Suppose you create an invention and have it patented in the U.S. Now further suppose a company in Canada incorporates your invention into products made there. The product never leaves Canada.
Patent rights are territorial, and a U.S. patent only protects you against infringement within the U.S. You will not be able to enforce your U.S. patent in Canada. The only way to go after the infringer and stop this nonsense is with a patent issued by the Canadian Patent Office.
Scenarios like this one are becoming increasingly common. You are in the position of having to protect your intellectual property in several countries that global competitors are likely to call home. But you can’t stop there. Manufacturing facilities can be built in almost any country. So it is also necessary to seek patent protection in all the major markets for the technology. If your invention involves automotive technology, for example, you should protect the invention in the countries that buy the most vehicles.
The investment for each patent/application can be substantial. The World Intellectual Property Organization (WIPO) estimates a cost exceeding $500,000 to get one patent and to maintain it for the full term in the 50 largest countries in the world. These costs include filing, translation, prosecution, and maintenance fees.
Patent rights in all countries are now quite similar. A patent is a contract between the government and the inventor. The government gives the inventor a limited monopoly — the right to exclude all others from making, using, or selling the invention during the patent term. The inventor gives the public a full and complete disclosure of the invention with a teaching of how it works. Once the term of the patent expires, the invention can be used by anyone.
The first step in obtaining a patent is to file a U.S. provisional or patent application. This only happens after the technology has been searched and a commitment has been made in lieu of the search results to pursue the patent.
No foreign patent applications can be filed unless and until you obtain a foreign filing license from the U.S. government. This is to assure that national security is not compromised. Foreign countries have similar provisions with their citizens. Within about a month of when the U.S. patent application is filed, you will receive a foreign filing license from the U.S. Patent Office if the government has no problem with national security concerning your technology. If the foreign filing license is not received, you will be barred from filing foreign-patent applications, and the U.S. patent application will not be published. If you file foreign-patent applications without receiving the foreign-filing license, your U.S. patent is in jeopardy and criminal penalties may result.
It is unrealistic to expect any inventor, even one associated with a large corporation, to file patent applications globally out of the starting gate. Fortunately there is a one-year grace period from the time the initial U.S. application is filed until the time when applications in foreign countries need to be filed. A foreign-patent application filed within the one-year grace period will have the benefit of the filing date of the initial U.S. application if reference is made and the foreign application is linked to the earlier filed U.S. application.
U.S. patent applications now publish 18 months after they are filed. It will be at least two years from the time the U.S. patent application is filed until you receive the results of the USPO’s review of your patent application. It will be at least three years until the U.S. patent issues. These delays stem from increased activity in the USPO and a chronic shortage of patent examiners.
The long delay means you will need to make critical foreign filing decisions before you have the benefit of the USPO’s review of your patent application.
It is important to preserve the U.S. filing date in foreign countries because these countries award the patent to the first party to file, NOT to the first party to make the invention. The U.S. is the only country in the world that still awards the patent to the first to invent, if there is a dispute.
The most important job that an attorney or agent can perform for his client is to obtain the earliest possible filing date for the invention. If the invention has value there is a good chance someone else may recognize the same problem and arrive at the same or similar solution. Further, you will prevail against anyone who either makes a similar invention or derives an invention from you, and who then applies for a patent during this one-year grace period. Finally, the filing date is important because otherwise, any disclosure of the invention made during the one-year grace period would jeopardize your rights in foreign countries.
If foreign-patent applications are not pending when your U.S. patent application is published, you lose almost all foreign rights. If you file the foreign-patent applications within the one-year grace period and claim the benefit of the U.S. application, the filing date of the foreign applications will be the same as the filing date of the U.S. patent application.
The patent owner has a second bite at the apple just prior to the publication of the U.S. patent application to file any additional foreign-patent applications. But these patent applications will have the filing dates corresponding to when the foreign-patent applications actually are filed in the foreign-patent offices. Because foreign countries will grant a patent to the first to file the patent application, the former course of action is much preferred.
Depending upon how much you can afford to pay and your objectives, there are two primary options available. One alternative is to file a patent application in each country or region where protection is sought within the one-year grace period. This approach is best when filing in a limited number of countries. The primary disadvantages to this approach are that legal fees and costs are not deferred, and that rights are lost in the venues where no filing occurs once the application is published.
To file a patent outside the U.S., you’ll generally need an agent or attorney in each country where you want to file. Usually the agent must be a resident of that country. Only an attorney or agent registered to practice in Japan, Korea, or Canada can file a patent application in those countries. Hence, once you enter the national phase, you’ll need local talent in the countries selected, and more lead time for this process.
