JAN VISHWAS ACT, 2023: CHANGING DYNAMICS OF IPR COMPLIANCE
INTRODUCTION
The Jan Vishwas (Amendment of Provisions) Act, 2023, which came into effect on August 1, 2024, marks a pivotal change in India’s Intellectual Property (IP) law framework. This legislation focuses on decriminalising several offenses across major IP statutes, such as the Patents Act, Trade Marks Act, and the Geographical Indications of Goods Act.
The Act aims to decriminalise 183 provisions across 42 Central Acts overseen by 19 Ministries and Departments. It proposes more practical adjustments to fines and penalties based on the nature of the offense, sets up Adjudicating Officers and Appellate Authorities, and includes periodic updates to the penalties and fines.
The Jan Vishwas Act aims to create a business-friendly environment where entrepreneurs can thrive without the constant anxiety of facing severe penalties for minor infractions. This is especially relevant in the context of start-ups, which often operate in a dynamic environment where mistakes are part of the learning process. For example, the decriminalisation of certain offenses under the Trademarks Act could allow small businesses to rectify unintentional infringements without facing crippling fines or imprisonment. Moreover, the bill promises to enhance the efficiency of the justice system by implementing administrative adjudication mechanisms. This approach streamlines legal procedures, allowing disputes to be resolved more quickly and effectively, thereby reducing the backlog in courts.
JAN VISHWAS (AMENDMENT OF PROVISIONS) ACT, 2023: DECODING THE CHANGES MADE IN IP
The Jan Vishwas Act carries substantial implications for the realm of Intellectual Property Rights (IPR). By decriminalising minor IPR offenses, the Act alleviates the fear of criminal prosecution that has often inhibited businesses from fully engaging in innovative endeavours. This shift will likely encourage more companies to allocate resources to research and development, as they can operate with the assurance that the legal environment is supportive rather than punitive.
For example, in the case of Bangalore Turf Club Ltd. v. Government of Karnataka, the stringent penalties imposed on trademark violations discouraged companies from marketing new products. The Jan Vishwas Act could potentially create a more conducive atmosphere for innovation. Businesses will now be more willing to explore new ideas and products, knowing they can address minor infringements through administrative channels rather than facing the threat of litigation and criminal charges.
Furthermore, the Act’s rationalisation of compliance mechanisms streamlines the process of obtaining and safeguarding intellectual property. This simplification is crucial in today’s globalised economy, where Indian enterprises must compete not only domestically but also on the international front. A notable example can be seen in the pharmaceutical industry, where securing patent rights is essential for protecting innovations. The Jan Vishwas Act allows for quicker registration and enforcement of patents, enabling companies to bring their products to market faster and more efficiently.
The Act is particularly helpful to the software industry, where ease of obtaining copyrights can lead to increased creativity and innovation. Developers can now protect their IPs with ease unlike in the past, where complex procedures would often resulted in long delays, discouraging small startups from pursuing IP protection.
Overall, the Jan Vishwas Act positions Indian businesses more competitively in the global market, while fostering an environment in which innovation can thrive. By providing a more supportive legal framework for IPR, the Act paves the way for increased investment, collaboration, and growth in various sectors, ultimately enhancing India’s position in the global innovation landscape.
Key Amendments are as follows:
- Patents Act, 1970
The Act has brought changes to many provisions of the Patent Act aiming to decriminalise specific patent offenses and increasing penalties for related violations. A major update is in Section 120, where the maximum fine for unauthorised patent claims has been raised from ₹1 lakh to ₹10 lakh, with additional daily fines for ongoing violations. Section 122 has been revised to address the failure to provide required information, setting fines up to ₹1 lakh and imposing further daily penalties for continued non-compliance.
These adjustments aim to align the patent system with international practices, and make it more transparent. It further incorporated Section 124A, which gives the Controller the authority to impose penalties for defaults while ensuring that the offending party has an opportunity to defend themselves. This step, which favours significant monetary penalties over criminal prosecution, reflects a broader trend to reduce imprisonment for minor infractions.
The Act also addresses false information by replacing possible jail time with substantial financial penalties. Overall, these amendments are intended to promote innovation, and improve the business environment in India while maintaining high compliance standards.
