The differences between Competition Law and IPR has surfaced a lot time to time
playing a vital role in the economic market. Both the laws promote welfare of
the consumer and transmit of Technology. But on one hand IPR gives exclusive
rights to the owner and to use it freely and on the other hand competition law
tries to restricts and prevent monopolistic practices. This paper aims to deal
with the differences between IPR and competition law and the conflict that
arises in the jurisdiction of both the laws.
India has, in the pursuit of globalization, responded to opening up its economy,
removing controls and restoring to liberalization. As a natural consequence of
this the Indian market has to face competition within India and also outside
India and for which there needs to be a law. The competition Act 2002 was
enacted by the Parliament of India, commenced on 31st march 2003.
Competition Act replaced the monopolies and restrictive Trade Practices Act,
1969 (MRTP Act). The failure of MRTP Act was led due to its lack of competition
advocacy and restrictive economic concentration. The MRTP Act was amended
several times but was unable to provide required results and hence considering
the lack of provisions of the MRTP Act, 1969 was repealed and replaced by the
competition Act, 2002.
According to World Intellectual Property Organization (WIPO) The IPRs shall
include the rights relating to:
Competition Act 2002: As the rise of Globalization and Liberalization the competition rose within
India and outside India. The competition Act provided with the establishment
of competition commission with extensive powers to give directions and
orders on anti-competition issues and also imposing penalties and
prosecution for violation of the act. It provided protection of consumers
interest from unfair competition practices. The Act promotes sustainable
competition and freedom of trade in the market.
Objective Of Completion Law: Supreme Court's view- " The laws were required to be enacted, primarily for
the objective of taking measures to avoid anti-competitive agreements and
abuse of dominance as well as to regulate mergers and takeover which result
in distortion of the market.
The various provisions of the Act deals with restricting anti-competitive
practices such as:
- Anti-competitive agreements
- Abuse of dominant position
- Bid rigging
- predatory pricing
Intellectual Property Law:According to Halsbury's laws of England 'property is that which belongs to a
person exclusively of others and can be subject to bargain and sale'. It
includes goodwill, trademark, license to use a patent, book debts, options to
purchase, life policies and other rights under a contract. Property can be
classified into two categories: 1. Tangible ( i.e. movable and immovable ) 2.
Intangible ( Intellectual property )
Intellectual property basically is a creation of mind created by human beings.
It is the product of human intellect. Inventions, industrial designs, designs,
literary and artistic works, symbols, logos used in promotion and commerce are
some forms of intellectual property. According to Salmond, the unnatural product
of a man's brains may be as valuable as his hands or his goods. The Intellectual
property rights gives an exclusive right in it. The intellectual property law
modulates the use and exploitation of intellectual property by others who are
unjustly profiting from it.
Some of the components of the Intellectual property are as follows:
- Literary, artistic and scientific work;
- performances of performing artists, phonograms and broadcasts;
- Invention in all fields of human endeavor;
- scientific discoveries;
- Industrial designs;
- Trademarks, service marks and commercial names and designations;
- Protection against unfair competition and all other rights
resulting fro intellectual activity in the industrial, scientific
literary or artistic field.
- Copy rights
- Trademarks and Service marks
- Industrial property
- Geographical Indications
- Plant varieties
- Industrial Designs
- Layout designs of integrated circuits
- Trade secrets
IPR Laws are monopolistic in nature.4 which creates many advantages to the owner
and can result in abuse of dominant position which creates conflict between
competition law and IPR.
Relationship Between IPR And Competition Law:
Intellectual property law and competition law are both fields of different laws
and deals with different objectives. The competition law deals with limiting of
anti-competitive activities in the market, monopoly and abuse of dominance
position in the market. Whereas Intellectual property law deals with protection
and enforcement of intellectual property rights which gives exclusive right to
the owner on the use of his intellectual creation. Which creates monopoly on the
other hand and it is discouraged by the competition policy.
It can be seen that
both the laws are edging to each other. However, they are also complementary in
some areas. Intellectual property law and competition law are both the part of
the consumer market. According to section 3(5) of the Competition Act 2002:
Nothing contained in this section shall restrict- i. the right of any person to
restrain any infringement of, or to impose reasonable conditions as may be
necessary for protecting any of his rights which have been or may be conferred
upon him under:
- the copyright Act, 1957 (14 of 1957);
- the Patents Act, 1970 (39 of 1970);
- the Trade and merchandise marks Act, 1958 (43 of 1958) or the trade
marks Act, 1999 (47 of 1999)
- the Geographical Indications of goods ( Registration and protection)
Act,1999 (48 of 1999);
- the Designs Act, 2000 (16 of 2000);
- the Semi-conductor Integrated Circuits layout-design Act, 2000 ( 37 of
2000); This section excludes IPR from restrictive trade practices. Competition
law provides protection to IPR as it is necessary to protect the intellectual
creation of human minds so that others cannot take unlawful advantage over it
and regulate fair competition in the market.
