202112.29
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Current Scenario of Artificial Intelligence and patent protection in India

Artificial intelligence is the ability of a computer or a robot to perform tasks commonly associated with intelligent beings or humans. This includes the ability to reason, make decisions and generalize based on data processing using algorithms. The pre-programmed computer can analyze data by studying the repeat patterns of human behavior and do intuitive thinking, also called machine learning. AI-powered by Apple’s Siri, Amazon’s Alexa, IBM Watson, Music, and video streaming services recommend songs and playlists. Speech recognition, chatbots, virtual assistants in messaging applications, Self-driving cars, automated stock trading are practical examples of machine learning. AI and machine learning are no longer new to India and have penetrated almost every industry. It is impossible to think of technology in any area, e.g., health sector, Communication, Food sector, Electronics, Software, Environment, Education, and transportation, without being equipped with Artificial Intelligence (AI). As per AI and Analytics start-up investment study for 2020-2021, the Indian AI market is valued at $7.8 Bn as of July – August 2021. This represents a 22% increase in the size of the market over 2020.

Given the significance of AI globally and in India, it would be prudent to understand the legal framework of AI and machine learning. The article analyzes current trends in artificial intelligence (AI) inventions, their patentability, and laws surrounding the protection of AI inventions in India.

AI ecosystem in India – current trends

According to the latest Government AI Readiness Index (Oxford Insights and IDRC, 2020), India has the fourth-highest number of technology unicorns after the USA, China, and the UK, and the third-highest market value for technology companies in the Forbes Global 2000, demonstrating India’s strong interest in the adoption of AI. The Government of India has taken various initiatives to promote the implementation of AI by releasing the national policy on Artificial Intelligence (AI). One of those is the “National Strategy on AI,” which was announced by the National Institute of Transforming India (NITI) Aayog (an apex think-tank of the government) in 2018. The Ministry of Finance sanctioned a budget of INR 7,000 Cr (USD 945 Mn) by for the period (2019- 20 to 2024-25)7 to NITI Aayog for the creation of a cloud computing platform called AIRAWAT (AI Research, Analytics, and knowledge Assimilation) and research institutes and set up a high-level task force to oversee the rollout and implementation of AI in the country. According to Worldwide Artificial Intelligence Spending Guide Forecast, India’s AI spending will grow to USD 880.5 Mn in 2023 at a compound annual growth rate (CAGR) of 30.8 percent (IDC, 2020).

The Data from Stanford AI Index 2021, published by arXiv discloses a steep increase in the publications from Indian Researchers on AI-related topics from 2015 to 2020.

The statistics indicate the Indian government’s commitment and efforts in promoting AI in the country. However, as per the UK-based consultancy Oxford highlights survey, India still ranks at number 40 in the AI readiness index compared with its global counterparts due to certain factors, including privacy and transparency.

Unifying AI ecosystem

The Indian government has set up a central knowledge hub/portal on artificial intelligence to create a unified AI ecosystem. The INDIAai portal driven by the Ministry of Electronics and Information Technology (MEITY), National e-Governance Division (NEGD), and National Association of Software and Service Companies (NASSCOM) and has released their report highlighting that:

  • more than 70% of the technology patents filed in India relate to one or more emerging technology domains. At an international level, the patent filing grew by 4% in the year 2020. Interestingly, AI accounts for 6% of all emerging tech patents in India.
  • India is emerging as a key destination for AI innovation: Innovation in AI has gained significant traction over the last decade as India is ranked 8th in terms of AI patent filing and 4th in terms of AI research papers
  • Over 5,000 AI patents filed over the last decade in India- 94% of them filed in the previous five years
  • 60%+ of patents filed originated in India
  • Consumer Electronics/ Personal Computing Devices and Healthcare were leading vertical focus areas
  • With a 93% share, Machine Learning was the most popular AI technique; Computer Vision, with a share of 36%, was the leading functional area
  • Among assignees, the Technology sector leads AI patents with a share of 47%
  • AI patent filings in India will maintain an upward trajectory, driven mainly by the growing importance of patent filing and protecting intellectual property. However, the filing will continue across diverse application areas
  • India’s AI success story can face challenges if adequate financial support, effective policies, and mentorship are not laid out for start-ups.

Overall, the policy-level initiatives by (MeitY) and programs around AI by NASSCOM and Defence Research & Development Organization (DRDO) have laid the groundwork for future disruption and created a roadmap for AI in India.

Intellectual property rights in technologies based on AI

The Inventions/ technologies based on Artificial Intelligence are examined similarly to that of Computer-related Inventions (CRI) in India. The Inventions should qualify the requirements of Section 3 (k) of the Indian Patent Act, which restricts computer program patentability per se. There have been concerns over the correct interpretation of Section 3(k) not to extend the same to all computer-related inventions. In today’s digital world, most inventions are based on computer programs; therefore, denying protection to them would discourage innovation. In a writ petition filed at the Delhi High Court (DHC) challenging the IPAB’s decision refusing patent to Ferid Allani on a “method and device for accessing information sources and services on the web”, the DHC has laid down the following criterion patentability of Computer related inventions: (WP (C) 7/2014 & CM APPL. 40736/2019)

Section 3(k) has a long legislative history and various judicial decisions have also interpreted this provision. The bar on patenting is in respect of `computer programs per se….’ and not all inventions based on computer programs. In today’s digital world, when most inventions are based on computer programs, it would be retrograde to argue that all such inventions would not be patentable. Innovation in the field of artificial intelligence, blockchain technologies and other digital products would be based on computer programs, however the same would not become nonpatentable inventions – simply for that reason. It is rare to see a product which is not based on a computer program. Whether they are cars and other automobiles, microwave ovens, washing machines, refrigerators, they all have some sort of computer programs in-built in them. Thus, the effect that such programs produce including in digital and electronic products is crucial in determining the test of patentability.”

