Foreign Filing License (FFL) is a requirement set forth by section 39 of the Indian Patent Act, 1970 (the Act), which provides that when any person who is a resident of India indents to file a patent application outside India (including in the PCT jurisdiction), it is necessary to obtain an FFL from the Indian Patent Office. There can be several factors behind the motivation to file outside India including but not limited to better market potential in other countries, subject matter not being patentable in India, different locations of the R&D teams, organization structures of multi-national companies having head quarters or IP hold-Cos outside India, etc. via this restriction/ limitation of FFL in the Act, the government of India gets an opportunity to scrutinize each

And every invention going outside the Indian border for being critical to national security, defense and atomic energy.

Section 39 states that “Residents not to apply for patents outside India without prior permission

• No person resident in India shall, except under the authority of a written permit sought in the manner prescribed and granted by or on behalf of the Controller, make or cause to be made any application outside India for the grant of a patent for an invention unless—
  • An application for a patent for the same invention has been made in India, not less than six weeks before the application outside India; and
  • Either no direction has been given under sub-section (1) of section 35 in relation to the application in India, or all such directions have been revoked.
• The Controller shall dispose of every such application within such period as may be prescribed: Provided that if the invention is relevant for defence purpose or atomic energy, the Controller shall not grant permit without the prior consent of the Central Government.
• This section shall not apply in relation to an invention for which an application for protection has first been filed in a country outside India by a person resident outside
  India”.

This requirement is not unique to India as the patent laws of several other countries like US, EP, etc. also require obtention of FFL by inventors/applicants for any invention that is intended to be filed in a foreign country. However, there are minor variations in the requirements set forth by different countries. For instance, in the United Kingdom unlike India the determination of whether or not the invention relates to national security is done by the inventor or applicant himself and not by the patent office. Similarly, in the Canada, the requirement is applicable only for government officials intending to file an application outside Canada. In India, the requirement set forth by the Indian patent law is much akin to the ones provided under the US law however minor differences exist there too for instance unlike US in India the FFl cannot be
obtained retrospectively.

Section 39 of the Act stipulates filing of the request of FFL along with the prescribed fee and prescribed documents/forms accompanied by a brief disclosure if the invention. It is critical here to understand that the disclosure should be sufficient enough to enable patent office to arrive at a decision as to whether or not the invention is critical to national security. It may be advisable here to submit the patent

Specification itself (provisional or nonprovisional), if handy and prepared already, to comply with the disclosure requirement however it is not mandatory to submit the specification and a brief disclosure as stated above may equally suffice. Upon receiving the request, the Indian Patent Office may grant the same ordinarily within 3 weeks’ time subject to a positive or negative determination on the security aspect.

For legal practitioners, the statute creates some issues of debate which have not found any conclusions till date, who should apply for the FFL, inventor or the company? While in practice the Indian patent office requires the FFL request to be filed by the inventor however whether or not it is a correct practice or whether this is what is required by the law is unclear simply because section 39 nowhere mentions or directly implicates the word “inventor” nor does it implicates the word “applicant”. Section 39 rather requires “a person resident” of India while the Act as a whole remains silent on the definition of “resident”. It is unclear as on date as to the source from where the meaning of the word “resident” must be derived, i.e. from foreign legislatures or from jurisprudence (there is none as on date) or from the closest Indian legislature such as the Income Tax Act that provides (under section 6) for a specific definition of “resident”. However, why should one look at the Income Tax Act and not any other source is also a question that may have to be answered while ascribing the definition to this disputed term “resident”. The definition of section 6 of the Income Tax Act covers both individuals and legal entities (companies) under the definition of “resident”. Therefore, going by this definition, it seems any one of the individuals (inventor) or the company
(applicant) could apply. However, the point also to ponder is to if any one of the inventor or applicants could apply then why does the patent office allows only the inventors to file? Why is it that the FFL request cannot be filed in the name of the company? One probable answer to this question finds an answer in the understanding of the FFL requirement under the US patent law which requires that the FFL must be obtained in a country where the invention first took place and it is implied that the invention can take place
only where the inventor/s reside. It is very much possible that a company situated or headquartered in, say Japan has its research team in India and therefore the inventors residing in India will inevitably be the ones
who made the invention in India. And therefore, they qualify as “residents” who made or cause to be made the invention the invention as per section 39.

