Patently inadequate

On August 21, India’s Controller General of Patents, Designs and Trade Marks office issued a set of revised guidelines for software (SW) related innovations; vastly widening the scope of SW-related patents in India.

While the new guidelines have cheered many in the IT industry, lingering questions posed by open source software communities needs attention — so we don’t blindly copy inefficient systems and open floodgates for frivolous litigations.

It is pertinent India starts looking at key measures to improve its Global Innovation Index (GII) so it is seen as a serious player focused on high-tech economy. In the recent index by the World Intellectual Property Organisation, India has slipped from 76 in 2014 to 81.

Globally, for many years, discussions around patentability of software innovations have been controversial. From a business point of view, India being the major exporter of software, India-based IT companies were constantly complaining about the difficulties in getting a software innovation patented.

The key arguments put forth by open source innovators such as “fast paced industries like IT, patents with a 20 year period lag behind the pace of innovation, so firms may end up with monopolies on the building-blocks of an industry, eventually blocking the overall industry growth” is valid.

India’s 1970 Patent’s Act predates the IT era and hence did not refer explicitly to software. Subsequently, there were many amendments including the key ones in 2002, 2004 and again in 2008 around the relevant section 3(k) and the discretions followed at the four local offices left ample room for open interpretation.

Unlike the US and Singapore, lack of subject matter experts at senior levels compounded the problem further. Due to the lack of comprehensive IP framework, our software focused companies continue to be under-valued.

Questions have been posed about the existing patent system itself — increasing instances of patent lawyer’s obfuscation methods of trolls and defensive patent-holders led to the perception that the global patent systems have started stifling innovations. Anomalies such as clubbing 20-year protection period for slow-paced pharmaceutical industry with the fast-paced IT industry are defeating the purpose of patents — spreading knowledge to society.

Globally, IP regulatory frameworks need a major overhaul. That said, India can ill afford to stay out of the patent system itself, risking its software IPs to be poached by competing economies in the global market.

Whether Indian innovators like it not, patent is the known effective, proven currency in global business transactions — it’s a necessary evil.

In a vast country like India, there are innumerable inventions that may not fulfil the stringent requirements of patentability but are novel, utilitarian and inventive in their own spheres.

So, in relation to specific concerns posed by open software communities — that is, allowing ‘small innovations’ such as mathematical algorithms and business methodologies may trigger IP lawsuits — a practical solution could be in the form of fixing 5-10 year patent periods for innovations coming out of fast moving industries such as IT.

To improve our GII and enrich our enterprise valuations in global market, even the so-called ‘small innovations’ coming out of the fast-moving IT industry or our MSMEs still require recognition and protection in the global market.

The writer is partner & CTO, Exfinity VC fund. He holds nine US patents

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