New free trade agreement between EFTA and India offers enhanced IP rights for business owners

After more than 16 years of negotiations, the European Free Trade Association, which consists of four countries Switzerland, Liechtenstein, Iceland, and Norway, has entered into a Trade and Economic Partnership Agreement with India. The agreement, signed on March 10, 2024, includes a reduction of import tariffs by India on goods from the EFTA countries, while the member countries of the European Free Trade Association have promised to invest $100 billion in India to facilitate the creation of 1 million jobs over the next 15 years.

One interesting aspect of the new agreement is that it provides enhanced and non-discriminatory protection for intellectual property among the signatory states. With stricter implementation of the rules, companies from Switzerland and other member countries are expected to encounter fewer obstacles when entering the Indian markets.

Being a “TRIPS-Plus Agreement”, some of the baseline levels of protection exceed what is generally conferred by the WTO TRIPS (Trade-Related Aspects of Intellectual Property Rights) Agreement. This enhanced protection is expected to have a significant impact on the nature and scope of trade between Indian and Swiss companies in particular.

  1. Patent Protection

The changes introduced for patent protection by the new agreement are primarily intended to address uncertainties in legal procedures within the Indian markets. These changes aim to ensure that only Swiss product enjoys the same status and level of patent protection as any other product manufactured or developed in India—and vice versa. Additionally, there is now a stricter timeline for processing patent oppositions, along with the right to dismiss or reject frivolous or baseless oppositions.

Other obligations under the free-trade agreement include limitations on the disclosure requirements for patent functioning. For patent owners, it is no longer mandatory to disclose information with gaps longer than 3 years. These confidentiality obligations also restrict the publication of any confidential information shared during such disclosures.

Despite these changes, the provisions on compulsory licensing under the TRIPS Agreement still apply. If the need arises for such licensing to meet the extent and production requirements of pharmaceutical products, member parties are required to adopt and follow the procedure stipulated under the TRIPS Agreement.

These changes are expected to facilitate smoother trade between Indian and Swiss companies.

  1. Protection for Brands

The new agreement extends protection to both agricultural and non-agricultural goods. Concerning Geographical Indications, parties are restricted from using comparisons or descriptive terms that denote the origins of products to geographical locations when those products do not originally originate from there. For instance, the use of the description “Swiss-style Chocolates” for any product made in India would not be permissible under the free-trade agreement.

This enhanced protection goes beyond the TRIPS Agreement and applies to all signatory states of the free-trade agreement.

India and Switzerland have taken it a step further by restricting the use of their country names in each other’s trademarks. Consequently, no trademark in Switzerland can include the name “India”, and vice versa.

This change aims to reduce confusion in the respective markets regarding the actual origins of the goods being sold. However, any trademarks registered before the agreement entered into force are not restricted from continued use or renewal. The enhanced level of protection, along with the affirmation of the quality of goods and services associated with Swiss companies, are expected to boost the positions of Swiss manufacturers in India.

The trade agreement between EFTA and India also marks a significant milestone in shaping agricultural trade relations. By extending enhanced protection to intellectual property rights, including trademarks, patents, and geographical indications, the FTA aims to create a level playing field for Indian farmers. The reduction of trade barriers and the commitment to robust supply chains benefits both producers and consumers.

After 16 years of talks, this collaboration underscores the importance of balanced trade agreements in a globalized economy and reaffirms the importance of intellectual property rights in international trade.