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State Policies and

GATT

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Government Intervention
 One of the features of modern business
is the increasing involvement of the
govt. in business activities.
 It is said that ”As on today there is no
country in the world where government
of the land does not interfere in its
economic activities.”

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Reasons for Intervention
 When country moves toward economic development,
greater has to be the role of the state.
 Modern economy must be planned economy
 Ours is being socialist democratic society, the govt is
compelled to enter directly into industrial and
commercial activities.
 The functions of the govt. which were originally limited
to the maintenance of law and order have considerably
expanded.

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Reasons for Intervention
 State participation is necessary to lay a
strong base for the future development of
industry and commerce.
 The failure of markets invites govt.
intervention in an economy.

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Types of Controls

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1. Formal Control
 Formal control are usually those enacted
from legislation
 E.g.: Companies Act 1956, MRTP ACT 1969,
Industrial (Development and Regulation) Act
1951.
 Very powerful intervention technique.

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2. Informal Control
 Refer to the controls in which business firms
adopted themselves out of need and custom.
 Business firms, in various lines of activity,
develop conventions, informal agreements
and accepted ways of doing things that have
important regulative implications.

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3. Coercive Controls
 Coercive regulations require performance of
certain actions in order to avoid penalties.
 E.g.: Taxes must be paid to avoid fine or
imprisonment.

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4. Inductive Controls
 Inductive controls holdout a promise of
reward for compliance with the desired line
of action.
 E.g. : Subsidies may be granted to stimulate
certain activities.

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5. Direct Controls
 Govt. fixes prices of certain goods or services
to protect consumers.

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6. Indirect Control
 By using indirect measures govt. can control
the business activities.
 E.g.: Variation of taxes.

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7. Promotional Control
 These are of positive nature and include such
activities like development of banks,
encouragement to small scale units, removal
of regional imbalances, subsidies etc.

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8. Regulatory Controls
 Regulatory measures ensure orderly
development of industries with the least
wastage of resources.
 Regulatory measures include direct controls
and formal controls.

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Economic Roles of Govt.
 The Govt. plays an important role in almost
every national economy of the world.
 Government normally play four important
role in an economy viz.
1. Regulatory Role.
2. Promotional Role.
3. Entrepreneurial Role
4. Planning Role

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Fundamental Rights
 The constitution has eight fundamental rights
mentioned below.
1. Right to equality.
2. Right to freedom
 Freedom of speech and expression.
 Freedom to assemble peacefully.
 Freedom to form associations or unions.
 Freedom to move freely through out the territory of
India
 Freedom to reside and settle in any part of the
territory of India.
 Freedom to practice any profession

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Fundamental Rights
3. Right to life and personal property.
4. Right to freedom of religion.
5. Right to cultural and educational freedom.
6. Right against exploitation.
7. Right to property.
8. Right to constitutional remedies.

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Fundamental Duties
 Obeying the constitution
 Following noble ideals.
 Defending the country.
 Rendering the national service when called
upon.
 Promoting harmony and spirit of common
brotherhood with all people of India.
 Respecting regional diversities.

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GATT
 General agreement on tariff an trade
(GATT) was established in 1948 in Geneva
to pursue the objective of free trade in
order to encourage growth and
development of all member countries.
 The GATT was transformed into a world
trade organization with effect from January
1995.

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The Uruguay Round
 Uruguay round is the name which the eight and the
latest round of the multilateral trade negations (MTN)
held under the auspices of GATT is popularly know as
UR because it was launched in Uruguay in September
1986.
 Discussion taken place in following areas
 Trade in services
 TRIPS
 TRIMS
 Following the UR agreement GATT was converted from
a provisional agreement into a formal international
organization called WTO with effect from Jan 1 1995

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TRIMS
 Trade Related Investment Measures (TRIMS) refers to
certain conditions or restrictions imposed by a Govt.
in respect of foreign investment in the country.
 The main features of TRIMs are
 All restriction on foreign capital should be scrapped.
 Foreign investor shall be given same rights in the
matter of investment as a investor.
 No restrictions will be imposed on any area of
investment.

