| "Outsourcing" is no more a new term in today's global | | | | services catered by the Indian service providers are: |
| marketplace. It has become one of the key factors in | | | | - TM Search |
| formulating the overall corporate strategy in the | | | | - TM Registration |
| emerging and highly competitive market scenario. The | | | | - Preparation Of Cease & Desist |
| reason as why more and more companies are getting | | | | - Filing & Docketing Services |
| attracted to this concept is because it offers less | | | | |
| capital expenditure, improved efficiency, saves on | | | | Issues related to IP outsourcing & their solutions |
| recruiting, training and operating costs and gives | | | | Associated with outsourcing are many issues which |
| access to specialized skills. India being a land of highly | | | | can be alarming if not considered properly before |
| skilled professionals is thus becoming a hub of | | | | outsourcing the IP work. |
| outsourcing. | | | | |
| General Outsourcing Trend | | | | 1. Export Control Regulations |
| Outsourcing is an arrangement in which one company | | | | Mostly all the developed countries who are indulging |
| provides services, sometimes from overseas or | | | | into outsourcing offshore have well developed export |
| sometimes within the same country, to another | | | | laws in place. The export law generally pertains to |
| company that could also be or is usually provided | | | | "technology transfer" across the border of the country. |
| in-house. It is a straightforward concept based on the | | | | Taking an example of U.S. for this scenario, we can |
| principles of comparative advantage and division of | | | | talk about two distinct bodies which functions for |
| labour. Thus, the decision for a business to outsource is | | | | controlling export law. Firstly, Commerce Department |
| often made in the interest of lowering firm costs or to | | | | and secondly the Patent office (United States Patent |
| make more efficient use of labour, capital, technology | | | | & Trademark Office – USPTO) itself. The |
| and resources. Off-shoring, on the other hand is | | | | Commerce Department has set of rules known as |
| process where work is sent across the borders of a | | | | Export Administration Regulation (EAR) which |
| country which can be even within the same | | | | regulates the "export of technology" across the border |
| organisation itself. | | | | of U.S., similarly USPTO restricts "export of patent |
| | | | | application" which generally is sent to off-shoring |
| But outsourcing offshore is now a more popular | | | | countries for drafting purpose. |
| corporate strategy, which is used, to a large extent, by | | | | Solution: Almost every U.S. organisation have found a |
| enterprises in developed countries to increase | | | | solution to this problem of outsource off-shoring by |
| profitability, by investing overseas in relatively | | | | getting export waivers from the Commerce |
| ‘low-wage' developing countries such as Brazil, | | | | Department, for the technologies which they want to |
| Russia, India, China (commonly termed as BRIC) to | | | | off-shore. This has helped them in getting away with |
| name a few. Personnel in creating offshore | | | | the regulation of EAR. Similarly other countries can |
| outsourcing alliances stress the savings as being the | | | | follow the steps of U.S. export control bodies by |
| prime driver, which lead to lower costs while | | | | providing a solution to the organisations interested in |
| maintaining high quality. This is due to a combination of | | | | off-shoring technology or patent work across the |
| factors, such as high level of education and skills | | | | border. |
| appropriate to the tasks outsourced. | | | | |
| | | | | 2. Confidentiality Concerns |
| Service organizations like Intellectual Property | | | | Maintaining confidentiality is one of the major concerns |
| practitioners, lawyers, physicians, surgeons, dentists, | | | | of the foreign organisations when sending work to |
| clinical laboratories, hospitals are relying on developing | | | | someone who is not a citizen of that country or who |
| countries to manage non-core processes for them. | | | | is not physically present in that country. Keeping track |
| The motive of doing so is to focus more on their core | | | | of documents sent miles away from the country |
| competencies. Today India has become the hub of | | | | becomes the highest priority as losing trust of the client |
| outsourcing and is capable to providing varied types of | | | | is directly associated with losing confidentiality. |
| services to the developed countries, few of them | | | | Solution: Indian law is well established and in practice |
| being: | | | | since decades now. As per the laws it becomes duty |
| - Call Center Services | | | | of the employee to make sure that each and every |
| - Legal Services (LPO) | | | | employee of the organization has signed agreements |
