Google Play Billing Policy: Whether Anti-Competitive In Nature

ABSTRACT:

The goals of both, namely the maximization of public welfare, can be compared in terms of how competition law and policy handle the process as well as to those of political democracy.[1] But because of the quick rise of e-commerce and the digital market, it has grown increasingly complex. The paper describes the entire situation by the way of taking an example of the contemporary Indian problem that occurred in relation to the Google Play billing system, contextualize it with the competition law and its current state, and draws attention to the shortcomings in the ruling itself.

INTRODUCTION:

Due to the rapid growth in field of e-commerce and digital market place there has been an insurgence of platform to facilitate the process and in turn gaining power from it. This new field is governed by multiple laws but the focus of the article is on the competition law which keeps the power of the platforms in check in order to preserve the right of freedom of choice and welfare of the consumer by keeping in check the competition in the marketplace.

The Google Play Billing System (hereinafter “GPBS”) in context to the digital market place of Google Play have been in spotlight as was fined for anti-competitive practice which was been followed. The GPBS has been rightfully charged by Competition Commission of India (hereinafter (CCI) and in this article after critically analyzing the facts, issues will lay down the judgement of the court, then point out the Main Factors which the Commission took aid in order to reach an ultimatum as well as substantiating it and then even pointing out the lacunae that even this judgement suffers from.  

ANALYSIS:

India has seen a drastic change in the technology and in the modern times due to increasing availability of electronic devices as smart phones, laptops, etc. with the supplement of the Internet has been the epicenter for the emergence of the e-commerce platform and mobile payment systems. Due to this emergence as the law changes with the change to the society so there has been changes, amendment and even addition of laws or legal provision governing the area of the digital market place. In Businesses operating in the digital market place in India have to comprise with multiple laws such as:

1. The Information Technology Act, 2000,[2]
2. The Indian Contract Act, 1872,[3]
3. The Consumer Protection Act, 2019,[4]
4. The Competition Act, 2002,[5]
5. The Payment and Settlement Systems Act, 2007,[6]
6. The Reserve Bank of India (RBI) regulations on digital payments,[7]
7. The Copyright Act, 1957,[8]
8. The Trademark Act, 1999,[9]
9. The Patents Act, 1970.[10]

But, this article focuses on the aspect of assessing the junction where the interfaces where two domains of completion law and the digital market place meets, in the recent times due to the fine imposed by the CCI against the Google for GPBS being anti-competitive in nature and impugned monetary fine of Rs. 936.44 crores as result of the case of XYZ vs Alpahabet Inc..[11]

XYZ v. ALPHABET INC.:

BACKGROUND:

There was a two-fold allegation made by the informants on Google as recognized by the commission, firstly was the mandatory use of the GPBS for purchasing apps as well as to conduct in-app purchases restricts the choice available to the app developers and also keeping in mind the 30 percent service tax which may be 15 in some cases which is mandatory to be given to Google under the GPBS for any purchasing of the app for the google play store and for ant in-app purchases as well. Secondly, was that the other mobile wallets and UPI apps are not accepted as legitimate payment methods in the Google Play payment system.[12]

Issue arose:

1. Whether making the use of Google Play’s billing system (GPBS), exclusive and mandatory by Google for App developers/owners for processing of payments for App and in-app purchases and charging 15-30% commission is violative of Section 4(2) of the Act?
2. Whether exclusion of other UPI apps/mobile wallets as effective payment options on Play Store is unfair and/or discriminatory as per Section 4(2) of the Act?
3. Whether pre-installation and prominence of Google Pay UPI App (GPay) by Google is in violation of Section 4(2) of the Act?