The main focus of competition law is to ensure that the business runs in open
and competitive markets and promoting economic growth and restricting
anti-competitive activities. On the other hand the main objective of IPR is to
encourage innovation and to provide exclusive rights to the holders and
protection of their rights. There is a need to protect IPR so that the rights of
the innovators are protected and maintained which can further motivate them
without any conflict and uncertainty.
In the case of intellectual property in competition law, The competition Act of
2002 provides for certain actions to be taken in motion to eradicate
anti-competitive behavior that may effect IPR. Competition Commission of India (CCI)
notes, that section 3 would not attract any fair condition imposed for the
security of IPR but the imposition of 'unreasonable condition' to protect IPR.
Section 3(5) of the competition Act provides for interdicting anti-competitive
agreements and limitations of person's right to avert infringement and to
enforce fair conditions for the protection of IPR. The section deals with the
reasonable use of private rights including innovations and that competition law
does not affect the IPR rights. The competition law deals with IPR conflicts in
a fullscale manner.
Conflict Between Ipr And Competition:
Competition law plays a conventional role by promoting market efficiency and
preventing market distortions whereas, IPR's role is to promote innovations by
providing protection and rights to requisite IP holders.
- Patent Pooling:
Patent pooling is when a company decides not to issue license to the third
party which could become restrictive trade practice. It is an association of
two or more firms/companies to cross license their patents in accordance to
a particular technology.
- Abuse of dominant position:
If section 3(5) of the competition Act 2002 is read with section 4 then we
can find its limitation which states that there shall be an abuse of
dominant position if a company or a business imposes discriminatory or
unfair conditions in the purchase or sale of the goods. Therefore, the
rights of IP holders can find its limit in section 4 of the competition Act
2002. Therefore it limits the IPR holders by taking the ability to place
unreasonable restrictions on innovations while licensing the Intellectual
Property Rights. In the case of 'Aamir khan production pvt. ltd. v. Union of
India' - competition commission of India stated that intellectual property
laws do not have any absolute overriding effect on competition law.
- Issue of jurisdiction:
The cases related to IPR are heard by High court or by Supreme court but The
competition Act does not provide for any exemption to cases involving IPR
issues which can be tried by Competition Commission Of India (CCI) 'King
fisher Airlines Limited v. Competition Commission Of India' proceedings were
initiated against jet Airways and King fisher Airlines by the CCI for
Anticompetitive practices and the issue arose against the jurisdiction of
The Commission. The Bombay High court held that CCI is competent to deal
with all the issues coming before the copy right Board of India. CCI is
competent to adjudicate matters relating to IPR which have adverse effect on
competition in relevant market in India.
- Tie-in Agreement:
When the licensee/seller agrees purchasing a highly usable product or
service exclusively from the patentee under the tying agreement which leads
to restrictive practices.
IPR and competition law both goes hand in hand yet sometimes it can be hard to
draw boundaries between them as IPR gives exclusivity to the owner creating
domination over the creation and then there is competition law preventing
monopolistic practices. It is also certain that both the laws need a balance to
fill in the loops.
There is a need to define the market as lucid as possible to reduce the
complexities. But it should be taken into account that both the laws are
complementary to each other as well as both IPR and Competition law encourages
economic growth and focuses on the consumer welfare. The dominant position
created by IPR are the result of misusing the competition policies for which
there is a need to classify both the domains as such that the laws don't overlap
- Dr. M.K. Bhandari, Law relating to Intellectual Property Rights, Sixth
Ed. 2021, Central Law Publications.
- Dr. S.C. Tripathi, Competition Law, First Ed.2012, Central Law
- Hritvik Dixit and Deepshikha Ughade,Conflict between IPR and Competition
Law: A Comparative Analysis between US, EU and India.
- Surabhi Singh and Richa Goel: The interplay between Competition law and
- Atul Patel, Aurobinda Panda, Akshay Deo, Siddhartha Khettry and Sujith
Philip Mathew: Intellectual Property Law & Competition Law, Journal of
International Commercial Law and Technology Vol.6,Issue 2 (2011).
- Amir khan productions v. Union of India(2010) BOM 112 7 https://www.the-laws.com/Encyclopedia/Browse/Case?CaseId=310102863200
- Dr. S.C Tripathi, Competion Law,1st Ed.2012, central law publications.
- competition commission of India vs. SAIL,2010 (10) SCL 744.
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