World Trade Organization Organisation Mondiale du Commerce Organización Mundial del Comercio

The government established the Maharatna status in 2009, which raises a company's investment ceiling from Rs 1,000 crore to Rs 5,000 crore. The Maharatna firms can now decide on investments of up to 15% of their net worth in a project while the Navaratna companies could invest up to Rs 1,000 crore without explicit government approval.

US 78:

Report by the Secretariat (WT/TPR/S/249): III. TRADE POLICIES AND PRACTICES BY MEASURE: (3) Measures Directly Affecting Exports: (4) Measures Affecting Production and Trade: (ii) Role of state owned enterprises (other than state trading companies), and disinvestment: Pages 96 98, paragraph 191 and table III.26:

When will the partial disinvestments approved for certain companies in 2011 take place? Will foreign investors be able to participate in these disinvestments?

Reply: Disinvestments in a particular year depend on culmination of a set of procedures mentioned below:

1. 
   Authorization procedure that includes, the Board of Directors of the CPSE, the administrative ministry including other ministries concerned and finally the Government.
   
2. 
   The CPSE specific compliance procedure in preparation for disinvestment.
   
3. 
   Market related procedure that includes professional positive input and advice about the markets.
   

Based on the above factors partial disinvestments approved for certain companies in 2011, will take place.

Foreign investors should be able to participate in these disinvestments under the category of qualified institutional buyers. Marketing road shows are organized to facilitate their participation in the IPOs/FPOs.

US 79:

Report by the Secretariat (WT/TPR/S/249): III. TRADE POLICIES AND PRACTICES BY MEASURE: (3) Measures Directly Affecting Exports: (4) Measures Affecting Production and Trade: (iii) Competition policy: Page 100, Paragraph 203:

The Secretariat's Report describes provisions of the Competition Act 2002, particularly as they pertain to abuse of dominant position. According to the report, the Act prohibits enterprises from imposing unfair or discriminatory conditions when purchasing or selling goods or services, or when pricing goods or services? Do these provisions of the Competition Act apply equally to India's central public sector enterprises? If not, please describe the measures in place to prevent abuse of market position by CPSEs.

Reply: The Competition Act applies fully to the CPSEs and the Competition Commission of India (CCI) has the authority to take decisions regarding any anti competitive practice entertained by CPSEs, but does not include any activity of the Government relatable to the sovereign functions of the Government including all activities carried on by the departments of the Central Government dealing with atomic energy, currency, defence and space, as per the definition of "enterprise" under section 2(h) of the Competition Act, 2002.

US 80:

Report by the Secretariat (WT/TPR/S/249): III. TRADE POLICIES AND PRACTICES BY MEASURE: (3) Measures Directly Affecting Exports: (4) Measures Affecting Production and Trade: (iv) Price controls: Page 102, paragraphs 217 218:

India has price caps on certain branded drugs. The Department of Pharmaceuticals (DoP) permits importers to recover landed costs, plus any additional cost getting drugs to market up to 50 per cent if there are no domestic manufacturers, in which case there is a 35 per cent rate of return. We have heard reports that the National Pharmaceutical Pricing Authority (NPPA) is deviating from this rule by offering a rate of return below the stated policy, which appears effectively to price foreign companies out of the market. Is this deviation by NPPA permitted under Indian law? If so, what is the legal basis for this deviation and what is the rationale for NPPA's refusal to implement DoP's stated policy?

Reply: National Pharmaceutical Pricing Authority (NPPA), an independent body of experts set up by the Government to fix/revise the prices of scheduled drugs as per the provisions of Drugs (Prices Control) Order, 1995 (DPCO, 1995).

As per the provisions of DPCO, 1995, for scheduled formulations drugs imported in finished form, landed cost shall form the basis for fixing its price alongwith such margin to cover selling and distribution expenses including interest and importer's profit, which shall not exceed 50% of the landed cost.

Thus the margins as above can also be less than 50%. Decisions of NPPA are judicial orders for which there is a judicial process for review. Companies aggrieved against NPPA decision can have recourse to review and appeal thereafter under due process of law.

