BLOCKCHAIN AND INTELLECTUAL PROPERTY - BareLaw

 Anamika, A final year LL.B. student (2021) of Amity University, Lucknow

Chirag Baliyan,A final year B.A. LL.B. Student (2021) of Amity University, Lucknow

 

It’s an era of disruptive technologies. These technologies are rapidly evolving and changing the way we live and conduct business. It will not be an exaggeration if we rate this era as the most fluid period in the history of human evolution; when we are witnessing the technologies outpacing each other in record time. Artificial Intelligence, Cloud Computing, Virtualization, Internet of Things, Blockchain, Deep Learning, etc. have become buzz words giving an ever-widening canvass of technological developments. Intellectual property rights (IPRs) and technological developments are complementary supplementary to each other. The rapid growth in technology requires corresponding IP laws to keep pace with such growth. 

IP offices across the globe witnessed a quick influx of patent applications relating to AIs, Cloud Computing, Virtualization, the Internet of Things, Blockchain technology, and related distributed ledger technologies. While the IP people group over the globe are worried about contriving suitable IP laws to secure these innovations, the genuine capability of these most recent advancements should be utilized in the IP system itself by using their backbone to address issues running from the beginning of a potential IP to its implementation. These most recent innovations might be utilized in wide going applications like re-building procedures of the indictment, insurance of IPRs, their requirement, and advancements. This paper shall confine itself to Blockchain technologies and various possibilities it offers for the IP regimes and other possible applications of Blockchain Technologies in the field of e-governance and the public good. 

Blockchain Technology: 

Blockchain technology is a decentralized, peer-to-peer network-based public, encrypted and immutable digital federated ledger system. The shared decentralized ledger is maintained by the participants themselves and does not need a third-party intervention. The technology is tamper-proof as data put into the blockchain cannot be tampered with without being noticed. It offers multidimensional utility as it can store any kind of data; be it cryptocurrency, transactional information, contractual data, design data, etc., immutability, traceability, and no third-party invention are unique attributes that make blockchain technologies an exciting proposition in today’s era, which is vulnerable to cyber-attacks on centralized systems. Blockchain technology involves the storage of information in encrypted independent blocks, which are linked using hash pointers. These hash pointers link one block to another to form a chain i.e., blockchain. These blocks are independently timestamped and contain individual transactional data. The ledger is maintained in a decentralized manner wherein no subsequent transaction is possible without the consensus of the network participants. 

Blockchain and IP: 

 A Two-Way relationship between IP and Blockchain has a dual relationship, whereby the IP system protects blockchain on one hand, and Blockchain technology can be utilized to strengthen the IP regime on the other. 

IP protecting Blockchain 

With the world getting ready to use blockchain to harness the untouched potentials of many industries, intellectual property can play a vital role in upcoming years. There has been a consistent growth in the number of entities expecting to secure patents over technology using blockchain as a base. A glance at the filing of patent applications in Blockchain technology at Indian Patent Office (IPO)2 reveals that nearly 112 applications published so far, the contribution from Indian applicants is considerably high to the tune of 39 applications. 

Blockchain Strengthening IP Regime 

A sound intellectual property system requires strong, traceable, and verifiable records of IP rights. In the present scenario, where IP records are being maintained at each IP office in silos; there is every possibility of the data not being in sync. In such a situation, ensuring the correctness of data and its continuous update poses a big challenge. With the advent of blockchain technology, IP offices across the globe can be immensely benefitted by using these technologies in maintaining their IP registers. The immutability, reliability, security, efficiency and federated features of blockchain may be used throughout the life cycle of IP rights be it registration, licensing, contractual agreements, and enforcement. Blockchain technology has the potential to be used in the following activities: 

Creation of IP  

Blockchain has immense potential in establishing evidence of first inventorship (in patents)/creatorship (in copyright)/first use in trade (in trademarks). This will not only help in identifying the rightful inventor/creator/proprietor but would also lead to minimizing a significant number of litigations. 

Transmission of Data on Blockchain while Filing for IP Rights 

The filing data maintained on blockchain will have sufficient evidentiary value to determine the rights of the first filer in a “First-to-File” regime. It also negates any possibility of tinkering with the database. 

Synchronized Search Databases 

Blockchain technology can be used to synchronize the internal as well as an external search database. This will help the patent examiners in searching the invention for anticipation by providing a single consolidated platform for patent literature. 

Record Keeping, Ledger Maintenance, and Data Verification 

 Intellectual property offices across the world maintain Intellectual Property registers either in paper form else electronically. These registers have evidentiary value in a court of law to justify the right of the holder. It also contains records of subsequent transactions of these rights. The registers can well be maintained using blockchain technology whereby ensuring the correctness of data and real-time updating of records in case of transfer of rights with due audit trails. The data verification will be much simpler as it will be tamperproof. 

