The Interaction between AI and IPR: Opportunities And Challenges

Paper Code: AIJACLAV04RP2025

Category: Research Paper

Date of Publication: May 19, 2025

Citation: Dr. Ashwini. P & Ms. Shravya Rao, “The Interaction between AI and IPR: Opportunities And Challenges", 5, AIJACLA, 23, 23-34 (2025), <https://www.aequivic.in/post/the-interaction-between-ai-and-ipr-opportunities-and-challenges>

Author Details: Dr. Ashwini. P, Assistant Professor, SDM Law College, Mangalore &

Ms. Shravya Rao, V year B.A.LL. B Student, SDM Law College, Mangalore

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Abstract

Artificial Intelligence (AI) has transformed the way people think of Intellectual Property Rights (IPRs) by transforming legal frameworks, patent innovation and content creation. The landscape of Intellectual Property Rights (IPR) has been completely transformed by the quick development of Artificial Intelligence (AI), which has brought up important issues about patentability, authorship and ownership. This paper examines the potentials and problems brought about by AI driven innovation, offering a thorough examination of the relationship between AI and IPR. The study looks at how AI may affect conventional ideas of Intellectual Property Rights, including the possibility and new economic models. It also explores the difficulties of patenting AI-generated inventions, negotiating the intricate details of international agreements, treaties such as TRIPS agreement, WIPO guidelines and other patent laws. Additionally, by analysing current global governance frameworks and agreements, this study explores the function of international collaboration in tackling AI-IPR concerns. Suggestions for enhancing global governance of AI-IPR are informed by a critical evaluation of international collaboration initiatives.  This paper offers an advanced comprehension of the AI-IPR relationship by combining insights from technology, ethics, and law in a multidisciplinary manner. For legislators, business executives and legal academics attempting to negotiate the quickly changing terrain of artificial intelligence and intellectual property rights.

Keywords: Authorship, ethics, data privacy, conventional ideas, patent law, international collaboration.

Introduction:

It is evident that technological advancement has impacted almost every aspect of contemporary society. Because of how deeply technology has permeated our daily lives, it seems though the digital world absorbed the physical world and the distinctions between the two are becoming harder to differentiate. Today, technology is both necessary and inevitable in the creation of innovations. While technology is important for new age innovations, it has also diminished and in some cases, completely replaced the amount human effort. This creates the problem where new works created using software programs and algorithms are indistinguishable from those that come from human effort[1].

Complex legal and moral issues are brought up by the nexus between Artificial Intelligence and Intellectual Property Rights, especially in relation to ownership, authorship and infringement. Traditional copyright and patent regimes are challenged by AI generated works since human authorship or inventorship is frequently required by law. Patents for AI driven inventions raise questions regarding whether human control required or if AI may be regarded as an inventor[2]. AI is also transforming anti-counterfeiting and trademark enforcement through automated detection systems. However, issues with fair use and infringement are also brought up by AI’s capacity to copy or alter previously created works. Legal frameworks must change as AI develops further in order to strike a balance between innovation and the protection of Intellectual property.

Internationally, there are both complicated legal opportunities and challenges at the nexus of AI and IPRs. Under Copyright law, only human creators are now recognised in many jurisdictions, including the US[3] and the EU. AI driven inventions are also problematic for patent rules, especially when it comes to whether AI is recognised as an inventor. Concerns around copyright infringement, fair use and data mining exclusions under agreements like the TRIPS Agreement[4] and Berne Convention[5] are also raised by AI’s capacity to evaluate and duplicate protected works. WIPO is one of several international bodies which currently investigating legislative reforms to strike balance between IP protection and innovation. The adaption of IPR laws to AI while maintaining moral and legal protection is still up for dispute on a worldwide scale.

This research article aims to provide comprehensive analysis of intersection between AI and IPR, examining the challenges and opportunities of AI in IPR and also with regard to current and future legislative frameworks which affects the AI and IPR

International Frameworks and Agreements:

Comparative analysis of AI and IPR laws across various jurisdiction:

Different countries and different regions are taking various approaches to address the challenges posed by AI in IPR domain countries like US, EU, Japan, China, UK, etc., are taking various initiations to tackle the challenges posed by AI in IPR.

