This note is only intended as a general overview and is not to be viewed as a substitute for legal advice. Bran ds & Bonds shall not be liable for any actions taken or not taken on the basis of this note.

In continuance with the Startup – India governmental policy initiative and National IPR policy, the government has brought in sweeping changes to the Patents Rules. The paradigm change enshrined in the Patent Rules, 2016 is the introduction of fourth type of applicant – ‘Startup’ the earlier

Start up: An entity shall be deemed to be Start up provided it complies with the below conditions.

  • The entity has to be a (i) Private Limited company as per the Companies Act, 2013, or (ii) a registered partnership firm registered under Section 59 of the Partnership Act, 1932 or (iii) a limited liability partnership under the Limited Liability Partnership Act, 2002;
  • A period of 5 years should have not lapsed since the date of registration or incorporation of the entity;
  • Turnover should not be more than INR 25 Crores in any of the financial year;
  • (d) Entity should not have been formed by splitting up or reconstruction of a business already in existence.

Fees of Startup at par with Individual

Another key advantage for the Startup is that the fee burden shall be at par with the individuals. This shall be a point blank saving of 60% in the official fees alone. This would motivate all Startup to extend their patent protection which in other words would culminate in scaling up their valuation.

Expedited Examination

The startup can opt for expedited examination instead of ordinary examination which would accelerate the patent grant process. The patent examiner will have to prepare the examination report with a period of one month but not exceeding two months from the date of reference of application by the Controller to such examin er. Being that the fact, it however, needs to be experienced whether the gain of one month through expedited examination would really make some changes.

Video Conferencing

Another sweeping change is the effect of technology. The rules have provided for video conferencing of hearing of applications. Earlier the applicant/patent agent was required to personally attend and submit the hearings. This would save a lot of cost and time both for the applicant and the patent agents. Precisely, proximity to the patent office may not be a concern any more.

Reduced time for putting patent in order for grant

The time period for putting the patent in order for grant has reduced from one year to six months with option of three month’s extension.

Claim Deletion

Yet another important amendment is concerning Indian national phase filings where in it is currently permitted to delete claims. Though it may not be a concern for the local startups the international startups which had filed their patent application with more than 10 claims were charged fees, however with the present amendme nts, they have an option to delete their claims and restrict to 10 claims.

Refund of Examination Fee

If the applicant opts to withdraw the application before the issuance of the First Examination Report, it can claim a refund of up to 90% of examination fees.

Address for service

The applicant should furnish a postal address in India, along with an e-mail address and the Patent agent needs to provide a mobile number registered in India.

Adjournments would be dearer

In the event the applicant seeks an adjournment, he has to make a request for adjournment with reasonable cause at least three days before the date of hearing and the maximum number of adjournments shall be two. The amendments in the Patent Rules are a definite boost to the Startups as the patent portfolio are the game changer for the Startups.

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