Intellectual property rights (IPRs) are proprietary rights where ownership vests in one or more persons (including legal persons). The IP rights owner exercises his rights to exclude unauthorized use of the protected intellectual property during the term of the protection. The Trade Related Aspects of Intellectual Property Rights (TRIPS) identify seven IPRs including patents, trademarks, copyrights, industrial designs, plant variety protection, geographical indications and semiconductor lay-out designs. As every other area of law, this too is evolving and there are many developments that tend to push the envelope. Time will tell! Meanwhile, it is important to understand that an IPR’s worth is gauged at the market place. It is here that the exact value of an IPR to its owners vis-a-vis their customers/consumers is evaluated. Of the seven IPRs mentioned above, it appears that Geographical Indications are the only IPRs that are owned collectively by a community. However, two forms of rights under the trademark laws namely Collective Mark and Certification Mark are also IPRs that are primarily used by communities. For purposes of clarity, “community” here refers to persons who access a particular form of the said IPR either due to geographical situation, or by way of work or a type of business.
“Can I patent this product?” is an everyday question faced by a patent lawyer/patent agent. Ordinarily, this question would kick-start a series of processes to assess patentability of the product (or a process) that would entail studying the abstract of the invention, conducting a prior art search, examining the product vis-à-vis the prior art to assess the novelty and inventive step etc. But when the question is posed by a member of Micro Small and Medium Enterprise (MSME) sector, a seasoned intellectual property practitioner will kick-start a different set of processes which starts with a series of penetrating questions toascertain the character of goods sought to be protected by the expensive patent system to save time, money and efforts of both parties.
For those who came in late, a standard patent is one of the most expensive IPR available from the plethora of IPRs on offer under the IP regime worldwide. Patents provide the patent holder the right to exclude all others in that jurisdiction from using, manufacturing, selling, marketing or distributing the patented product or products made through patented process. The criteria of patentability set out in the Patent Act are very stringent and requires considerable skills on patent of the patent drafter, including a good knowledge of technology and patent law, adequate penmanship for drafting the patent specification. Then at prosecution stage the patent agent or the patent lawyer must have adequate techno-legal skills to argue before the Patent Office to set right or where possible comply with the objections raised by the Patent Office for the grant of Patent. As the reader is aware under the prevailing patent regime, the basic criteria of novelty, inventive step and industrial application are bolstered by additional conditions of patentability enshrined in Sections 3, 4 and 10 of the Indian Patents Act. Thus, product(s) comprising new use of a known substance, mere admixture of known substances, traditional knowledge etc., are not patentable.
One may well ask: is obtaining a patent on a product the first step to commercialization? Not always. Further, even if the product is patented there are other IPRs that may also be deployed for commercialization such as trademark, copyright and industrial design. In fact, there are all kinds of commercially successful products in the market that are not patented. They are protected through a plethora of other IPRs including copyrights, trademarks and designs. For instance, the formula of the very successful Coca Cola is not patented; it is a trade secret and hasbeen so, for over 100 years. The strength of the commercialization lies in the trademark which differentiates the soft drink from other similar products in the market. There is of course a wall of IPRs including patents on the can (vessel), the can opening mechanism, the shelf life of the soft drink etc. All innovations deal with presenting this product or its variants to the market and patents are incidental to the basic drink composition which is a trade secret.
Talking about Collective Marketing in the context of registered GIs, it has been a challenge to get the potential consumer to recognise the quality assurance associated with collectively marketed products. There is as yet, very little by way of institutionalised structures to ensure consumer protection through quality assurance. Thus, any attempt at collective marketing first of all needs a major brand recognition exercise and link the same to quality. If there is a perceived quality enhancement owing to standardisation of the products in use of raw materials, manufacturing, finishing, etc., then this can be the U.S.P. on the basis of which price premium can also imposed.
If the quality assurance is linked to the place owing to its natural resources then absent this link the GI cannot be registered or enjoyed. In the latter case, this leads to genericisation of the GI. This is not necessarily against consumer interest. The case of Kolhapuri Chappals is the easiest to recognise. However, there is a major impact on the traditional artisans in the trade owing to failure to protect the trade through a GI.
