SEMICONDUCTOR INTEGRATED CIRCUITS LAYOUT-DESIGN

"Semiconductor Integrated circuits Layout- Design Act 2000" is a supplement act to designs.

With the growing technological development in the field of information technology, a new branch in the field of intellectual property flourished, called as the Layout-Design and the semiconductor integrated circuits.

The semiconductor integrated circuit is an integral part of every computer chip. The fifth generation computers were using Very Large Scale Integration (VLSI) where numerous transistors are accommodated on a single chip, cutting down the size of the chip and at the same time increasing it’s processing power significantly. This ultimately translates into smaller and more powerful computers. Hence, the development of the layout-design on a semiconductor integrated circuit as an intellectual property is quite significant.

Therefore, a step was taken by various organizations to pass regulations regarding this issue. One such was the World Trade Organization, and the result was the TRIPS agreement addressing the intellectual property related issues. India being a signatory of the WTO also passed an Act in conformity with the TRIPS agreement called the Semiconductor Integrated Circuits Layout-Design Act (SICLDA) passed in the year 2000.

Definitions

·      "Semiconductor integrated circuit"

According to section 2 (r) of the Act, ‘Semiconductor integrated circuit’ means a product having transistors or other circuitry elements, which are inseparably formed on a semiconductor material or an insulating material or inside the semiconductor material and designed to perform an electronic circuitry function.

·      "Layout-design" 

According to section 2 (h) of the Act, ‘Layout-design’ means a layout of transistors, and other circuitry elements and includes lead wires connecting such elements and expressed in any manner in a semiconductor integrated circuit. Section 2 (n) of the Act defines ‘registered layout-design’ to mean a layout-design which is actually on the register.

·      "Commercial exploitation" 

According to section 2 (e) of the Act, ‘commercial exploitation’ in relation to the SICLD means to sell, lease, offer or exhibit for sale or otherwise distribute such semiconductor integrated circuit for any commercial purpose.

·      “Registered Proprietor”

According to section 2(o) of the Act, ‘registered proprietor’ in relation to a layout-design, means the person for the time being entered in the register as proprietor of the layout-design.

·      “Registered User”

According to section 2(p) of the Act, ‘registered user’ in relation to a layout-design means a person who is for the time being registered as such under section 25.

(According to section 25, a person may be registered as a registered user of the layout design when the registered proprietor and the proposed registered user apply jointly in writing to the Registrar. The application shall accompany the agreement in writing or its authenticated copy, entered between the registered proprietor and registered user. The registered proprietor also has to submit an affidavit to the satisfaction of the Registrar.)

Need for Protection of IC designs:

Product life cycles in many industries are shortening. The length of time and amount of investment required, to obtain intellectual property rights, especially patents, can be disproportionate to the life of such product. Requirements such as the need to mark products with "patent pending" also become impracticable when products have short life cycles and use many different technologies subject to different patents, especially when these products are miniaturized.

Protection under Patent or other IP Laws:

·      Integrated circuits comprises of numerous building blocks, each block being patentable. Since an integrated circuit contains hundreds or thousands of semiconductor devices, a claim to an integrated circuit would have to cover hundreds or thousands of individual elements. Consequently, a patent claim that attempts to describe an entire integrated circuit may be hundreds of pages long. Clearly, such a narrow claim would provide almost no protection. 

·      Even if one sought such narrow protection, writing a patent application supporting a claim with thousands of elements would be extremely complex, cumbersome, and expensive. Obviously, integrated circuits are not easily describable in a patent specification or the claims. 

·      Also, it may take several years to obtain an integrated circuit patent from most patent offices worldwide. This is unacceptable given that an integrated circuit’s useful commercial life may be less than one year. The cumbersome, time-consuming nature of filing combined with extremely narrow protection often makes patent law an insufficient form of protection for integrated circuits.

·      Other forms of existing intellectual property protection are also inapplicable to integrated circuit layouts. Design patents protect the ornamental, but not the functional, aspects of an article of manufacture described in its drawings. Since integrated circuit layout is more functional than ornamental, design patent protection is generally inapplicable to integrated circuits.

·      Finally, trade secret law cannot be used to protect most integrated circuits because an integrated circuit layout may be reverse-engineered.

·      The layout of transistors on the semiconductor integrated circuit or topography of transistors on the integrated circuit determines the size of the integrated circuit as well as its processing power. That is why the layout design of transistors constitutes such an important and unique form of intellectual property fundamentally different from other forms of intellectual property like copyrights, trademarks, patents and industrial designs.

·      Given that patent, copyright, and trade secret law cannot adequately protect integrated circuit design, hence an exclusive protection for semiconductor integrated circuits layout-design has became necessary to the semiconductor industry.

