Transferring Of Patent

INTRODUCTION

The importance of intellectual property in today’s world is unfathomable. People today are more vigilant about their intellectual property than they were a decade ago. The protection of intellectual property is integral in order to encourage innovation and creativity in inventions and also to give an incentive to the inventors and creators. In order to avoid any discrepancies, various global organizations have ever since formulated numerous treaties for the systematic working and smooth facilitation for the registration and commercial exploitation of one’s intellectual property rights. We now have half a dozen laws to protect and provide for transfer and distribution of copyrights, trademarks, patents and industrial designs among other intellectual property. In this article, we’re specifically going to focus on how the ownership of a patent can be completely transferred, its legal requirements and the legal procedure. We’re going to look at how a patent can be transferred, different methods of transfer, requirements of a transfer, and how to defend or file claims over a patent in different jurisdictions.

REQUIREMENTS OF TRANSFER

Before you’re all set to hand over your patent/invention to the designated person, you need to consider certain aspects which are important in the transfer.

✅Transfer to be documented

When you transfer a patent, you need to make sure that the same is done in a written and duly executed document, regarding the rights that you are handing over to the assignee/licensee so that in case complications arise in future, with the legal backing support in your contentions that creates a clear chain of transfer of rights to prove ownership over a property.

✅Establish your ownership

Before you make the transfer, it is pertinent to determine whether you actually own the IP you are transferring as without ownership no rights can be transferred. For example, if you invented the patent under the employment of a company or a person, you are said to be under the contract of service and therefore whatever you invent, is legally the property of the company or the person you’re employed under. However, if you invented the patent before getting employed under another authority, you are said to be under the contract for service and you are the original owner of your invention.

✅Careful filing and notarization of documents

Make sure to include complete bibliographic information about the patent like patent number, title, priority application detail etc. Correctly spell the names like legal name if the assignee is a business or a company, if there are multiple owners of the patent, name all the owners. Also, make sure all official documents are notarized. This provides credibility to your documents. If you can’t get it notarized, get it attested by at least two witnesses.

✅File a Proprietary Information Agreement

Make sure to ask the employees to sign a proprietary information agreement. This automatically assigns inventions and designs to the business. Other options include signing an automatic assignment or an explicit assignment. This will provide further clarity in identifying ownership.

TYPES OF TRANSFER

A patent can either be transferred permanently via assignment or partly or temporarily via license. However, it can also be transferred by operation of law.

ASSIGNMENT

You should assign your patent only if you want to part with your patent/invention and the rights related to it permanently. Here Patent Attorney in India would like to inform you that once you assign your patent to the assignee, you will not be able to get the same back. These are usually made under contractor agreements or under employment. For example, when a company acquires another company, it also acquires the intellectual property of the latter for life. Assignment is also preferred by movie studios in cases wherein they need capital to make the movie. They henceforth assign rights of the movie to an investor in return for financial capital for the movie.

An assignment can be done by way of legal assignment, wherein the assignee enters his name as the patent owner after which he becomes the proprietor of the patent and is henceforth entitled to all the rights concerning the patent. An assignment can also be done by way of equitable assignments, where the patentee agrees to share the ownership of the patent with another person via an agreement. In such a scenario, he therefore cannot register his name as the proprietor, but the assignee may have notice of his interest in the patent entered in the register. Moreover, a patent can be transferred by means of mortgages, wherein the patent owner assigns his entire/ part of his rights to the assignor in return for a financial consideration. Once the owner repays the same consideration back to the assignee, the rights are restored to the owner.