| - Research & Analysis Services (KPO) | | | | or contracts which abide them to follow and maintain |
| - Healthcare Services | | | | confidentiality of the clients' details. Violations of the |
| - Transcription Services | | | | legal document which forbid them from sharing the |
| - Banking & Financial Services | | | | details with any third party can thus lead to punishable |
| - Software & IT Services | | | | offence under Indian Laws. |
| - Data & Document Management Services | | | | |
| | | | | 3. Maintaining Work Quality |
| Legal Process Outsourcing | | | | When it comes to patent work, quality plays a vital |
| Legal services or precisely the Legal Process | | | | role. Unlike other services, patent services cannot be |
| Outsourcing (LPO) has picked up high momentum in | | | | compromised on quality. A single words presence or |
| the recent years. Legal Process Outsourcing is one of | | | | absence in claims or specification of the patent |
| the value added Business Process Outsourcing (BPO) | | | | application may lead to heavy aftermaths. Hence U.S. |
| services which involves legal work that companies | | | | or U.K. attorneys are really concerned of a real good |
| outsource to more economical destinations. It includes | | | | quality of work as per their own standards. They are |
| various processes and services which requires varied | | | | concerned whether service providers in India can |
| level of legal acumen and knowledge to perform a | | | | deliver as good as what their clients expect. |
| particular type of task. | | | | Solution: The best way to combat this concern of U.S. |
| | | | | or U.K. attorneys is to provide quality training to the |
| LEGAL PROCESS OUTSOURCING | | | | associates working on behalf of the service providers |
| - IPR Portfolio Management | | | | in India. An extensive training of about one or two |
| - Patent Application Drafting | | | | years (depending upon the type of work) by U.S. or |
| - Legal Research | | | | U.K. attorneys (who are in practice) will lead to a quality |
| - Document Review | | | | work. Though it again adds to the cost of off-shoring, |
| - Contract Management | | | | but if the training is imparted efficiently, then it becomes |
| - Litigation | | | | a onetime investment and can be an ever lasting |
| - Support | | | | solution to his concern. |
| - Paralegal Services | | | | |
| - Immigration Data Analysis | | | | 4. Cost Savings |
| - Legal Memo Drafting | | | | The last and the foremost which any off-shoring party |
| | | | | can ask is will there be any real cost savings from |
| | | | | off-shoring. |
| IP Regime & IP Outsourcing | | | | Solution: An associate in India for doing a patent related |
| In law, intellectual property (IP) is an umbrella term for | | | | work (specifically drafting of a patent application) will |
| various legal entitlements which attach to certain types | | | | not cost more than $10-15/hr. On the contrary a U.S. |
| of information, ideas, or other intangibles in their | | | | attorney for doing the same work will charge ten |
| expressed form. The holder of this legal entitlement is | | | | times of that. Considering training to be a onetime |
| generally entitled to exercise various exclusive rights in | | | | investment, the associate under the supervision of a |
| relation to the subject matter of the IP. Intellectual | | | | senior associate can thus produce the same quality of |
| property laws are designed to protect different forms | | | | work. Thus, the foreign law firm can expect a 10% |
| of intangible subject matter, although in some cases | | | | saving by off-shoring the work. Apart from cost |
| there is a degree of overlap. | | | | saving the off- shoring of work like patent docketing, |
| | | | | proof reading etc. can reduce the work load of the |
| The existing frame work of intellectual property laws | | | | in-house attorneys. (Outsourcing and Offshoring, A |
| recognized internationally are those identified by TRIPS | | | | Summary of the Issues", National Law Journal, |
| (Trade Related Aspects of Intellectual Property Rights) | | | | September 12, 2005) |
| and governed by WTO (World Trade Organization). | | | | India as a solution |
| They are: | | | | India has been the most preferred choice among |
| - Patents | | | | global organization when it comes to outsourcing. In the |
| - Trademarks | | | | U.S alone, more than 80% have ranked India as their |
| - Copyrights | | | | first choice, when outsourcing software and IT |
| - Industrial Designs | | | | services. The U.S has also recognized India as an |
| - Geographical Indications | | | | outsourcing superpower. The number of organizations |
| - Trade Solutions | | | | outsourcing services to India has only been increasing |
| - Layout Designs of integrated circuits | | | | over the years. Thus the reasons to outsource to India |
| | | | | are: |
