Fleeting Life of Exclusive Marketing Rights and the Birth of a Stronger Patent Regime
Trade Related aspects of Intellectual Property Rights (TRIPS) Agreement under the World Trade Organization (WTO) came into effect in 1995 mandating all the developing member countries to bring in TRIPS-compliant national laws within ten years i.e., 2005.
India became a party to the TRIPS Agreement in April, 1994. At that time, India’s then-current enactment of the Patent Act, 1970 directly contravened Article 27 of the TRIPS Agreement. Upon coming into effect on January 1, 1995, TRIPS set out transitional periods for WTO members to introduce legislation complying with the obligations under TRIPS.
For developing countries, like India, the deadline for complying with TRIPS was the year 2000. Article 65.4 of TRIPS provided a special transitional provision for those countries that did not grant product patents. The provision provided an additional five years (until 2005), from the initial TRIPS transitional period, to introduce product patent protection.
India had to provide a means by which patent applications could be filed during the transitional period. The Mailbox Provision allowed applicants to file for patents, thereby establishing filing dates, while at the same time permitting member countries to defer granting product patents. In addition, India also had to provide Exclusive Marketing Rights (EMRs) in exchange for the permission to delay the grant of product patents until January 1, 2005.
EMRs are applicable where a patent is granted for the same product in another WTO member country after 1995 (the date of entry into force of TRIPS), provided the other member country obtained marketing approval for the product. EMRs are limited to pharmaceutical and agricultural chemical products only. From a simple dictionary definition reading of the term, the meaning of EMR appears to be very similar to Patent Rights however in theory EMRs prevent others from making or using patentable inventions. The rights holder can indirectly prevent them from marketing products based on such use since they would lack the authorization to do so. Patent protection and EMRs are alternatives and are not used concurrently. The following amendments were made to fraction the TRIPS regime:
1999: Transitional arrangements through Section 5(2) of the Indian Patent Act, which allowed product patent applications to be filed through a “Mailbox”, while Chapter IVA provided for the grant of Exclusive Marketing Rights (EMRs) if certain conditions were fulfilled.
2005: Introduction of product patents in the area of chemicals, pharmaceuticals, and agricultural chemicals and food.
The provision of EMR was imbibed in the Indian Patent law as a transitory provision to help developing countries which followed a Process Patent regime into a Product Patent regime.