PROMULGATION OF THE TRIBUNALS REFORMS (RATIONALISATION AND CONDITIONS OF SERVICE) ORDINANCE, 2021 AND ITS IMPLICATIONS IN THE IP SEGMENT

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The Tribunals Reforms (Rationalisation and Conditions of Service) Bill, 2021 was introduced in the Lok Sabha on February 13, 2021 proposing that the Intellectual Property Appellate Board (“IPAB”) be scrapped and all its powers should be transferred to the relevant Courts. However, the bill did not pass in the session it was introduced, therefore, its fruition was postponed to the next session. Recently, the government notified  that the President in exercise of the powers conferred upon him under Article 123(1) of the Constitution, on being satisfied that circumstances exist which render it necessary for him to take immediate action, on April 04, 2021 promulgated the Tribunals Reforms (Rationalisation and Conditions of Service) Ordinance, 2021 (“The Tribunal Reforms Ordinance”).However, an Ordinance promulgated by the President has to be adopted or rejected in the next session of the Parliament within six weeks from the commencement of such session. Thus, it will be exciting how that works out.

Amendments brought in by the Ordinance

The Tribunal Reforms Ordinance abolishes appellate authorities under nine Acts and the right to hear appeals under the statute has been conferred on the High Courts. Further, certain other amendments have also been introduced in the Finance Act, 2017 in provisions relating to the qualifications and tenure of the Chairperson and members of Tribunals. There are various other amendments, however, this post aims to highlight the amendments brought in relation to the field of IP.

Amendments to the Copyright Act, 1957

Chapter III of the Tribunal Reforms Ordinance deals with various changes that it would bring in to the provisions of the Copyright Act, 1957. These include:

  • Clause (aa) of Section 2 of the Copyright Act, defining the term “Appellate Board” has been omitted.
  • The term “Appellate Board” has been replaced by “Commercial Courts” in Section 6, section 19A, section 23, section 31, section 31A, section 31B, section 31C, section 31D, section 32, section 32A, section 33A, section 53A, section 54.
  • Clause (fa) is to be introduced in the definition clause (Section 2). This clause defines “Commercial Court”. It means a Commercial Court constituted under section 3, or the Commercial Division of a High Court constituted under section 4 of the Commercial Courts Act.
  • Sections 11 and 12 of the Copyright Act, which deals with the powers and functions of the “Appellate Board”, will be omitted from the Act.
  • Section 50 of the Copyright Act, provides that the power of rectification of Register of Copyright is with the Appellate Board. The Ordinance seeks to replace the term “Appellate Board” with “High Courts”, thus transferring the power of rectification to the High Courts.
  • Section 72 of the Copyright Act also replaces the term “Appellate Board” with “High Courts”. Therefore, any aggrieved person can now refer an appeal against the final decision of the Registrar of Copyright within three months to a single judge bench of the High Court.

Amendments to the Patents Act, 1970

Chapter V of the Tribunal Reforms Ordinance deals with various changes that it would bring in to the provisions of the Patents Act, 1970. These include:

  • Clause (a) of Section 2 of the Patents Act, defining the term “Appellate Board” has been omitted.
  • The word “Appellate Board” shall be omitted from Section 52, Section 58, Section 59, Section 64, Section 76, Section 113, and Section 151.
  • Sections 116, 117, 117B, 117C, 117D, 117F, 117G, 117H of the Act have been scrapped.
  • In Section 117-A, the term “Appellate Board” shall be replaced by the words “High Courts”, implying that an appeal from the decision of the Controller of Central Government shall lie to the High Courts.

Amendments to the Trade Marks Act, 1999

Chapter VII of the Tribunal Reforms Ordinance deals with various changes that it would bring in to the provisions of the Trade Marks Act, 1999. These include:

  • Clause (a) of Section 2(1) of the Trade Marks Act, defining the term “Appellate Board” has been omitted. Further clauses (d), (f), (k), (n), (ze), (zf) have been scrapped.
  • Under clause (s) of Section 2 of the Act, definition of the term ‘prescribed’ has been amended to mean that rules made by the High Court shall be applicable in relation to proceedings before a High Court and in other proceedings, Rules prescribed under the Act would apply.
  • In Sections 10, 26, 46, 47, 55, 57 and 71 wherever the term “tribunal” occurs, it is replaced by the words “Registrar or the High Court, as the case may be”.
  • In Section 91, the term “Appellate Board” shall be replaced by the words “High Courts”, implying that an appeal from the decision of the Registrar shall lie to the High Courts.
  • Under section 94, it has been newly prescribed that upon ceasing office, the erstwhile chairperson, vice chairperson or members shall not be permitted to appear before the registrar.