Patent applications filed in most foreign countries will need a translation. The exception is the European Patent Office (EPO) and the members of the British Commonwealth. Also, the translations will need to be certified, either by a translation service, or through your foreign-patent associate, which further drives up the cost of the translation. The certification is of particular importance in an application involving high technology, since the translation must accurately reflect the technical disclosure. Applications filed in several Spanish-speaking countries will need only a single translation. Similarly, only one Arabic translation is necessary when filing numerous applications in Middle-East countries.
And some countries charge annual maintenance fees even before the patent issues. That’s the case, for example, in Europe and Canada. Japan charges annual fees once the patent has issued. The U.S. incurs a maintenance fee every three and a half years after the patent has issued.
Stories From the trenches of worldwide patenting
Many years ago Auto Specialties Mfg. Co. of St. Joseph, Mich., invented a ball-ramp tractor brake. The firm tried to get the automobile industry to accept it, with no luck. They went so far as to advertise the development to automobile owners. They never got past test installations on taxicabs.
However, the brake was accepted as the worldwide standard for ag tractors of 40 hp and up. Its inventors obtained patents in every industrial nation. But at that time, no one thought to get patents in South America or Mexico.
Surprise! A manufacturer in Brazil started making the brake, without the benefit of a license, for South America and Mexico. The replacement market was huge. So brake manufacturers now entering the market always take care to include Brazil in their patenting efforts. — George H. Morgan
Patent Cooperation Treaty (PCT)
Filing a PCT application is the other primary filing option. The PCT offers patent owners an avenue for obtaining patent protection internationally in 138 member countries. If you select this option, you will need to file a PCT application in the USPO within one year after the initial U.S. application is filed. The filing costs of national-patent applications are a major factor in getting global patent protection. So you may opt to defer foreign filings and their costs as long as possible, while preserving global rights thanks to the benefit of the initial patent application’s filing date. You will need to file national or regional applications 18 months later in the PCT member countries where you want patent protection.
The advantages of a PCT filing are many. There is only a single application filed in the USPO by a U.S. patent attorney or agent within the one-year grace period. It is in English. Future foreign patent rights are preserved. The applicant can defer national entry and patent-related costs into PCT member countries for up to 30 months from the initial filing date. And, perhaps, most importantly, the patent owner can use the additional time (18 months in PCT member countries) to determine the value of the patent, to seek commercial opportunities while preserving broad coverage of the technology for licensing purposes.
The extra time the PCT buys in PCT member countries comes for about the same cost as filing a Patent Application in one country. If you wanted protection in these countries, you would need to file applications in each of them within one year (or prior to the date of publication of the U.S. patent application at 18 months) from the filing date of the U.S. patent application.
Japan is a PCT country. You should also know that Japan is one of the most-expensive venues in the world for patent applications, though the Japanese have reduced costs in recent years. And the JPO doesn’t necessarily examine all applications. The applicant has three years from the date the application is filed to request an examination and pay the examination fees. If you don’t make the request, the examination is abandoned.
If you are mainly concerned about protection in Europe, consider a filing in the EPO. An EPO filing covers 32 countries. The EPO examines the application (which can be in English) and grants the patent. But the process is not over once the EPO gives you your patent. At that point you must perfect the grant in each country where you want protection. The perfecting process usually involves paying various fees and translating the patent or just the claims.
Note, however, that if you only want patent protection in one or two European countries, you should consider filing patent applications only in those countries. Only when the applicant wants patent protection in multiple European countries is it more economical to file a patent application in the EPO. Patents that the EPO grants have the same status as national patents in the countries the applicant designates. Another point to note is that you must designate the EPO member states in which you want the patent to apply.
Historically, the busiest patent offices have been the USPO, the JPO, and the EPO, in that order. However, NAFTA has created renewed interest in Canada and Mexico. Now, there is also interest in the countries of the Middle East, South Africa, and Australia. But as the world continues to change, and the center of the world moves to the East, we are seeing real interest in the emerging economies of Asia.
China, India, and Korea are all PCT members, but each has a few idiosyncrasies. China has 1.3 billion people, is one of the fastest-growing economies in the world, and has set a goal of becoming the world’s leading office for IP. India has a population of 1.1 billion people, emerging highly educated middle class, and there is no need for a translation. Korea ranked as the country filing the fourth-most PCT applications in 2007, behind the U.S., Japan, and Germany. md
Gerald Black’s Web site, tinyurl.com/4rs34e
George Morgan’s Web site, tinyurl.com/4br7vx
Costs of global patent procurement according to WIPO, tinyurl.com/4c7x6
World Intellectual Property Organization, tinyurl.com/yvyy3
The USPTO is the largest patent office in the world, with 8,913 employees and is based in Alexandria, Va. Currently, there are 3,030 patent examiners.
There are about three times as many patent applications filed in both Japan and the U.S. each year as are filed in the EPO. But, of course, that does not account for the patent applications filed in the national patent offices in Europe.