WHETEHR GPBS PRACTICE IS ANTI-COMETITICE IN NATURE OR NOT:

Yes, the GPBS system was anti-competitive in nature and the commission was right in its approach and holding them liable under 4(2)(a)(i),[13] 4(2)(a)(ii),[14] 4(2)(b)(ii),[15] 4(2)(c),[16] and 4(2)(e) of the Act.[17] and we can analyze each of the aspects discussed by the court while substantiating it even further:

GPBS:

GPBS is the proprietary billing system of the google, in which the app developer makes account with Google, and in this system the Google gets its “service fee” on all the app purchase or in-app purchase. In the due process of creating an account by the app developer with Google they have to agree to the DDA (Developer Distribution Agreement) and the DPP (Developer Program Policies) which clearly mandates the compulsory use of the GPBS.[18] Further, if seen in the Section 4 of the Google Play’s Payment Policy can be clearly inferred that the not only does it mandates the use of GPBS,[19] but in addition it also has an “Anti-steering provisions” which means it also restrict the ability of the app-developer to inform the consumer about in-app purchase from some elsewhere. There were number of factors as to why the GPBS system is anti-competitive in nature such as subsequently discussed.

DISCRIMINATORY PRACTICES:

Then Court finally highlighted the part of discriminatory practice which comes to light when we see that YouTube which is owned by Google does not use GPBS but YouTube is in connection with third-party payment processors directly, Google had given liberty to YouTube but not to the others who still have to follow the GPBS and have to pay the exorbitant rate of 15-30% service fee every time putting them at a disadvantage;[20] (cite) When we say discriminatory practice, we say so in the light of the practices which results in denial of market access in violation of provisions of section 4. (cite para 40 Arshiya Rail Infrastructure Limited Vs. Respondent: Ministry of Railways Arshiya Rail Infrastructure Limited vs. Ministry of Railway: MANU/CO/0076/2012). Also, the Supreme Court itself has interpreted denial of market access under Section 4(2)(c) widely, noting that denial of market access ‘in any manner’ would fall under its ambit, regardless of whether it is a denial of access to competitors or denial of access to players in vertically affected markets.[21] So the denial of market access used in this context is an umbrella term. Here, Google turning a blind eye to the YouTube in turn to increase their revenue allowed them engage with a third-party payment processor and like others they are charged significantly lesser fee then they themselves charge to others which ranges from 15-30%.

ACCESS TO DATA:

All the Google-owned services have access to the all data giving competitive advantage as a result of having access to this downstream competitors’ data set. Google would be able to use this information to enhance its offerings and more effectively target its potential clients. On the other side, the downstream rivals wouldn’t have access to the entire data set, which would hurt their ability to compete;[22] as can be inferred from the clause 9.2 of the DDA,[23] and also from the “Share usage & diagnostics information with Google” as explained on the Google Play’s Support page itself.[24] From the very insurgence of the digital marketplace access to data have been both an enabler and driver of competition and like any tool it serves the competitive as well as the anti-competitive services. There are companies like Google in at this very instance we can see that it misused their data access and companies not being careful not to abuse their control over the data will harm consumer welfare as well as limit the competition.

INNOVATION AND BARRIER TO ENTRY:

The GPBS has an adverse effect on the even though Google argues that GPBS as evident from its averments that it aids in levelling the playing field for app developers and stops monopolistic practices by app shops. On the other hand, while in reality as accepted by the commission as well GPBS stifles innovation by preventing developers from experimenting with fresh business models and sources of income.[25] The same argument is forwarded with respect to barrier to entry as it raises barriers to entry for competitors and inhibits developers’ capacity to provide alternative payment systems, Google’s requirement that app developers utilize its billing system reduces competition and choice for app developers and customers.[26]

UPI

There was another issue of UPI, Google has made only itself available to the intent flow technology while the other UPI only have access to the collect flow technology, to differentiate between in intent flow and collect flow in simple terms would be that, intent flow is a connected chain of steps, user-friendly and simple while collect-flow technology is a broken chain of steps which are disconnected with each other,[27] through this this Google was discriminated between developers of “similarly placed apps, equally placed transactions”.[28] While rejected the last contention as the option of pre-installation is available to all the others just because one utilizes it does not make it abuse of dominant position.

LIMITATION TO THE JUDGEMENT:

The main aim of the competition law is to maintain the following aspects:

1. Prohibition of anti-competitive agreements
2. Prohibition of abuse of dominant position
3. Merger control
4. Consumer protection

When any practice which is in contravention of any of the point and is having an adverse-effect on market competition is an anti-competition practice.[29]

With the rise of the e-commerce and digital marketplace there has been a sharp rise in anti-competitive practice like price-fixing, predatory pricing, Exclusive dealing, tying and bundling, abuse of market power.

