competiton vs monoploy

8/10/2019 Competiton vs Monoploy

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MONOPOLY Vs. COMPETITION

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Submitted by:-

Manzoor Elahi Laskar

Monopoly:- A monopoly is a market structure in which a single supplier produces and sells a

given product. If there is a single seller in a certain industry and there are not any close

substitutes for the product, then the market structure is that of a "pure monopoly".

Intellectual Property is jura in re propria.The Intellectual Property are those type of

intangible property which gives the owner of such intangible property right to exclude others

from exploiting non-corporeal asset. They include patents, copyright, trademarks, designs and

other items. It is a valuable intangible property which vests on the owner in the form of artistic,

literary, dramatic, musical, cinematographic works and sound recording. It also exists in any

new creation which has any utility and industrial application; i.e, to any invention. These rights

are protected because they are the brain child of a person and the fruits of his labour. They are

worthy of protection by national laws and international laws because of the fact that the

civilised nations recognises the value of such creations and are highly prized.

The reason for giving protection to such intellectual properties is mainly because it

provides incentives to the holder and other persons and also because they are the output of a

mans hard effort. When a man by the exertion of his rational powers has produced an original

work, he seems to have clearly a right to dispose of that identical work as he pleases and any

attempt to vary the disposition he has made of it appears to be an invasion of that right.1Thus,

every person has a natural right to claim protection for his work or labour which is the result

of his or her effort. Any appropriation of his or her work is an unjust act.

Copyright is a legal protection of a work given to an author or the owner of the original

work. Similarly, Patent is the recognition of a mans hard labour in creating a new, usefulproduct or a process having industrial application at present or in future. The object of these

laws is to preserve the efforts of the individuals by rewarding them in such a way that others

cannot reproduce the same work for certain term. Thus, they in other way give monopoly rights

to the individuals so that they can enjoy benefits from their work before they actually fall within

the public domain. This exclusive right is the negative right which prevents others from

adapting, reproducing and copying the original work. Similarly, Trademarks encourage the

1Blakstoe i his Coetaies, Vol. at p., uoted i Copyight y Cate-Ruk ad Skoe Jaes, 9,

p..


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holders to invest in the reputation of the product, as consumers will be able to identify it by

reference to the trademark. Since marks are valuable and the holder will want to maintain its

reputation, they are indirectly a guarantee of quality.

Another reason for granting intellectual property rights is that they encourage

investments. As for example, if there were no patent rights, few firms would invest large

resources in research and development. There would be no incentive to perform research and

development.

Thus, intellectual property rights can be considered monopoly rights because they have

all the characteristics of monopoly markets; i.e, it maximizes profit, decides the price of the

products and services, exclude others, etc.

Even the Competition Act, 2002 in Section 3 (5)provides that :-

Nothing contained in this section shall restrict-

(i) the right of any person to restrain any infringement of, or to impose reasonable conditions,

as may be necessary for protecting any of his rights which have been or may be conferred upon

him under-

(a) the Copyright Act, 1957 (14 of 1957)

(b the Patents Act, 1970 (39 of 1970)

(c) the Trade and Merchandise Marks Act, 1958 (43 of 1958) or the Trade Marks Act,

1999 (47 of 1999)

(d) the Geographical Indications of Goods (Registration and Protection) Act, 1999 (48

of1999)

(e) the Designs Act, 2000 (16 of 2000)

(f) the Semi-conductor Integrated Circuits Layout-Design Act, 2000 (37of 2000)

(ii) the right of any person to export goods from India to the extent to which the agreement

relates exclusively to the production, supply, distribution or control of goods or provision of

services for such export.


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Competition:- The simple hallmark of competition law is the protection of those principles

and practices which enable the efficient functioning of markets. A natural concomitant to this

objective is making certain that incumbent enterprises do not engage in anticompetitive

practices to the detriment of the market.