United States:

A developing legal issue is whether AI generated creation and innovations are eligible for intellectual property protection. The U.S. Copyright Office has routinely rejected applications for AI generated content that lacks human creative input, maintaining that copyright protection only extends to works written by human authors. In a similar vein, the USPTO[6] has consistently rejected patent applications that claim AI system inventors, reiterating that only people are eligible to be recognised as inventors under US law. These stances have generated discussions about whether or not current legal frameworks need to be modified to take Artificial Intelligence developments into account[7]. While some argue against changing the existing human centric IP laws, others support revisions that would allow AI assisted ideas to be protected.

European Union:

Through laws like the AI Act and the Data Act, the EU has taken important steps to regulate Artificial Intelligence and how it interacts with IP. By creating a thorough framework for AI development and application, the AI Act seeks to guarantee that technology complies with moral principles and fundamental rights. In a similar way, the Data Act affects how AI systems use and produce data by emphasising equitable access and use of data. The EPO[8] has reaffirmed the need for human inventors in the field of patents, specifically rejecting AI generated discoveries that were not created by human. This ruling supports the prevailing legal position that human input is necessary for creativity and invention, as acknowledged by patent law[9]. Additionally, the EU has been actively developing ethical AI principles that prioritise fairness, accountability and openness in AI system. In order to ensure that technical breakthroughs stay compatible with current legal frameworks, these principles may influence future IP rules, notably with regard to AI assisted creations, copyright, ownership and data usage rights.

United Kingdom:

A potential foundation for addressing the Copyright status of AI generated content is provided by the unique clause in the UK Copyright legislation that protects computer generated works. The UK differs from many other jurisdictions in this regard, as it assigns authorship to the individual who made the required arrangements for the creation of the work. The UKIPO[10] has held consultations on AI and IP, indicating a willingness to investigate possible reforms in light of the changing importance of AI in creative industries[11]. In order to keep copyright law flexible in the face of developing technology, these debates show an attempt to strike a compromise between innovation and legal certainty.

China:

China has shown a strong commitment to modify its IP rules to meet new challenges and it has been rapidly developing its AI capabilities. The protection of AI generated content under Chinese Copyright law has been clarified by recent court ruling. China has recognised the increasing role of AI in content creation and has begun to adapt its legal structure to accommodate it, even though traditional copyright law protects works written by human writers. When evaluating whether AI generated works are eligible for copyright, courts have taken into account elements like originality and human interaction[12]. These changes are a reflection of China’s larger approach to strike a balance between legal protections and innovation, making sure that its legal system keeps up with swift breakthroughs in technology.

Japan:

Japan has been actively investigating legal frameworks to safeguard works produced by AI, taking into account either new rights or modifications to current copyrights regulations. Clarifying patent eligibility and requirements for AI driven breakthroughs, the Japan patent office (JPO) has released rules for reviewing inventions pertaining to AI. These principles cover topics including inventorship, the importance of human participation and whether current IP laws apply to works produced by AI. By improving these laws Japan hopes to strike a balance between legal protection and creativity, guaranteeing that AI generated works are properly acknowledged while adhering to global IP norms.

WIPO initiation relating to AI and IPR:

The World Intellectual Property Organisation (WIPO) plays a crucial role in addressing the legal and policy challenges posed by AI in IPR. As usual AI continues to revolutionise creativity, innovation, process of business, etc WIPO has been actively in discussions on how the IP laws should be adapted and future circumstances that can be raised to which proper frameworks have to be made.

WIPO conversation on AI and IP, series of conversation sessions which brings the member states and the stakeholders to discuss the impacts and how to deal with newly generated problems of AI in IP policies[13]. WIPO has conducted various expert meetings, public consultations, and policy discussions to collect various perspectives on how the AI should be treated under existing IP legislations.

 It also published a Technology Trends Report on AI, which spoke about global AI related patent filings, trademarks, industrial designs. This report helped the legislators and businesses to understand the impact of AI on innovations and IP systems[14].

Key issues in AI and IPR include authorship and inventorship, i.e., who authored the work and who invented the work. The debates arise on whether AI can be recognised as an inventor or author, challenging traditional IP laws. Patentability of AI generated inventions is another concern, as some jurisdictions deny patents for AI listed inventors, while others allow them if a human plays a role. Copyright protection for AI generated works remains uncertain with discussions on whether AI generated content should receive protection and who should own the rights. Lastly, AI in trademark and IP enforcement presents both opportunities and challenges, as AI helps to detect infringements but also raises challenges like deepfakes and automated brand naming. WIPO continues to explore these issues to develop balanced and effective policies.

