Published: April 17, 2018
Publisher: World Trademark Review
By their very nature, IP rights are monopolistic. Patent laws in particular, which seek to encourage innovation by granting limited monopolies over inventions, epitomize this aspect of IP rights. Since a patentee is statutorily empowered to prevent others from infringing its right – and thereby gains an economic advantage – patent rights do appear to run counter to competition. Indeed, antitrust laws aim to foster competition in the market by preventing abuse of dominant positions, which patent rights naturally create.
Examined in isolation, the two acts may leave an impression that they are based on conflicting objectives and are antithetical to each other. However, this is not necessarily true. As is evident from a reading of the provisions of patent laws – both internationally and in India – both laws aim to create a balance between opposing interests in order ultimately to protect public and consumer interests; however, their means of achieving this end are different.
International agreements
The Paris Convention for the Protection of Industrial Property and the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPs) form the basis of patent legislation in most countries. These two agreements recognize the underlying interplay between patent and competition laws and offer clues on how the overlaps may be addresses. Specifically, Article 5(A)(2) of the Paris Convention envisages the grant of compulsory licenses to prevent any abuses which might result from granting monopolistic patent rights. Similarly, Articles 8.2, 40 and 40.2 of TRIPs allow member countries to take appropriate measures to prevent the abuse of IP rights through practices which unreasonably restrain trade or adversely affect the international transfer of technology.