A Study on Compulsory Licensing Under

Copyright Law

PROJECT REPORT ON-

“intellectual property rights”
SESSION: 2018-2019

SUBMITTED TO: SUBMITTED BY:

Dr. Harman Shergill Devanshu Goyal

UILS, PU, CHANDIGARH Roll No: 12/14

B.A.L.L.B (Hons.)

Section: - A

10th Semester;5rd Year

UNIVERSITY INSTITUTE OF LEGAL STUDIES

PANJAB UNIVERSITY, CHANDIGARH

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 ACKNOWLEDGEMENT

I wish to convey my greatest appreciation to DR. Harman Shergill a professional professor and
a great mentor, who challenged and organized my thoughts and helped convert them to the
written words.

I desire to thank deeply the professionals at the UNIVERSITY INSTITUTE OF LEGAL

STUDIES, PANJAB UNIVERSITY, CHANDIGARH, for their initial faith and
encouragement that I submit my project report.

I am indebted to MY MOTHER, MY FATHER and other family members for providing

models of kindness and decency.

My greatest debt, however, is reserved for THE ALMIGHTY for providing me with everything
in life.

DEVANSHU GOYAL
Roll No.- 12/14
***
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 TABLE OF CONTENTS

1. Introduction 4

2. Meaning and Need of copyright 4

3. Licensing 6

4. International convention on copyright 8

5. Compulsory license under Indian copyright act 11

6. Conclusion 14

7. Bibliography 15

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INTRODUCTION

Copyright is a right given by the law to creators of literary, dramatic, musical and
artistic works and producers of cinematograph films and sound recordings. It is a
bundle of rights including, inter alia, rights of reproduction, communication to the
public, and translation of the work. The only criterion to determine whether a
person is entitled to copyright protection is originality in expression. 1 Copyright is
a kind of intellectual property the importance of which has increased enormously
in recent times due to the rapid technological development in the field of printing,
music, communication, entertainment and computer industries.

In India the first Copyright Act was passed in 1914. It was a replica of the English
Copyright Act of 1911. The Act, presently in force was legislated in the year 1957
and is known as Copyright Act, 1957, as amended by Copyright (Amendment)
Act, 1999. Consequent upon India signing the GATT and entering the global
market economy, a number of changes have been made in the Copyright Act of
1957 by the Amending Act of 1999, to give effect to the obligations arising from
the signing of the GATT and to make Indian Law more in line with the present law
in many developed countries.

MEANING AND NEED OF COPYRIGHT

The term “copyright” is not defined under the Indian Copyright Act, 1957. The
general term copyright refers to the “right to copy” which is available only to the
author or the creator, as the case may be. Thus, any other person who copies the
original work would be amount to infringement under the Copyright Act.
Copyright ensures certain minimum safeguards of the rights of authors over their
creations. In the case of Garware Plastics an Polyster Ltd., Bombay v. M/s.
Telelink,the Bombay High Court observed that Copyright Act is meant to protect
the owner of the copyright against unauthorized performance of his work, thereby
entitling him monetary gain from his intellectual property.” Creativity being the
keystone of progress, no civilized society can afford to ignore the basic
requirement of encouraging the same. Economic and social development of a
society is dependent on creativity.
The protection provided by copyright to the efforts of writers, artists, designers,
dramatists, musicians, architects and producers of sound recordings,
1
Dr. M. K. Bhandari, Law Relating To Intellectual Property Rights 149( Central law publications, Allahabad,2 ndedn.,
15

2010)
cinematograph films and computer software, creates an atmosphere conducive to
creativity, which induces them to create more and motivates others to create. On
the other hand, what is created by him/her cannot be claimed ownership for
generations all together as it might harm the social justice. Therefore, a term of life
plus sixty years is being adopted in India for the purpose of determining the period
of copyright. This period may vary from country to country. If copyright protection
is applied rigidly, it can hamper progress of the society. Therefore, copyright laws
are enacted with necessary exceptions and limitations to ensure that a balance is
maintained between the interests of the creators and of the community.2
WORKS UNDER COPYRIGHT

