The Centre has decided that there is no need to issue additional guidelines for the issue of compulsory licences as the existing legal framework is comprehensive.  

The question of whether guidelines need to be framed for the issue of compulsory licences has been carefully considered by the central government. Articles 31 of the TRIPS Agreement sets out the requirements for the issuance of compulsory licences by a WTO member state. The framework of the Indian Patents Act and Rules fully meets all these obligations and provides adequate guidance for the issue of compulsory licences. The circumstances of application of each of the relevant sections will depend upon the facts of each case, a government communique said.

Earlier in August 2010, the Department of Industrial Policy and Promotion (DIPP) had issued a Discussion Paper on Compulsory Licencing of Patents. The effort was to explore the scope of provisions under TRIPS for compulsory licensing, since there were rising concerns over the availability and affordability of medicines in the backdrop of increased acquisition of Indian pharma companies by MNCs, the marketing tie ups between the both and the decline in domestic sales of companies even as there was growth in sales of drugs in Indian industry.

The discussion paper was issued to discuss various related issues, including whether there is a requirement of guideline for compulsory licensing and whether the licenses should be issued under Section 92, and 92A of Patents Act 1970 as amended in 2005 where the controller invokes the provisions in case of emergency either following a notification from the central government or to export to another country in case of insufficient supply of the particular medicine to that country.

The Department received 38 responses, 10 of these responses were received from stakeholders based in countries outside India including Thailand, South Africa, USA , UK and Japan and 11 responses were received from pharma manufacturers associations, and business promotions councils/chambers. Fourteen were received from other stakeholders including academics and NGOs.

After studying the responses carefully, the government decided that there is no need to issue additional guidelines for the issue of compulsory licences as the existing legal framework is comprehensive.

However, to ensure that the power to grant CLs is exercised with due care and caution, the Controller General of Patents has been advised not to delegate this power to any subordinate authority. He has also been requested to ensure that all CL applications are decided promptly.

In addition, the Controller General has been advised to ensure prompt and effective compliance with all the reporting requirements of patentees stipulated in the Patents Act.  In his Annual report to the government, the Controller General has been requested to specifically review the data received from patentees under Section146 of the Patents Act.