The second sociological issue that has been seen to crop up is the alienation of the local populace from the GI registered product owing to the premium that the product may now command in the market, driving the product out of the ability to pay of the traditional customers. This has been seen to happen in the case of Chanderi Sarees where the existing artisans now command such a premium in the market for their products that the local ladies who were the traditional customers for the product and had a social link with it can no longer afford the same. Here is a case of the producer interest and the art form itself being protected, yet being alienated from the consumer.
Creating Certification Marks is one thing and getting the consumer to accept it as a quality assurance is quite another. The trust in ISI Mark has over the years been considerably eroded owing to dilution of the standards. Similarly, the ISO Standards face a credibility crisis being so esoteric that the ordinary customer is not able to understand what the said ISO certification means. The SMEs would need to adopt a strategy towards development of such uniform and consistent standards that customer confidence is established in a reasonable frame of time.
Next Step Many entrepreneurs believe that patents are essential for the success of a product in the market. While there is an iota of truth in this belief especially when the product is a technological invention, often the products sought to be patent protected are not patentable under the Patents Act. For instance, neither the Pashmina Shawl nor Basmati Rice or for that matter Darjeeling Tea are patentable subject matter; and yet there is a sizeable global market for these products. In fact, these products have been traditionally produced for a few generations and therefore fail the patentability criteria of novelty and inventive step as well as the Section 3 requirements of the Patent Act which abjure traditional knowledge and knowhow from patentability. However, these goods can be protected as Geographical Indications (GI) under the Geographical Indication (Protection and Registration of Goods) Act, 1999 which came into force in India on 15th September, 2003. Equivalent examples from foreign shores include Champagne of France, Parma ham from Italy, and Scotch Whisky from Scotland.
Then again there are products that a large number of independent establishments are manufacturing, which have similar characteristics and are recognized by their consumers for those special characteristics. For instance, the cottage industries that make the Panchranga Pickles or the co-operative societies that make a product(s) of certain quality evocative of the source or a particular characteristics can be classed under this category. While they may not be protectable as GIs, there are mechanisms under the IPR regime to leverage these products in the market and maintain their sanctity.
Seen in this context, the response to the rather innocuous question posed by theclient on patentability of his product ought to be a series of leading questions with the sole purpose of finding out the nature of product(s), its origin, the history of its creation, etc. Basically, the experienced attorney seeks answers to questions that is likely to be asked at the Patent Office during prosecution. Usually, 15 minutes of playing the Devil’s Advocate reveals the reasonable chances of the types of IPR that can cover the product; as well as whether serious time and money ought to be invested in getting a patent. Where the client’s invention is based on traditional craft there is only a 10% chance that his product is in the ambit of being considered to be a patentable subject matter. Usually, there are minor innovations which are practiced by a number of entities in the style of a cottage industry. And it is likely that there is a sale of same or similar goods with minor variations.
To leverage the advantages of the products (goods) to increasingly discerning consumer, collective marketing appears to the obvious choice in such cases. Interestingly, collective marketing has been successfully practiced in India and elsewhere. Collective marketing is a mechanism used by otherwise unrelated members of an unorganised sector to collectively market their product(s) and differentiate them for the consumers in a highly competitive market. It allows the members to cut down on costs of advertising and get better visibility and recognition in a highly competitive market. In certain circumstances, collective marketing is fait accompli sincethe production techniques and the know-how used to develop a product belong to or involve entire communities and therefore cannot be attributed to a single individual.
A case in point is that of Anand Milk Producers Union Ltd (AMUL) and Self-Employed Women’s Association (SEWA), while in the case of Darjeeling Tea the sale and auction etc., is administered by the Tea Board of India. Trademarks, especially, Collective Mark and Certification Marks under the Trademark Act coupled with copyrights appear to be IPR of choice in these instances; and so it is. However, with the enactment of the GI Act in 2003, GI and trademarks are mutually exclusive by law. This means that if the product is protected as a GI, the same name cannot be protected as a trademark and vice versa. Which means that playing the Devil’s Advocate will also entail questions on the origin of product and traditional knowledge, if any, associated with the product(s). In fact, where traditional skills or crafts are involved, the more obvious IPR is that of Geographical Indication.