As said by Ashok Kumar Gupta, chairman of Competition Commission of India that, “Digital markets are epicenters of technological innovation but lately they have become zones of “entrenched and unchecked dominance”,[30] all this has been possible due to the presence of lacunae in the act of competition law itself. Some of the lacunae are:

LACUANE 1: “RELEVANT MARKET IN DIGITAL MARKET PLACE”

The “relevant market” defined in Indian Competition law,[31] is based on the geographic region as in Section 2(s),[32] and the nature of product or service being offered as in Section 2(t),[33] which is ingenious only in case of the single side transaction, but does not take into account the interconnectedness of the sellers on each other which occurs in a multi-side transaction. There are substantial differences between a multi-side transaction and a single side transaction such as the unlike the traditional market where there was a seller and a buyer, here there can be multiple buyer as well as seller and may at times for one buyer to earn money there has to be involvement of other buyer, all of the people interact through a platform which is to say there is an intermediary role and there is a degree of the network effect, there are pricing models and even risk allocation.[34]

The biggest limitation to Indian Competition Law is the Multi-sided transaction as it is not possible to find the “relevant market” based on the available test, when looking at judicial procurements we see that courts have only recognized multi-sided nature of platform,[35] but have not adopted any means to aid the situation as can be seen from the subsequent judgement including Xyz v. Alphabet Inc.,[36] where to the CCI did not give any weightage to the multi-sided nature of the app store which connects the smartphones users to app developers just applying the tradition test of substitutability and geographic region just gave three separate relevant market and had delineated between market for licensable mobile operating system for smart mobile devices and the market for app store for Android OS.

Keeping in mind the past inconsistent judicial procurements with respect of “relevant market” in competition law ranging from cases such as Matrimony.Com Limited vs Google LLC & Ors,[37] Make My Trip case,[38] to contemporary cases such as Harshita Chawla,[39] Delhi Vyapar Mahasangh cases.[40]

LACUNAE 2: DETERMINATION OF DOMINANT POSITION AND ABUSE OF POWER BASED ON SHARES:

Market share measures the percentage of total sales or revenue in a market that a company controls, but it does not take into account other factors that can affect a company’s ability to exercise market power, such as barriers to entry, network effects, economies of scale, and access to data or other resources. Even though, in the judgement the court while accessing the case of Xyz v. Alphabet Inc.,[41] the court had taken into account other factors such as access to data, entry barriers, etc. but had clearly stated that the Commission is of the view that market share is one of the primary though not determinative parameters to assess dominance in a relevant market.[42] Accepting market share as a dominant factor to access the dominance in the market place can be very misleading in the current age witnessing the rise of e-commerce and digital market place as mentioned above.

CONCLUSION:

To sum up, the key takeaway from this article is that GPBS was anti-competitive in nature and is one of the major accomplishment of the CCI in identifying the issue and then delivering the judgement it in a very detail and a descriptive manner had discussed the issue while shedding light to the aspects of discriminatory practice, access to data and even to the effect of innovation and the barrier on entry, while also highlighting the second clubbed issue of UPI which was discussed then afterwards highlights the lacunae which the decision itself suffers from and through this highlights lacunae we can clearly see the way forward which is, accepting and understanding our own shortcomings which is that unlike other countries with competition law India still falls a bit short, India as a way forward just as a suggestion can take two different ways like:

1. Can pass a similar ruling as the seminal ruling of Ohio v. Amex, the CCI can take into account the feedback effects and competitive constraints in transaction and non- transaction platforms which is unique to the multi-side transaction,[43] or
2. Can either join or create something similar to the Digital Markets Act in the EU,[44] so that the there is a separate legislation to deal with digital market place altogether.