Bilateral and Multilateral Agreements which are addressing the AI and IPR:

There are specific agreements dedicated mainly on AI and IP which are still developing, several existing international treaties and regional agreements have significant implications for the intersection of AI and IP. These agreements provide a framework for addressing emerging challenges to AI generated contents, patentability and protection of such innovations.

TRIPS Agreement:

The Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS), administered by the World Trade Organisation (WTO), which sets minimum standards for IP protection across the member states. With the rise of technologies, TRIPS may require modifications as per the changes that is to provide safety to the innovators, authors rights on their works[15].

WIPO Copyright Treaty (WCT) and WIPO Performances and Phonograms Treaty (WPPT):

The WCT and WPPT, collectively known as the “Internet Treaties” were they designed to address Copyright challenges in the digital era. However, they may need revisions to accommodate AI generated contents. Questioning the authorship, ownership and liability for Ai generated works which are relevant and these treaties may play a crucial role in shaping international standards for such contents.

Patent Cooperation Treaty (PCT):

The PCT facilitates international patent applications, which need to evolve to address AI related inventions. Various jurisdictions have taken different stances on AI inventorship and future amendments to PCT could provide greater clarity and uniformity in handling AI driven patents[16].

Some Reginal Agreements: 

There are several regional agreements which incorporate provisions that may affect AI and IP. The European Patent Convention (EPC), which governs patent law in Europe, which is currently exploring AI inventorship issues and how patent laws should accommodate AI generated innovations.

The United States-Mexico-Canada Agreement (USMCA) includes provisions on algorithmic transparency that could influence the regulation of AI related IP.

AI Specific Collaborations:

Including all the Traditional IP agreements, there are various AI specific collaborations to shape the AI and IP discussions. One of them is the Global Partnership on Artificial Intelligence (GPAI)[17], which focuses on responsible AI development and indirectly impact IP policies by promoting best practices in AI governance.

Similarly, the EU-US Trade and Technology Council has established working groups on technology standards and AI, which include discussions on AI generated inventions and copyright related issues.

These initiatives do not constitute formal treaties yet, they contribute to shape future regulatory approaches to AI and IPR in global standards[18].

Challenges with regard to protection of AI creations:

Copyright:

One of the key challenges in granting copyright protection to AI generated works in India is determining whether they meet the originality criterion Under Section 13 of the Copyright Act, 1957. While the term “original” is not explicitly defined, the Supreme Court in Eastern Book Co. Vs D.B. Madak[19], adopted the “modicum of creativity” standard, which requires a minimum level of creativity beyond mere effort or skill. Given this relatively low threshold, AI generated works could qualify as “original” and be eligible for copyright protection.

In 2020, Indian Copyright Office faced case involving an AI system which is named as RAGHAV, it was to secure copyright registration for an art work “Suryast”, in the initial stage office rejected the application for lacking human author. Later protection was granted when natural person was named as co-author alongside Raghav[20].

However, the issue of AI ownership remains unresolved. Section 2(d) of the Copyright Act states that for computer generated works, the author is “the person who causes the work to be created,” aligning with UK law[21]. Indian legal practice recognises only human authorship, as confirmed by the Copyright Office’s 2018 manual, which mandates that only natural persons be named as authors in copyright registration. Furthermore, Section57[22] grants moral rights exclusively to human authors, reinforcing that AI, lacking independent legal recognition, cannot claim authorship. Thus, AI generated works may be protected under copyright, their ownership will remain with the human or entity responsible for their creation.

Patent:

The Indian Patent Act, 1970, does not explicitly define the term “inventor”, but Section 6[23] specifies that a patent application can only be filed by a person who is the true and first inventor, their assignee or legal representative. In a recent patent application, the Controller rejected AI as an inventor, citing Sections 2 and 6[24] which do not recognise AI entities under the existing legal framework. While Section 2(1)(y)[25] clarifies who cannot be considered an inventor, it does not address cases where AI is primarily creator of an invention, leading to uncertainty in determining right of inventorship. Additionally, the Supreme Court in Som Prakash Rekhi vs Union of India[26], ruled that only entitles with juristic personality, those capable of legal rights and obligations can be recognised, making it difficult for AI to be legally acknowledged as an inventor.

