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Intellectual Property Rights and E-Commerce By: Navin Kumar Jaggi

October 31,2018:

The Author, Navin Kumar Jaggi , Advocate is CEO of Jaggi Jaggi and Jaggi Attorneys. He is a former Law Teacher of Delhi University, where he taught Law of Pleadings and Conveyancing, Law of Limitation, Arbitration Law, Labour Law, Law relating to the Seas and Constitutional Law. He has been Counsel for the Union of India as well as the Delhi Development Authority and several other Public Undertakings for many years.


The development of the World Wide Web has significantly led to the evolution of the Internet from a mere technological infrastructure to a network linking people, and ultimately to the fore runner of the Information and the Digital Age, which now plays a major role in the Economy.

Intellectual Property Rights and E-Commerce
Intellectual Property Rights and E-Commerce

This profound use of internet has also affected the legal world in so far as the protection of Intellectual Property (IP) Assets is concerned. Intellectual Property has assumed similar importance in E-Commerce as it has in the Offline Commercial Sphere.


The Intellectual Property Law protects against the disclosure of trade secrets and, as a result against the unfair competition. That makes Intellectual Property an asset that has more worth than any tangible asset. This can be seen most clearly in relation to technology and the digital economy.

Without Intellectual Property practices and laws, hard work is stolen and spread around the globe without paying the creator for their labour and intellect. Further, the two primary areas of concern here are:

i. Safeguarding one’s own Intellectual Property

ii. Violating someone else’s Intellectual Property


§ E-Commerce system, search engines or other technical Internet tools maybe protected by patents or utility models.

§ Software, including the text based HTML code used in website, can be protected by Copyright or Patents.

§ The website design is likely to be protected by Copyright.

§ Creative website content such as text, photographs, graphics, music and videos, maybe protected by Copyright.

§ Databases can be protected by Copyright or by sui generis database laws.

§ Business Names, Logos, Product Names and other signs posted on the website can be protected as Trademarks.

§ Computer generated graphic symbols, screen displays, Graphic User Interfaces (GUIs) and even webpage can be protected by the Industrial Design Law.

§ Protect the IP rights- register Trademarks, register a Domain Name that is user friendly and reflects the name and character of the business.

§ Patent the online business method.

In furtherance to the aforesaid elements of protection, apart from providing the protection, it is also necessary to make the fact public that the content material is protected through the Intellectual Property Laws. In order to convene the same, one may mark the Trademarks with

a.) symbol or

b.) by writing the name of the Copyright Owner and the year in which the work was published.

Another option is to use Watermarks that embed the Copyright information into the digital content itself. For example, a music file can be Watermarked by few bits of music samples to encode the ownership information.


A typical E-Commerce website is a collage of components owned by different persons. For instance, one company may own rights in the navigation software; other may own a copyright in photographs, graphics and text and yet another person may own copyright in the design of the website. Eventually it sums down to the actual owner of the E-Commerce business owner.


It must be noted here that both, Intellectual Property and E-Commerce, are totally interdependent on each other. Intellectual Property is important to E-Commerce and vice versa. E-Commerce, more than other business systems, often involves selling products and services that are based on IP and its licensing. Music, pictures, photos, software, designs et cetera can all be traded through E-Commerce, in which case, IP is the main component of value in the transaction. The IPR is important because the things of value that are traded on the internet must be protected, using technological security systems and IP laws, or else they can be stolen or pirated and the whole E-Commerce business can be destroyed.

E- Commerce business and internet related business is based on Product or Patent licensing. This is because so many different technologies are required to make a product that companies often outsource for the development of some component of products, or share technologies through licensing arrangements. If every company had to develop and produce all technological aspects of every product independently, development of high technology products would be impossible.



The balance that a Copyright System seeks to strike, that is safeguarding the rights of owners and public use, is the real challenge in the digital era. The creative content spanning the internet and information constituting the subject matter of E-Commerce are indeed protected by the Copyright. The rapid digitisation and unauthorised copying, reproduction and distribution of the work has caused the right owners to bear significant losses.

The circumstances under which an Online Service Provider (OSP) should be held accountable for infringing activities initiated by the subscriber is another issue. In India, though the Copyright Act does not address the liabilities of online intermediaries, in so far as Copyright Infringement is concerned, the Information and Technology Act (Amendment), 2008, though directly not addressing any IPR issues, makes a provision that would have an impact on the IPR in E-Commerce and digital environment. It also tends to clarify the scope of immunities available to the intermediaries.

The Copyright Owners, may themselves use technological protection measures, such as Encryption and Watermarking to safeguard their Rights. Also under “Digital Rights management (DRM)”.


Trademarks are of considerable importance in E- Commerce and are of similar significance in the online world as in the physical world. The brand plays a crucial role in the E-Commerce, more so because the consumer is deprived of face to face interactions in the virtual market. The challenges that a Trademark Owner faces in the online environment include unauthorised deep linking, meta-tagging, banner advertising, framing, search engine marketing abuse, SEO manipulation, pop up advertisements, mouse trapping etc.

Companies across the world practicing E-Commerce are coming up with different techniques to curb the problem of such

infringement. One such approach is linking from websites, such that a list of multiple trademarks is included on one website which further directs the customers to relevant trademarks sites. For example- disc.com offers access to ‘Distributor Systems Corporation of Farmington, Connecticut’ as well as dynamic information systems Corporation of Boulder, Colorado. This approach allows the companies to reconcile the limitation of registering only one ‘disc.com’ domain name in the cyberspace with the ability for separate businesses to own the same trademark in two different geographic locations in the physical world.


Undeniably, the rapid technological growth in this arena is the outcome of incentives, provided by the patents to the researchers and innovators. The business intelligence is however divided on the patenting of the business methods. It is contended that the companies may exploit the system to obtain the patents for business methods that are not new and already exist in the cyberspace.


In order to observe the significance of IPR in carrying out the practices at E-Commerce, it shall be thoroughly noted that the fair compliance of the activities can’t be achieved in such a dynamic and diverse virtual world without the presence of such rights whereby, technological inventions are being brought up from time to time and in a more effective way.

Thus, in order to maintain the secrecy in the trade activities and further providing the actual share of profits to the righteous owner, without getting one’s right infringed. IPR stands as a protective guard to the activities held at the virtually challenged E-Commerce arena and thus the success rate solely relies upon the protection of the E-Commerce businesses via adopting effective measures of IPR.

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