- Copyright Act, 1957
There have been significant changes made to various provisions of the Copyright Act by shifting copyright infringement from a criminal to a civil liability. Section 63 now imposes increased monetary fines instead of imprisonment, while Section 64 eliminates jail time for companies, focusing on financial penalties. Section 67 allows authorities to seize infringing copies without pursuing criminal charges, and Section 70 imposes fines for specific infringement acts rather than imprisonment. These updates aim to simplify enforcement, reduce judicial burdens, and encourage business compliance, thereby strengthening IP protection through civil penalties.
- Trade Marks Act, 1999
Like the other IP regimes, the Act aims to decriminalize IP infringement and provide civil liabilities for offences related to Trademarks. For example, Section 107 now stipulates a financial penalty rather than imprisonment for falsely representing trademarks. The previous penalty of up to three years of imprisonment has been replaced with a monetary fine calculated as a percentage of total sales or gross receipts. There have also been changes to other Sections such as Section 106, 108, 109, among others, which initially imposed criminal liabilities which has now been substituted to financial penalties.
The various amendments of this Act are mentioned below:
- Patents Act, 1970
|
Section |
Particulars |
Original Provision |
Amended Provision |
|
Sec. 120 |
Increase in penalty for unauthorised claim of patent rights |
A fine up to ₹1 lakh |
A fine up to ₹10 lakhs, and in case of a continuing claim, a further penalty of ₹1,000 for every day after the first during which such claim continues. |
|
Sec. 121 |
Removal of provision regarding wrongful use of the words ‘patent office’ |
Imprisonment for a term which may extend to 6 months, or with fine, or with both |
This section was removed in its entirety. |
|
Sec. 122(1) |
Reduced penalty for refusal or failure to furnish information to the Central Government or to the Controller |
A fine up to ₹10 lakhs |
A fine up to ₹1 lakh, and in case of continuing refusal or failure, a further penalty of ₹1,000 for every day after the first during which such refusal or failure continues. |
|
Sec. 122(2) |
Decriminalisation of penalty for furnishing of false information |
Imprisonment up to 6 months, or with fine, or with both |
Penalty for a sum equal 0.5% of the total sale or turnover, as the case may be, of business or of the gross receipts in profession as computed in the audited accounts of such person, or a sum equal to five crore Rupees, whichever is less. |
|
Sec. 123 |
Increase in penalty for practice by non-registered patent agents |
A fine up to ₹1 lakh for the first offense, and for subsequent offences, the maximum fine was ₹5 lakh |
Penalty up to ₹5 lakhs, and in case of continuing default, a further penalty of ₹1000 for every day after the first during which such default continues. |
|
Sec. 124A |
Introduction of a new provision for the adjudication of penalties |
– |
The Controller may authorise an adjudicating officer for holding an inquiry and imposing penalty under the provisions of the Patents Act, 1970. |
|
Sec. 124B |
Introduction of a new provision for appealing the order of the adjudicating officer under Section 124A |
– |
Those aggrieved by the order of the adjudicating officer under Section 124A can appeal the same before an appellate authority. |
|
Sec. 159(2) |
Inclusion of two clauses Two clauses (xiiia) and (xiiib) |
– |
Central Government was granted the power to make rules regarding the under Section 124A & 124B. |
- The Trademarks Act, 1999
|
Section |
Particulars |
Earlier Provision |
Amended Provision |
|
Sec. 106 |
Removal of penalty for removing piece goods (goods that are ordinarily sold by length or by the piece) for sale from any premises mentioned under Section 81 of the Act |
Such goods shall be forfeited to Government with a fine up to ₹1000 |
This section was removed in its entirety. |
|
Sec. 107 |
Decriminalisation of penalty for falsely representing a trademark as registered |
Imprisonment for a term of 3 years or with fine or both |
Penalty for a sum equal to 0.5% of the total sales or turnover, as the case may be, in business or of the gross receipts in profession, as computed in the audited accounts of such person, or a sum equal to five lakh rupees, whichever is less. |
|
Sec. 108 |
Removal of penalty for improperly describing a place of business as connected with the Trademarks Office |
Imprisonment for a term of two years or fine or both |
This section was removed in its entirety. |
|
Sec. 109 |
Removal of penalty for falsification of entries in the register |
Imprisonment for a term of two years or fine or both |
This section was removed in its entirety. |
