India: Frequently Asked Questions W.R.T. Working Statements For The Financial Year 2020-2021

1. What are Working Statements and its purpose?

Granted patents should act as an instrument to promote public interest especially in sectors of vital importance for socio-economic and technological development of India. In view of above and to check that the patent right is not abused by the patentee, Section 146(2) of the Indian Patents Act, 1970 & Rule 131(2) of the Indian Patent Rules, 2003 requires every Patentee and Licensee to submit a statement regarding the extent to which the patented invention has been worked on a commercial scale in India (called as Working Statements) on Form 27.

2. What amendments are brought about in the Patent Rules w.r.t. Filing of Working Statements?

1.1. Rule 131(2), which specifies the furnishing of statements of working has been amended as marked below:
"The statements referred to in sub-rule (1) shall be furnished once in respect of every financial year, starting from the financial year commencing immediately after the financial year in which the patent was granted, and shall be furnished within six months from the expiry of each such financial year."

1.2. Form 27 for submitting the statement of working of patented invention on a commercial scale in India has been substituted. New Form 27 is annexed herewith - Annexure A.

3. What is the due date to file working statement?

Working statement on Form 27 with respect to previous financial year shall be filed within six months from the expiry of such financial year, i.e., Form 27 shall be filed by 30th September. For example, for the financial year 2020-21, Form 27 shall be filed by 30th September 2021.

4. What is the duration of financial year in India?

A financial year in India is the period staring 01st April to 31st March of the following year. Accordingly, financial year 2020-2021 ranges from 01st April 2020 to 31st March 2021.

5. Can a single Form 27 be filed for multiple patents?

Yes, after the said Amendment, single Form 27 can be filed for multiple "related patents".

6. What information/data is to be provided on new Form 27?

Now the Patentee(s) and Licensee(s) shall provide below listed information while furnishing statement of commercial working of patent in India on Form 27:

i. Name(s) of the Patentee(s) / Licensee(s)
ii. Patent No.
iii. Worked / Not Worked [Yes / No]
iv. Approximate revenue / value accrued in India to the Patentee(s) or Licensee furnishing the statement from Patent No(s) where the working is through:
a) Manufacturing in India (in INR)
b) Importing into India (in INR)

v. Brief in respect of approximate revenue / value accrued in India or the Working of the Patent at the commercial scale in India -Brief may include countries from which patented articles are imported, name of licensee(s), sub-licensee(s), how multiple patents (if on single Form 27) are related, how approximate value was derived or any other information which the Patentee/Licensee deem appropriate while filing Form 27.

vi. If not worked, reasons for not working of the Patented invention and steps being taken for working of the invention

7. Are any documents required to be enclosed with the working statement on Form 27?

Apart from the above stated information to prepare Form 27, we would require a Power of Authority (if not provided already) from the Applicant(s)/Licensee(s) authorizing S&A to file statement of working of patent(s) at the Patent Office.

8. Which Patents are eligible for filing Working Statements for financial year 2020-21?

For financial year 2020-21, working statements should be filed for all patents granted on or before 31st March 2021 and are active/ subsisting on Patents Register for part or whole of the financial year 2020-21.

9. Does all Patentees and Licensees need to file the Working Statements?

Yes, all Patentees and Licensees shall file working statement. While co-Patentees over a patent can collectively file single Form 27, the Licensees are required to file Form 27 separately.

10. When can the Patentee/ Licensee/ In-House Attorney provide instruction with information for preparing and filing working statements?

Required information for preparing and filing of working statement on Form 27 can be provided any time before 30th September of the year. However, to avoid the last weeks' rush to file working statements in thousands of subsisting patents in India and to reasonably correct/clarify on the information, the Client should preferably give instructions with relevant information for Form 27 by July 2021.

11. Guidance on what is meant by "related patents" and how related they have to be to each other.

i. How Patents will be classified as 'related patents'?

Phrase "related patents" includes all patents relating to the same product or are interlinked such that approximate value for a particular patent or each patent cannot be derived separately. Further, it should be kept in mind that the Patentee or Licensee making the Statement is the same for all patents included on the single Form 27.

ii. Are patents only allowed to be considered as "related" if the approximate revenue / value accrued from a particular patented invention cannot be derived separately from the approximate revenue/value accrued from related patents?

To use single Form 27 for multiple patents, it is assumed that the Patentee/Licensee cannot derive value for a particular or each patent separately from the said group of "related patents".

iii. Does it have to be stated how the patents are related?

While the Form 27 does not particularly asks for "how the patents are related", it is advisable to put information with respect to the same in column 4.(b) Brief in respect of (a) above. One may also include how total approximate revenue/value was derived.

iv. Will it be assumed that all the patents mentioned on the same form 27 are related?

Yes.

v. In case the patents are not related, is a separate form 27 needed?

Yes.

12. What options are available if the due date for filing the Statement of Working is missed?

In case the working statement (Form 27) is not filed by 30th September, the same can be filed along with petition under Rule 137/138 giving detailed reasons for such delayed submission. The acceptance of such petition and delayed Form 27 will be at the discretion of the Controller.

13. Will the new Form 27 information still be submitted online?

Yes.

14. With respect to imports, does the patentee/licensee need to specify country of origin?

The revised Form does not particularly require "country of origin" for imported items. Further, the old version of Form 27 is still showing and revised Form 27 is not yet updated on the IPO's e-Filing portal. In the given scenario, while "country of origin" is not required as per revised Form 27, the Patentee/Licensee may choose to provide "country of origin" and we can include the same in Col. 4(b) of revised Form 27. Further, we will keep a watch on revised Form 27 over e-Filing portal and will inform our clients in case there is any clarity in this regard.

15. What sort of information is required for the brief about working statements (4b)?

As on date, there is no prescription from the Patent Office as to what can be included in Col. 4(b) Brief in respect of (a) Approximate Value.. The Patentee/Licensee may choose to including "how patents are related" in case of multiple patents, "how approximate value was derived" and/or "country of origin" in case of value by importing in India or any other information that the Patentee/Licensee deem appropriate while providing statement of working of patent(s) in India.

i. Does the brief only relate to the information in 4a?

Yes.

ii. Can the brief be omitted entirely, or be blank/empty?

We will be able to answer "whether 4(b) is mandatory while e-Filing of Form 27 or not" once the e-Filling portal is updated with revised Form 27.

16. What are the consequences if the Working Statement is not filed with the correct information or within the stipulated time (or with petition)?

As per Section 122(1) (b) of the Patents Act, 1970, failure to supply such information as required under Section 146 is punishable with fine which may extend to ten lakh rupees. If the information or statement furnished by the patentee is false, there is a punishment with imprisonment up to six months, or with fine, or both [Section 122(2)]. Consequently, non-submission of statement regarding working of invention can lead to penalty, and may further lead to a valid ground for grant of compulsory license over the patent.

FORM 27
THE PATENTS ACT, 1970 (39 of 1970)
AND
THE PATENTS RULES, 2003

No Fee

STATEMENT REGARDING THE WORKING OF PATENTED INVENTION(S) ON A COMMERCIAL SCALE IN INDIA
[See section 146(2) and rule 131(1)]

Note: Every patentee and every licensee (exclusive or otherwise) is required to file this Form; where a patent is granted to two or more persons, all such patentees may file this Form jointly; however, each licensee shall file this Form individually.

Authored by
IPR Team

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