Section 13 of copyright act Copyright includes literary works such as novels,

poems and plays, films, musical works, artistic works such as drawings, paintings,
photographs and sculptures and architectural designs. Rights related to copyright
included those of performing artists in their performances, produces of
phonograms and those of broadcasters in their radio and television programs.
1. Literary works (including computer programmes, tables and compilations
including computer literary data bases)
2. Dramatic works
3. Musical works
4. Artistic works
5. Cinematograph films
6. Sound recordings.
In the case of Sulmanglam R. Jayalakshmi v. Meta Musica., “ the Madras High
Court held that “the right which a person acquires in his literary or artistic work
which is the result of his intellectual labour is called his “copyright”.

The copyright of foreign works is also protected in India. Copyright of nationals of

countries who are members of the Berne Convention for the Protection of Literary
and Artistic Works, Universal Copyright Convention and the TRIPS Agreement
are protected in India through the International Copyright Order, as if such works
are Indian works. Copyright as provided by the Indian Copyright Act is valid only
within the borders of the country. To secure protection to Indian works in foreign
countries, India has become a member of the following international conventions
on copyright and neighbouring (related) rights:
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2
http://copyright.lawmatters.in/2010/05/non-voluntary-copyright-licences.html visited on April 10, 2017
a. Berne Convention .
b. Universal Copyright Convention.
c. Trade Related Aspects of Intellectual Property Rights (TRIPS) Agreement.3

LICENSING:
The copyright owner may grant a license and transfer some or all of his rights to
others to exploit his work for monetary benefits. A license is different from an
assignment as licensee gets certain rights subject to the conditions specified in the
license agreement but the ownership of those rights is not vested with him while in
case of an assignment the assignee becomes the owner of the interest assigned to
him. A license may be exclusive or of non-exclusive.4

Voluntary Licensing: The owner of the Copyright in any existing or future work
may grant any interest in the work by way of license. As regards the future works
the license shall take effect only when the works comes into existence. For a
license to be valid it must be in writing and signed by either the owner or his duly
authorized agent. And where a person to whom a license relating to copyright in
any future work dies before the work comes into existence, his legal representative
shall be entitled to the benefit of the license.

A License Agreement generally contains the following particulars:

1. Identification of the work licensed

2. Duration of the license
3. Territorial extent of the license
4. Amount of royalty payable
5. Conditions relating to revision, extension and/or termination of license
6. Any dispute in respect of the license shall be settled by the Copyright
Board or by way of Arbitration.
7. Allowability of sub-licensing etc.5

If the licensee does not exercise his right licensed to him within one year from the
date of license in respect of such rights it will be deemed to have lapsed after the

3
T. G. Agitha , “International Norms for Compulsory Licensing and the Indian Copyright Law” 15 TJWIP 26(2012)
4
Dr. B. L. Wadehra, Law Relating To Intellectual Property 132( Universal Law Publishing Co., 4 thedn., 2007)
15

5
Ibid
expiry of one year. If the period of license is not stated it will be deemed to be 5
years from the date of granting license.
Compulsory Licensing:Compulsory license is the term generally applied to a
statutorily license to do an act covered by an exclusive right, without the prior
authority of the right owner. Where an exclusive right is granted, but the statute
allows a user, without the prior permission of the right owner, to carry out acts
covered by the right upon completion of certain procedures, possibly including
payment of royalties, a compulsory or statutory license is said to exist.