| IP outsourcing is one of the most talked about services | | | | - High Quality & Wide range of Services |
| when it comes to legal outsourcing. IP as we | | | | - High End Technology & Best of Breed |
| understand includes patent, copyrights, trademarks, | | | | Infrastructure |
| industrial designs, trade secrets, geographical indications | | | | - Sound Knowledge of US & UK Law |
| and Layout designs, but when we talk about IP | | | | - Cost Effective Services with Maximum Revenue |
| outsourcing it is majorly Patent work which is being | | | | - Quick Turnaround Time |
| outsourced currently. Patents are the most valuable | | | | - Stable Indian Government |
| informational source of technical and competitive | | | | - Skilled, Talented & experienced professionals |
| information. During the last few years these have | | | | |
| gained a lot more attention. Due to increase in the | | | | Future Scope |
| globalization and competition, it is very important for the | | | | Revenues from the Indian patent services off-shoring |
| companies to protect their innovations and also make | | | | industry were nearly $46 million for the calendar year |
| their R&D activities more efficient, by means of | | | | 2007 and are expected to reach $206 m by end 2012. |
| Patents. | | | | Large corporations are in favour of off-shoring patent |
| | | | | related (and other legal) work to India as they are the |
| As we know, obtaining patents has become part of | | | | ultimate beneficiaries of the cost savings. The current |
| business strategy now but at the same time the cost | | | | addressable value of the patent services off-shoring |
| of obtaining patents is high. Reduction of patent costs | | | | market is estimated at $2.2 billion. Typically catering to |
| therefore has becomes a high priority for many | | | | the international markets, patent services outsourcing |
| organizations. Outsourcing of patent work is hence | | | | to India is still in its infancy with a history of only about |
| considered as a means of reducing that cost. India is | | | | 3 to 4 years behind it. There are about 50 vendors in |
| well recognized as a knowledge hub, due to its rich | | | | the industry with an estimated 1,550 professionals |
| talent pool. A lot of IP services providers have | | | | employed as of end 2007. While a few vendors have |
| emerged in India during the last few years and have | | | | been in this business longer, this industry has gained |
| become the giants in providing specialized IP services. | | | | momentum only in the last few years. The Indian |
| Lots of Indian law professional and law firms are also | | | | patent off-shoring industry will grow 35% per annum |
| now trying to enter into the market to provide the | | | | over the next four years. As for the number of |
| highest quality analysis and research services. | | | | employees it is estimated that about 6959 people will |
| Most of these firms are located in the metropolitans of | | | | be employed by the end of 2012 ("India is new hub for |
| India like Bombay, Delhi, Hyderabad and Bangalore | | | | patent outsourcing", Times of India, 8th July 2008, p: 19). |
| cities, with well developed infrastructures, internet | | | | |
| access and US or UK contacts. Almost all firms are | | | | Conclusion |
| providing the following types of Patent services: | | | | By virtue of WIPO & TRIPS the IPR regime has |
| - Prior –Art Search | | | | attained globalization which has further enhanced the |
| - Application Filing, Drafting & Prosecution | | | | scope of IP Outsourcing. Legal outsourcing in India is still |
| - Landscaping | | | | in a beginner stage when compared to the heights |
| - Invalidation Study | | | | which BPOs have attained in India, but the foundation |
| - Freedom to Operate Opinion | | | | has already been laid and within no time India will shine |
| - Infringement Analysis | | | | as a master in LPO industry as well. While there are |
| - Novelty & Inventiveness Assessment | | | | pitfalls, IP off-shoring has huge potential cost savings. If |
| - Patent Illustrations & Drawings | | | | handled correctly, this can create history in the field of |
| - Competitive Intelligence | | | | outsourcing. Indian companies that provide IP |
| - Commercialization & Valuation | | | | outsourced services thus can place themselves at an |
| - Docketing & Maintenance | | | | additional competitive advantage. As the Indian Patent |
| Trademark comes the second in the list when we | | | | Laws are getting more stringent and effective the |
| discuss IP outsourcing. But as compared to Patents, | | | | Indian vendors are able to backup the U.S. and U.K. |
| trademark still is in a blossoming stage and there are | | | | attorneys in a more competent manner. Thus, IP |
| very few service providers who have gained | | | | Outsourcing is a route to reduce cost and increase |
| expertise in this domain. Few of the Trademark related | | | | effectiveness by outsourcing work to India. |