Competition Act 2002 has come into force to replace the Monopolies and Restrictive

Trade Practices (MRTP) Act, 1969. After the economic reforms of 1990, it was felt that MRTP

has become obsolete pertaining to international economic developments relating to competition

law and there was a need of law which curbs monopolies and promotes competition. In 1990s

India saw substantial increases in the value and volume of international trade in goods and

services, in foreign direct investments (FDI), and in cross border mergers and acquisitions

(M&A). Over the period of time, trade barriers fell and restrictions on FDI were reduced. The

Competition Act, 2002 has been enacted with the purpose of providing a competition law

regime that meets and suits the demands of the changed economic scenario in India and abroad.

The objective of the Competition Law, 2002 is to position the competition policy with

pragmatic options to promote the spirit of competition and harmonise the conflicts caused by

the volatility of globalised markets. It provides for a regulatory framework of rules covering

the critical areas of competition namely;

Anti-competitive agreements among any person and enterprises

Abuse of dominant position in the market, and

Combinations / Mergers between Enterprises.

Provisions relating to Anti-competitive Practices under TRIPS:-

Article 6 of the TRIPS Agreement provides for exhaustion of rights, which means that once

the owner of the Intellectual Property authorised the release of the IPR, he has no right to

control the use or resale of goods in the market.

Article 7 provides for promotion of technological innovation and to transfer and

disseminate technology to the mutual advantage of producer and user of technological

knowledge in a manner conducive to social and economic welfare.


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Article 8 recognizes the right of members to adopt for public health and other public interest

reasons and to prevent abuse of intellectual property rights.

Article 30 provides that some exceptions to exclusive rights conferred by a patent can be

given.

Article 31 provides for compulsory licensing and government use.

Article 39.1 provides for effective protection against unfair competition by misusing

confidential information.

Article 40 provides for protection against anti-competition practices.

The reason for excluding Patents, Copyrights, Trademarks, Designs, Semi-Conductor

Integrated Circuits Layout-Design and the Geographical Indications of Goods in Section 3 (5)

of the Competition Act, 2002 is mainly because the Act governing the above mentionedIntellectual Properties have provided for limitations on the monopoly rights itself.

Copyright Act, 1957provides for Compulsory Licence in Sections 31, 31A and 31B if any

work is withheld from public and even for the benefit of disabled. Section 32 A is a significant

provision which provides for license to reproduce and publish literary, scientific or artistic

works if the copies of such works or such copies are not available or offered for sale in India.

Section 52 also provides certain acts which are not considered to be copyright infringement.

Thus, Copyright Act gives fair chance for a competitive to exist.

Patent Act of 1970also provides for compulsory licensing of Patents in Section 84 if the

Patentee or his agents fails to work out the patents. Section 99 to Section 102 also provides for

the power of the Central Government for using any invention or to acquire any invention for

the purpose of the Government.

Even the Semi-Conductor Integrated Circuits Layout-Design Act, 2000provides that

the Appellate Board can grant permission for certain use of layout-design. Similarly, the

Designs Act, 2000in Section 4 (b) prohibits registration of a design which has been disclosed

to the public anywhere in India or in any other country by publication in tangible form or by

use in any other way. Section 9 (a), (f), and (g) of the Geographical Indications of Goods

(Registration and Protection) Act, 1999provides for prohibited geographical indications if

the use is likely to deceive or cause confusion, which are generic terms or falsely represent the

origin of the goods, and thus in a way facilitate competition. Similar provisions can be seen in

Trade Marks Act, 1999 in Section 9 and 11. Thus, these provisions provides for fair

competition in the market.


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Conclusion:-

Although, intellectual property rights laws seeks to protect the rights of the right holders

but they also provides for competition by imposing certain restrictions. The limited monopoly

power is always under the supervision of the Government and if this monopoly right could not

satisfy the needs of the public, it can curtailed for the benefit of the public or for public interest.

Thus, the monopoly which is granted or protected by the Intellectual Property Laws are limited

monopoly and not absolute one.

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competiton vs monoploy

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