It has long been recognized that restrictions or limitations upon authors, and
related rights may be justified in particular cases. Thus, at the outset of the
negotiations that led to the formation of the Berne Convention in 1884, the
distinguished Swiss delegate NumaDroz stated that it should be remembered that
“limits to absolute protection are rightly set by the public interest.” In
consequence, from the original Berne Act of 1886, the Berne Convention has
contained provisions granting latitude to member states to limit the rights of
authors in certain circumstances. In keeping with this approach, the present
international conventions on authors’ and related rights contain a mixture of
limitations and exceptions on protection that may be adopted under national laws.
One of such limitation is:

“ allowing a particular use of copyright material, subject to the payment of

compensation to the copyright owner.” These are usually described as
“compulsory” or “obligatory licenses,” and specific dispositions permitting them
are found in Articles 11bis(2) and 13, and the Appendix of the Paris Act of Berne.6

In case of compulsory licensing, the author’s rights continue to be protected but are
significantly abridged: public interest still justifies the continuance of the use,
regardless of the author’s consent, but subject to the payment of appropriate
remuneration

Compulsory Licensing And International Copyrights Regime

1. BERNE CONVENTION
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6
Supra Note 3
The Berne Convention for the Protection of Literary and Artistic Works is an
international treaty that refers to the concept and necessity of providing for an
international copyright regulations and statutes. The Berne Convention was
developed by Victor Hugo and was accepted and enacted into legislation in 1886 in
Berne, Switzerland, which lends the convention its name.
The inception of the Berne Convention was born out the necessity for the ability of
copyright legislation and regulations to be able to be interpreted and applied at an
international level, and most importantly, between countries. Before the
Convention, countries would often refuse to recognize foreign copyright of works,
and reproduced and distributed such works freely. Many countries had and still
have their own legislation regarding copyrights and wanted to impose their native
laws upon those works on foreign soil. An all-governing international law was
needed to regulate such instances and protect the copyrights of works and materials
and their respective authors or owners.7
Berne Convention would have its core three basic principles regarding the
regulation of international copyright laws and protection. These basic principles
are modeled on the basis of simplicity and minimal restrictions, so as to be adhered
to without incident by all of the nations or countries in accordance with the
Convention.

 The first principle is basically that all countries will respect foreign copyrights
and treat them as they do with their national copyrighted works.

 The second states that copyrights are inherent based on the creation of work and
are not subject to registration or application for copyright to be for those rights and
protection to be recognized.

 The third simply provides for an explanation regarding a term of protection

instituted by the Convention.
Aside from the three basic principles, the Berne Convention delineates basic rights
to be observed of all copyrighted material and their authors or owners.

An author from any country that is a signatory of the convention is awarded the
same rights in all other countries that are signatories to the Convention as they
allow their own nationals, as well as any rights granted by the Convention.

7
www.copyrightservice.co.uk/copyright/p14_universal_copyright_convention
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The Convention also sets out a minimum duration that copyright will apply in
various types of work.
Indian Legal Position vis- `a-vis TRIPS Agreement and Future Requirements

India, being a developing country and party to the Berne Convention, has
incorporated provisions in the Copyright Act, 1957 for the grant of compulsory
licences pursuant to the special provisions laid down in Berne Convention for the
developing countries. The Act provides for the grant of compulsory licences in
Indian Work in the public interest in some limited circumstances.8

Non Voluntarily Licensing Is Introduced Mainly Because Of The Two Main

Reasons-

1) When it is difficult to locate the right owner of the copyright work and get
the individual license from him.
2) To avoid the making of monopoly of the copyright owners. Such licensing
ensures public dissemination and authors' compensation and market failure-
high transaction costs .

Distinguishing Compulsory Licensing From Statutory Licensing

There is no specific difference as such between statutory licensing and compulsory

licensing. In many jurisdictions both the terms are used interchangeably. However
the Indian copyright law tries to make a distinction between the two in the sense
that under compulsory licensing the rate of royalty is left to be negotiated by the
parties but in statutory licensing the rate of royalty is decided by the Copyright
Board . In this form of statutory licensing permission is not required before using
someone else’s intellectual property, provided that a fee is paid. Licence is created
by statute and not the copyright owner nor the user.