US 81:

Report by the Secretariat (WT/TPR/S/249): III. TRADE POLICIES AND PRACTICES BY MEASURE: (3) Measures Directly Affecting Exports: (4) Measures Affecting Production and Trade: (iv) Price controls: Page 105, paragraphs 217 218:

What new price control policies is India considering, and does India plan to have a process that is open for public comment?

Reply: The Pharmaceutical Policy as amended from time to time envisages making available quality medicines at reasonable prices to the masses. This policy is prepared after consulting with all the stakeholders.

US 82:

Report by the Secretariat (WT/TPR/S/249): III. TRADE POLICIES AND PRACTICES BY MEASURE: (3) Measures Directly Affecting Exports: (4) Measures Affecting Production and Trade: (v) Government procurement: Page 106, paragraph 219:

India became an observer to the WTO Agreement on Government Procurement in February 2010. Does India have plans to commence accession to the GPA? If so, please indicate when India intends to commence accession?

Reply: Issue of India's accession to GPA is under examination. At present, any commitment on this issue is not feasible.

US 83:

Report by the Secretariat (WT/TPR/S/249): III. TRADE POLICIES AND PRACTICES BY MEASURE: (3) Measures Directly Affecting Exports: (4) Measures Affecting Production and Trade: (v) Government procurement: Page 110, paragraphs 238 240 generally:

To what extent, and under what conditions, are service providers located outside India eligible to bid for government tenders? Does India currently impose any restriction on foreign financial institutions being able to provide financial services to public sector undertakings and government entities?

Reply: Various norms for obtaining bids in respect of Central Government procurement are contained in the Rules 149 to 154 of chapter 6 of General Financial Rules, 2005, while those for procurement of services are contained in the Rules 163 to 185 of the same chapter. There is no general bar on participation of global firms in Central Government procurement. A copy of the General Financial Rules is available at the website: http://finmin.nic.in/the_ministry/dept_
expenditure/GFRS/GFR2005.pdf.

US 84:

Report by the Secretariat (WT/TPR/S/249): III. TRADE POLICIES AND PRACTICES BY MEASURE: (3) Measures Directly Affecting Exports: (4) Measures Affecting Production and Trade: (vi) Intellectual property rights: Page 114, paragraph 250

The Secretariat discusses the proof of efficacy requirement in Section 3(d) of India's Patent Act. Under Section 3(d), if an applicant demonstrates the novelty, non obviousness, and industrial use of a product, can it still be denied a patent on the grounds that it fails to also demonstrate a significant improvement in efficacy? Does the Government of India consider this requirement to be in line with TRIPS Article 27(1) which states that patents shall be available for inventions in all fields of technology provided they are new, involve an inventive step, and are capable of industrial application? Please explain.

Reply:

• 
  Patents are available to any invention that meets the criteria of patentability, that is, novelty, inventiveness and industrial application.
  
• 
  Section 3(d) prevents the grant of patent for merely new forms or new usages of known substances and thus averts grant of frivolous patents, which may be obtained by minor modifications, particularly in the pharmaceutical sector.
  
• 
  The provisions for requirement of enhancement of the known efficacy under section 3(d) of the Patents Act, 1970 are only for the mere discovery of a new form of a known substance. This provision has been made only to prevent the ever greening of product patents.
  
• 
  Section 3(d) is also intended to ensure availability of medicines by preventing ever greening of existing patents and thus is in consonance with Member States' rights of ensuring availability of medicines at reasonable prices for meeting public health requirements.
  
• 
  This is one of the recognized flexibilities available under Article 8 of the TRIPS Agreement that countries are free to adopt in their legislation as per Doha Declaration.
  
• 
  The Declaration states that TRIPS Agreement can and should be interpreted and implemented in a manner supportive of WTO members' right to protect public health and, in particular, to promote access to medicines for all.
  
• 
  As such the said provisions of section 3(d) of the Patents Act, 1970 are fully compliant with Article 27(1) of the TRIPS Agreement read with Article 8 of the said Agreement.
  