Since time immemorial, the state of Kashmir is known for its finest handicrafts. The increasing cross-border strife between India and Pakistan on this issue, led to the Government of India taking steps to get the Geographical Indicator (GI) patent for some of the finest Kashmiri handicraft amidst opposition. We have now registered the traditional crafts of Kashmir known in the world over as “Pashmina” under the Geographical Indications of Goods (Registration & Protection) Act, 1999 which came into force with effect from 15th September 2003.
Talking in terms of Geographical Indicator (GI) patent, it provides absolute rights of a brand to a particular product in a particular geographical region. The GI Registry before conceding the patent publishes the matter in its journal and invites objections from across the globe. In the year 2006, the Craft Development Institute (CDI) in Srinagar had filed an application for GI patent pertaining to Kashmir Pashmina, Sozni embroidery and Kani shawl (tapestry woven), but the Rawalpindi Chamber of Commerce and Industries (RCCI) in Pakistan opposed the move by citing the existence of similar handicrafts in Pakistan-occupied Kashmir (PoK). Internationally, the Kashmir Pashmina is considered as a major handicraft with a huge market potential, but in recent times, it is threatened by the incursion of fake and blended Pashmina which devalues the reputation of the original product. I believe that our artisans involved in the Pashmina trade in Kashmir have the expertise and know very well that the yarn needs to be handled with utmost care as it is weaved into a shawl since Pashmina is quite frail and has to be handcrafted and not machine woven. Owing to the ban imposed on “Shahtoosh” due to illegal poaching of the Chiru goats, Pashmina is now considered as the most delicate, soft and costliest wools in the world.
We produce the Pashmina wool of 12-14 micron thickness while Cashmere wool, which is often passed off as Pashmina, is anywhere between 14-19 microns. China, which is the world’s largest producer of Cashmere wool, also passes most of its wool under the name of Pashmina. The International market for Pashmina and Cashmere is about 15,000 tons with China alone producing about 7,000 tons of goods every year. We can’t say out of these how many are fake and how many are genuine! In Kashmir, there are around 50,000 people associated with the Pashmina trade, including nomads, weavers, spinners, artisans and washers etc. Kashmir alone produces 40 tons of goods each year as compared to 15,000 tons of goods being in demand worldwide. The annual trade in shawls in Kashmir is estimated to be around Rs. 550 crore and with the patent in hand this income is expected to multiply several times over.
In Pashmina, the actual product is very costly and anything fake or local is relatively cheap in the market. Our major focus is to stop such misuse, due to which we discovered and identified that a more sophisticated method of hallmarking has to be used and are in the process of exploring the possibility of using the RFID (Radio Frequency Identification Device) or the NFCT (Near Frequency Communication Tag). This entails the same technology as is available in cell phones today, where you bring the cell phone near the tag and it will give you the exact details. So, we are hoping that we would be successful in applying a very small chip to the product which cannot be taken off and which has all the important information that can be verified in the testing laboratory to prove its authenticity across the globe. Now, we are in the process of establishing the Pashmina testing laboratory within CDI (Craft Development Institute) in Srinagar with the State and Central Government initiative and to act as a catalyst in the development of the handicraft sector in the State of Jammu & Kashmir and simultaneously provide a human resource platform for national craftsmen. We are going to operationalize and administer this testing laboratory which will issue the tag and also ensure that the institutional product is genuine. If Pashmina is used in related products such as on scarves and shawls, it will act as a value-add due to the fine embroidery including the particular handwoven “Kani” shawl which we have projected under the GI. The International Trade Association namely CCMI (Cashmere & Camel Hair Manufacturers Institute) located in Boston is also a leading authority on domestic and international issues concerning fibers, labeling, standards, supply and market trends. It not only promotes the use of genuine cashmere and camel hair products but also protects the interests of manufacturers, retailers and consumers of these products so as to maintain its integrity through education, information and industry cooperation.
Geographical Indications (GI) refers to marks that link product to the place where it is produced and provide a promise to deliver a product of a certain quality following certain traditions. In effect, it is a link between the product and the place of geographic origin, even where there are no obvious appellations of origin. For instance, while the Kolhapuris refer to distinctive leather slipper of Kolhapur in Maharashtra giving clear indications of geographic origin, the Chikankari work is evocativeof the delicate embroidery of Lucknow (UP) even when the GI does not mention it. Needless to mention, the community producing the said product ought to collectively have a right in the proprietorship of the GI name. The marketing here would be a collective effort.
