the day before the agreement started working.
Tariffs are part of the situation for a company that has value in a special formula, a pump part or some important process knowledge. Before sending technology or products to New Zealand, a company that has a patent needs to ask three questions. Is the invention protected in New Zealand? What are the rules for letting someone else use it? How will the company make sure the rights are protected? This blog looks at the patent parts of the agreement and compares them with law and New Zealand law looks at how to apply for patents, how to license them and how to protect them. It ends with a list of things to check before entering the patent market.
Legal Provisions
The FTA’s Patent Provisions
Chapter 11 confirms that both countries stay true to their promises under the Patent Cooperation Treaty. Article 11.26 says that a disclosure must be clear and thorough enough for a skilled person to be able to carry out the invention. It also lets each Party ask for information about applications that are similar. Article 11.27 allows a sharing of information about how a patent works. Article 11.28 guarantees that there will be written reasons if a patent is refused, that a person can appeal in court that there is a chance to make changes and that there is a way to cancel or invalidate a granted patent. Article 11.24 makes sure that a regulatory review exception is available. Article 11.25 keeps the TRIPS flexibilities that let use happen without the right holder’s permission. Article 11.11 gives each Party the decision about exhaustion. Enforcement must follow Articles 41 to 61 of TRIPS. Border measures that are mandatory only cover trademarks and pirated copyright goods, other rights are optional. Article 11.33 promotes using knowledge databases, such as India’s TKDL, when examining patents.
Indian Law: The Patents Act, 1970
Section 39 says that a person who lives in India cannot file a patent application abroad unless that person has a written permit unless that person had already filed an application for the same invention at least six weeks earlier. Section 3(d) says that new forms of known substances that do not improve effectiveness are excluded. Section 31 offers a safe period for limited disclosures, such as when a product is displayed at a notified exhibition and Section 25 allows opposition before and after a grant. A licence must be in writing and must be registered. Section 84 allows a compulsory licence to be granted three years after the grant on grounds that include failure to work the invention in India. Section 107A shelters the costs of testing and authorised imports and Section 108 provides for injunctions, damages or an account of profits. Working statements, under Section 146(2) must be filed once every three years.
New Zealand Law: The Patents Act 2013
In my view since 30 December 2018 New Zealand has ignored an inventor’s public disclosure that was made within one year before a complete specification was filed. Both countries must grant a term of least twenty years from filing.
Legal Analysis
Filing Strategy: Sequence Matters
For a company the filing sequence begins at home. Section 39 requires an application or a permit, to be filed first. A direct New Zealand filing by a resident without an Indian application creates legal risk. The practical route is to file an application then within twelve months file a PCT application or a direct New Zealand filing that claims priority. The grace periods differ. New Zealand allows the inventor to disclose the invention for a year without losing priority. India protects a few narrow categories. A product demonstration in Auckland before the Indian filing can therefore damage the patent even though New Zealand would allow it if the full specification is filed within a year.
Validity deserves attention before any export plan is built around a patent. The Supreme Court in Bishwanath Prasad decided that a grant does not guarantee validity and that a mere workshop improvement fails the test of step. For exporters Novartis adds that a new form of a known substance must show enhanced therapeutic efficacy under Section 3(d). An Indian patent that is vulnerable to revocation becomes a priority base and a weaker licensing asset.
Licensing: Paper, Price and Proof of Working
Many Indian technology products are likely to reach New Zealand through a distributor or a licensee. I understand that Indian law requires the licence to be written and registered and that the FTA expressly preserves working disclosures. The 2024 amendment, which moved Form 27 to a three-year cycle eased the burden. Working remains a live issue at home. In Bayer the Bombay High Court accepted that import can amount to working though where the patent holder explains why the patentee does not manufacture in India. Royalties need a documented basis too. In KK Bansal the Delhi High Court refused a royalty claim where the patentee produced no licences. Exhaustion also shapes pricing across borders. The same Division Bench held that Section 107A(b) reflects exhaustion so goods sourced through authorised channels abroad may lawfully enter India. Since Article 11.11 leaves the question, to each Party an Indian licensor should fix limits and resale terms in the contract itself.
Enforcement: Courts First, Customs Later
The agreement assures enforcement akin to TRIPS; however, Article 11.39 mandates border suspension solely for counterfeit trademarks and pirated copyright goods. In many instances, patent owners turn to civil lawsuits in the nation where the infringement occurs. The standard of proof is stringent. KK Bansal overlooked foreign essentiality certificates lacking a witness, and testing evidence was missing without records. Claim charts, test results and licensing documents must be established long before any conflict occurs.
