Legal & Regulatory
By Tracie Frost
India recently released a new national intellectual property rights policy which seeks to enhance Prime Minister Narendra Modi’s Make in India scheme by boosting innovation. The policy, which comes at an important time for U.S.-India relations, has been widely criticized in the Indian press.
India currently ranks 37 out of 38 countries in the United States Chamber of Commerce (USCC) Global Intellectual Property Chamber Index. Based on 30 indicators spread across six categories – patents, copyrights, trademarks, trade secrets, enforcement, and international treaties – the index gives India an abysmal score of 7.05 out of 30 possible points. The greatest concern for the USCC is an Indian rule prohibiting patents for incremental changes and India’s use of compulsory licensing provisions as a means of effectuating technology transfer. Also noted as areas of concern were a series of court rulings regarding copyright infringements, deficiency of regulations for data protection, and poor enforcement of civil and criminal remedies.
Government Considers Longer Highway Contracts to Attract Investors
The government will consider extending the tenure of contract for operation and maintenance (O&M) of highways, from the current nine years to 29 years. This includes both fresh contracts and projects where the contractor is the National Highways Authority of India (NHAI). The extended stipulated period will ease recovery of costs and boost profit margins, after which the projects will be handed over to the government. Sources placed in the government state that the Union Ministry of Road Transport and Highways and NHAI are already working together to come up with more incentives to attract foreign investors to India’s infrastructure sector.
By Siddhartha Thyagarajan & Kabir Narang
The Indian government’s attempts to ease doing business currently seem one-sided. Facilitating market entry and tearing down barriers to production and trade are just one side of the coin. The other involves allowing defunct, unhealthy firms to seamlessly exit the market, where they can easily liquidate their assets.
The current financial scenario in India makes this all the more important. Most companies and major banks’ balance sheets are riddled with NPAs (Non-Performing Assets). Bad lending practices, natural disasters, and poor credit policies also contribute to the rising number of NPAs. Due to these NPAs, mostly comprising of faulty loans and overdue debt obligations, banks become starved of incoming cash flows and therefore have to compensate by charging extremely high interest rates on some products. Bank shareholders are also adversely affected. NPAs have a profound effect on the financial scenario in an economy and are often responsible for causing liquidity crunches for major financial institutions. This in turn has a destabilizing effect on the economy.
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Customs Authority to Speed up Cargo Clearances
India’s Central Board of Excise and Customs (CBEC) is in the process of establishing a paperless system for cargo clearances. This would mean an overhaul of the existing system – one that has fostered time consuming processes requiring several different types of documentation. The new reforms are ambitious, and aim to speed up cargo clearance to within hours instead of days, by 2017.
By A&A LAW
When an outsider looks at a business, the first thing they notice is its trademark. A trademark is where the identity of a business lies. It is the name and symbol under which a business undertakes its trade and commerce, which represents the company, and under whose aegis its business is conducted. It distinctively identifies an individual or organization.
In India, trademarks are regulated by the Trade Marks Act of 1999. The Act aims to provide registration and better protection towards trademarks while preventing the use of fraudulent marks.
By Dezan Shira & Associates
Editor: Tracie Frost
The possibility of foreign law firms to open offices in India took a step forward this week when reports emerged that the Bar Council of India (BCI) drafted rules to allow foreign lawyers to practice in India. The new rules would allow foreign lawyers and law firms to set up offices in India to practice non-Indian law, after registering with the BCI and paying registration fees of US$ 25,000 for individual lawyers and US$ 50,000 for law firms. Practitioners would also be required to make security deposits of US$ 15,000 or US$ 40,000 for individual foreign lawyers and law firms.
Under proposed changes, foreign lawyers would be allowed to do all non-Indian law transactional legal work and could hire Indian lawyers or go into partnership with Indian lawyers. Under the proposed rules, foreign lawyers would be allowed to work for clients with foreign headquarters in international arbitrations held in India. However, foreign lawyers would not be allowed to provide any legal advice relating to courts, tribunals, boards or statutory authorities.
By Siddhartha Thyagarajan
India’s Union cabinet recently approved a bill that will allow several commercial establishments to operate for 24 hours a day. The Model Shops and Establishments (Regulation of Employment and Conditions of Service) Act 2016 will permit malls, shops, restaurants, banks, and cinema halls to operate on a 24/7 basis. The bill is to have a significant impact on India’s business climate, market dynamics, and employment rate.
The proposed Act will cover all premises and shops, with the exception of those covered under the Factories Act 1948. However,it should be noted that the Act is only advisory in nature. State governments can choose to accept or reject the Act and implement it accordingly. Thus, the impact on businesses will be determined by the respective state in which the business operates.