Nepal joined the World Trade Organisation in 2004, but it began making legislative reforms only recently. Speaking at the Nepal Investment Summit 2019 held last month, Prime Minister Oli said that the country was a virgin land with huge potential for foreign investment. To attract and facilitate foreign investment, Nepal has introduced the Public Private Partnership and Investment Act, and the Foreign Investment and Transfer of Technology Act as part of policy reforms.

In 2017, Nepal approved the long overdue National Intellectual Property Policy. It aims to achieve economic prosperity by preserving, using and protecting various aspects of intellectual property. The policy lists several objectives and one key commitment—to achieve the said objectives through legislative reforms within two years. Unfortunately, the National Industrial Property Code couldn’t be finalised before the 2019 Investment Summit. Many had expected that the Investment Summit would hasten the process of finalising the National Industrial Property Code, but it didn’t happen. However, one can consider this as a blessing because it will provide more time for the Ministry of Industry, Commerce and Supplies to revise the existing draft.

Famous trade marks

A subject of concern for multinational companies investing in Nepal has been the protection of their brands. Indian brands, in particular, have been facing serious problems in protecting their marks which have earned a reputation through their use in India and other countries. The Patent, Design and Trademark Act 1965 opted for the file system which means trademark rights are guaranteed only after registration. As a result, local traders have been registering marks which have earned a reputation abroad but have not been used domestically.

One major concern which needs to be addressed is the conceptual misunderstanding about well-known trademarks, and that the lack of adequate laws has frustrated both foreign and local companies.

Some positive steps have been taken towards protecting well-known trademarks in Nepal. For example, in the 2017 case Facebook Inc v Amrit Distillery, the director general of the Department of Industry ruled that Facebook was a well-known trademark in Nepal. The case began when a local trader filed a trademark identical to Facebook. The director general did not elaborate on the meaning of unfair practice, but the reference to unfair practice indicates that a trademark application should not dilute the ‘reputation of the trademark’ by setting a minimum level of fairness. This clearly opens the door for claiming unfair practice as a potential remedy in trademark disputes in Nepal.

The draft Industrial Property Code does not change the first-to-file trademark system to first-to-use. If there is sufficient evidence to prove that a mark in question was in use before the first filing, the earlier mark receives protection based on prior use. Similarly, the draft law has well defined criteria for well-known trademarks as compared to the seven-point guideline of the Department of Industry. In addition, the Foreign Investment and Technology Transfer Act 2019 has included ‘goodwill’ under the definition of technology transfer which further strengthens protection of brands in the absence of proper legal provisions.

Every year, there are controversies related to copyright in Nepal. In 2018, the Kri movie team was accused of copyright infringement for using Shambhu Pradhan’s work. The dispute was reportedly settled out of court for a payment of Rs1.1 million. Last January, Nepali Idol winner Ravi Oad was criticised for derogatory treatment of Basanta Thapa’s song. The Copyright Act prohibits changing the lyrics to a song, which would be prejudicial to the author’s reputation and honour. It was reported that the matter was resolved out of court after Oad apologised. These cases demonstrate that if the authors raise their voice against infringement, it will receive attention, and even if the parties choose not to initiate legal proceedings, a settlement can be reached.

Copyright issues

The increasing attention being given to copyright issues by the media shows the concerns of authors, and also reflects the commercial success of the music and cinema industries. Modern authors and filmmakers are not only well trained but very familiar with copyright issues. Therefore, this is the right time to take the initiative as a collective force to advocate for legislative reforms. The problem with copyright law and its nodal department, the Nepal Copyright Registrar’s Office, is that they are outside the Ministry of Industry,

Commerce and Supplies, which looks after industrial property—trademarks, designs and patents.

Copyrights reflect cultural and societal relevance along with business interest.

It seems the government has little motivation to invest in developing a proper copyright regime by providing adequate human resources and funds. The 2017 National Intellectual Property Policy refers to copyright reform, but no initiative has been taken to reform the existing copyright laws to keep up with technological advancements. It is believed that the Nepal Copyright Registrar’s Office and the Collective Rights Management Society are not comfortable integrating copyright issues with industrial property, and so wish to remain within the purview of the Ministry of Culture, Tourism and Civil Aviation. Regardless of this prevailing tension, one cannot ignore the growing cinema industry, which requires attention; and to promote creativity, it is important to emphasise copyright law reform and enforcement.

Upreti is an advocate.