IP Provisions of the UK's Free Trade Agreement with India

Science City, Kolkata

Author: Biswarup Ganguly Licence CC BY-SA 3.0  Source Wikimedia Commons

 

Jane Lambert

By a press release dated 6 May 2025, the Department for Business and Trade announced that the United Kingdom had concluded a trade deal with India.  According to Dominic Webb's UK India Free Trade Agreement, a research briefing for the House of Commons Library dated 9 May 2025, no details are available, but the deal seems to consist of a free trade agreement and a double contributions convention.  The research paper refers to UK and India clinch trade deal after three years of talks in Politico, which states that negotiations for a bilateral investment treaty are continuing.

The Free Trade Agreement

The Department for Business and Trade published a chapter summary on the issues that had been agreed in its policy paper, UK-India trade deal: conclusion summary, on 15 April 2025.  Work is continuing on the legal text and the resolution of a few remaining issues. Once the text has been finalized, it will be checked by both sides' lawyers.  Domestic approval will then be sought in each country.  Once that has been obtained, the agreement can be signed, after which it will enter into force.

The agreement will cover anti-corruption, the temporary movement of natural persons, competition and consumer protection, customs and trade facilitation, trade and development cooperation, digital trade, the environment, financial services, goods market access, good regulatory practice, government procurement, innovation, intellectual property, labour, professional business services, rules of origin, remedies, sanitary and phytosanitary, small and medium enterprises, state owned enterprises, subsidies, technical barriers to trade, telecommunications, trade and gender equality and trade in services.  

Intellectual Property

According to para 4.15 of the policy paper, the IP chapter will support the British and Indian economies "through effective and balanced protection of IP rights.  It will cover copyright and related rights, designs, trade marks, geographical indications, patents, and trade secrets, as well as the enforcement of IP rights, and ongoing cooperation in relation to IP matters.  The chapter will secure improvements to patent procedures in India to reduce the administrative burden, speed up processes, and lock in commitments that provide for transparency and legal certainty in the patent system.  India will commit to engaging on aspects of copyright and related rights, including public performances, artists' resale rights and the copyright terms of protection.  UK food and other suppliers will be able to seek protection for all geographical indications and not just wines and spirits in India. Nothing in the outline agreement will commit the UK to domestic legislative change, undermine the UK’s IP system or its international positions on IP.  There is likely to be a degree of overlap between IP and some of the other agreed issues, such as competition and consumer protection, digital trade, financial services, innovation, small and medium enterprises, technical barriers to trade and telecommunications. 

Existing IP Protection in India

According to the WIPO, India ranked 39 among the 133 countries in the global innovation index in 2024.  The main IP statutes appear to be The Copyright Act, 1957, The Designs Act, 2000, The Geographical Indications of Goods (Registration and Protection) Act, 1999, The Patents Act, 1970, The Protection of Plant Varieties and Farmers' Rights Act, 2001, The Semiconductor Integrated Circuits Layout-Design Act, 2000 and The Trade Marks Act, 1999,  India is party to the main intellectual property treaties including Paris, Berne and Rome Conventions, the Patent Cooperation Treaty and the Madrid Protocol (see WIPO-Administered Treaties, Contracting Parties/Signatories India).

Comment

This is the UK's 4th new trade agreement since it left the European Union and potentially the most important.   I shall return to the topic as more information becomes available.  Anyone wishing to discuss this topic may call me on +44 (0)20 7404 5252 during normal UK business hours or send me a message through my contact form at any time.

EU's Exhaustion of Rights Doctrine to Remain in Force in UK

Standard YouTube Licence

Jane Lambert

Shortly before the UK-EU Summit on 19 May 2025, the Intellectual Property Office announced that the doctrine of exhaustion of rights will continue to apply to the UK even though the UK has left the European Union and notwithstanding that the doctrine will not apply in the opposite direction (see IPO press release Certainty for businesses and choice for consumers as UK maintains IP rights regime 15 May 2025).  In view of the furore over the so-called reset of relations between the UK and EU with threats from the Leader of the Opposition and Reform UK to reverse the deal it is surprising that the IPO's announcement has received so little attention in the press (see Badenoch vows to reverse Starmer's EU Deal The Telegraph 19 May 2022).

Exhaustion of Rights

The doctrine of exhaustion of rights was developed by the Court of Justice of the European Union to reconcile the tensions between arts 30 and 34 of the Treaty on the Functioning of the European Union.  Art 30 provides:

"Customs duties on imports and exports and charges having equivalent effect shall be prohibited between Member States. This prohibition shall also apply to customs duties of a fiscal nature."

Arts 34 and 35 supplement art 30 by prohibiting restrictions on imports and exports.  However, art 36 allows some exceptions:

"The provisions of Articles 34 and 35 shall not preclude prohibitions or restrictions on imports, exports or goods in transit justified on grounds of public morality, public policy or public security; the protection of health and life of humans, animals or plants; the protection of national treasures possessing artistic, historic or archaeological value; or the protection of industrial and commercial property. Such prohibitions or restrictions shall not, however, constitute a means of arbitrary discrimination or a disguised restriction on trade between Member States."

