What is a start-up according to the Patents Act?

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Patent Rules define “Start-up” as an entity that satisfies the following criteria:

  • Has not been registered or incorporated for more than 5 years;
  • Has a turnover for any of the financial years of not more than Rs. 25 crores (approx 4.2 million US Dollars); and
  • Is working towards innovation, development of products and services driven by technology or intellectual property.


‘Entity’ means a private limited company (as defined in the Companies Act, 2013), or a registered partnership firm registered under section 59 of the Partnership Act, 1932 or a limited liability partnership under the Limited Liability Partnership Act, 2002.

Any entity that is formed by splitting up or reconstruction of a business already in existence will not be considered as a start-up.

‘Turnover’ means the aggregate value of the realisation of amount made from the sale, supply or distribution of goods or on account of services rendered, or both, by the company during a financial year.

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