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An international Patent Prosecution strategy

John Walker / April 5, 2018
Patent-Prosecution-Strategy_Blog

John Walker, from Dennemeyer & Associates, examines Patent Prosecution strategies in the Asian region including the use of Australia as a platform, the judicious use of the PPH and the consideration of regional treaties.

Although this article and the principles contained herein have a broad international application, it is directed more particularly at Patent Prosecution strategies in the Asian region. In the context of the patent life cycle, it aims to address the prosecution component where "commoditization" has not progressed at the same rate as other life cycle components such as annuities and filings. In particular, the use of Australia as a platform for this prosecution strategy is addressed, as well as the judicious use of Patent Prosecution Highway (PPH) mechanism(s) and the consideration of regional treaties, are discussed. Use of these in a coordinated manner can provide a cost effective approach for patent applicants with significant Asian portfolios. Before looking at these three elements of an Asian patent strategy, a few patent strategy concepts are introduced, as well as providing the overall economic role of Asia in a patenting context.

Patenting strategy overview

As a precursor to identifying specific Patent Prosecution mechanisms, one needs to be cognizant that all patent applicants will have a range of preferred patenting strategies, which are directly influenced by their broader strategies. These might include business decisions such as the likelihood of foreign competition, the size of foreign markets, as well as foreign manufacturing and/or licensing strategies. This option will also be influenced by technical decisions like the nature of the technology (as it relates to the applicant's business – core, peripheral, stage of development, life span of the invention, etc.). These issues are more "why file?" questions. Also, one needs to consider the "where to file?" and "when to file?" questions. The "where to?" decision will address local factors such as market size, population, GDP/capita, nature of the industry, technical capabilities, etc., as well as the patenting conditions (like standards, costs, and enforceability). The "when to?" (both for filing and prosecution) is taken, in this article, to be as soon as possible – provided cost considerations are addressed.

However, it needs to be recognized that, in some cases, the preference might be to defer costs for as long as possible. Deferring the cost associated with grant and validation of a European patent is a good example. However, in this article, and as will be discussed later, it is assumed that the applicant's filing – but more particularly prosecution strategy is to obtain grant (and thus certainty) as early as possible, and all within a coordinated and cost effective framework.

Asia – A broad overview

Asia can be conveniently broken down into four geographic regions:

(a) Northern Asia which comprises three large economies – China, Japan and South Korea, as well as Taiwan;
(b) Western Asia, which includes the large economy of India, as well as Sri Lanka and Bangladesh;
(c) The ASEAN 10 or South East Asia – Singapore, Malaysia, Indonesia, Thailand, Philippines, Vietnam, Brunei Darussalam, Cambodia, Laos and Myanmar;
(d) Oceania – including Australia and New Zealand.

As a total grouping, and based on International Monetary Fund (IMF) 2016 figures, Asia contains three of the world's largest 10 economies (China, Japan, and India) and 12 of the largest 50. If the ASEAN 10 (Association of South East Asian Nations) were combined, it would represent the 7th largest economy and is predicted to be the 4th largest by 2050.

From a patent perspective, Asia includes three of the IP5 – China, Japan, and South Korea. Further, and based on WIPO 2016 figures, Asia contains 12 of the top 20 patent filing destinations. Again, aggregating the ASEAN 10 results in Patent Filing numbers just outside the IP5. Another interesting statistic for the ASEAN 10 shows local filings represent only 12% of total filings, and clearly, strategies to focus on filings from foreign applicants need to be a major focus in this particular region.

Australia as a platform for the strategy

As a general rule, the time to commence the Patent Prosecution stage is largely determined by the individual Patent Office. In some jurisdictions, the Patent Office simply issues an examination report at a time, often dependent upon examiner workload, technology expertise and the like – the USPTO and EPO being examples. Other jurisdictions, like Canada and Japan, require the applicant request examination within five years and three years respectively of the filing date. Another variation is in Australia (and New Zealand) where a specified period (five years in each case) is stipulated, but if the Patent Office issues a direction to the applicant to request examination, then it must do so within three months (AU) and two months (NZ) of receiving the direction. These "standard" procedures set the fundamental framework for commencing prosecution. However, if one is to fast track, expedite or accelerate this prosecution phase, then one must identify suitable and cost effective mechanisms in particular jurisdictions to achieve the desired benefits. By itself, seeking a more rapid examination of an application in a particular jurisdiction does no more than speed up examination and, ultimately, the grant. In some jurisdictions, additional fees are necessary to utilize this advantage. However, if "fast tracked" examination can be suitably combined with Patent Prosecution Highway options (see below), this can lead to greater certainty and potential cost savings to the applicant across its entire portfolio. Seeking a more rapid examination is given different names depending on jurisdiction.

patent prosecution strategy
It can take more than a year from the submission of an examination request for the examination process to begin but applicants can request an expedited examination and potentially reduce the waiting time between four and eight weeks. The price is the same as a standard examination request. 

