Rules are a form of delegated legislation which are intended to carry out ancillary or subordinate legislative functions - often called `filling up the details.' The Parliament may, after laying down the legislative policy in an Act, confer discretion on an administrative agency to work out the details within the framework of the policy by issuing rules.

The Patents Act clearly states the legislative policy that the Government will have the right to sell or distribute a drug if necessary in the public interest. The fact that the rules define what `public interest' means cannot be viewed as more than filling up the details in the parent Act which is the purpose of delegated legislation. The provision of a definition by the Patent Rules cannot be misinterpreted as somehow illegally `restricting' the Patents Act. Instead, the rules are aiding the interpretation of the parent Act.

As delegated legislation, the Patent Rules can be scrutinised by thecourts and declared invalid on two grounds: Violation of the Constitution; and violation of the provisions of the Patents Act. The rules must be consistent with the provisions of the Patents Act and must not go beyond what the Act contemplates. The definition of "public interest" in the rules does not contradict the provisions of the Patents Act. The Patents Act does not even define `public interest'. As the definition of `public interest' neither violates the Constitution of India nor the provisions of the Patents Act, there is no basis for judicial review of the Patents Rules.

The definition of `public interest' in terms of national emergency has been challenged on the grounds that it prevents the Government from selling medicines in circumstances where, for example, prolonged short supplies have led to high prices or the medicines are needed for national health plans, in short, in critical situations which do not amount to national emergencies.

However, this view overlooks the fact that the provisionsallowing the sale and distribution of medicines by the Government are provisions of last resort. The Patents Act also provides for compulsory licensing of drugs and medicines with respect to which an EMR has been granted where the reasonable rights of the public have not been satisfied.

In other words, a person other than the EMR-holder can sell and distribute the medicine in circumstances where the drug is not readily available to the public or shortages exist which do not amount to national emergencies.

In view of the compulsory licensing provisions, limiting the Government's right to sell and distribute a drug only in national emergencies makes sense. Moreover, it is consistent with the fundamental purpose of the Patents Act which is to create a balance between the rights of the EMR-holder to be compensated for new medicines and the interest of the public in having access to the same. As there is no conflict between the rules and the Act and the rules further the purposes of the Act, judicial reviewcannot be exercised by the courts to scrutinise the validity of the rules.

Furthermore, the definition of `public interest' in the Patents Rules is taken verbatim from the TRIPs Agreement. The TRIPs agreement allows a government to use a product which is the subject matter of a patent without the authorisation of the right holder under certain circumstances. Products protected by EMRs are, by definition, the subject matter of a patent because an EMR may not be granted unless a product has been patented in a country.

Under the TRIPs agreement, a drug covered by an EMR may be sold by a person other than the EMR-holder only if the proposed user has made efforts to obtain authorisation from the right holder on reasonable commercial terms and conditions and such efforts have not been successful within a reasonable period of time. This requirement may be waived in the case of a `national emergency or other circumstances of extreme urgency.'

This language is identical to the definition of `public interest'in the Patents Rules. This means that both the TRIPs agreement and the Patent Rules provide that, even though an EMR with respect to a particular drug has been granted to a person, the Government can use such drug in a national emergency or other circumstances of extreme urgency. Since the language of the Patents Rules is identical to that of the TRIPs agreement, it cannot be argued that the Patents Rules have somehow `exceeded' the TRIPs agreement.

Moreover, the EMRs created under the TRIPs agreement are still stronger than those under the Patents Rules. In order for any person, including a government, to use a drug protected by an EMR, without the authorisation of the EMR holder, a series of conditions must be complied with under the TRIPs agreement. As discussed above, the TRIPs agreement requires that the proposed user must have made efforts to obtain authorisation from the EMR holder on reasonable commercial terms and conditions and such efforts were not successful. Furthermore, such use must benon-exclusive and non-assignable, the use must be predominantly for the supply of the domestic market, and the right holder must be paid adequate remuneration even in the event of a national emergency. In contrast, none of these conditions circumscribe the use of a drug protected by an EMR without the authorisation of the right holder by the Government under the Patents Act. Therefore, it is much easier for the Government to use a drug protected by an EMR without the authorisation of the holder under the Patents Act than under the TRIPs agreement.

In sum, the Patent Rules' definition of `public interest` in terms of national emergency does not violate the provisions of the Patents Act. In fact, the definition is entirely consistent with the scheme of the Patents Act. Since the compulsory licensing provisions already allow a person other than the EMR holder to sell a drug if it is not reasonably available to the public, then allowing the Government to also sell and distribute such drug should be limited tonational emergencies. As there is no conflict between the rules and the Act, there is no basis for judicial review of the rules.

Moreover, the definition of `public interest' has been taken verbatim from the TRIPs Agreement and, as such, have been validly promulgated in accordance with India's international obligations.

The author is a Delhi-based advocate