Intellectual PropertyLegal Advice

Understanding the Startups Intellectual Property Protection (SIPP) Scheme 

Intellectual property rights are a strategic business instrument that any company can use to improve its competitiveness, especially in the current scenario with increased business access to consumers. 

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Startups, which have limited resources and manpower can only sustain themselves through continuous evolutions in their development and innovations. This makes intellectual property right protection even more important for startups. In this light, we bring to you details of a scheme called the Startups Intellectual Property Protection Scheme. 

Objective of the Startups Intellectual Property Protection (SIPP) Scheme

  • The scheme is aimed at promoting intellectual property rights registration, awareness and encouraging innovation and creativity.
  • The scheme envisages mentoring emerging technologies among startups and helping them commercialise it by way of providing access to high-quality intellectual property services and resources. 

Eligibility for the Scheme

  • Under the scheme, a startup is an entity that has been incorporated or registered in India not more than seven years before the application. 
  • The annual turnover must not exceed ₹25 crores in any preceding financial year. 
  • The entity must be working towards innovation, development, or commercialisation of new products and processes or services which are driven by technology.
  • Additionally, the entity is not formed by the splitting up, or reconstruction, of a business already in existence. 
  • The entity shall cease to be a Startup if its turnover for the previous financial years has exceeded ₹25 crores or it has completed 7 years from the date of incorporation/registration.
  • A startup shall be eligible for availing the benefits of this scheme only after it has obtained certification from the startup certification board.


Operation of the Scheme

  • The scheme initially made to last until March 2020 has now been extended by three years to last until 31 March 2023. As many as 44,534 startups have already been recognised by the Department for the Promotion of Industry and Internal Trade (DPIIT) as of 24 February 2021. 
  • The government has also empanelled IP facilitators (patent agents and trademark attorneys) who will be working with startups in filing and prosecuting patent applications.
  • The plan includes a fast-track examination of patent applications and a rebate in fees.

Fast-tracking of Startup Patent Applications

A patent provides a protective cover to a startup with an innovation. To this end, the government has promised to fast track the process of application for examination and disposal, so that startups can realise the value of IPRs at the earliest.

Rebate on Filing of Application

Startups are provided with an 80% rebate for the filing of patents vis-a-vis other companies. 

The Importance of IPR for Startups

The Startups Intellectual Property Protection (SIPP) scheme underscores the importance of securing intellectual property rights for a startup. Below, we briefly outline the advantages of securing rights over intellectual property.

It is ideal for an early-stage business to secure ownership over intellectual property, such as brand name, trademarks, and patents. This is so because, in case of a possible infringement, such as someone else using the same name, logo, or goodwill, it is easier to establish your rights over IP. Most investors, while taking a call on your startup business’s worth, also factor in the IP value that you may gain in future. For those into inventions of a scientific nature, it is absolutely imperative to seek a patent registration at the earliest as the average time taken from filing to the actual granting is about five years in India.

Why You Should Register Your Trademark As Soon As Possible

While creativity may vest in designing a logo, just like artwork or writing a catchy slogan, these are not covered by the Copyrights Act. Almost any logo (The ‘swoosh’ for Nike), brand name (Coca-Cola), word (Classmate), label (Chanel), numerals (Forever 21), or even a combination of colours used (The blue, white, and red of Pepsi), qualifies to be a trademark. Since a business uses all of these in its dealings, casting an impression of a certain standard of quality, the law prohibits anyone else from employing the same combination and giving the impression that the goods belong to someone else. 


From medical equipment to scientific expedition tools and computer programs, technology surrounds us everywhere. A patent protects the way something is made, its process, its composition, and the methodology of its creation. It covers all stages in the spectrum – from conceptualisation to development and improvisation. 

Why Does Your Startup Need to File a Patent ASAP?

In India, a patent is granted for a period of twenty years. It is however advisable to file a patent as soon as possible, as claims in this regard are often decided on a ‘first to file basis. So, in case two people develop the same process independently, the one filing it first in the patent office has a superior claim. Moreover, in India, a patent takes on average five years from the initial filing to be granted. After it’s granted, the patentee may sell, license, or assign the patent or make commercial use of the patent in his or her own interest. However, the government has enough power to obtain a patent and make it compulsorily licensed for use in the interest of the public. 

Vakilsearch’s legal experts, adept in the latest developments in intellectual property in India, can assist your company in filing trademark and patents at the earliest.   


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