In Case 16/74 Centrafarm v Winthrop [1974] ECR 1183, the Court said:

"[7] Inasmuch as it provides an exception to one of the fundamental principles of the common market, Article 36 in fact only admits of derogations from the free movement of goods where such derogations are justified for the purpose of safeguarding rights which constitute the specific subject-matter of this property.
[8] In relation to trade marks, the specific subject-matter of the industrial property is the guarantee that the owner of the trade mark has the exclusive right to use that trade mark, for the purpose of putting products protected by the trade mark into circulation for the first time, and is therefore intended to protect him against competitors wishing to take advantage of the status and reputation of the trade mark by selling products illegally bearing that trade mark.
[9] An obstacle to the free movement of goods may arise out of the existence, within a national legislation concerning industrial and commercial property, of provisions laying down that a trade mark owner' s right is not exhausted when the product protected by the trade mark is marketed in another Member State, with the result that the trade mark owner can [oppose] importation of the product into his own Member State when it has been marketed in another Member State.
[10] Such an obstacle is not justified when the product has been put onto the market in a legal manner in the Member State from which it has been imported, by the trade mark owner himself or with his consent, so that there can be no question of abuse or infringement of the trade mark.
[11] In fact, if a trade mark owner could prevent the import of protected products marketed by him or with his consent in another Member State, he would be able to partition off national markets and thereby restrict trade between Member States, in a situation where no such restriction was necessary to guarantee the essence of the exclusive right flowing from the trade mark."

In Case C-9/93 IHT Internationale Heiztechnik GmbH and Uwe Danzinger v Ideal-Standard GmbH and Wabco Standard GmbH. (Free movement of goods) [1994] ECR I-2789, [1994] EUECJ C-9/93, the Court explained the principle of exhaustion of rights at para [34]:

"So, application of a national law which would give the trade-mark owner in the importing State the right to oppose the marketing of products which have been put into circulation in the exporting State by him or with his consent is precluded as contrary to Articles 30 and 36. This principle, known as the exhaustion of rights, applies where the owner of the trade mark in the importing State and the owner of the trade mark in the exporting State are the same or where, even if they are separate persons, they are economically linked. A number of situations are covered: products put into circulation by the same undertaking, by a licensee, by a parent company, by a subsidiary of the same group, or by an exclusive distributor."

 Brexit

Although art 61 of the Agreement on the withdrawal of the United Kingdom of Great Britain and Northern Ireland from the European Union and the European Atomic Energy Community provided that intellectual property rights which were exhausted both in the EU and in the UK before the end of the transition period under the conditions provided for by EU law should remain exhausted both in the EU and in the UK, the doctrine ceased to apply to the UK after the end of that period.   The IPO published guidance entitled 
Exhaustion of IP rights and parallel trade on 30 Jan 2020.

Consultation

In a Consultation document on the UK’s future regime for exhaustion of IP rights, first published on 7 June 2021 and subsequently updated, the IPO noted:

"The concept of exhaustion has built up over many decades. When the UK was part of the EU, the UK was part of the EU’s regional exhaustion regime. The principle of exhaustion of rights is derived from the provisions concerning the prohibition of qualitative restrictions in the Treaty on the Functioning of the EU (and the EEA Agreement) as interpreted by EU case law and was specifically recognised in various EU Directives as implemented into domestic legislation. As a result of domestic legislation concerning EU exit this principle continues to have the same effect in domestic law as it had before the end of the implementation period (the UK’s unilateral application of the EEA regional regime). In particular, the principle of exhaustion is relevant to section 7A of the Registered Designs Act 1949, sections 18 and 27 of the Copyright, Designs and Patents Act 1988 and section 12 of the Trade Marks Act 1994."

Between 7 June and 31 Aug 2021, the IPO consulted on the following options:

• UK’s unilateral application of a regional EEA regime, otherwise known as a “UK+” regime:  Inbound parallel import of goods only automatically permitted from EEA countries (assuming there is separate authorisation for regulated goods such as medicines);
• National: Inbound parallel import of goods not automatically permitted from any country; 
• International: Inbound parallel import of goods automatically permitted from any country (assuming there is separate authorisation for regulated goods such as medicines); and 
• Mixed: Ability to parallel import will depend on any decision on treatment for a specific IP right, good or sector.

None of those options provided for parallel export of goods except to countries with an international regime.   The consultation document explored each of those options.   A response form asked consultees for their views.

Response 

According to para 45 of the Government response to the consultation on the UK’s future exhaustion of intellectual property rights regime. HMG received 150 responses:  120 from businesses and organizations, 17 from individuals and 13 from respondents who failed to state whether they were businesses, organizations or individuals.   A list of the corporate respondents can be found in the Government Response at para 46.  The responses are summarized in UK’s future exhaustion of intellectual property rights regime: Summary of responses to the consultation.

Outcome

According to the IPO's press release, HMG has opted for UK+.   This will not require new legislation. The Intellectual Property (Exhaustion of Rights) (Amendment) Regulations 2023 SI 2023 No 1287 will continue to apply.

Anyone wishing to discuss this article may call me on +44 (0)20 7404 5252 during normal office hours or send me a message through my contact page at any time.