Collaboration between IP Offices and World Intellectual Property Offices (WIPO) 

Blockchain having immutable/traceable features will prove to be very useful in modern schemes like Patent Prosecution Highway (PPH) while collaborating with other IP offices during the prosecution of IP applications. The information sharing with WIPO will also be easier if the data is available and maintained using blockchain technology, especially while working as International Searching Authority (ISA) /International Preliminary Examining Authority (IEPA) and/or Receiving Office (RO). 

Detecting and Preventing Counterfeiting  

When the data is maintained on the blockchain, tracking and detecting IPR violations like fake goods, parallel imports, etc, and providing evidence of genuineness would become easier. It will help to detect counterfeit goods by customs authorities thereby preventing their entry into the domestic market. The technology can find its use in preventing the sale of fake drugs in the country by tracking every step of its supply chain network 

Licensing, Contractual Agreements, and IP Rights Management 

Smart contracts enabled through blockchain technology will be immensely useful in-licensing of IP rights and related contractual agreements; as the smart blockchain contracts can help in self-monitoring terms and their due execution, real-time payment, and maintaining immutable proof of their execution, etc. IP rights management will be simplified with blockchain-based IP data since the information about both the rights and the right-holders as well as the probable and prospective users will be available on a real-time verifiable basis. 

Advantages to Micro Small and Medium Enterprises (MSMEs) 

If the information regarding enforced and expired IP rights are made available on the blockchain, it will help the MSMEs to invest their resources in the free domain without infringing others’ rights and also to use the technologies for which the IP rights have already expired. 

Better Enforcement Mechanism 

The genuineness of IP rights and their holders will help the enforcement agencies such as police, customs, excise, and judiciary to settle the IP disputes expeditiously if the IP data is made available on the blockchain. 

Blockchain Technology beyond IP 

Blockchain technologies hold promise for any field/sector which needs immutable/traceable record management. In India, apart from IP, blockchain technologies can be a game-changer in the fields of real estate record-keeping, financial record management, health sector, and insurance sector. The real estate sector needs traceable maintenance of title and its audit trail. Blockchain with its immutable record-keeping can solve a long-festering issue in Real estate/land record management. The recent cyberattacks on the centralized server-based financial system and compromise of hundreds of thousands of credit/debit card data of various national/international banks; accentuate the need for an alternative system for financial data maintenance. Blockchain offers a potential solution in this regard. Blockchain technology has the potential to transform health care by helping to set up Healthcare Information Exchanges having electronic medical records of individual patients together with their entire prescription history. Using it, not only the medical practitioners can provide personalized healthcare experience to patients but also the same records may be used in settling medical claims. Blockchain can lead to smart insurance contracts expediting the claim settlement and minimizing fraudulent cases. Further, it may be used in creating a seamless smart ecosystem in the insurance sector be it travel, crop, property, or health insurance. 

Government Initiatives in India on Blockchain 

In the recent past, the Government of India has shown keen interest in transforming its economy into a digital economy. Various steps have been undertaken by the government to adopt and enhance the use of the latest technologies. As a premier think-tank of the Government of India, National Institution for Transforming India (NITI) Aayog provides critical knowledge, innovation, and entrepreneurial support to the country. It is exploring the use of blockchain and Artificial Intelligence (AI) in diverse areas such as education, healthcare, agriculture, electricity distribution, and land records. Further, NITI Aayog has released a discussion paper on National Strategy for Artificial Intelligence in June 2018 which envisages establishing a decentralized data marketplace that is based on blockchain technology.4 Apart from laudable initiatives from Union Government, State Governments have also shown their enthusiasm in adopting blockchain technologies for digital transformation in governance. States like Maharashtra,5 Andhra Pradesh,6 Telangana,7 Karnataka8, and Kerala9 are exploring the possibilities to use distributed ledger technologies for their e-governance initiatives. National Association of Software and Services Companies (NASSCOM), the apex body for the IT-BPM industry in India, has recently signed a pact with a blockchain research institute to evangelize the blockchain ecosystem in India. 

Conclusion 

Blockchain technology has immense potential to cater to the needs of its own IP offices across the globe. The sooner IP offices adopt this technology into their day-to-day activities; it will yield better results in terms of faster examination, reliable record management, smart licensing, and contractual agreements. The technology will not only help improved prosecution but also prove useful in the enforcement of IP rights and settlement of IP infringement disputes. Though Blockchain has enormous potential to offer, there are certain restrictions in terms of security, network size, speed, growth rates, and transaction rates. Time and again apprehensions have been raised about the possibilities of choking of blockchain-enabled network/ system in case of a huge number of transactions within a fraction of time. These challenges need to be addressed effectively to reap the fullest benefit of the blockchain technology 

 

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