History and Genesis of protection:

Ever since the early 1970s, chip pirates have quickly produced copies of semiconductor chips at vastly reduced prices by copying chip designs and avoiding the expensive research and development phase. This problem was particularly prevalent in the US where, until 1984, there was virtually no intellectual property protection for the IC layout, which cost millions of dollars to design and develop. As a result, the manufacturers of ICs sought some sui generis (Unique) form of intellectual property protection for this backbone of modern technology.

Need For Sui Generis Protection:

The need for a sui generis form of protection developed primarily as a result of chip piracy, which threatened to undercut the vitality of the semiconductor industry. Chip pirates could sell identical chips for lower prices than could the companies that originally designed them. This caused legitimate companies that engaged in chip research and development to cut prices to compete with pirated chips, which deprived legitimate companies of the funds needed to carry out further research and development to build the next generation of chips. Legitimate companies could not get adequate chip protection under patent, copyright, or trade secret law, so a sui generis form of protection was provided.

What is protected?

A layout design expressed in any manner, which is original, which has not been commercially exploited for more than 2 years from the date of application for the registration, which is inherently distinctive and capable of being distinguishable from any other registered layout design, is protected or registered under the Act.

Who can apply?

·      The application for the protection of layout design can be made by the person who claims to be the creator of the layout design, his legal representative, a person registered in the prescribed manner as a layout design agent or a person in the sole and regular employment of the principal, in writing to the registrar in the prescribed manner.

·      The application can be filed either alone or jointly. The application has to be filed within the territorial limits that is a principal place of business in India of the applicant.

Procedure for registration

·      Filing of application in writing to the registrar in the office of SICLD registry in a prescribed form along with 3 sets of drawings produced to the plotter which describes the layout design and 3 sets of photograph of masks used for the fabrication of the semiconductor integrated circuits by using of the layout design or drawings which describes the pattern of such masks.

·      Acceptance of the application with acknowledgement by way of returning one copy of the application. The registrar can also withdraw the acceptance if the application is found to be prohibited for registration.*

·      The application is advertised in a prescribed manner within 14 days of acceptance of layout design application. If any opposition is found to the registration, then a notice is sent to the registrar in the prescribed manner within 3 months from the date of advertisement. The registrar can call for evidences to be produced by both the parties and finally give his decision.

·      If the application is not opposed or the opposition has been decided in favor of the applicant, the registrar shall register the said layout design in the register of layout design and also issue a certificate sealed with the seal of the SICLD Registry.

*Grounds for Prohibition of Registration

Section 7 of the Act lays down grounds for prohibition of layout-design. It provides that a layout-design shall not be registered -

a.     Which is not original; or 

b.     Which has been commercially exploited anywhere in India or in a convention country; or 

c.      Which is not inherently distinctive; or 

d.     Which is not inherently capable of being distinguishable from any other registered layout-design, 

Provided that a layout-design which has been commercially exploited for not more than two years from the date on which an application for its registration has been filed either in India or in a convention country shall be treated as not having been commercially exploited for the purposes of this sub-section. 

Original Layout-Design

According to Section 7(2), a layout-design shall be considered to be original if it is the result of its creator's own intellectual efforts and is not commonly known to the creators of layout-designs and manufacturers of semiconductor integrated circuits at the time of its creation. Hoever, a layout-design consisting of such combination of elements and interconnections that are commonly known among creators of layout-designs and manufacturers of semiconductor integrated circuits shall be considered as original if such combination taken as a whole is the result of its creator's own intellectual efforts. 

According to section 7 (3), where an original layout-design has been created in execution of a commission or a contract of employment, the right of registration to such layout-design under this Act shall belong, in the absence of any contractual provision to the contrary, to the person who commissioned the work or to the employer.

Duration of Registration

The registration of the layout design shall be only for the period of 10 years counted from the date of filing an application for registration or from the date of first commercial exploitation anywhere in any country, whichever is earlier.

Exclusive Right to the Registered Proprietor

The registration of the layout design gives to the registered proprietor of the layout design the exclusive right to the use of the layout design and to obtain relief in respect of infringement. This right shall be available to the registered proprietor of that layout design irrespective of the fact as to whether the layout design is incorporated in an article or not.

Assignment and Transmission

A person who becomes entitled by assignment (in writing) or transmission (operation of law) to a registered layout design shall apply to the Registrar in the prescribed manner to register his title. The Registrar, on the proof of the title being to his satisfaction, will register him as the proprietor of the layout design.