This understanding also raises several new questions such as What happens when the invention partly developed in India and partly outside India? Similarly, what happens when only part of the invention takes place in India then how much of the invention should it be for attracting the FFL requirement? Under such circumstance, whether the conception in India is sufficient to attract FFL requirement by the Indian inventor or whether reduction to practice is what Indian inventor must do to fall under the meaning of word “resident” under section 39 of the Act. Lastly, when only part of the invention takes place in India then what portion of the invention should it be to attract FFL requirement? Whether substantial portion or the inventive step itself should have been worked in India or the whole invention should have been conceived and worked in India to enable an Indian inventor to fall under the section 39 of the Act.

Another ambiguity in the FFL statute under the Indian law is the meaning and scope of phrase “make or cause to be made any application outside India”. This does not necessarily mean filing of application outside India. Going by the literal interpretation, while ‘making’ of may be accomplished only by the inventor, the phrase “making of an application” can be accomplished by both the inventor or the company/applicant. Similarly, the phrase ‘cause to be made’ may be implied as covering an inventor or a company/applicant.

Considering that there is absolutely no jurisprudence on this provision and more importantly since this is the only provision under the Indian patent law that attracts punitive liabilities, it is advisable to interpret the same in the most conservative way possible. For instance, it will be safe to apply in the name of the inventors (also because the current practice allows only this), however it may be worthwhile to mention the name of the assignee to whom the patent rights have been assigned by the inventors, i.e. the company who will be applicant of the intended foreign patent application. Similarly, in case of several inventors belonging to different countries, FFL must be sought from India on behalf of the Indian inventors and also separately from

Each such other country of other inventors, where such law is in place.

Further, in case of the invention taking place partly in India and partly in any other country, FFL must be sought from all the countries where the invention took place, unless it can be demonstrated that any part of the invention (that took place in any other country) is not substantial or important to the finally claimed subject matter. To this end, it is important to understand that an ‘invention’ is ‘what is covered by the claims’ and not ‘what is described in the specification’. Also, that what is not claimed is considered as disclaimed. Therefore, the meaning of word invention can be linked to claims and the determination of where the claimed subject matter originated can be used to decide the country where FFL must be applied.

Similarly, when struggling between conception and reduction to practice, a conservative approach may help where FFLs must be sought from each of such countries where invention was conceived and reduced to practice.

From Indian context, in an instance where FFL is not a feasible option, it may be advisable to file an Indian patent application and wait for six weeks before filing a foreign/ PCT international application. Considering
that the cost of filing both the FFL and the patent application in India is the same, there is no flip side to filing a patent application in order to be able to file outside India, except for the time difference where in case of FFL a foreign application can typically be field in 21 days whereas in the case of patent application, six weeks waiting time will be suffered before going outside. It is worth mentioning here that in case the subject matter of the invention is not patentable in India, a provisional patent application can be filed in India which can be later abandoned after foreign applications are filed taking priority from the same. This way, the need to secure an FFL before moving outside can be obviated without any adverse consequences as such.

As for the consequences of non-Compliance of Section 39/FFL requirements, the law stipulates serious consequences of imprisonment upto two years or monetary fine, however the consequences will apply to inventors or companies/applicants is again a question that remains unanswered as on date. While the law also provides that failure to comply with the FFL requirements may result in the deemed abandonment of the Indian patent application and revocation of the patent granted, if any. However, this limitation appears to be mute since the statute covering grounds for revocation of a patent does not include any ground stipulating non-compliance of section 39 or FFL requirements as such. Therefore, even if one finds out that an FFL was not secured appropriately for any given case, there is no provision under the act as such that can be formally invoked to revoke the patent.

With the growing trend of globalization and cross border exchange and implementation of technologies, the need and applicability of FFL will only witness sharp increase. This may in turn result in jurisprudence and better understanding of this issue. As on date, it will be meaningful to play conservatively and make a case to case determination backed by formal legal opinion from experts in local patent laws in different countries as may be applicable.