While at the current juncture though there is the Competition (Amendment) Bill, 2022, which a has passed both the Lok Sabha as well as the Rajya Sabha on March 29, 2023 and April, 3 2023 respectively and one of its key issue is analysing digital market, so the India may in the future successfully tackle issues such as which arose at the current instance.[45]

Author : Arkadeep Poddar, in case of any queries please contact/write back to us via email to chhavi@khuranaandkhurana.com or at IIPRD

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[1] JSTOR: INDIAN COMPETITION LAW: GLOBAL CONTEXT, by B.S. Chauhan, published in Journal of the Indian Law Institute, July-September 2012, Vol. 54, No. 3 (July September 2012), pp. 315-323, at page 315,  available at, https://www.jstor.org/stable/44782475, (last visited 14^th May, 2023).

[2] The Information Technology Act, 2000.

[3] The Indian Contract Act, 1872.

[4] The Consumer Protection Act, 2019.

[5] The Competition Act, 2002.

[6] The Payment and Settlement Systems Act, 2007.

[7] Master Direction on Digital Payment Security Controls, Reserve Bank of India, available at, https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=12032&Mode=0, (last visited 14^th May 2023).

[8] The Copyright Act, 1957.

[9] The Trademark Act, 1999.

[10] The Patents Act, 1970.

[11] Xyz and Ors. V. Alphabet Inc. and Ors., 2022 SCC OnLine CCI 63.

[12] Xyz and Ors. V. Alphabet Inc. and Ors., 2022 SCC OnLine CCI 63.

[13] The Competition Act, 2002, § 4(2)(a)(i).

[14] The Competition Act, 2002, § 4(2)(a)(ii).

[15] The Competition Act, 2002, § 4(2)(b)(ii).

[16] The Competition Act, 2002, § 4(2)(c).

[17] The Competition Act, 2002, § 4(@)(e).

[18] Xyz and Ors. V. Alphabet Inc. and Ors., 2022 SCC OnLine CCI 63, ¶ 249.

[19] Google Play, Google Play’s payment policy: Google Terms and Services, § 4, Rights and Restrictions, available at, https://play.google.com/about/play-terms/index.html, (last visited on 14^th May, 2023).

[20] Xyz and Ors. V. Alphabet Inc. and Ors., 2022 SCC OnLine CCI 63, ¶ 29.

[21] Competition Commission of India v. Fast Way transmission Pvt. Ltd., Civil Appeal No. 7215 of 2014.

[22] Xyz and Ors. V. Alphabet Inc. and Ors., 2022 SCC OnLine CCI 63, ¶ 282, 284.

[23] Google Play Developer Distribution Agreement, clause 9.2, available at, https://play.google.com/about/developer-distribution-agreement.html, (last visited on 14^th May, 2023).

[24] Google Play Support page: “Share usage & diagnostics information with Google”, available at https://support.google.com/accounts/answer/6078260?hl=en, (last visited at 14^th May, 2023).

[25] Xyz and Ors. V. Alphabet Inc. and Ors., 2022 SCC OnLine CCI 63, ¶ 314.

[26] Xyz and Ors. V. Alphabet Inc. and Ors., 2022 SCC OnLine CCI 63, ¶ 186, 193.

[27] Xyz and Ors. V. Alphabet Inc. and Ors., 2022 SCC OnLine CCI 63, ¶ 354.

[28] Xyz and Ors. V. Alphabet Inc. and Ors., 2022 SCC OnLine CCI 63, ¶ 355.

[29] Competition Commission of India v. Bharati Airtel Limited and Ors. (2018) SCC OnLine SC 2678.

[30] Khurana and Khurana Advocates and IP Attorneys, The Antitrust issues in digital markets – Modifiable anti-competitive conduct of Artificial Intelligence, published at 12^th October, 2021, available at, https://www.khuranaandkhurana.com/2021/10/12/the-antitrust-issues-in-digital-markets-modifiable-anti-competitive-conduct-of-artificial-intelligence/, (last visited at 14^th May, 2023).

[31] The Competition Act, 2002, § 2(r).

[32] The Competition Act, 2002, § 2(s).

[33] The Competition Act, 2002, § 2(t).

[34] Business Model Analyst: Mutisidedx Platform Business Model, available at,  https://businessmodelanalyst.com/multisided-platform-business-model/, (last visited 14^th May, 2023).