Similarly, in Thaler vs Vidal[27], the US Patent and Trademark Office (USPTO) ruled DABUS, an AI system, could not be considered an inventor as it failed to meet the legal requirement of being an individual. The decision emphasised that inventors must demonstrate “intentionality and culpability,” which AI lacks since it cannot be recognised as an inventor in both India and the US, reinforcing the need for legal clarity on AI generated inventions.

Trademark:

AI plays a significant role in the creation of new brands and trademarks by generating unique combinations of words, logos and designs. However, this raises concerns about the authenticity and distinctiveness of Ai generated trademarks. According to Section 9(2) of the Trademark Act, 1999, only distinctive TMs can be registered, and marks that have become customary or generic in trade practices cannot be protected. In Aachi Masala Foods Pvt. Ltd Vs. Aachi Cargo Channels Pvt. Ltd[28],  the Madras High Court ruled that the term “Aachi” was too common to gran exclusive rights, highlighting that trademarks should prevent consumer confusion regarding the origin of goods and services. Therefore, AI generated TMs can be legally protected as long as they are unique and do not create confusion or infringe on existing trademarks.

However, AI itself cannot own a trademark. The Trademark Act does not explicitly define who can own a trademark, but it recognises a “registered proprietor” under Section 2 (v)[29] and registered user under section 2 (x)[30], both of which refer to a person or legal entity. Since AI lacks legal personality, it cannot register or hold trademark rights. Instead, ownership and legal responsibility for AI generated trademarks will rest with the human or entity that created or commissioned the AI to generate the mark.

Opportunities at the Intersection of AI and IPR:

AI presents numerous opportunities for enhancing IPR management and enforcement. Automated IP Search and Registration, AI can streamline patent and trademark searches by quickly analysing vast databases, reducing time and cost for innovators seeking protection.

AI Assisted Creativity and Innovation, AI tools can assist artists, musicians, and inventors in generating new works and designs, leading to increased innovation.

Efficient IP Enforcement, AI powered tools can monitor online platforms for copyright and trademark infringements, enabling faster and more effective enforcement[31].

Personalised IP Strategies, AI can help businesses analyse market trends and competitor IP portfolios to develop better IP strategies.

Improved Patent Examination, AI can assist patent offices in assessing novelty and prior art, improving the accuracy and efficiency of patent grants.

International Collaboration and Harmonisation, AI can support cross border IP management by analysing global patent trends and ensuring compliance with international IP laws. These opportunities demonstrate how AI can enhance efficiency, accessibility and protection in the evolving IP landscape[32].

Key Findings:

The rapid advancement of AI presents significant challenges for IP laws, as traditional legal frameworks struggle to accommodate the unique nature of AI generated works and inventions. Copyright and patent laws were designed with human creators and inventors in mind, often requiring elements like human authorship or inventive step, which AI generated content may not clearly fulfil. This legal uncertainty creates challenges in determining ownership, liability and the scope of protection for AI generated outputs. As AI continues to evolve, there is a growing need for legal adaptions that can address these complexities without stifling innovation.

Internationally, jurisdictions are taking varied approaches to regulate AI related IP, leading to fragmented landscape. Some countries like US, emphasises human authorship requirements, while others like China and European Union explore more flexible models. This divergence could create legal inconsistencies, complicating cross border innovation and commercialisation. Policymakers must strike a balance between protecting AI driven innovations and ensuring public access to knowledge, requiring an interdisciplinary approach that brings together legal experts, technologists, ethicists and policymakers to develop comprehensive forward-looking solutions.

Recommendations:

The Article highlights the pressing need to adapt IP frameworks to the rapid advancements in AI. Key policy recommendations including redefining fundamental concepts such as authorship and inventorship, introducing sui generis rights for AI generated innovations and harmonising global approaches to AI related IP issues[33]. Additionally, AI for more efficient IP management and enforcement is emphasised. However, these recommendations are not static solutions but rather starting points for ongoing policy discussions, given AI’s continuously evolving nature. Any legal framework must remain flexible to accommodate future technological breakthroughs while staying aligned with the fundamental objectives of IP law.

Moving forward, AI and IP policies should be shaped by several critical considerations. These include fostering innovation by balancing incentives for both human and AI driven creativity, addressing ethical concerns related to AI’s role in society and ensuring global cooperation to develop coherent legal strategies. Transparency in AI generated works will also be crucial for public trust and effective enforcement. Most importantly, a commitment to continuous adaption will be necessary to keep pace with technological advancements. By embracing interdisciplinary collaboration and striking balance between private rights and public interest, IP laws can evolve into a system that not only accommodates AI driven innovation but thrives alongside it, shaping the future of creativity and technological progress.