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TRIMS
 Imports of raw-material and components
will be allowed freely.
 Foreign investor will not be obliged to use
local products and materials.
 Restrictions on dividend, interest and
royalty will be eliminated.

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GATS
 The General Agreement on Trade in Services
(GATS) which extends multilateral rules and
disciplines to services.
 GATS covers four modes of international delivering
services.
 Cross – border supply
 Commercial presence
 Consumption abroad
 Movement of personnel

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TRIPS
 Protection of intellectual property rights has become
an issue of wide and serious discussion with the
formation of the general agreement on Trade Related
Aspects of Intellectual Property rights (TRIPS).
 Intellectual property rights may be defined as “
Information with commercial value”.
 IPRs may be legally protected by patents, copy
rights, industrial designs, geographical indications
etc

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TRIPS
 The UR agreement on TRIPS cover seven Intellectual
property-
 Copy rights
 Trade mark
 Geographical indication
 Industrial design
 Patents
 Layout design
 Undisclosed information

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Patents
 A patent is a legal protection granted for an
invention that is new and useful.
 A patent is a legal protection granted to the
patent holder exclusive right to make use
or sell the patented product or process.

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Indian Patent Act 1970
 According to the Indian Patents Act 1970, invention
means any new and useful
(i) art, process, method or manner of manufacture;
(ii) Machine, apparatus or other articles;
(iii) Substance produced by manufacturer; and
includes any new and useful improvement of any
of them, an alleged invention.

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Indian Patent Law and the UR Agreement
IP Act 1970 UR Agreement
 Only process patent  Product patent is also
applicable
 Patent expiry period is 5  Patent expiry period is
to 7 years incase of 20 years for all
food, medicine, drugs, products.
and 14 years incase of
other patents
 Plants and animals,  Only plants, animals
micro-organisms, and biological process
biological and micro are not patentable.
biological processes are
not patentable.

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Indian Patent Law and the UR Agreement
IP Act 1970 UR Agreement
 Process for treatment of  Not patentable.
human beings and
animals are not
patentable.
 On ceiling on the fee or
royalty that can be
 There is ceiling on the charged from a licensee
royalty or fee that are the
by the patent holder.
patent holder can
demand from a licensee.
 A patent is treated as  A patent is treated as
’working’ only when it is working when it is not
used in local used in local
manufacturing. manufacturing.

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Indian Patent Law and the UR Agreement
IP Act 1970 UR Agreement
 Licensing of any patent  Compulsory licensing of
is granted for three patent allowed only
years . under exceptional, very
strict conditions

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Trade Marks
Brand
 “ A brand is a name, term, sign, symbol or design
or a combination of them which is intended to
identify the goods or services of one seller or
group of sellers and to differentiate them from
those of competitors”
Brand Name
 Brand name is a part of a brand consisting of a
word, letter, group of word, or letters comprising a
name which is intended to identify the goods or
services of a seller or a group of sellers and to
differentiate them from those of competitors”

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Trade Marks
Brand Mark
 “ A brand mark is the part of the brand
which appears in the form of a symbol,
design or distinctive colouring or lettering”

Trade mark
 “Part of a brand that is given legal
protection because it is capable of
excusive appropriation”
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The Trade mark Act 1999
 Trade and Merchandise mark act 1958 has been
replaced by the Trade Marks Act 1999.
Objectives
 The registration and better protection of trade
marks for goods and services.
 The preventation of the use of fraudulent marks

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Definitions
Trade Mark
“ Trade mark means a mark capable of being
represented graphically and which is
capable of distinguishing the goods or
services of one person from those of others
and may include shape of goods, their
packaging and combination of colours”

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Definitions
Collective Mark
“ Collective mark means a trade mark
distinguishing the goods or services of
members of an association of person, not
being a partnership within the meaning of
the Indian partnership Act 1932, which is
the proprietor of the mark from those of
others.”