[35] Vijay Gopal Vs. Big Tree Entertainment Pvt. Ltd. (BookMyShow) and Ors., 2022 SCC OnLine CCI 36.

[36] Xyz and Ors. V. Alphabet Inc. and Ors., 2022 SCC OnLine CCI 63.

[37] Matrimony.Com Limited vs Google LLC & Ors, 2018 SCC OnLine CCI 1.

[38] Makemytrip India Pvt. Ltd. MMT and Another V. Competition Commission of India and Others, 2022 SCC OnLine Del 4440.

[39] Harshita Chawla (informant) Whatsapp Inc. and Facebook Inc. v. Competition Commission of India, 2020 SCC OnLine CCI 32.

[40] Amazon Seller Services Private Limited, represented by its Authorized Signatory Mr. Rahul Sundaram v. Competition Commission of India, represented by its Secretary and Others, 2021 SCC OnLine Kar 12626.

[41] Xyz and Ors. V. Alphabet Inc. and Ors., 2022 SCC OnLine CCI 63.

[42] Xyz and Ors. V. Alphabet Inc. and Ors., 2022 SCC OnLine CCI 63, ¶ 164.

[43] IndiaCorpLaw: Delineating Relevant Market for Multisided Platforms: Transaction vs Non-Transaction Platforms, by Harshit Upadhyay and Sanigdh Budhia, publishe at October 26, 2022, available at, https://indiacorplaw.in/2022/10/delineating-relevant-market-for-multisided-platforms-transaction-vs-non-transaction-platforms.html, (last visited 14^th May,2023).

[44] European Commission: The Digital Markets Act: ensuring fair and open digital markets, available at https://commission.europa.eu/strategy-and-policy/priorities-2019-2024/europe-fit-digital-age/digital-markets-act-ensuring-fair-and-open-digital-markets_en, (last visited 14^th May, 2023).

[45] PRS Legislative Research: The Competition (Amendment) Bill, 2022, by the Ministry of Finance, available at, https://prsindia.org/billtrack/the-competition-amendment-bill-2022, (last visited on 14^th May, 2023).

Comprehensive Study of Section 117A of The Patents Act, 1970

Introduction

The Patents Act, 1970 (hereinafter referred to as Act) being a gallant enactment to encourage research & development and innovation and providing monopoly over intellectual creations came into force on 20^th April 1972, supplanting the Indian Patents and Designs Act 1911. This enactment is currently in par with all the international arrangements as it gets amended regularly in accordance with the international conventions and treaties. The Act contains provisions regarding to application, registration, oppositions, anticipation, surrender and revocation, register of patents, patent offices, appeals, penalties etc. The provisions related to appeals are contained in Chapter XIX of the Act which lays down the exclusions from appeals, procedure of appeals and establishment of Appellate Board (hereinafter referred to as IPAB) etc.

Analysis of Section 117A

Section 117A in particular aims to deal with the appeals passed on from any decision, order or direction of the Controller or Central Government. Bare text of Section 117 A is extracted here for referral purposes:

117- A. Appeals to the Appellate Board. —(1) Save as otherwise expressly provided in sub-section (2), no appeal shall lie from any decision, order or direction made or issued under this Act by the Central Government, or from any act or order of the Controller for the purpose of giving effect to any such decision, order or direction.

(2) An appeal shall lie to the Appellate Board from any decision, order or direction of the Controller or Central Government under Section 15, Section 16, Section 17, Section 18, Section 19, Section 20, [sub-section (4) of Section 25, Section 28,] Section 51, Section 54, Section 57, Section 60, Section 61, Section 63, Section 66, sub-section (3) of Section 69, Section 78, sub-sections (1) to (5) of Section 84, Section 85, Section 88, Section 91, Section 92 and Section 94.

(3) Every appeal under this section shall be in the prescribed form and shall be verified in such manner as may be prescribed and shall be accompanied by a copy of the decision, order or direction appealed against and by such fees as may be prescribed.

(4) Every appeal shall be made within three months from the date of the decision, order or direction, as the case may be, of the Controller or the Central Government or within such further time as the Appellate Board may, in accordance with the rules made by it allow.