2.The Universal Copyright Convention (UCC)

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8
Supra Note 3
The Universal Copyright Convention (UCC), was first created in 1952 in Geneva,
as an alternative to the Berne convention The developments in Latin America
explain the need perceived in the mid 1940’s for another multilateral treaty on
author’s rights in addition to the Berne Convention - a need perceived although the
Berne Convention had just proved its dynamics by its then latest. revision of 1948.
Indeed, international relations in the field of copyright in the first half of the
twentieth century were not truly universal but split between major parts of the
world.
While the Berne Convention was centered on Europe, other multilateral treaties
had developed in parallel in the America’s to govern relations among most North
and South American countries. At the same time, most American countries were
not members of the Berne Convention because they were not ready to comply with
its comparatively high level of minimum standards. This development towards a
split into two separate international protection systems contradicted the
fundamental aim of the Berne Convention to achieve international protection
universally. The idea of a convention that should overcome this split was born.

Terms of the Convention

The convention details the following points .:

 Contracting states provide the same cover to foreign published works as they
do to their own citizens.
 States that require formal registration should treat works from foreign states
that are signatories of the convention as though they had been registered in
the state, provided that they carry a notice which includes the © symbol and
states the name of the owner.
 It sets a minimum duration for copyright protection as 25 years from the
date of publication, and typically not less that 25 years from the authors
death. With a notable exception of photographic and applied arts work
which has a minimum protection of 10 years.
 It recognises the economic rights of the author, (the right to authorise
reproduction, public performance, broadcasting etc.)
 It recognises the authors right to make translations of the work.

Compulsory Licensing under Indian Copyright Act, 1957

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Sec 31. Compulsory License In Works Withheld From Public.-

(1) If at any time during the term of copyright in any Indian work which has been
published or performed in public, a complaint is made to the Copyright Board that
the owner of copyright in the work-

(a) has refused to republish or allow the republication of the work or has refused
to allow the performance in public of the work, and by reason of such refusal the
work is withheld from the public; or

(b) has refused to allow communication to the public by of such work or in the
case of the work recorded in such [sound recording], on terms which the
complainant considers reasonable;

the Copyright Board, after giving to the owner of the copyright in the work a
reasonable opportunity of being heard and after holding such inquiry as it may
deem necessary, may, if it is satisfied that the grounds for such refusal are not
reasonable, direct the Registrar of Copyrights to grant to the complainant a license
to republish the work, perform the work in public or communicate the work to the
public by [broadcast], as the case may be, subject to payment to the owner of the
copyright of such compensation and subject to such other terms and conditions as
the Copyright Board may determine; and thereupon the Registrar of Copyrights
shall grant the license to the complainant in accordance with the directions of the
Copyright Board, on payment of such fee as may be prescribed.

Parameters For The Grant Of Compulsory Licence

The Copyright Board must take into consideration the following parameters:

 The work in question has been published or performed in public.

 The owner of copyright/ sound recordings has refused to republish or allow
the republication of the work or has refused to allow the performance in
public of the work, and by reason of such refusal the work is withheld from
the public
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  The owner of copyright has refused to allow communication to the public by
of such work or in the case of the work recorded in such [sound recording],
on terms which the complainant considers reasonable.

Thus the inherent objective behind the section is to provide for the mechanism
whereby for the purpose of public good the works which have been copyrighted
cannot be monopolized and the license to use such works is allowed to any person
who is genuinely interested to pay the reasonable amount for that work bur is not
allowed due to the monopolistic tendencies of the copyright holder.9

In the case of Phonographic Performance Limited v. Millineum Chennai

Broadcast (P) Ltd,10it was held in the view of section 31(2) compulsory licenses
could be granted to more than one broadcasters. If a compulsory license is granted
only once covering every single part of the country, the same cannot be lead to a
conclusion that no other person can approach the Board. Hence, grant of license
cannot be said to be limited to one person. Giving a purposive construction it can
be stated that compulsory license can be issued to more than one broadcaster after
proper consideration of each case.
Section 31A.Compulsory license in unpublished Indian works.-

Where, in the case of an Indian work is unpublished ,than any person may apply to
the Copyright Board for a license to publish such work or a translation thereof in
any language. Which is made in such form as may be prescribed and shall be
accompanied with a copy of the advertisement issued under sub-section (2) and
such fee as may be prescribed.