Conclusion:

In conclusion, there are lot of opportunities and challenges at the interaction of AI and IPR, which calls for a flexible legal system that can keep up with the quick changes in technology. AI generated works are difficult for traditional IP rules, which were created for human creators and inventors, to handle, creating legal ambiguities surrounding ownership, authorship and patentability. Global harmonisation is still essential to promoting innovation while upholding justice and ethical issues even though different jurisdictions have adopted different strategies for regulating AI in IPR. Policymakers must create forward-thinking, adaptable policies that strike a balance between innovative incentives, legal clarity and international cooperation as AI continues to transform creative and technological advancement. The legal system may adapt to AI driven developments while maintaining the fundamentals of IP protection by embracing interdisciplinary collaboration and utilising AI for effective IP management and enforcement.

[1] Nayantara Sanyal. Sheetal Mishra. Nihal Shah. ‘Intersection of Intellectual Property Rights and AI generated works – Part I’.  https://www.barandbench.com/law-firms/view-point/intersection-intellectual-property-rights-ai-generated-works-part-i accessed 13th Feb 2025.

[2] Ibid.

[3] The U.S. Copyright Act 1976.

[4] Trade Related aspects of Intellectual Property Rights Agreement 1995.

[5] Berne Convention for the protection of Literary and Artistic Works 1886.

[6] United States Patent and Trademark Office (USPTO).

[7] Dr. Rahul Kailas Bharti. ‘AI and Intellectual Property: Legal frameworks and Future directions’ (24th September, 2024). Law Journal https://www.lawjournal.info/article/141/4-2-31-193.pdf accessed 14th Feb 2025.

[8] European Patent Office (EPO).

[9] Dr. Rahul Kailas Bharti. Supra note 9.

[10] United Kingdom Intellectual Property Office (UKIPO).

[11] Dr. Rahul Kailas Bharti. Supra note 9 at 11.

[12] Ibid.

[13] Dr. Rahul Kailas Bharti. Supra n 9 at 13.

[14] Ibid.

[15] Trade Related Aspects of Intellectual Property Agreement (TRIPS) 1995.

[16] Dr. Rahul Kailas Bharti. Supra n 9 at 16.

[17] Global Partnership on Artificial Intelligence (GPAI) 2020.

[18] Dr. Rahul Kailas Bharti. Supra n 9 at 18.

[19] Eastern Book Co v D B Madak (2008) 1 SCC 1.

[20] King Stubb & Kasiva. ‘The Divergence in Copyright recognition for AI generated works: An In-depth Analysis of Ankit Sahni’s Case in the US and India’. (8th January, 2024)  https://ksandk.com/intellectual-property/divergent-copyright-recognition-ai-generated-works-sahnis-case-us-vs-india/  accessed 14th Feb 2025.

[21] Hemendra Vishnav. ‘IPR in the Age of AI: Navigating Challenges and Seizing Opportunities’. (13th June, 2024) https://www.iiprd.com/intellectual-property-rights-in-the-age-of-artificial-intelligence-navigating-challenges-and-seizing-opportunities/ accessed 15th Feb 2025.

[22] The Copyright Act 1957, s 57.

[23] The Indian Patent Act 1970, s 6.

[24] The Indian Patent Act 1970, Ss 2 & 6.

[25] The Indian Patent Act 1970, s 2 (1)(y).

[26] Som Prakash Rekhi v Union of India 1981 AIR 212 1981 SCR (2) 111.

[27] Thaler vs Vidal No 21-2347 (Fed Cir 2022).

[28] Aachi Masala Foods Pvt Ltd v Aachi Cargo Channels Pvt Ltd AIR 2014 Mad 2.

[29] The Trademark Act 1999, s 2(v).

[30] The Trademark Act 1999, s 2(x).

[31] Dr. Rahul Kailas Bharti. ‘AI and Intellectual Property: Legal frameworks and Future directions.’ (24th September, 2024). Law Journal https://www.lawjournal.info/article/141/4-2-31-193.pdf accessed 17th Feb 2025.

[32] Ibid.

[33] Dr. Rahul Kailas Bharti. Supra n 34.