By no means an exhaustive list, USA has prioritized examination and accelerated examination, the EPO has PACE, the JPO has accelerated and super accelerated examination, China has prioritized examination and Canada has a "Special Order" approach. All of these do speed up the process in their respective jurisdiction. The Australian Patent Office provides a particularly attractive option through its expedited examination mechanism. This involves no additional fees, compared to USPTO where fees more than $1,500 (accelerated examination) or $6,500 (prioritized examination) are required to "fast track." Since 2013, eligibility criteria for seeking expedited examination in Australia have been tightened, but criteria ultimately depend on the circumstances of the invention, as well as "commercial considerations" or "licensing reasons." Satisfactory reasons need to be set out in writing. Among reasons likely to be considered satisfactory are proposed product or market launch, enhanced investment opportunity or anticipated infringement. Interestingly, where an applicant wishes to pursue an expedited examination in a country where Australia has a PPH arrangement, this is likely to be considered reasonable.

Using this expedited examination approach in Australia can result in obtaining grant within seven or eight months from requesting expedited examination and, depending on when the application is filed, it is possible the grant may occur before any Patent Cooperation Treaty (PCT) filing deadline.

As a further footnote to Australian patent practice, many proposals have been put forward in 2017 by the Australian Productivity Commission and, while accepted by the government, have not yet been enacted. One valuable suggestion is to further align the inventive step criteria for a patent grant in Australia with that of the EPO. By raising this standard even further, the likelihood of using allowable Australian claims in a PPH Request (see later) should benefit applicants seeking wider international protection.

The role of Patent Prosecution Highway(s) – PPH

The concept of the PPH is now well established. From a broader governmental viewpoint, the stated purpose of the PPH(s) has been to enhance the utilization of search and examination results between patent offices through work sharing, thereby reducing the burden of the examination by offices and an improved quality of examination worldwide. From the applicant’s perspective, cited benefits include a higher speed to grant (thereby improving predictability and certainty), as well as cost savings by reducing the prosecution tasks in each jurisdiction. However, notwithstanding these benefits, it should be remembered that ultimately the decision about whether to grant a patent remains under the control of the national Patent Office where individual patentability criteria might vary. A review by the JPO in 2013 (at a relatively early stage in the life of PPH) summarized the principal benefit to Patent Offices as an easing of the examination burden through work sharing. It also summarized benefits to the applicant as higher speed through accelerated examination, cost savings and higher predictability.

These benefits were illustrated through data for many jurisdictions showing reduced pendency periods between the PPH request and the first office action (and final decision), the decrease in the number of office actions and an increase in grant rate. The basic principle of the PPH is that it enables an application with claims (at least one) deemed patentable in the Office of First Filing (OFF) to undergo accelerated examination in an Office of Second Filing (OSF) through a simplified PPH procedure. In itself, this is quite straightforward, however certain formality requirements must be met. Although not intended as a complete checklist, some of the requirements are that substantive examination in the OSF has not begun before making a PPH request, and the OFF and OSF applications are in a particular relationship (such as the same priority date). In particular, all claims in the OSF application must "sufficiently correspond" to the allowable claims in the OFF application.

Patent Prosecution Highway
If another patent authority has carried out an official assessment for the same invention, the Patent Prosecution Highway significantly speeds up the examination process of a patent application. From the applicant's perspective, the benefits also include cost savings.

Claims will "sufficiently correspond" where they are of the same or similar scope taking into account differences in claim format requirements across jurisdictions. Where a claim is narrower in scope, in the OSF, this will be permitted provided it is in a dependent form. It should also be noted that documentation requirements must be strictly adhered to request under a PPH. These requirements are both formalities related like the PPH request form, and "examination related" such as a detailed claims correspondence table setting out how all claims in the OSF application correspond to the allowable or patentable claims in the OFF. Accordingly, while the PPH is an "accelerated examination" mechanism in itself - between jurisdictions, this acceleration can be further amplified if grant in the OFF has risen due to "quicker" examination in that jurisdiction. As outlined previously, Australia can act as a very suitable OFF.

If one is to use the PPH framework in any Asian prosecution strategy, it is necessary to identify which countries can take advantage of their membership of this framework. It is very difficult to accurately define PPH "membership" at any one time as the announcement of new arrangements now occur on a regular basis. Looking at this broader framework, there are the "traditional" arrangements – typically a bilateral or multilateral arrangement between two or more participating offices. There is the "PCT-PPH" enabling fast tracking in a participating office when a designated International Search Authority (ISA) and/or International Preliminary Examination Authority (IPEA) issues a positive opinion during the PCT phase. There is also the "Global PPH" with over 25 "members", and the "IP5 –PPH" which covers the world's five largest offices – the US, EP, JP, CN and KR.

