Patent assignment in India: how a company buys a patent, and when a licence is better

Sometimes a company does not want permission to use a patent. It wants to own it. That is a patent assignment: the owner transfers the patent, or a share of it, to the buyer. It is the right move in some deals and an expensive mistake in others. This guide explains how assignment works under Indian law, what to file, what it costs, and when a licence is the better choice.

Assignment or licence: what you are actually buying

An assignment transfers ownership. After it is registered, you are the patentee. You decide who else may use the invention, you can sue infringers in your own name, and you pay the renewal fees.

A licence gives you permission to use the patent while the owner keeps it. It can be exclusive or non-exclusive, limited to a field, a territory or a period, and paid for through royalties. We cover licence types in exclusive or non-exclusive licences.

When buying makes sense

• The patent is core to your product and you cannot accept the owner licensing it to a competitor or ending the deal.
• You want to enforce it. An owner can sue infringers. An exclusive licensee's position depends on the agreement and the facts.
• The seller wants out. A startup closing down, an inventor without funds for renewals, or a company exiting a line of business may prefer a clean sale.
• You want to license it onward. Ownership lets you build a licensing programme.

When a licence is better

• You need only one field or territory. Paying for worldwide ownership of rights you will not use wastes money.
• The seller is a university or public lab. Many prefer to license rather than assign, and their IP policy may require it.
• Cash matters. A licence spreads the cost over time through royalties tied to your sales.
• The technology is unproven. Pay for the right to try before you pay for the whole asset.

For the bigger strategic choice, see build, buy or license.

The legal rules in brief

Section 68: it must be in writing. An assignment of a patent or a share in it is not valid unless it is in writing, contains all the terms and conditions governing the parties' rights and obligations in one document, and is duly executed. A handshake or an email chain is not enough.

Section 69: register it. The buyer applies to the Controller to register its title. The seller may apply instead. The Controller registers the title once satisfied with the proof, and can wait for a court decision if the parties dispute it.

Section 69(5): the cost of not registering. An unregistered assignment deed cannot be admitted as evidence of title in court, except in a registration or rectification application, unless the Controller or the court allows it and records reasons in writing. In practice, an unregistered buyer is badly placed to enforce the patent.

Section 70: what the registered owner can do. The person registered as proprietor can assign, license and otherwise deal with the patent, subject to co-owner rights and to anything recorded on the register.

Section 50: co-owners. Where a patent has two or more owners, each holds an equal share unless they agree otherwise. One co-owner cannot assign its share or grant a licence without the consent of the others, unless an agreement says otherwise. Buying from one co-owner without the others' consent can leave you with a share you cannot use as you planned.

How to register a patent assignment: step by step

Step 1: Check title and status

Before signing, confirm who owns the patent and whether it is alive. IP India's public search (InPASS) lets you see the applicant details, the application status and the patent e-register, which shows renewal history and the next due date. Check that the chain of title from the inventors to the seller is complete. Our patent due diligence checklist covers this in detail.

Step 2: Sign the assignment deed

The deed should identify the patent by number, state whether you are buying the whole patent or a share, set the price and payment terms, and cover warranties on title, overdue renewal fees, pending proceedings, existing licences and cooperation for future filings. Section 68 requires all terms in one document.

Step 3: Pay stamp duty

An assignment deed is an instrument under the Indian Stamp Act and state stamp laws. The duty depends on how the deed is classified and on the state where it is signed, so it varies. An unstamped or under-stamped deed may not be admissible as evidence until the duty and any penalty are paid. Take local advice before signing.

Step 4: File Form 16

The buyer (or the seller) files Form 16 with the Patent Office, with the deed. Under Rule 91 the document is filed with the application, in two certified copies unless the Controller directs otherwise. The Controller may ask for more proof.

Step 5: Confirm the register is updated

Once the Controller registers the assignment, the e-register shows you as the proprietor. Check it. Set the renewal dates in your own calendar from that day, because renewals are now your problem.

Buying a pending application

If the patent has not been granted yet, you are buying an application. The route is different: the buyer files Form 6 under Section 20 to be substituted or added as applicant, producing the original deed or an official or notarised copy. If the application has joint applicants, an assignment by one needs the others' consent.

Official fees

These come from the First Schedule to the Patents Rules. Check the current schedule on the IP India website before filing.

Physical filing costs about 10% more. The fee category depends on the applicant filing the form, so a large company pays the higher rate even if it buys from a startup.

Renewal fees after the sale

A granted patent stays in force only while annual renewal fees are paid. The rules do not say who must pay around a sale, so the deed should. Check the e-register for the next due date, and agree who pays any fee that falls due or is overdue near closing. If a fee is missed, it can still be paid within six months with an extension request on Form 4. Our guide to patent renewal in India has the fee table.

Foreign patents are separate

Patents are territorial. Registering an assignment on Form 16 covers only the Indian patent. If the seller holds family members in the US, Europe or elsewhere, each needs its own assignment recorded in that country. In the US, for example, an unrecorded assignment can be void against a later buyer who paid without notice, unless it is recorded within three months or before that later purchase.

Tax: get advice

The tax treatment depends on whether the transaction is a sale or a licence, on who is selling, and on the facts. The Income-tax Act, 2025 took effect on 1 April 2026, so older articles may cite section numbers that have changed. Speak to a chartered accountant before you agree the price structure.

Common mistakes

• Buying from one co-owner without the other co-owners' written consent.
• Not registering. Section 69(5) makes an unregistered deed weak evidence of title.
• Ignoring stamp duty until a dispute forces the question.
• Letting renewals lapse in the handover period.
• Forgetting foreign family members and recording only the Indian patent.
• Buying when a licence would do. Ownership brings costs: renewals, enforcement and portfolio management.

Finding patents worth buying or licensing

Many of the technologies Indian companies want sit in universities and labs, which usually prefer to license. Zernyx Hub indexes about 6.5 lakh technologies from the last ten years, with AI-generated business insight on each, including commercial applications, so you can search and compare options before deciding whether to license or approach an owner about a sale.

FAQ

What is the fee to register a patent assignment in India?

Form 16 costs ₹1,600 per patent when e-filed by a natural person, startup, small entity or educational institution, and ₹8,000 per patent for others. Check the current First Schedule before filing.

Is it mandatory to register a patent assignment?

The assignment is valid once it meets Section 68, but under Section 69(5) an unregistered deed cannot normally be used as evidence of title in court. Registration is essential in practice.

Can I buy a patent application before it is granted?

Yes. The buyer files Form 6 under Section 20 to be substituted as applicant, with the assignment deed or an official or notarised copy.

Can one co-owner sell a patent without the other?

Under Section 50, a co-owner cannot assign its share or grant a licence without the consent of the other co-owners, unless they have agreed otherwise.

Is a licence also registered on Form 16?

Yes. Section 69 covers licences and other interests as well as assignments, and the same form is used.