While construing/interpreting this provision one must keep in mind that, it is well settled that no provision or word in a statute is to be read in isolation ¹, as true intent of the legislature behind enacting the provision can only be understood if a liberal approach is taken to interpret/construe. Scope of section 117A is apparently very extensive and is accordingly discussed and appraised in Yahoo! Inc., etc. v. Intellectual Property Appellate Board & Others (W.P. No. 4462 of 2010)² where Madras High Court while deciding a Writ Petition filed under Article 226 of the Constitution of India has discussed the capacious scope of the said provision.

A basic read of the text of section 117A reveals that sub-section 1 deals with matters that cannot be appealed with IPAB. It can be understood as an barring clause that refers to sub-section 2 and states that matters listed out in sub-section 2 are the ones that can only be appealed to IPAB. It is worth noting that sub-section 2 lays down the matters that can be appealed before IPAB. It points out certain provisions of the Act from which the right to appeal to the IPAB arises. Provisions listed in sub-section 2 of section 117A are as follows:

Section 15, Section 16, Section 17, Section 18, Section 19, Section 20, sub-section (4) of Section 25, Section 28, Section 51, Section 54, Section 57, Section 60, Section 61, Section 63, Section 66, sub-section (3) of Section 69, Section 78, sub-sections (1) to (5) of Section 84, Section 85, Section 88, Section 91, Section 92 and Section 94.

One thing common in all these sections is that these all are either related to powers of controller or the orders passed by Controller. This sub-section explicitly excludes any other decision, order or direction passed under this Act by Central Government or Controller which is not mentioned in it. But even after such a clear-cut view expressed by the legislature in the provision, courts in Yahoo! Inc. (supra) went beyond the litera legis and interpreted Section 117-A of the Act. They mentioned the Apex Court’s holding in Chandra Mohan v. State of Uttar Pradesh ³ – “The fundamental rule of interpretation is that in construing the provisions of the Constitution or the Act of the Parliament, the Court “will have to find out the express intention from the words of the Constitution or the Act as the case may be …..” and eschew the construction which will lead to absurdity and give rise to practical inconvenience or make the provisions of the existing law nugatory.”. The courts also inculcated the principles of natural justice in their judgment as well by stating“Being the person who was responsible for the order passed against the petitioner, the respondent No.4 is entitled to be heard in law on the principles of natural justice. When an order is passed behind the back of a person whose presence is a necessity, it has got civil consequences”. Finally, the Respondent No.1 (IPAB) in Yahoo! Inc. (supra) was asked to number an appeal and decide the case on merits.

Through this the courts expanded the very scope of Section 117A by holding that the order passed by Controller under Section 25(1) is to be construed as an order passed by Controller under Section 15 hence, should be appealable under Section 117A. The courts left Section 117 open for interpretation to be done by the courts in future.The courts also defined the scope of this provision as:

“9.Scope of Section 117A of the Patents Act, 1970:-

Section 117A of the Patents Act, 1970 deals with the appeals to the Appellate Board. Sub-section (1) of Section 117A deals with the decisions which are not appealable. In other words, sub-section(1) of Section 117A is an exclusion clause specifying certain actions from the purview of the Appellate Board. Section 117A(2)speaks about the appeal to the Appellate Board from any decision, order or direction of the Controller of Central Government. Therefore it is seen under Section 117A(2) an appeal would lie not only against the decision but also an order or direction of the Controller. A reading of the above said provisions would clearly show that an order of the Controller which in effect is the decision, order or direction made by the Central Government alone is exempted in so far as the applicant seeking a patent is concerned. Hence, Section 117A is exhaustive to include the orders passed by the Controller, in refusing an application for patent.”

Subsequently, sub-section 3 of Section 117A deals with the proper procedure and formalities in which an appeal to IPAB should be made and sub section 4 of Section 117A lays down the time period in which the appeal should be filed and will remain amenable. It also gives IPAB a power to extend the time period for filing an appeal from the matters listed in Sub-section 2.