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Registrar and Trade Mark Registry
 The Controller- general of patents, designs
and trade marks, appointed by the central
Govt. is the registrar if trade marks for the
purpose of the trade marks act.
 Further, central govt. may appoint other
officers such designations as it thinks fit for
the purpose of discharging, under the
supervision and direction of the Registrar.
 The act also lays down that, there shall be a
trade marks registry with its head office at
such place as the central govt. may specify.
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Registrar and Trade Mark Registry
 For the purpose of facilitating the
registration of trade marks, there may be
branch offices of the trade marks registry
established at such places as the central
govt. may think fit.

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Registration of Trade Marks
 Any person claiming to be the proprietor of a
trade mark used or proposed to be used by him,
who is desirous of registering it, shall apply to
the registrar in the prescribed manner for the
registration of his trade mark.
 A single application is enough for registration of
a trade mark for different classes of goods and
services.
 The application shall be filled in the office of the
trade marks registry.

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Registration of Trade Marks
 Subject to the provisions of this act, the registrar may
accept the application absolutely or subject to such
amendments, modifications, conditions or refuse the
application.
 In the case of a refusal or conditional acceptance of an
application, the registrar shall record in writing the grounds
for such refusal or conditional acceptance and the
materials used by him in arriving at his decision.
 On the registration of a trade mark, the registrar shall issue
to the applicant a certificate in the prescribed form of the
registration sealed with seal of trade marks registry.

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Registration of Trade Marks
 The duration of the registration of a trademark
is ten years, but may be renewed from time to
time in accordance with the provisions of the
act. Failure to renew the registration may
result in the removal of the trade mark from
the register.

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Grounds of refusal of registration
 The act lists a number of absolute grounds or
refusal of registration of trade marks;
 It is of such nature as to deceive the public or
cause confusion;
 It is likely to hurt the religious customs of any
class or section;
 It comprises or contains scandalous or obscene
matter;

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The effect of registration
 The exclusive right to use of trade mark in
relation to the goods or services in respect of
which the trade mark is registered, subject to
any conditions and limitations to which the
registration is subject.
 The right to obtain relief in respect of
infringement of the trade mark in the manner
provided by this act.

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Assignment and Transmission
 A registered trade mark is assignable and
transmissible, whether with or without the
goodwill of the business concerned.
 Associated trade marks shall be assignable
and transmissible only as a whole and not
separately.
 A certification trade mark shall not be
assignable or transmissible otherwise than
with the consent of the registrar.

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Appellate Board
 The trade narks act provides for the
establishment of an appellate board to be
known as the intellectual property appellate
board by the central govt. to exercise the
jurisdiction, powers and authority conferred on
it by or under this act.

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Offences and Penalties
 Offences under the act are punishable by
imprisonment and fine.
 Such offences include falsifying and falsely
applying trade marks, selling goods or
providing services to which false trade marks
or false trade description is applied.

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Government responsibilities to
Business
 Govt. responsibilities to business are much greater
than the obligations of business to the govt.
 Being democratically elected and having accepted
the mixed economy, govt. is clear about the role it
has to play and responsibilities it has to discharge
towards business houses.
 Specifically, the govt.’s responsibilities towards
business are as follows-
 Establishment and enforcement of laws.
 Maintenance of order.
 Money and credit
 Orderly growth

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COPY RIGHTS

“Copy right is basically the right to copy and


make use of literary, dramatic, musical,
artistic works, cinematographic films, records
and broadcast. This comes in existence as
soon as the work is created.”

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Government responsibilities to
Business
 Providing infrastructure.
 Information
 Assistance to small scale industries.
 Inspection and licenses
 Tariff and quotas.

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What is Govt.
 Refer to the process of governing, to the
exercise of power.
 Refer to the manner , method or system of
governing in a society; to structure and
arrangement of offices and how they relate to
the governed.
 Consisting of three distinct sets of powers
 Legislative
 Executive
 Judiciary

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