Where an application is made to the Copyright Board under this section, it may,
after holding such inquiry as may be prescribed, direct the Registrar of Copyrights
to grant to the applicant a license to publish the work or a translation thereof in the
language mentioned in the application subject to the payment of such royalty and
subject to such other terms and conditions as the Copyright Board maydetermine,
and thereupon the Registrar of Copyrights shall grant the license to the applicant in
accordance with the direction of the Copyright Board.

9
V K Ahuja, Law Relating To Intellectual Property Rights 99( Lexis Nexis, Delhi, 2 ndedn., 2016)
15

10
(2008(37) PTC 353 (SC)
32A. REPRODUCTION AND PUBLICATION OF WORKS FOR CERTAIN
PURPOSE

.Where , after the expiration of the relevant period from the date of the first
publication of an edition of a literary, scientific or artistic work,--

(a) the copies of such edition are not made available in India; or

(b) such copies have not been put on sale in India for a period of six months, to the
general public at a price reasonably related to that normally charged in India for
comparable works by the owner of the right of reproduction or by any person
authorized by him in this behalf,

any person may apply to the Copyright Board for a licence to reproduce and
publish such work.

2. Where an application is made to the Copyright Board under this section, it may,
after holding such inquiry as may be prescribed, grant to the applicant a licence,
not being an exclusive licence, to produce and publish a reproduction of the work
mentioned in the application subject to the conditions that,--

(i) the applicant shall pay to the owner of the copyright in the work royalties in
respect of copies of the reproduction of the work sold to the public as decided by
the Board

(ii) a licence granted under this section shall not extend to the export of copies of
the reproduction of the work outside India and every copy of such reproduction
shall contain a notice that the copy is available for distribution only in India

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 CONCLUSION
Knowledge and information, economically exploited as intellectual property are
replacing the more traditional, material elements of production as the primary
engine of economic growth. . It is influenced by the ingenuity, creativity, and
innovative ability of a nation. Converting these resources into tangible economic
assets requires an effective and efficient intellectual property system.
1. The ultimate goal of copyright is the cultural enrichment of society.

2. If society cannot benefit from the author’s work in a satisfying degree –

because the author charges excessive prices – this would disturb the mutual
exchange between them. This could justify the authorization of third parties
to reproduce the copyrighted materials without the author’s consent.

3. However, in order to preserve incentive for authors the exception should be

limited to what is absolutely required in the public interest.

4. This requires a delicate balancing test between the competing interests of

the public and the author.

5. The strict laws of copyright, with a limited set of exceptions, just do not fit
the digital era where everything digital transaction results in a bytes being
copied. We need to take a much more thoughtful approach to rationalizing
copyright:

If we don’t take such measures soon, we will all have to be prepared to be treated
as criminals for all our lives. Thus, by having no provision of compulsory licenses,
there was a virtual monopoly of the rights holder and what was happening was
exactly reverse of this. Thus, the provisions of compulsory license were introduced
in the statute book.
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 BIBLIOGRAPHY

 T. G. Agitha , “International Norms for Compulsory Licensing and the

Indian Copyright Law” 15 TJWIP 26(2012)

 Dr. B. L. Wadehra, Law Relating To Intellectual Property 132( Universal

Law Publishing Co., 4thedn., 2007

 Dr. M. K. Bhandari, Law Relating To Intellectual Property Rights

149( Central law publications, Allahabad,2ndedn., 2010)

 K Ahuja, Law Relating To Intellectual Property Rights 99( Lexis Nexis,

Delhi, 2ndedn., 2016)

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