The above decision concluded that the innovation in Artificial Intelligence would be judged based on “technical effect” and “technical contribution”. Therefore, if the technologies can solve a technical problem through technical means, it will be eligible to be considered for grant of a patent.

Ownership of AI inventions/intellectual property:

Under Indian Patent Act, a person or assignee of that person or legal representative of any deceased person is entitled to apply for patents under section 6. The definition of “person” as defined in the Indian Patent Act includes “Government”. Thus, either the natural person or government can file the patent. However, there is no reference to the machine being named as an Inventor of a patent. Therefore, it is unclear who owns the intellectual property rights in an invention or creation originating from the AI. Until the law is amended to include machines as inventors, the parties will need to rely upon robust contracts with clear clauses on ownership. In case of disputes, the courts will decide conflicts based on the circumstances of the case and agreement between the parties. Currently, there are no decisions from the courts related to ownership of IP rights in AI inventions.

However, the Indian Copyright Office has accepted and registered a copyright application for a painting titled “Suryast” created by an AI painting app (RAGHAV) and a person. As per the published facts, the painting was created by the AI painting application (RAGHAV) based on Vincent van Gogh’s painting “Starry Night” and a picture captured by Mr. Ankit Sahni, who was the owner of the AI painting application (RAGHAV).

Liabilities for the act of AI

The legal liabilities in the case of resulting IP based on AI remain unclear, considering that the AI invention is the result of the combination of inputs/instructions from the programmer and the decision taken by the AI-based on the user’s inputs. At this time, the subject is being highly debated across the world on who owns the liability in case of any wrongful acts of the AI. As AI does not have a legal personality, thus, the question remains valid that how can it be imposed for any infringement or how would the damages be assessed. E.g. accidents caused by driverless cars. The UK Department for Transport has proposed new two-way insurance policies that cover autonomous vehicle insurance. If the car is in driverless mode, the insurance companies can recover claims from the party responsible for the crash, vehicle manufacturer, or technology/software company. Few other countries are implementing similar changes to their current regulations keeping the AI-driven businesses in mind.

Challenges to AI:

  1. Data is one of the primary drivers of AI solutions, and thus appropriate handling of data, ensuring privacy and security, is of prime importance. There are challenges in the implantation of AI-equipped technologies related to Data privacy, including concerns relating to data usage without consent, risk of identifying individuals through data, etc. India currently does not have a specific privacy law to safeguard personal data. There are provisions under the Information Technology Act of India that cover some of the issues related to data collection, usage, retaining, and disclosing of the personal data of individuals and require them to have a privacy policy. However, such regulations are not comprehensive, and there is a dire need for a special law. The Personal Data protection bill (PDPB) modeled on the General Data Protection Regulation (GDPR) protects personal data. However, the law is yet to see the light of the day. In the absence of a dedicated law governing personal data, the contracting parties would look at the terms and conditions of the Contract and privacy policies in case of any disputes.
  2. Expertise and skill development: Other factors need to be addressed for comprehensive and better implementation of AI technologies like lack of enabling data ecosystems, Inadequate availability of AI expertise, human resources, and skilling opportunities, high resource cost, and low awareness for adopting AI in business processes. The public and private sectors need to train the workforce with multidisciplinary skills to make them AI-ready. While there are concerns that AI will take away jobs, AI can generate new employment opportunities where humans and artificial intelligence can work together to make human lives more comfortable with appropriate skill development.
  3. Ethical Issues: With the advent of AI products and algorithms and their increasing role in daily lives, ethics and morality have emerged as significant challenges for AI solution providers. The ethical considerations for every industry can be different.  E.g., the safety and security of confidential information is an essential requirement in the Healthcare and finance industry. Clear regulations must be in place to address ethical standards for broader cultural acceptance and trust in AI solutions.

What Next?

While India is noticeably investing in implementing AI in every industry, the laws need to keep pace with the fast-changing technologies. The Department-related parliamentary standing committee on commerce reviewed the Intellectual Property Rights Regime in India and presented their report to both the parliament houses on July 2021, laying the significance of AI. The Committee recommended that a separate category of rights for AI and AI related inventions and solutions should be created for their protection as IPRs. It further suggests that the Department review the existing legislation of The Patents Act, 1970 and Copyright Act, 1957 to incorporate the emerging technologies of AI and AI-related inventions in their ambit. It further suggested following the approach linking the mathematical methods or algorithms to a tangible technical device or a practical application for facilitating their patents as being done in the EU and US.

Summary:

Artificial intelligence continues to evolve globally and is expected to revolutionize the existing process and technologies. At this time, when India needs to revitalize productivity and growth to fulfil aspirations of its growing population, AI promises to fill the gap. To fully seize the opportunities provided by the AI revolution, foster economic growth, and improve lives through it, multiple stakeholders need to work together to develop a responsible AI ecosystem. Further, a reliable legal and regulatory framework, skilled AI-ready workforce, strong research & development will help attract people’s confidence and investment into this promising area.   With the right strategy, policies, and regulations in place, India’s AI journey has the potential to lead to a brighter future.

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