Conclusion

Hence, Section 117A is a provision under the Act that restricts certain appeals and allows certain appeals by explicitly mentioning the provisions under sub-section 2 but after referring to the courts in Yahoo! Inc. case it is evident that Section 117A has a wide scope hence, can be interpreted for the ends of justice.

Author:  Kshitij Gopal Kalra – 5th Year Law Student at Dr. Babasaheb Ambedkar College of Law, intern at Khurana & Khurana, Advocates and IP Attorneys. In case of any queries please contact/write back to us at niharika@khuranaandkhurana.com

References:

[1] ZAMEER AHMED LATIFUR REHMAN SHEIKH v. STATE OF MAHARASHTRA [(2010) 5 SCC 246]
[2](2010)5 LW 104 (Mad) (DB).
[3] 1967 (1) SCR 77

Considerations Under Section 8 Indian Patent Act, 1970

Intellectual Property Rights are jurisdictional in nature. Hence, instances wherein different patent applications for the same subject matter filed in different parts of the world are common. PCT (Patent Cooperation Treaty) does make it easier for patent rights to be granted worldwide, however, applicants still prefer filing separate patent applications in countries that aren’t covered under the PCT agreement. Filing different applications in varied countries brings with it the obligation to apprise the Indian Patent Office of such filings if the same or a substantially same invention is filed for the grant of a patent in India.

Provisions mandating the disclosure of such information are made under Section 8 of the Indian Patent Act 1970[1], read with Rule 12 of the Indian Patent Rules 2003.
As per Section 8(1) (a). The Applicant is required to provide ‘a statement setting out detailed particulars of such application(s)’ in Form 3 as prescribed under Rules 12(1) and 12(1A) of the Patent Rules. This formality must be fulfilled either at the time of filing a patent application for the invention in India or within the subsequent six months of such filing in India.

The Patent Act also makes provisions for apprising the Patent Office of new foreign application. Section 8(1) (b) read with Rule 12(2) requires the applicant to furnish information in respect to ‘any other application’ if any, as filed in any other country. If such a foreign application is filed subsequent to the application filing in India, the statements (in Form 3) in respect of such foreign application should be filed within six months of the foreign application’s filing.

Section 8(2) read with Rule 12(3) provides for discretionary powers for the Controller. In case the applicant is to ‘furnish details, as may be prescribed, relating to the processing of the application in a country outside India’ as per a requisition by the Controller[2], the applicant must do so under Form 3 within six months of the said request.

Consequently, in this way, the Indian Patent Act, 1970 mandates that the disclosure of information relating to a foreign application can be made in 3 distinct ways.

a. When a patent application is already filed in a foreign country for the same or substantially same as the one seeking patent protection in India.

The statements in Form 3 in respect to such a foreign application should ideally be filed together with the Indian patent application in India.

b. When Form 3 containing statements disclosing information in respect to already existing applications in foreign countries could not be filed together with the Indian patent application.

The statements in Form 3 with respect to such a foreign application must be filed within the subsequent six months from filing the Indian patent application.

c. When a foreign application is filed after the lapse of six months from the filing of the Indian patent application.

The statements disclosing information in Form 3 in respect to such foreign application must be filed within the subsequent six months from the filing of such foreign application.

*The time limits may be extended by a month at the discretion of the Controller.

After the requisite information as statements has been provided for in the prescribed Form 3, to fulfill the aforementioned reasons (a) (b) and (c), there is no stated requirement for resubmission of an updated Form 3, to merely update changes in the status of the foreign patent applications which have been previously disclosed. The change in the status can subsequently be shown in any new application that may be filed at a later date to reflect a foreign application in Form 3 which enumerates the previously disclosed foreign applications.

Considering that a patent application is filed in India and an application for the same or a substantially same invention is filed in a foreign country.

Author: Niharika Sanadhya, Associate at Khurana & Khurana, Advocates and IP Attorneys. In case of any queries please contact/write back to us at niharika@khuranaandkhurana.com

References:

[1] The Patents Act 1970, as amended by the Patents (Amendment) Act 2005 (Act 15 of 2005) at Section 8 [Patents Act]

[2] Such a requisition shall be notified in the FER (First Examination Report).