US 85:

Report by the Secretariat (WT/TPR/S/249): III. TRADE POLICIES AND PRACTICES BY MEASURE: (3) Measures Directly Affecting Exports: (4) Measures Affecting Production and Trade: (vi) Intellectual property rights: Page 115, paragraph 256:

The Secretariat indicates that DIPP has issued a discussion paper on patent compulsory licensing with a view to developing a predictable environment to use such measures. How will the Government of India ensure that any suggested changes to current implementation of compulsory licensing complies with all of the conditions in TRIPS Article 31? Does India plan to seek public comments regarding any changes it is considering? How does the Government of India satisfy the undisclosed information obligations of TRIPS Article 39(3), including protection of data against unfair commercial use?

Reply: The Department of Industrial Policy and Promotion (DIPP) prepared a Discussion Paper on the subject of Compulsory Licensing and hosted the same on its website to invite the views and suggestion on certain issues for resolution. The objective of this exercise was not to invite any change/amendment to the provisions of the Patent Act 1970 but only to elicit the suggestions to take an appropriate policy decision whether the existing provisions of the Patents Act, 1970 require any amplification through issuing of guidelines by the Government. As such, the question of any change to the existing provisions of the Patents Act 1970 does not arise. Moreover, after obtaining and examining the suggestions on the said Discussion Paper, the Government has decided that there is no need to issue additional guidelines for the issue of Compulsory License and issued a press release to this effect to conclude the matter. Further, the existing provisions of the Patent Act 1970 are already TRIPS compliant including Article 31 thereof.

As regards the protection of undisclosed information against unfair commercial use as per Article 39(3) of TRIPS Agreement, adequate safeguard provisions are there in the existing Acts.

US 86:

Report by the Secretariat (WT/TPR/S/249): III. TRADE POLICIES AND PRACTICES BY MEASURE: (3) Measures Directly Affecting Exports: (4) Measures Affecting Production and Trade: (vi) Intellectual property rights: Page 116 paragraph 265:

The Secretariat's Report states: "Any person may oppose the registration, within three months from the date of its advertisement." How many pre registration opposition and post registration cancellation/rectification matters are pending before the Intellectual property Office? On average, how long does it take for the Indian Intellectual Property Office to decide a pre registration opposition and a post registration cancellation/rectification matter?

Reply: With reference to the Secretariat observation regarding trade mark opposition in India there are about 1,30,000 pre registration oppositions pending at TMR. Further about 2,500 cancellation proceedings are pending at TMR. The average time for disposal of contested matters at TMR after conclusion of the hearing by the adjudicating officer is between three to six months by way of a detailed speaking order.

US 87:

Report by the Secretariat (WT/TPR/S/249): III. TRADE POLICIES AND PRACTICES BY MEASURE: (3) Measures Directly Affecting Exports: (4) Measures Affecting Production and Trade: (vi) Intellectual property rights: Page 117, paragraph 270:

According to the Secretariat, in 2007, "the customs authorities promulgated guidelines, under which right holders may record their registered trademarks with the customs authorities. These guidelines authorize customs officials to seize goods infringing the trademarks of the right holder at the border without a court order. According to the authorities, there have been no such instances." Why have there been no seizures of trademark infringing goods conducted without a court order despite the existence of guidelines authorizing customs officials to take such action?

Reply: There have been seizures of trade mark infringing goods by the Indian Customs as per the IPR border measure prevalent in India, without court order.

US 88:

Report by the Secretariat (WT/TPR/S/249): III. TRADE POLICIES AND PRACTICES BY MEASURE: (3) Measures Directly Affecting Exports: (4) Measures Affecting Production and Trade: (vi) Intellectual property rights: Page 119, paragraph 278:

The Secretariat's Report states: "[T]he Copyright (Amendment) bill 2010 proposing amendments to the Copyright Act 1957 is being discussed in Parliament." On August 12, 2011, press reports indicated that the Cabinet had approved changes to the proposed bill. What are the key issues in the cabinet approved version of the bill, and the expected timeline for legislative consideration and passage? On a related legislative note, what is the status of India's draft optical disc law and India's efforts to combat optical disc piracy?

