Patents Act overrides the Competition Act

Context:  The Delhi High Court ruled that the Patents Act, will take precedence over the Competition Act concerning the exercise of rights by a patent holder. About the Case:
  • The case involved appeals by agrochemical company Monsanto and telecom company Ericsson, along with the Competition Commission of India (CCI).
  • CCI initiated “antitrust investigations” against Monsanto and Ericsson for alleged anti-competitive practices related to patent licensing.
  • The key issue was whether CCI had jurisdiction to investigate actions of a patentee or if it was solely under the Patents Act.
What are antitrust laws? Antitrust laws are rules that promote competition by restricting a firm’s ability to dominate the market. This frequently entails dismantling monopolistic firms as well as making sure mergers and acquisitions don’t excessively concentrate market power.
  • The Court ruled that the Patents Act must prevail over the Competition Act on the issue of the exercise of rights by a patentee under the Patents Act.
  • Complete Code in Patents Act: The court stated that Chapter XVI of the Patents Act comprehensively deals with unreasonable conditions in patent licensing, abuse of patentee status, inquiries, and relief.
About Patents Act:
  • Definition: A patent is an exclusive right granted for an invention under the Patents Act 1970.
    • The patent provides the holder with the sole authority to use, sell, or license the invention, preventing others from doing so without permission.
  • Patentee under the Patents Act: According to the Act, a patentee is the person whose name appears on the register of patents as the “grantee or proprietor of the patent.”
  • Register of Patents: The register of patents is maintained by a government patent office, which is present in four cities across the country.
Additional Information: About Competition Commission of India (CCI):
  • It is a statutory body responsible for enforcing the Competition Act, 2002.
  • It was constituted in March 2009, replacing the Monopolies and Restrictive Trade Practices Act, 1969 (MRTP Act) on the recommendations of the Raghavan committee.
  • Composition: The CCI consists of one Chairperson and six Members appointed by the Central Government.
    • It is a quasi-judicial body that provides opinions to statutory authorities and deals with various cases.
The Competition Act, 2002:
  • The Act prohibits anti-competitive agreements, abuse of dominant position, and regulates combinations that adversely affect competition within India.
  • The Act led to the establishment of the Competition Commission of India and the Competition Appellate Tribunal (COMPAT).
    • COMPAT was replaced by the National Company Law Appellate Tribunal in 2017.
 News Source: The Livemint
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