Patent management in India is also progressing, on 7 August 2026, the Patent Office released instructions for employing artificial intelligence in evaluations and on 4 September 2026, preliminary pharmaceutical examination guidelines were made public. Exporters with active Indian applications must adhere to both.
Relevant Case Laws
Bishwanath Prasad Radhey Shyam vs Hindustan Metal Industries
Bishwanath Prasad Radhey Shyam sued Hindustan Metal Industries for using a method to mount utensils on a lathe for polishing, which was patented by the plaintiff. The case involved a competitor from Mirzapur who was accused of copying the patented technique. The Supreme Court reinstated the trial court's decision to revoke the patent. It stated that an improvement must result in something new or a better and cheaper product, that simply combining known elements does not count as an invention, and that granting a patent does not ensure it is valid.
Novartis AG vs Union of India
Novartis applied for a patent covering the beta crystalline form of imatinib mesylate, which is marketed under the brand name Glivec. The Supreme Court upheld the prohibition, stating that efficacy under Section 3(d) is equivalent to therapeutic efficacy for medicines, and that a thirty per cent increase in bioavailability did not indicate this.
Bayer Corporation vs Union of India
Controller allowed Natco to use Bayer's patent for sorafenib tosylate under a compulsory license on March 9, 2012, and the Intellectual Property Appellate Board later increased the royalty rate to seven percent. The Bombay High Court rejected Bayer's challenge, stating that the drug fulfilled only a small part of the patient's need, was not available at an affordable price, and that producing it through imports needed an explanation for not manufacturing it locally.
KK Bansal vs Koninklijke Philips Electronics NV
Philips had secured a 2018 court ruling that granted them royalties based on a DVD patent, which they claimed was essential for industry standards. The Division Bench dismissed it, stating that there was no evidence of essentiality or infringement, comparable licenses were required for a FRAND royalty claim, international exhaustion made it impossible to enforce chips bought through authorised channels, and the punitive damages lacked any legal basis.
Practical Implications
Medicines, engineering products, and auto components are a few Indian items that will gain from exporting without incurring duties. These are also the regions where patents hold the greatest potential for generating profit. A business that distributes its brochures initially and then submits the required paperwork could find its own brochures used against its application in India. Conversely, a business that issues licenses without maintaining accurate documentation may struggle to demonstrate the established royalty rate in the future. The checklist provided ensures that patent choices remain in accordance with the export strategy.
Patent Market Entry Checklist
The checklist begins with a review of the Indian patent's freedom-to-operate and validity prior to signing any contract in New Zealand, as a fragile patent undermines all downstream licenses. Before any foreign application or public showing, the company is required to either file in India or secure a Section 39 permit and indicate the twelve-month priority period for a PCT or a direct application to New Zealand. Product launches, trade shows, and buyer presentations need to be delayed until the applications are submitted and handled.
The next step is licensing. All distributor or licensee agreements need to be documented, registered in India for Indian patents, and must explicitly define the covered territory, resale restrictions, quality control protocols, and royalty reporting obligations. Similar licensing records and operational information, along with the justifications for opting to import rather than produce the item internally, must be prepared for Form 27 and for any mandatory license evaluation. Ultimately, being prepared to pursue a claim requires documents such as claim charts, dated test reports, and market monitoring records from both nations, enabling legal proceedings to commence with existing evidence.
Conclusion
The agreement keeps the main parts of both patent laws as they are and ensures protection similar to TRIPS, clear processes for reviewing patents, allows for sharing information about inventions, and maintains flexibility on the right to sell products after they're made. For Indian exporters, the crucial work begins long before the first shipment: securing a strong Indian patent, following a strict filing process, maintaining proper documentation of licenses and having evidence that can hold up in court.
The near future offers several possibilities. Cooperation between the two patent offices under Article 11.13 could lead to exchanges between examiners, shared search practices, and more widespread use of TKDL in New Zealand's examination process, which would help protect India's traditional knowledge from being wrongly granted patents. New Zealand has promised to help bring in $20 billion of investment from its country to India over the next fifteen years. This money is expected to come through partnerships between companies and by sharing technology, where the cost of using the technology is decided based on the patents involved. Indian companies that make medicines and engineering products could have a stable market for their patented items, while New Zealand creators in agriculture technology and food science might get a big place to make their products at scale. Both economies would be better off if patents come along with the products from the beginning.
Author :- Muskan Gupta, in case of any query, contact us at Global Patent Filing or write back us via email at support@globalpatentfiling.com.