Protection against Infringement

The act of reproducing, selling, importing and distributing of integrated circuit layout design for commercial purposes constitutes infringement. Where such act is performed for the purposes of scientific evaluation, analysis, research or teaching it shall not constitute the act of infringement.

Any person who commits infringement shall be punishable with imprisonment for a term, which may extend to 3 years, or with fine which shall not be less than fifty thousand rupees but which may extend to ten lakh rupees, or with both.

Adjudicating Authority

·      The Government of India appoints a person to be known as a registrar of the SICLD. He has both administrative and legal powers.

·      Any person aggrieved by an order or decision of the Registrar may file an appeal to the Layout Design Appellate Board. The procedure and powers of the Appellate Board are that of a civil court as given under the Civil Procedure Code, 1908. 

·      If any person is not satisfied by any decision or order of the Appellate Board may file an appeal to the High Court within prescribed period and in a prescribed manner.

Compulsory Licences

Section 51, of the Act, empowers the Appellate Board to permit the use of registered layout-design by the Government or by any person authorised by the Government on an application made in the prescribed manner, and after providing an opportunity of being heard to the parties concerned. 

The permission shall, however, be given subject to any or all of the following conditions as the Board deems fit under the circumstances of such use. These conditions are:

a.     That the use of the layout-design shall be for non-commercial public purposes or for the purposes relating to national emergency or of extreme public urgency; 

b.     That the duration of the use of the layout-design shall be limited for a period specified by the Board. 

c.      That the use of the layout-design shall be non-assignable and non-transmissible; 

d.     That the use of the layout-design shall be to the extent which the Board deems necessary to remedy the anti-competitive practice; 

e.     That the use of the layout-design shall be predominantly for the supply of semiconductor integrated circuits or articles incorporating semiconductor integrated circuits in domestic market of India.

 It is obligatory for the person so authorised to first make efforts to enter into agreement with the registered proprietor of such layout-design on reasonable commercial terms and conditions for permitted use of such layout-design. It is only when such efforts have not been successful within prescribed period that the Board shall permit the use of such layout-design.

However, there shall be no such obligation for such person where he produces to the Board a certificate issued by the Government to the effect that such use is required due to national emergency or any other circumstances which the Government considers to be of extreme urgency or of public non-commercial use. 

The Appellate Board shall determine the amount of royalty to be paid by the Government or the person authorised by the Government, as the case may be, to the registered proprietor of such layout-design for such permitted use. 

The Appellate Board may, on the application of the registered proprietor of a layout-design referred to above, may review the permission granted and, after giving notice and opportunity of hearing to the parties concerned in the prescribed manner, cancel or amend such permission if the Board is satisfied that any of the conditions subject to which the permission was granted has not been observed or the circumstances which led to the granting of such permission has ceased to exist or substantially altered.

Convention Countries

Any country which accords to the citizens of India similar privileges and rights as granted to its own citizens, the Central Government may specify such country to be a convention country and provide the citizens of such convention countries the similar privileges as granted to citizens of India under the SICLD Act. Where any country does not accord to the citizen of India the same rights in respect of registration and protection of layout design as it accords to its own citizens, the citizens of such countries shall not be entitled to be registered as a proprietor of layout design, assignee of the proprietor of a registered layout design or to be registered as a registered user of a layout design.

Summary

·       There is protection of semiconductor integrated circuits layout and designs by a registration process.

·       There is a mechanism for distinguishing which layout designs can be protected.

·       There are rules to prohibit registration of layout designs which are not original or which have been commercially exploited.

·       Protection of 10 years period is provided to layout designs.

·       Provisions regarding infringement and evidence of validity are mentioned.

·       There are provisions for determining payment of royalty for registered layout designs in case of innocent or unintentional infringement.

·       Penalties in the form of imprisonment and fine are imposed for willful infringement and other offences in the Act.

·       The Registrar is appointed for the purpose of administration and the Appellate Board is established for facilitating the legal objective.

Conclusion

The SICLD Act fulfills India’s obligation under the TRIPS agreement as approved by the members of WTO. The intellectual property protection for Integrated Circuit layout design is a key factor throughout the world, and more so in India because it does not have a strong intellectual property protection policy in software. As integrated circuit layout designs is in its early years in India, it’s important that the country boosts of a strong protection policy right in the beginning itself and the SICLD Act provides such a strong protection policy.

The number of Indian companies focusing on integrated circuit design is beginning to grow and this would force major semiconductor companies to set up their offices and address the needs of the domestic market. This will encourage a lot more companies to base their operations in India.

The Indian legislation therefore provides a comprehensive protection to the layout designs of the semiconductor integrated circuits as recognized intellectual property and bundle of rights to the proprietor of the registered layout design.