Reply: The Copyright (Amendment) Bill, 2010 pending in Rajya Sabha (the Upper House of Parliament) since it was introduced on 19 April, 2010. The Bill is available at www.copyright.gov.in. The details of amendments to the Bill will only be made available after both the Houses of Parliament consider the same.

US 89:

Report by the Secretariat (WT/TPR/S/249): III. TRADE POLICIES AND PRACTICES BY MEASURE: (3) Measures Directly Affecting Exports: (4) Measures Affecting Production and Trade: (vi) Intellectual property rights: Page 119, paragraph 280:

The Secretariat's Report states: "Through the International Copyright Order, copyright is protected in India for nationals of countries that are members of the Berne Convention, the Universal Copyright Convention, and the TRIPS Agreement." Recently two Indian courts issued decisions effectively holding that songwriters and music publishers lose their exclusive public performance rights after their songs have been licensed for recording. As a result of these rulings, radio stations will only be required to pay license fees to the sound recording companies, but not to the collecting society which distributes royalties to the songwriters and publishers. See Music Broadcast Private Ltd. v. Indian Performing Right Society (decided July 25, 2011 in Bombay; Suit No. 2401 of 2006) and Indian Performing Rights Society v Aditya Pandey (decided July 28, 2011in Mumbai; CS(OS) 1185/2006 and I.A. Nos. 6486/2006, 6487/2006 and 7027/2006). Please explain these decisions in light of India's obligations under the Berne Convention (incorporated into the TRIPS Agreement by virtue of TRIPS Article 9(1)).

Reply: Issues raised in these cases are sought to be addressed in the Copyright (Amendment) Bill, 2010 and the amendments to the Bill presently under Parliament scrutiny. The Copyright Act, 1957 is in compliance with India's obligations under the Berne Convention (incorporated into the TRIPS Agreement by virtue of TRIPS Article 9(1)).

US 90:

Report by the Secretariat (WT/TPR/S/249): III. TRADE POLICIES AND PRACTICES BY MEASURE: (3) Measures Directly Affecting Exports: (4) Measures Affecting Production and Trade: (vi) Intellectual property rights: Page 120, paragraph 283:

The Secretariat states: "Twenty four states and UTs have set up Copyright Enforcement cells within the crimes section of the police, to enforce the copyright legislation. The authorities have indicated that, in 2008 the police registered 6,036 cases regarding copyright violations; 2,151 persons were convicted." We would appreciate information regarding the type of penalties imposed on the convicted persons, whether any of the convicted persons were sentenced to serve time in prison, and if so, for what period of time?

Reply: The above information can be obtained from National Crime Records Bureau of Ministry of Home Affairs, Government of India.

US 91:

Report by the Secretariat (WT/TPR/S/249): III. TRADE POLICIES AND PRACTICES BY MEASURE: (3) Measures Directly Affecting Exports: (4) Measures Affecting Production and Trade: (vi) Intellectual property rights: Page 120, paragraph 285:

The Secretariat Report indicates that the "Geographical Indications of Goods (Registration and Protection) Act 1999" stipulates the grounds for refusing registration of Geographical Indications. Can India confirm that the grounds include that the proposed geographical indication is likely to cause confusion with an earlier established right, whether established via a prior registration or through prior use? Also, can India confirm that an additional ground for refusing registration of a geographical indication is if there is evidence that the proposed geographical indication is the common name (the generic term) for a good in India?

Reply: Yes. It is confirmed that grounds for refusing registration of geographical indications include that the proposed geographical indication is likely to cause confusion with an earlier established right, whether established via a prior registration or through prior use.It is provided under section 9(a) of India's GI Act that "a geographical indication the use of which would be likely to deceive or cause confusion shall not be registered as a geographical indication". However, the expression "earlier established right" has not been used in the GI Act. But Section 26 of the Act protects a trade mark which contains or consists of a GI which has been applied for or registered in good faith or where such trade mark has been used in good faith before the date of filing of an application for a GI in India. Hence, such 'earlier established rights' are subsumed in the Act.

