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FIG Paper (No. 34 – Data Law Series 5) Balancing Sectoral Regulation and DPDP Act Compliance by NBFCs & Fintechs

Background

Indian regulators in recent times have shown a keen interest in monitoring the intersection between data, information technology, and cybersecurity with regulated entities—more so in relation to Non-Banking Financial Companies (“NBFCs”) and ‘fintechs’. With the expected enforcement of the Digital Personal Data Protection Act, 2023 (“DPDP Act”), and the promulgation of its rules, it becomes imperative for NBFCs and fintechs to map their journey of compliance from legal and regulatory perspectives.

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‘Technical Breach’ not a contravention of Section 39 of the Patents Act?

In Selfdot Technologies (OPC) Pvt. Ltd. v. Controller General of Patents, Designs & Trademarks, [order dated November 28, 2023],the Madras High Court has adjudicated on Section 39 and 40 of the Indian Patents Act and held that the breach committed by the appellant was a technical breach and cannot be considered a contravention of Section 39 of the Patents Act, 1970, and hence cannot trigger deemed abandonment under Section 40.

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Court interprets “known substance” in respect of Section 3(d) of the Patents Act

In an important decision, Justice Senthilkumar Ramamoorthy, discussed Section 3(d) of the Patents Act, 1970.[1] The case involved a patent application no. 7096/CHENP/2015, which claimed priority from the US application number 61/815,502 dated 24 April 2013. The patent application claimed two polymorphic forms—A and B—of a compound RTA-408. Compound RTA-048 was claimed and granted in the Indian Patent Application No. 8486/DELNP/2014.[2] The patent application 7096/CHENP/2015 was refused essentially on the grounds of being not patentable under Section 3(d) of the Indian Patents Act.

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Substantial Issues in Defining “Substantially the Whole of the Undertaking”

Section 180(1)(a) of the Companies Act 2013 (“2013 Act”) requires a company to obtain prior approval by a special resolution to sell, lease or dispose of the whole or substantially the whole of the undertaking of the company or, when the company owns more than one undertaking, of the whole or substantially the whole of any of such  undertakings.

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Summary of the Draft Trade Marks (1st Amendment) Rules, 2024

The Draft Trade Marks (1st Amendment) Rules, 2024, introduced by the Department for Promotion of Industry and Internal Trade under the Ministry of Commerce and Industry, represent a strategic modification to the Trade Marks Rules, 2017. This regulatory endeavor is conducted under the delegated powers provided for in Section 157[1] of the Trade Marks Act, 1999 (“the Act”). These rules create a unified adjudication process which is carefully planned to ensure consistency. This effectively streamlines the Act’s execution by strengthening the Adjudicating Officer’s capabilities. The aim of this comprehensive approach is to optimise and refine the adjudicative framework, thereby fostering a more robust and coherent administration of trademark-related matters.

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Declaration of Dividend: Interplay of law and business dynamics

Context

The aim of any business organisation is to earn profit and distribute it among the owners. In case of a company, such distribution of profits is connoted as Dividend. The Companies Act, 2013 (“the Act”), inter alia provides for declaration of dividend out of profits. Profit here is the net profit of a company, as determined for preparing financial statements, as per the provisions of Section 129 of the Act and after complying with all the applicable accounting standards notified under Section 133 of the Act.

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Cause of action for a Writ Petition in Patent Suit stands independent of “Appropriate Patent Office” Determination under Patent Rules

In University Health Network v. Adiuvo Diagnostics Pvt. Ltd.[1], Madras High Court has held that it shall have territorial jurisdiction to entertain the writ ‘irrespective of the location of the appropriate patent office’[2], which was Delhi. At the time of filing of a patent application, “appropriate office” for that application is ordinarily frozen, i.e. decided based on the place of residence or domicile or business of the applicant(s); or where the invention originated; or based on the address of service of the applicant in India, in case of a foreign applicant.[3] Section 2(1)(r) and 74 of the Patents Act 1970 (“the Act”), Rule 4 of Patent Rules 2003 (“Patent Rules”), and Clause 3.02 of Patents Manual indicate the immense significance of ‘appropriate office’ in the process of prosecution and grant of patent application in India. For instance, all proceedings are conducted from the appropriate office, all communications related to the proceedings are addressed to the concerned appropriate office, among others.

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Purpose & Effect Test for RPTs – How should Audit Commitees navigate it?

Regulatory Context

The definition of ‘Related Party Transaction’ (“RPT”) under Regulation 2(1)(zc) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“LODR Regulations”), inter alia provides that with effect from April 1, 2023, a transaction involving transfer of resources, services or obligations between “a listed entity or any of its subsidiaries on one hand, and any other person or entity on the other hand, the purpose and effect of which is to benefit a related party of the listed entity or any of its subsidiaries,” will also be regarded as an RPT (referred to below as the “Purpose and Effect Test”).

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FIG Paper (No. 33 – Series 2): Compulsory Registration of Off-shore Virtual Digital Asset Service Providers with FIU-IND?

Recently, the Financial Intelligence Unit – India (“FIU-Ind”) has issued show-cause notices to several offshore Virtual Digital Asset Service Providers (“VDASP”) for non-compliance with  provisions of the Prevention of Money Laundering Act, 2002 (“PMLA”) and for non-registration with the FIU-Ind, post amendment to PMLA on march 07, 2023, while catering to the Indian customers and operating in the Indian market.

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Permissibility of Pledges: Decoding SEBI’s View

The efficiency of the securities market depends on equal access to information and ensuring information symmetry for all stakeholders. Many Indian listed entities have significant promoter/ promoter group shareholding, which gives them the advantage of asymmetrical access to unpublished information. For free and fair trade in the financial market, a level-playing field between the promoter/ promoter group and retail shareholders is crucial. This is why there is prohibition on communication of Unpublished Price Sensitive Information (“UPSI”) and insider trading.

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