LICENSE

License refers as temporary transfer of your intellectual property rights and allows you to maintain a certain chain of command over the transferred intellectual property. When licensing, you can decide the duration of the exploitation, the jurisdiction as to where the IP can be exploited as well as whether the licensee can further sub-license the patent/invention. License upholds the principle of reversion of property, that is, your rights return to you after a certain condition like disputes. A license ends when i) the time period of license is over ii) the licensee fails to fulfill the conditions like it’s commercialization or iii) licensee breaches any terms of the license agreement

A patent can be transferred by means of- i) voluntary licenses where the terms of the agreement are mutually agreed to by the licensor and the licensee. By way of a voluntary license, the patent owner gives the rights to make, use or sell the patented article ii) Statutory license is basically granted by the government to a third party to make use of the patented product in view of public interest. An example of statutory licenses is compulsory licenses which are also granted by the government without the permission of the patent holder. This is granted if the government feels that the patented article is not available to the general public at an affordable price or if the article is unable to fulfill the requirements of the public. iii) Exclusive Licenses and Limited Licenses where an exclusive license excludes all other parties from the right to use the invention. The rights may be divided and assigned, restrained entirely or in part. In a limited license, the limitation may arise as to persons, time, place, manufacture, use or sale. iv) Express and Implied Licenses: An express license is one in which the permission to use the patent is given in express terms. Such a license is not valid unless it is in writing in a document embodying the terms and conditions. In case of implied license though the permission is not given in express terms, it is implied from the circumstances.

BY OPERATION OF LAW

This mostly happens on the death of the patent holder/owner. When the owner of an IP dies, his rights pass on to his/her legal heir. The provisions of law also come into play in the case of winding up or dissolution of a company.

New Trends & Key Developments

So, what’s changing in India’s patent transfer ecosystem? Let’s dive into the latest trends, legal updates, and case studies that every inventor, startup, and business should know.

1. India’s Patent Transfer Market is Booming📈

📌 Over 83,000 patents were filed in India in 2022-23, a record-breaking number.
📌 Patent assignments have grown by 40% in the last five years.
📌 Pharma and tech dominate patent licensing—60% of all transferred patents belong to these industries.

With India becoming a global hub for innovation, more companies are either selling patents or licensing them for royalty earnings.

2. Cross-Border Patent Transfers are Increasing 🌍

Many Indian companies are now transferring patents globally, thanks to the Patent Prosecution Highway (PPH) agreements with Japan and the US.

📌 Foreign companies own 50%+ of granted patents in India, and many of them transfer patents to Indian firms for manufacturing.
📌 Indian startups are now licensing their patents internationally, especially in biotechnology, AI, and IT.
📌 The Madrid Protocol & WIPO regulations are helping Indian businesses secure global patent rights easily.

3. Government Push for Patent Commercialization 💰

The Indian government is actively promoting patent monetization through various initiatives:

✅ Startup Intellectual Property Protection (SIPP) Scheme – Helping startups file patents and license them profitably.
✅ Patent Commercialization Support Program – Connecting patent holders with businesses that need innovation.
✅ Faster Patent Approvals – The Indian Patent Office has reduced processing time from 58 months to 24 months, making transfers quicker.

📌 As of 2023, over 10,000 patents filed under the SIPP scheme have been successfully transferred!

4. New Legal Updates on Patent Transfers ⚖️

India’s patent laws are evolving to support faster and more secure transfers:

📜 Mandatory Online Registration of Patent Transfers – The Indian Patent Office now requires all assignments and licenses to be digitally recorded.
📜 Updated Licensing Rules for Foreign Companies – Indian firms entering international licensing deals must comply with the latest Foreign Exchange Management Act (FEMA) regulations.
📜 Stronger Enforcement Against Patent Misuse – Stricter penalties for companies that license patents and fail to meet agreed-upon terms.

📌 The government is also working on a centralized “IP Marketplace” for patent owners to find buyers and licensors easily!

5. Emerging Industries in Patent Transfers 🔬🚗💻

Certain industries are witnessing massive patent transfer activity in India:

🔹 Artificial Intelligence (AI) & Software – AI-based patents are being licensed to IT firms for automation solutions.
🔹 Electric Vehicles (EVs) & Green Tech – Auto giants are assigning patents to smaller firms to boost sustainable mobility.
🔹 Pharmaceuticals & Biotech – Generic drug manufacturers are licensing patents from global pharma giants.

📌 India’s EV sector saw over 200+ patent transfers in 2023 alone!

  Categories : Patent
  Tags : How to Transfer Ownership of Patents , Patent Transfer , Transferring Of Patent