Section 9 (f) of the GI Act provides that "a geographical indication which are determined to be generic names or indications of goods and are, therefore, not or ceased to be protected in the country of origin, or which have fallen into disuse of that country shall not be registered as a geographical indication". Explanation 1 to section 9 further provides "For the purpose of this section, generic names or indications, in relation to goods, means the name of a goods which, although relates to the place or the region where the goods was originally produced of manufactured, has lost its original meaning and has become the common name of such goods or serves as a designation for an indication of the kind, nature, type or other property or characteristic of the goods.

It is, therefore, confirmed that a GI which has become generic cannot be protected under the Act.

US 92:

Report by the Secretariat (WT/TPR/S/249): III. TRADE POLICIES AND PRACTICES BY MEASURE: (3) Measures Directly Affecting Exports: (4) Measures Affecting Production and Trade: (vi) Intellectual property rights: Page 122, paragraph 297:

The Secretariat's Report states: "India has no specific legislation regulating the protection of trade secrets; hence enforcement measures/penalties for violations of trade secrets are available through common law." India was considering a statutory law for protection of trade secrets under the draft of the Innovation Bill. Please confirm the status of this Bill. Does it provide for protection of trade secrets?

Reply: India's 'National Innovation Policy' is under formulation.

US 93:

Report by the Secretariat (WT/TPR/S/249): III. TRADE POLICIES AND PRACTICES BY MEASURE: (3) Measures Directly Affecting Exports: (4) Measures Affecting Production and Trade: (vi) Intellectual property rights: Pages 123 124, paragraphs 298 300:

The Secretariat says that India has made improvements in IPR enforcement through increased border protection, and its IP offices continued to pursue promising modernization efforts. Please describe what steps have been taken to increase border protection of IPR. We would appreciate information or data on the number of seizures of IPR infringing goods made at the borders, the kind of products that are being seized and from what country, and how this has changed from previous years.

Reply: Apart from introducing a separate law on border measures, Indian Customs has focused on effective implementation of the law. A key initiative taken by Indian Customs in this regard is the facility for online registrations by the right holders. The web based IPR module known as the Automatic Recordation and Targeting for IPR Protection (ARTS) provides for online registration with the chosen Customs field formation for the enforcement of IPR rights namely copyrights, trademarks, patent, designs and geographical indications by following appropriate guidelines. The main features of the ARTS are online submission of IPR Notice, uploading images of genuine goods and trademark insignias, uploading images of infringing goods, generation of Unique Temporary Registration Number (UTRN), auto generated mail to applicant regarding the status of his application for recordation, communication of the final Unique Permanent Registration Number (UPRN), etc.

The ARTS has been Integrated to national risk management module. ARTS has been listed by the WCO Asia Pacific Regional Office for Capacity Building as one of the Regional Best Practices and circulated to the members.

Taking into consideration the relatively new IPR regime in force since May 2007, the performance of Indian Customs in checking instances of counterfeiting and piracy has been noteworthy. Cases have been booked by the Customs involving counterfeit goods infringing IPRs of brands such as Nokia, Nivea, L'Oreal, Garnier, Revlon, Dove, Axe, Sony, Adidas, Bosch Mico, etc.

US 94:

Report by the Secretariat (WT/TPR/S/249): IV. TRADE POLICIES BY SELECTED SECTOR: (1) Overview: Page 125, paragraph 4:

As the Secretariat states, the services sector has emerged as the main driver of Indian economic growth, with increasing overseas operations by Indian companies and numerous leading global firms doing business in India. We believe that this requires world class legal services and compliance with international legal practices. The Secretariat's Report from India's 2007 Trade Policy Review noted that provision of any legal service by a foreign firm or foreign lawyer was at the time prohibited. It also noted that a discussion on liberalization had been initiated via a Department of Commerce consultation paper. What is the current status of liberalization in India's legal services sector? What was the outcome of the discussion initiated via the consultation paper referenced in the 2007 TPR Report?