From an Asian perspective, countries in the region that are members of one or more of these arrangements include China, Japan, South Korea, Taiwan, Australia, New Zealand, Singapore, Malaysia and the Philippines. A significant "non member" is India. Through its international arrangements, Australia has links in Asia with Japan, Korea, Singapore, Malaysia and New Zealand, as well as the ability to use its links in other Asian jurisdictions (e.g., China and Taiwan) through its affiliations with the USPTO and EPO.

Regional considerations – Asia

The foregoing has identified Australia as a most suitable platform for expedited examination and, in turn, has identified some (but not all) PPH arrangements where such fast tracking can be further amplified, both in time and cost savings. Where additional regional arrangements exist and where these can be combined further, additional advantages can be obtained. Two such regional arrangements are in South East Asia and the PROSUR countries in South America. Given the focus of this article is on Asia, the former will be discussed in more detail.

patent prosecution examination
Every patent applicant will have different frameworks and systems for determining “where to file” but utilizing a PPH based strategy and early expedited examination in Australia has many advantages.

The ASEAN Patent Examination Co-operation (ASPEC) arrangements include 9 South East Asian countries (including Singapore). It comprises the ASEAN 10 less Myanmar. ASPEC is an arrangement where a patent applicant that receives a favorable search and examination report in one ASPEC country can request that report be taken into account when examining the application in any of the other ASPEC member Offices. While not guaranteed in practice, the favorable report will most likely result in a favorable examination in the others. This process takes place in English and prevents the need for further translations. ASPEC requests are given priority in the processing of applications.

Combining ASPEC membership with expedited examination and the PPH can provide significant cost savings. For example, by obtaining a rapid grant in Australia through expedited examination and then utilizing Australia and Singapore's membership of the Global PPH results in obtaining a grant in Singapore. This grant can, in turn, be further utilized within the ASPEC group.

Putting it together

Although every patent applicant, particularly those with global operations, will have different frameworks and systems for determining "where to file,", the following example shows the potential advantages of a PPH based strategy utilizing early expedited examination in Australia. This hypothetical case involves seeking protection in those countries/regions in the WIPO "top 15" filing nations, as well as a particular emphasis in South East Asia. Essentially, the sequence is as follows:

1 Seek expedited examination and obtain allowance/grant in Australia
2 Make PPH requests (based on Australia as the OFF) in:
   2.1 USA, Singapore, Russia, Japan, Korea, Canada, New Zealand, Israel (all through membership of the Global PPH)
   2.2 EPO through Australia’s bilateral arrangements with it
3 Then, having obtained grant in the above jurisdictions:
   3.1 Make PPH request in China (either through USPTO or EPO and IP5)
   3.2 Make PPH request in Taiwan, Brazil, and Mexico (through USA bilateral arrangements)
   3.3 Use Singapore (see 2.1) as the basis for up to 9 ASPEC countries.

The previous approach only excludes India, which in the 2016 WIPO figures is ranked around number 7 or 8 (excluding specific national filings in EPO member states). India currently has no PPH agreements in place and, accordingly, the framework described cannot be utilized for obtaining earlier or more cost effective grant in India. However, Section 8 of India's Patents Act requires applicants to submit information about all corresponding foreign patent applications, including examination, search reports and status of applications. As this type of information requirement (e.g., claims correspondence tables) forms the cornerstone of the PPH mechanism, there is at least some potential to utilize this information effectively with the Indian Patent Office.

Concluding comments

This article has aimed to provide a framework within the Patent Prosecution phase where a number of developments and arrangements at both national and international levels, when carefully considered and applied, can lead to increased certainty for patent owners, as well as demonstrated cost savings. While it is not possible to describe every global prosecution strategy in detail, the article attempts to provide the direction upon which specific strategies, particularly in the Asian region, may be crafted.

It is also apparent that the real benefits of such strategies can only flow when attorneys in various jurisdictions cooperate and collaborate for the benefit of the client. It is evident that for cost effective international Patent Prosecution, a desirable approach is to centralize all patent office interactions globally with a single firm and, if necessary, utilizing support from foreign associates. In the example provided, Dennemeyer & Associates not only has a patent attorney practice in Australia for stage 1 but also in the USA and Europe (for EPO) for the subsequent stage 2.

This article was originally published in Patent Lawyer magazine, issue November/December 2017.
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Posted by John Walker

John Walker holds degrees in engineering, economics and IP law, and has vast experience in patent and trademark prosecution. He specialises in energy technology, environmental and materials engineering, and assists Australian clients in filings, prosecutions and IP strategy.

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