Prof Kirti Kumar Mehta, a visiting professor of Fribourg Graduate Law School, Switzerland, observed that product and process innovations are indispensible for the growth and development of the economy.
Delivering the Distinguished Lecture on 'IP Protection, Innovation and Anti-Trust Enforcement’, organised by Administrative Staff College of India (ASCI) at the India International Centre, New Delhi, on 23rd February 2017, he said: "These innovations are outputs of Research and Development efforts of firms. Competition among firms plays major role in innovation because it is the force of competition rather than the monopoly that accounts for the pace of innovation."
The Lecture was sponsored by the Delegation of the European Union to India under a project, titled: Capacity Building Initiative in the Competition Area Under Trade Development Programme in India. This lecture was the third lecture in a Distinguished Lecture series under the aegis of this project.
Prof. Mehta focused on the relative importance and roles of two forces that generate innovation by firms: Competition between firms on one hand, and IP protection on the other. Considerable theoretical and empirical evidence suggest these two forces as providing and intensifying the incentives for firms to innovate in products and processes. Patent Rights and Competition laws are distinct regulatory regimes with similar objective for encouraging dynamic efficiencies hence the interface between two set of laws. In European Union competition laws intervenes only when owners of patent rights conclude agreements beyond the substantive scope of the rights granted by the patent regime. Competition law cannot be used to question the patent rights per se. Hence, patent rights and competition law regimes play a complementary role in enhancing competition in the market place and thereby facilitate innovation.
A researcher in the Centre for Economic Analysis and Management (CREA) at Luxembourg University and a former Cartels Director in the Directorate General for Competition in the European Commission, Prof. Mehta emphasized that if aside from Intellectual Property protection, competition between firms is a significant driver of innovation, then it is imperative to evaluate and act on two important implications: firstly, the need for effects –based and pro-innovation Antitrust enforcement to combat anticompetitive exclusionary conduct in the sectors concerned. Secondly, given the importance of IP protection for innovation by firms, Antitrust enforcement policy needs to take that into account, if only to ensure that incentives for IP licensing and in particular competition in licensing remains vigorous.
Mr. R.H. Khwaja, Director General, ASCI, in his opening remarks, said that because of the nature of competition in markets characterized by intellectual property, there is a tendency to drift toward single-firm dominance and even monopoly. The exclusionary rights granted by intellectual property protection, coupled with trends toward standardization due to network effects, threaten to diminish market competition. He also spoke about the fact that the TRIPS Agreement remains a cornerstone of the international effort to enforce minimum standards of IP protection/maintain appropriate incentives for innovation/technological diffusion and prevent free riding.
Dr. Ashita Allamraju, Team Lead of the project, elaborated the activities of the project in her welcome address.
Senior officials in government, eminent academicians and resource persons from think tanks and policy research institutes attended the lecture. Mr Ashok Chawla, Chairperson, TERI, Mr Rajeev Kher, Member COMPACT and Mr M M Sharma, Partner VaishLaw were among the distinguished persons who attended the lecture. Representatives from the following organisations were among participants.