Section 88 of the Patents Act, 1970
Powers of Controller in granting compulsory licences
Gives the Controller extra powers when granting compulsory licences, including licensing related patents and revising terms that prove too harsh.
Official legal text
The verbatim statutory text of this provision is reproduced from the official source and checked by our legal reviewer before it is published here. Until that check is complete for this page, read the exact wording directly from the official source linked below — it is the only version that governs.
This is a simplified explanation. Where it differs from the official text of the provision, or from an applicable Gazette notification, the official text and the notification prevail.
What this section says, in plain language
Section 88 fills gaps that a single, simple licence order would leave open. Once the Controller has decided that a compulsory licence is justified, this section lets him shape the outcome so the licence actually works in practice rather than existing only on paper.
The first power deals with restrictive licence conditions. Where the Controller finds that the manufacture, use or sale of materials that are not themselves protected by the patent is being prejudiced by conditions the patentee attaches to its licences, and that granting relief is in the public interest, he may order licences to be granted to the applicant and to other persons on terms he thinks fit. This targets the practice of using a patent on one component to control an entire unprotected product line.
The second power deals with existing licensees. If the person applying for a compulsory licence already holds a licence under the patent, the Controller may cancel that existing licence when he grants the new order, or he may instead simply amend the existing licence rather than issue a fresh one. The idea is to avoid two inconsistent licences running side by side.
The third power deals with related patents held by the same patentee. If the applicant shows that the public's reasonable requirements are unmet for only some of the patentee's patents, but cannot work the licence he has been given without infringing the patentee's other patents, the Controller may extend licences to those other patents too. Without this, a compulsory licence could be made worthless by a surrounding patent thicket.
The fourth power looks forward in time. Where the Controller has fixed the terms of a licence, the licensee may apply to revise them after working the invention on a commercial scale for at least twelve months, on the ground that the settled terms have turned out to be more onerous than expected and the invention cannot be worked except at a loss. Such an application can be made only once, and the procedure is governed by Rules 100 and 101.
Why this section matters
Compulsory licence applicants, existing voluntary licensees, and patentees who hold clusters of related patents or impose conditions on their licences.
At the point the Controller settles a compulsory licence, and again once the licensee has run commercial operations for at least a year.
Discretionary powers to widen, cancel, amend or later revise licences so that a compulsory licence is workable in the real world.
A licensee who never invokes the revision power may be locked into royalty terms that make production loss-making for the remaining term.
How it works in practice
A licence that would not work without the neighbouring patents
Sanchari Diagnostics Pvt Ltd obtains a compulsory licence over a patented test-strip chemistry from a large diagnostics company. On starting work, Sanchari finds it cannot produce a usable strip without also using two other patents held by the same company, one on the reagent coating and one on the reader interface. It shows the Controller its engineering analysis and independent expert evidence that no non-infringing route exists. Using Section 88, the Controller extends licences to those two related patents so the first licence can be worked. Fourteen months later, after running a commercial line at its Pune plant, Sanchari applies again. It shows that the royalty set earlier, combined with a sharp rise in reagent input cost, means every batch is sold at a loss. It asks the Controller to revise the terms. Because it has worked the invention on a commercial scale for more than twelve months, the application is entertained, and Sanchari knows it will get only this one chance.
Simplified illustration only. Actual legal outcomes depend on the facts.
Key points to remember
- The Controller can order licences where a patentee's licence conditions prejudice trade in materials that are not patented.
- An existing licence held by the applicant can be cancelled or amended instead of a fresh licence being issued.
- Related patents of the same patentee can be licensed too, so a compulsory licence is not blocked by surrounding patents.
- Licence terms can be revised if they prove more onerous than expected and the invention cannot be worked except at a loss.
- A revision application needs at least twelve months of commercial working first.
- Only one revision application is allowed; Rules 100 and 101 set out how it is dealt with.
Common mistakes and misunderstandings
- Assuming a compulsory licence automatically covers everything you need to make the product. It covers the patent applied for unless the Controller extends it to related patents.
- Applying to revise terms too early. Twelve months of commercial working is a condition, not a guideline.
- Saving the revision application for later problems. Since it can be made only once, the timing and the evidence need to be chosen carefully.
- Thinking a loss on paper is enough. The Controller looks for evidence that the settled terms themselves, not general business decisions, made working unviable.
Connected provisions
You will find the related rules grouped below rather than inside the explanation. The separation is deliberate. The Act and the Rules are distinct legal instruments, and mixing them can lead a reader to attribute a procedural requirement to the statute itself.
Forms, deadlines and fees
- A licensee can seek revision of Controller-settled terms only after working the invention on a commercial scale for at least twelve months.
- A revision application under this section can be made once only.
Open the deadline calculator — and have every date confirmed against the current Rules before you rely on it.
Where a fee is payable under this provision, the figure comes from the First Schedule. Categories of applicant are charged at different rates, and electronic filing is treated differently from paper filing, so an accurate number can only come from the Schedule in force on the day you file. How Indian patent fees work.
Related judgments
Court decisions shape how this provision is applied, but a summary is useful only if it is right. Every case note on this site is read by a legal reviewer before it goes live, and none has been completed for this provision so far. This section will fill in as those reviews finish. How case notes are prepared.
Questions people ask about Section 88
Can a compulsory licence cover more than one patent?
Yes, in a specific situation. If the same patentee holds several patents, and the licensee cannot work the licence granted to it without infringing the patentee's other patents, the Controller may grant licences under those other patents as well. This prevents a patentee from making a compulsory licence useless by surrounding it with related patents. The applicant has to prove the technical dependence with evidence, usually an engineering or expert analysis showing there is no reasonable non-infringing alternative.
What does more onerous than originally expected mean?
It means the terms the Controller settled have turned out in practice to be heavier than they appeared at the time, so that the licensee cannot work the invention except at a loss. It is not enough to say the business is unprofitable. The licensee has to link the loss to the settled terms, usually the royalty rate or a production or supply obligation, and back it with audited costs, sale prices, volumes and the reasons for any input cost change since the order.
What happens to my existing voluntary licence if I apply for a compulsory one?
The Controller has a choice. He can grant the compulsory licence and order your existing licence to be cancelled, so that only the new order governs. Or he can leave the existing licence in place and simply amend it, which is often simpler where only the royalty or a restrictive clause is the problem. Either way you should expect the earlier agreement to be examined closely, because it shows what terms the patentee was willing to accept.
Are your compulsory licence terms unworkable in practice?
MYCrave helps licensees evidence a Section 88 revision and helps applicants secure licences over the related patents they actually need.
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