Amendments to the Geographical Indications of Goods (Registration and Protection) Act, 1999

Chapter VIII of the Tribunal Reforms Ordinance deals with various changes that it would bring in to the provisions of the Geographical Indications of Goods (Registration and Protection) Act, 1999. These include:

  • Clause (a) of Section 2(1) of the Geographical Indications of Goods (Registration and Protection) Act, defining the term “Appellate Board” has been omitted.Further clause (p) shall be omitted.
  • In Section 31, the term “Appellate Board” shall be replaced by the words “High Courts”, implying that an appeal from the decision of the Registrar shall lie to the High Courts.

Amendments to the Protection of Plant Varieties and Farmer’s Right Act, 2001

Chapter IX of the Tribunal Reforms Ordinance deals with various changes that it would bring in to the provisions of the Protection of Plant Varieties and Farmer’s Right Act, 2001. These include:

  • Clauses (d), (n) and (o) of Section 2 of the Act shall be omiited.
  • Under clause (q) of Section 2 of the Act, definition of the term ‘prescribed’ has been amended to mean that rules made by the High Court shall be applicable in relation to proceedings before a High Court and in other proceedings, Rules prescribed under the Act would apply.
  • Section 54 will be omitted, meaning that Plant Varieties Protection Appellate Tribunal will be abolished.
  • In Section 56, the term “Tribunal” shall be replaced by the words “High Court”, implying that an appeal from the decision of the Authority or the Registrar shall lie to the High Courts.

Implications of the Ordinance

The amendments brought in by the Ordinance have scrapped the IPAB and has transferred its powers and duties to the High Courts and Commercial Courts. This means that all the cases and appeals shall now lie with the relevant Courts. Consequently, this will discard the extra layer of litigation that the litigants had to go through. Further, another imperative reason why this has been done is because as was set forth in the Statement of Objects and Reasons when the Bill was proposed that the tribunals have not necessarily led to faster justice delivery and they are also at a considerable expense to the exchequer.

But what will happen to the cases that have been pending before the IPAB? The Tribunal Reforms Ordinance provides this remedy under Transitional provisions in Clause 15(3). It states that “Any appeal, application or proceeding pending before the Tribunal, Appellate Tribunal or other Authorities specified in the Schedule, other than those pending before the Authority for Advance Rulings under the Income-tax Act, 1961, before the notified date, shall stand transferred to the Court before which it would have been filed had this Ordinance been in force on the date of filing of such appeal or application or initiation of the proceeding, and the Court may proceed to deal with such cases from the stage at which it stood before such transfer, or from any earlier stage, or de novo, as the Court may deem fit.” However, the transfer of pending cases to the High Courts and Commercial Courts will overburden the Courts with trivial matters like rectification of registers etc.The above-mentioned transitional provision makes it abundantly clear that it will be the discretion of the Court as to how it wants to handle a particular case. However, the Ordinance has not cleared the air as to which commercial courts in India will hold the proceedings and fix the rates for Licenses, for instance Statutory Licenses under Section 31D of the Copyright Act, 1957. The Ordinance has simply replaced the term “Appellate Board” with “Commercial Courts” without assigning any specific responsibility to a specific Court. This would create a possibility of conducting hearings relating to compulsory and statutory Licenses in various commercial courts in the country. This may pose a setback for both the right owners as well as the radio and television industry because earlier only one tribunal heard matters relating to statutory Licensing, but the  to lack of clarity in the Ordinance may result in multiple commercial courts having jurisdiction to hear such cases, resulting in contradictory license conditions or even different fee rates. Moreover, it is imperative to highlight that the technical members in the IPAB played a pivotal role in tasks like royalty sharing which has been rendered completely redundant by the impugned Ordinance.

Furthermore, very recently the Copyright Amendment Rules, 2021 was notified by the Government. One of the key changes that were brought in by these rules was that the term “Copyright Board” is replaced with the term “Appellate Board”. This was done to bring the rules in line with the parent act as in the parent act, the term “Copyright Board” was replaced with “Appellate Board” in 2017 through amendments making such amendment now redundant.

Thus, it will be exciting to see how the promulgation of the Tribunal Reforms Ordinance and its implications pan out.

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