Analysis of Jan Vishwas Act, 2023 Vis-À-Vis Draft Trademarks Rules, 2024

1st August, 2024 - 12:14 pm Categories: Trademark 0 Comments

OVERVIEW OF JAN VISHWAS ACT,2023

The Jan Vishwas Act, 2023, decriminalize major violations across various Central Ministries and Departments. Amendments to the Trade Marks Act, 1999 is all revolving around increased fines and reduced term of imprisonment. The aim of this act is to focus on civil penalties or administrative penalties rather than criminal penalties.

AMENDMENTS IN JAN VISHWAS ACT,2023

1. Section 106 was removed officially now but it had become obsolete since 2010. This section was related to regulation of stamping requirements.
2. Sections 108 and 109 have been deleted which was related to false representation of Trademark registration and false association with the Trademarks office.
3. Section 107 which was related to false representation as a registered trademark has now been replaced with higher monetary penalty and provisions for imprisonment has been deleted. Jan Vishwas Act has set the penalty at the lesser of 0.5% of the offender’s business turnover or Rs 500000.
4. Section 140 which dealt with Custom notices has also been replaced with higher monetary penalty. It has increased from Rs 500 to Rs 10000.
5. Section 112A and 112B allows subordinate officers to impose penalties previously under the court’s jurisdiction by introducing adjudication and appeals processes for criminal penalties.

These amendments have been made to modernize and streamline the provisions related to imprisonment and penalties under the Trademarks Act, 1999.

POSITIVE ASPECTS

• By replacing criminal penalties with civil penalties, many provisions are decriminalized.
• It aims to reduce the burden on individuals and businesses.
• This shift in penalties is promoting compliance without the fear of serious criminal consequences.
• This amendment is incentivising compliance with regulatory norms.
• It is creating a more business friendly environment by attracting more investment and if businesses are of less punitive regulatory framework it would foster economic growth.
• If such regulatory framework is streamlined it is more conducive to business planning.

NEGATIVE ASPECTS

• Civil penalties might not have that serious effect as the criminal penalties as people will not fear for causing such major violations such as false representation of a registered trademark.
• For minor violations, civil penalties might be effective but for major violations criminal punishment is a must for maintaining integrity and transparency in the legal framework.
• There is lack of clarity in imposing civil penalties which could lead to legal enforcement challenges.
• The is lack of fairness and equity to the aggrieved person as the violation being a major one needs to be addressed through Criminal punishment rather than by Civil punishment.

OVERVIEW OF DRAFT TRADEMARKS RULES,2024

Amendments have been proposed to the Trade Marks Rules, 2017 by the Department for Promotion of Industry and Internal Trade through the Draft Trade Marks (1st Amendment) Rules,2024. The Draft Rules were released on January 10, 2024. It has a comment period of 30 days. There are other ministries which allows for 45 days of comment period. No transparency was maintained during the drafting process. No public stakeholder consultations were made.

AMENDMENTS IN DRAFT TRADEMARKS (1^ST AMENDMENT) RULES, 2024

1. It introduces new definitions for simplifying the adjudication processes.

• Complainant: It suggests to include any person rather than only the aggrieved person.
• Parties’ Obligation: Clarity is also needed on the issue that who constitutes the “other party” in submissions or applications.
• Summary Proceedings: The term, Summary Proceedings creates ambiguity. Thus it is a recommendation to amend the term “Proceedings when a case is made out” for transparency.

2. It also recommends to specify the qualifications of the Adjudicating Officers.
3. It also focuses on who is responsible for the appointment of Appellate Authority and who constitutes the Central Govt.
4. It also determines the issue regarding Compensation being granted by the Adjudicating officer’s authority for which rules were not specified.
5. It ensured clarity on time limit for primary facie proceeding, commencement of proceedings, clear service deadlines, correction of typographical error, speaking order requirement, opportunity for hearing etc.

POSITIVE ASPECTS

• It enhances transparency and efficiency in the adjudication processes of trademark.
• It focuses on streamlined dispute resolution.
• It addresses the issues regarding the ambiguity in certain terms and definitions of the Act.
• It clarifies the roles and responsibilities of the Adjudicating Officers.
• It also enhances stakeholder participation in enforcement processes of trademark.
• It strengthens a competitive environment for businesses.
• It also encourages creativity among IP businesses.
• It reduces litigation costs and expenditure spent on dispute resolution.

NEGATIVE ASPECTS

• There is no consideration of the perspectives of the stakeholder neither there is any consultation from them during the drafting process.
• There are complex provisions related to the qualifications of the Adjudicating Officers.
• No clear guidelines and training for adjudicators.
• No proper clarity regarding legal disputes and delays in trademark adjudication.
• Decisions based on unclear provisions might be challenged by the stakeholders.

CONCLUSION

When Jan Vishwas Act, 2023 is focusing on reducing the burden of businesses and the judicial authority, at the same time it is also affecting and reducing the penalties for serious crimes. Balancing the need of strong enforcement with reduced deterrent effect of the penalties is a challenge. The Draft Trademark Rules, 2024 enhances clarity and efficiency for the procedural aspect of the act but complex provisions may hinder the effectiveness and create a problem for the effective enforcement to take place. Both the act aim for creating a business friendly environment with reduced expenditure but however it has to ensure that the integrity and transparency go hand in hand. Engagement of the stakeholder is a must. Prevention of potential misuse and prevention of arbitrary decisions if taken by the judicial authority must be taken into consideration. Public Awareness Campaigns should be held. Mechanisms for feedback from stakeholders must take place. Regular Reviewing of the Trademark Rules and Act should be done for the regulatory framework to be in force. Moreover when amendments takes place, it is for the betterment of the public with streamlined laws and ensuring transparency, innovation, creativity, economic growth will be a key element for the successful enforcement of these reforms.

Author: Ambika Swain, A Student at KIIT School of Law, in case of any queries please contact/write back to us via email to chhavi@khuranaandkhurana.com or at  Khurana & Khurana, Advocates and IP Attorney.

BIBLIOGRAPHY

1. https://ksandk.com/intellectual-property/analysis-of-the-proposed-trade-marks-1st-amendment-rules-2024/
2. https://spicyip.com/2024/02/a-saral-analysis-of-the-proposed-trade-marks-1st-amendment-rules-2024.html
3. https://corporate.cyrilamarchandblogs.com/2024/01/summary-of-the-draft-trade-marks-1st-amendment-rules-2024/
4. https://www.lexology.com/library/detail.aspx?g=d980a6ee-e4d7-4d51-b351-69ff0f497d0b
5. https://medium.com/@EashanGhosh/the-jan-vishwas-amendments-to-the-trade-marks-act-three-talking-points-37271af94f35
6. https://kandspartners.com/author/editorial/page/2