Interestingly, GI is the only one among the IPRs that cannot be licensed or assigned. The members of the proprietary association/society can use the GI mark / logo, but cannot license or assign to anyone. Stands to reason! Thus, under the GI law, there is an authorization and a collective right to use the GI mark/logo. Each enterprise located in that area demarcated in the application form has a right to use the mark for products originating from that area subject to certain pre-defined and predetermined quality requirements (Section 11 read with Rule 32 of the GI Act). The link between the product and place could vary in the following manner as to the place where the product is produced as in the case of most of the agricultural produce and some specific handicraft as in Alfonso mango, Kashmir Pashmina, PochampallyIkat, Darjeeling Tea etc. In some cases, it could even be the place where the goods are elaborated; for instance Belgian Chocolates which are famous in their final form, while the cocoa are produced elsewhere.
What happens when the strong link between place and product is missing along with the history and traditions associated with the link between the product and the place? The Collective Mark (CM) provision under Trademark law can be put to very good use here for collective marketing by the association of producers. The CM is a mark/logo or any such sign that is capable of distinguishing the origin of any other common characteristics of different enterprises which use the sign under the control of the registered owner. The owner typically is an association of producers. The CM is registered in the Trademarks Registry. There is a criteria of membership, conditions for use of the CM, with of course sanctions against misuse as per the law. Thus, the function of the CM is to inform the customers of the quality of the product and the fact that, it originates from the members of the association.
It is interesting to note that in countries where GI laws are absent, the traditional GIs are protected as CM. For instance, Darjeeling Tea which is a registered GI in India is protected as a CM in anumber of countries including the BENELUX countries (Belgium, the Netherlands and Luxembourg). Interestingly, Darjeeling is also protected as a Certificate Mark (CTM) in a number of countries including Australia and the USA which do not have GI laws. In fact, before the enactment of the GI Act in India, Darjeeling was protected primarily in India as a CTM. In fact, it is up for renewal on December 10, 2015 (Source : The Tea Board of India).
Certification marks (CTM) are signs (marks/logos or both) that indicate that the goods (or services) are certified by an independent certifying body who owns that mark. The certifying body is usually an independent enterprise, institution or government body that certifies in relation to origin, quality, material, mode of manufacture, accuracy etc., of the goods or services of a third party. Thus, the CTM is not owned by the association of producers unlike the GI and the CM. WOOLMARK, AGMARK, ISI etc., are some of the better known CTM. The certification could be for a range of predetermined qualities such as the fact that the product is handmade, or that the product is made from 100% recyclable materials, etc. Incidentally, the CTM for Darjeeling is with the Tea Board of India. Like CM, CTM is registered in the Trademark Register and is governed by the Trademark law. The assignment of CTM can be effected only with the consent of the Registrar of Trademarks.
For an enterprise to enter and sustain itself in a highly competitive market requires high level of organization and production, effective and widespread distribution channels along with strong advertising. Small and Medium Enterprises (SMEs) and producers from unorganized sectors may find it difficult to compete as individual entities in this extremely competitive market. In such situations, the use of collective marketing tools including the GIs, CMs and CTMs, can go a long way to leverage theirproducts (and services where applicable). For example, a single advertisement of a GI or a CM effectively represents the products of a large number of the persons (members of the association/society that is the proprietor of the GI or CM). The benefits to SMEs range from economies of scale such as registration costs, advertising campaign, enforcement etc., besides leveraging products made from different producers through common origin, and/or characteristics as well as standardization of production, and their marketing through common strategy.
The discussions (read: question-answer sessions) in the office with the client revealed that he and his extended family members were manufacturing pickles. The pickles are lip-smacking (great marketability) using seasonal vegetables and fruits including raw mangoes, made using family recipe (no patentable invention – lacks novelty!). Since, there was no history or traditions involved in the pickling process used by him and the other members of the community which in any case was scattered over a number of states, he was advised to form an association and market the various forms/varieties of the pickles under a collective mark.
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