Intellectual property rights (IPR) have come to be a crucial asset in improving businesses in…
Through this article, we will shed light upon settlement of IPR related disputes through arbitration under the Singapore legal regime, by peeking into Part IXA of the Singapore Arbitration Act and Part IIA of the International Arbitration Act, introduced by way of Intellectual Property (Dispute Resolution) Act 2019.
The resolution of IPR disputes through arbitration, under the Singapore legal regime was under uncertainty since decades.[i] The introduction of Part IXA to the Singapore Arbitration Act and Part IIA to the International ArbitrationAct, through the Intellectual Property (Dispute Resolution) Act2019[ii], untangled the whole scenario of IP dispute resolution through arbitration.
Section 52A of the Arbitration Act and 26A of the International ArbitrationAct enlists the Intellectual Property rights, to which the provisions with respect to arbitration apply. It include, patents, trademarks, geographical indication, registered design, copyrights, a layout design of integrated circuit, plant varieties, trade secret or confidential information, right to protect goodwill by way of passing off or a similar action against unfair competition, and any other intellectual property[iii].
An IPR dispute involves a dispute over the infringement, enforceability, scope, validity, duration, ownership, transaction, compensation payable, subsistence or any other aspect of such intellectual property rights[iv], which is capable of being settled by way of arbitration as between the parties to the IP dispute, whether it be a main issue or an issue incidental to arbitration[v]. Furthermore, even though a specified entity such as a court, tribunal etc., has powers or jurisdiction under certain Singaporean or other laws to try IP related matters, it by no means exclude settlement through arbitration[vi].
Section 52C of the Singapore Arbitration Act and Section 26C of the International Arbitration Act of Singapore further clarifies the parties to the arbitral award. It excludes a third party licensee and a third party holder of a security interest concerning IPR, from the title of ‘parties to the arbitral proceedings’. That means, in case a party to the proceedings grants a security interest in IPR to a third party or grants license in the IPR to a third party, then that doesn’t make the third parties a party to the arbitral proceedings. However, a right or liability amongst the parties arising out of a contract or by operation of law shall not be affected because of the same. However, this can also prove to be a major drawback as, even when the arbitral award is declared invalid, it’ll be enforceable and valid for the 3rd parties, who are excluded from the purview of parties to the proceedings[vii].
According to Section 82(2) of Singapore’s Patents act, the issue about the validity of patents may not be put into any other proceedings. This provision of the Singaporean patent Act somehow restricted the scope of arbitration relating to patents, thus IPR, which was resolved through the insertion of section 26G to the International Arbitration Act and Section 52G to the Singapore Patent Act, which stated that “Section 82(2) of the Patents Act (Cap. 221) does not prevent a party from putting the validity of a patent in issue in arbitral proceedings.”, thus extending the scope of resolving IP issues through arbitral proceedings.
Arbitration, as an alternative dispute resolution mechanism, is cost-effective, flexible, expeditious, and can be achieved by maintaining enough confidentiality. Cases wherein technical and complex inventions concerning patents law are concerned, arbitration proceedings prove to be a boon as it offers flexibility, thorough analysis, speed, and cost-effectiveness. Further, IP rights such as trade secrets and confidential information when dealt with by arbitration proceedings as compared to litigation can prove to maintain a high amount of confidentiality and flexibility as both the proceedings and awards are confidential by default under the Singapore arbitration regime.[viii]
Conclusion: The amendments made in the Singapore Arbitration Act and the International Arbitration Act of Singapore, by way of the Intellectual Property (Dispute Resolution) Act 2019, introduced certain provisions in both the arbitration acts of Singapore which removed the obscurity encircling the issue of resolving IP disputes through Arbitration by making the sheer process admissible under the Singaporean law. As the arbitration proceedings are accompanied by various merits such as cost-effectiveness, flexibility, and confidentiality, etc., it can prove to be very effective in cases of disputes concerning intellectual property rights. Nevertheless, the sections in both the act, cutting out third parties from being party to the arbitral proceedings have its demerits.
Author: Vartika Prasad, student of 5th Year- B.A. LL.B. (Hons.), Amity Law School, Noida, an intern at Khurana & Khurana, Advocates and IP Attorneys. In case of any queries please contact/write back to us at [email protected].
[i] Amendments to the Singapore Arbitration Act And International Arbitration Act to Clarify the Arbitrability of IP Disputes in Singapore. access from: https://www.twobirds.com/~/media/pdfs/singapore/2019/bbatmd20191126-v2-amendments-to-the-singapore-arbitration-act-and-international-arbitration-act.pdf?la=en&hash=61C6F9C0427BABAC240CCE803B18A4D378FBEB6B
[ii]Arbitrability of IP disputes in Singapore – recent amendments to the AA and the IAA. Access from: https://www.lexology.com/library/detail.aspx?g=30725cb4-1ca1-4df7-bacd-1c51356904db
[iii]Section 26A.International Arbitration Act.52A, Singapore Arbitration Act.
[iv] Section 52A(3), Singapore Arbitration act. Section 26A(4), International Arbitration act.
[v]Section 52B, Singapore Arbitration Act.Section 26B, International Arbitration act.
[vii]Id. at i.