A startup backed up by forces of innovation and creativity has a long road to travel in order to establish itself and prosper in every aspect. Such creation of mind or intellect is an intangible asset which needs to be protected by law from infringement or being stolen. However, seeking protection for the intangible asset such as Intellectual Property is the road less travelled by startups and small businesses in India. Hence, in order to promote awareness about the importance of IPR among startups and boost its adoption, the Government of India introduced a scheme called as “Start-Ups Intellectual Property Protection” (SIPP). For enhancing valuation and providing early competitive advantage to the start-up, it is critical to protect the IPR.
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To encourage innovation and creativity among start-ups through protection and promotion of their Intellectual Property Rights
Objective of SIPP is very simple i.e. to facilitate the Start-Ups Intellectual Property Protection in India and promote its adoption by start-ups. The purpose of the scheme is to nurture, mentor and assist the innovative and emerging technologies in protecting and commercializing their IPR by providing easy accessibility to intellectual property services and resources.
“Startups certified by Startup Certification Board having an innovative business is eligible for SIPP scheme.”
Before moving ahead let us first examine what does the word “Startup” mean? A “Startup” is an as entity, incorporated or registered in India not prior to five years, with an annual turnover not exceeding Rs.25 crores in any preceding financial year, working towards innovation, development, deployment or commercialization of new products, processes or services driven by technology or intellectual property.
“Provided that such entity is not formed by splitting up, or reconstruction, of a business already in existence.”
“Provided also that an entity shall cease to be a Startup if its turnover for the previous financial years has exceeded INR 25 crore or it has completed 5 years from the date of incorporation/ registration.”
“Provided further that a Startup shall be eligible for tax benefits only after it has obtained certification from the Inter-Ministerial Board, setup for such purpose.”
Appointment of Intellectual Property Facilitators
In order to ensure effective implementation of the scheme, the Controller General of Patent, Design and Trademark (CGPDTM) shall empanel facilitators. Further, it will be responsibility of CGPDTM to regulate the conduct and functions of these facilitators from time to time. Also, the CGPDTM has the authority to remove any facilitator in case of any complaint by a Startup regarding the retrieval of any information or professional misconduct.
Eligibility Criterion for a Facilitator
- Any patent agent registered with CGPDTM
- Any trademark agent registered with CGPDTM
- Government organizations/ agencies/ departments like TIFAC, BIRAC, NRDC, DEITY, etc.
- Any advocate as defined under The Advocates Act, 1961 who is entitled to practice law as per the rules laid down by Bar Council of India from time to time, who is well versed with the provisions of the relevant Acts and Rules, and is actively involved in filing and disposal of applications for patents, trademarks and designs.
Functions of Facilitators
A facilitator will be responsible for providing the following services apart from other functions that as decided by CGPDTM:
- Providing general advisory on different intellectual property rights to startups on pro bono basis;
- Providing assistance in filing and disposal of the IP applications related to patents, trademarks and design under relevant Acts at the national IP offices;
- Providing information on protecting and promoting IPRs to startups in other countries on pro bono basis;
- Drafting complete/provisional specifications for inventions of startups;
- Appearing on behalf of startup at hearings as may be scheduled;
- Preparing and filing responses to examination reports and other queries, notices or letters by the IP office;
- Contesting opposition, if any, by other parties, and
- Ensuring final disposal of the IPR application.
Fees for Facilitators
The central government through the office of CGPDTM shall be liable to pay the fees directly to the facilitator for any number of trademarks, patents or designs applied for by the Startup. The facilitator shall not charge anything from the entrepreneur or the Startup. The fees structure for the empanelled facilitators that may be revised from time to time by the Department of Industrial Policy and Promotion is mentioned below:
NOTE: “If any application is abandoned or withdrawn before disposal of application, facilitator shall be entitled to fees only for filing of application and not for disposal of application.”
After the launch of SIPP any statutory fees payable for each trademark, patent or design applied for in India or abroad by a Startup shall be borne by the Startup itself.
Period of Scheme
Initially the scheme shall run on pilot basis and from the date of launch of Startup India, the scheme shall be applicable for a period of 1 year.
The ownership rights of the IPR created shall in no way under any circumstance transfer, either wholly or partially to the facilitator or the Government under this scheme. The startup will have full rights on the created IP.
The Startup or the facilitator in no way under this scheme is entitled to registration or grant, as the case may be, of the IPR. The applications shall be filed and disposed off as per the IPR laws and the rules.