Intellectual Property laws provide substantially to both state and national economies.

In today's
competitive environment, they are necessary to provide incentive to parties to continue to both
innovateandtoimprovetheexistingstateofthings.

The digital revolution, which started in the late 1950s has completely changed the way we live. The
world has come a long way from room-sized computers totabletsthatfitintothepalmofyourhands.
Everything nowadays is digitised. And what has made this possible is the invention and the rapid
advancement of semiconductor technology. Considering the continued growthmomentum,theIndian
semiconductor design market is expected to touch US$ 14.5 billion in 2015. Whatnowneedstokeep
pace with this advancement are the laws which cover fields one wouldn't have thought of as needing
protection as little as 30 years back. India, after signing the TRIPS Agreement in 1995 has sought to
fulfil all its obligations under the said treaty and in lieu of which it enacted The Semiconductor
IntegratedCircuitsLayout-DesignAct,2000.

Chip piracy has been a problem for the industry since the early 70s. Infringing copies made atlittleto
none development cost by copyingexistingdesignsstartedfloodingthemarketandputtingtheoriginal
developers out of business. A need was then felt to protect the rights of these individuals so as to
ensure the continuity of innovation in this field which would then lead to long term gains in other
fields. The need for protection provided under the Act was felt more acutely in India because of
existing weak intellectual property protection policy for software. The existing regime proved
insufficient because of the narrow claim that existing patent and copyright laws would have provided.
Moreover, the time taken to file and get patents for integrated circuits, which contain hundreds and
sometimes thousands of semiconductors would have rendered it redundant as the their commercial
livesaresometimeslesserthanoneyear.

Under Section 7oftheAct,protectionisprovidedtoalayoutdesignexpressedinanymanner,whichis

original, which has not been commercially exploitedformorethan2yearsfromthedateofapplication
for the registration and which is inherently distinctive and capable of being distinguishable from any
other registered layout design. Any person claiming to be the creator of the layout design, his legal
representative, a person registered in the prescribed manner as a layoutdesignagentorapersoninthe
sole and regular employment of the principal, can, under the Act, apply in writing to the Registrarfor
the protection provided. Any person may, under Section 11 of the Act, within 3 months of the
publication of advertisement by the Registrar regarding the application, oppose the application by
providing a written notice and paying a fee to the Registrar, who, after hearing the parties and
examiningtheevidencewilldecidethecase.

The registration is valid for a term of ten yearsfromthedateoffilinganapplicationforregistrationor

from the date of first commercial exploitation anywhere in the world, whichever is earlier. Oneofthe
highlights of the Act is a provision for determining theroyaltiespayabletotheregisteredproprietorof
a design layout in case of an innocent or unintentional infringement. The acts of reproducing, selling,
importing and distributing of integrated circuit layout designs for commercial purposes constitute an
infringement.ThepunishmentprovidedundertheActforsuchaninfringementisimprisonmentwhich
may extend up to a period of three years, or a fine not less than fifty thousand rupees but which may
extendtotenlakhrupees,orboth.

To conclude, this Act fulfils India's obligations under the TRIPS Agreement. This initiative will be
effective in confidencebuildingintheindustryandtheinvestingcommunity.TheActcompareswellto
similar legislations enacted elsewhere in the world and sometimes goes even further. The sui generis
protection provided has brought a lot of new players to the industry as evidenced by the burgeoning
market. However what needs to be kept in mind, is that such policies should not stifle innovative
activity.