|
Sec. 112A |
Introduction of new provision for adjudication of penalties |
– |
The Registrar may authorise an adjudicating officer for holding an inquiry and imposing penalty under the provisions of the Trademarks Act, 1999. |
|
Sec. 112B |
Introduction of new provision for appealing order of adjudicating officer under Section 112A |
– |
Those aggrieved by the order of the adjudicating officer under Section 112A can appeal the same before an appellate authority. |
|
Sec. 140(3) |
Increase in penalty for importers/ their agents upon failure to produce any documents & to furnish relevant information within deadline when required so by the Commissioner of Customs |
Fine up to ₹500 |
Penalty of ₹10, 000 |
|
Sec. 157(2) |
Inclusion of two clauses Two clauses (xxxiiia) and (xxxiiib) |
– |
Central Government was granted the power to make rules regarding the under Sections 112A & 112B. |
- The Copyright Act, 1957
|
Section |
Particulars |
Earlier Provision |
Amended Provision |
|
Sec. 68 |
Removal of penalty for making false statements for deceiving or influencing any authority/ officer in respect of doing or omitting their duty of execution of the provisions of this Act |
Imprisonment up to one year, or with fine, or with both. |
This section was removed in its entirety. |
- Geographical Indications of Goods (Registration and Protection) Act, 1999
|
Section |
Particulars |
Earlier Provision |
Amended Provision |
|
Sec. 37A |
Introduction of new provision for adjudication of penalties |
– |
The Controller may authorise an adjudicating officer for holding an inquiry and imposing penalty under the provisions of the Geographical Indications of Goods (Registration and Protection) Act, 1999 |
|
Sec. 37B |
Introduction of new provision for appealing order of adjudicating officer under Section 37A |
– |
Those aggrieved by the order of the adjudicating officer under Section 37A can appeal the same before an appellate authority. |
|
Sec. 87(2) |
Inclusion of two clauses (oa) and (ob) |
– |
Central Government given the power to make rules under Section 37A and 37B. |
|
Sec. 42(2) |
Decriminalisation of penalty for falsely representing a GI as registered |
Imprisonment up to 3 years, or fine, or both |
Penalty for a sum equal to 0.5% of the total sales or turnover, as the case may be, in business or of the gross receipts in profession, as computed in the audited accounts of such person, or a sum equal to five lakh rupees, whichever is less. |
|
Sec. 43 |
Removal of penalty for improperly describing a place of business as connected with the GI Registry |
Imprisonment up to 2 years, or with fine, or with both |
This section was removed in its entirety. |
|
Sec. 44 |
Removal of penalty for falsification of entries in the GI Register |
Imprisonment for a term up to 2 years, or with fine, or with both |
This section was removed in its entirety. |
MERITS OF DECRIMINALISATION OF IP
The Jan Vishwas Act attempts to tailor the punishments based on the seriousness of the crime. Severe penalties for minor violations stifle innovation, discourage entrepreneurship, and overload the legal system. It is designed to create a more supportive environment for businesses by promoting fairer, more proportionate penalties, which would reduce the constant worry over severe consequences for small mistakes. Additionally, it aims to enhance the efficiency of the justice system by streamlining legal procedures through administrative adjudication
DOWNSIDE OF DECRIMINALISATION
Alternatively, the Act also highlights concerns that minimising penalties might weaken intellectual property protection. Critics fear that reducing punishments could inadvertently diminish the perceived seriousness of IPR violations, leading to a more relaxed attitude toward safeguarding creative rights. This shift could potentially impact both creators and businesses, possibly deterring them from investing time and effort into innovative ideas.
CONCLUSION
The Jan Vishwas Act, in relation to Intellectual Property, aims to enhance the ease of doing business by fostering trust and simplifying operations for startups and new entrepreneurs. This aligns with the government’s philosophy of “minimum government, maximum governance.” By decriminalizing certain aspects, the Act seeks to empower businesses, creating a more favourable environment for growth and innovation. However, a critical analysis highlights potential challenges, emphasizing the need for careful implementation. As India progresses, it is essential to adopt a balanced approach that not only promotes innovation but also protects intellectual property rights. Achieving this delicate balance will enable the country to enhance economic growth while maintaining the integrity of creative efforts.
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