Scientific thomsonreuters.com

Vasheharan Kanesarajah
Thomson Reuters
December 2008

Increasing globalization and changes in social, political and technological trends have created a surge in the number of applications filed worldwide. The demand for patents is growing faster than the number of patents processed, creating a backlog of pending applications recently described as ‘Global patent warming’.

Increasing globalization and changes in social, political and technological trends have created a surge in the number of applications filed in the world’s patent systems. The demand for patents is growing faster than the number of patents processed, creating a backlog of between five to ten million pending applications globally. The escalating pendency of applications is creating uncertainty in the patent system, and casting pressure across the IP landscape, as applicants have to wait up to ten years to see their patents granted. Ciáran McGinley a senior European Patent Office (EPO) official recently described this as ‘Global patent warming’.

Some may attribute the global backlog to an increase in innovation, however the root cause largely stems from the growing number of multiple filings for single innovations. Patents by nature are territorial rights, hence applicants are required to file in each national patent office where they want to obtain protection: each office must then perform a duplicate search and examination. Second filings are taken out by applicants who wish to extend the geographic territory of their patent, and with globalizations the numbers have increased.

Over the past few years the EPO has been taking a systematic approach to studying workload management between itself and other patent offices. EPO officials have been calling for co-operative solutions to ease the increased workflow between:

• National IP offices of the member states; and
• Trilateral offices comprising EPO, Japan patent office (JPO)
  and the United States Patent and Trademark Office (USPTO)

Mutual recognition
The current climate in the patenting system has brought to light the hugely debated concept of 'Mutual recognition' - to create a single European patent and even a global system, where patents granted by one office would be automatically valid before other offices. However, differences in patenting standards, regulations and quality make this very complex. This is highlighted with the profound disagreements over what should be deemed patentable between Europe and America on issues like business methods, software and bio-technology. Harmonization is unlikely to be put into action anytime soon.

Challenges for the EPO
The EPO is facing the critical challenge of addressing the growth of pendency and the accumulation of patent applications while maintaining quality. In the past 25 years the volume of patent applications at the EPO has quadrupled to a record 218,200 in 2007, and has been increasing further during 2008.

In a bid to battle this ballooning effect the EPO hired 224 new examiners in 2007, a ten per cent increase on the previous year, and a further 100 had been earmarked during 2008. However, with EPO backlogs predicted to grow to one million within the next five years, and with pendency times still remaining a problem (the average time to grant remains high at 43.7 months, and up to 58 months for inventions in the field of biotechnology) such actions are unlikely to resolve the hold-ups promptly.

Issues such as:

• Growing number of multiple filings
• Poor patents
• The lack of clarity and conciseness in applications
• Changes in technological trends, and
• Patent trolling (opportunistic/aggressive enforcing of patents against alleged infringers)

are increasingly affecting how the offices are run, with respect to timeliness and quality management.

Enhancing co-operation with Europe
The EPO provides a one stop search and examination procedure that results in a collection of independent patents which are nationally enforceable in the designated member states. However, there is a layer of complication since there are two ways to obtain a patent in a member state. Applicants can choose to file through:

• National patent offices (NPO) via national procedures
• The European Patent Office under the European patent convention (EPC)

It is common practice for many applicants to first file for a patent through their NPO, and then extend their territory by filing through the EPO within the priority period (12 months). The consequence of this strategy is that the EPO receives relatively few first filings, and many applications arrive already examined.

European Patent Network
The European Patent Network (EPN) was set up as a result of the strategy debate, which was concluded by the EPO's Administrative Council in 2006. One of the main objectives of the EPN is to improve co-operation between the EPO and the national IP offices of the member states, on matters such as quality, work sharing and customer service.

In January 2007 the EPO implemented the co-operation policy, and in April launched the Utilization Pilot Project (UPP) in order to assess whether the work done by the national patent offices during examination can be utilized by both the European Patent Office (EPO) and the applicant. The test will run throughout 2008 and will use information from Austria, Denmark Germany and the United Kingdom. Depending on the results of this pilot project, the Administrative Council will decide whether to go ahead with the full-scale roll-out of the utilization scheme within the EPN.

International patent activity
Enhanced global activity and the aggressive filing strategies of companies has lead to an increased flow of patent applications between the Trilateral countries (which represent a significant portion of the world patent system). These applications cause the offices to perform duplicate searches and examination on the same innovation, as the majority are second filings. This is proving to be highly inefficient.

European applications can also be made internationally through the Patent Cooperation Treaty (PCT). Applications filed through the PCT route first enter an international phase which is subject to the PCT, and then a national phase that is primarily governed by the European Patent Convention (EPC). In 2007 PCT applications accounted for 56 per cent of applications received at the EPO, with national-phase filings providing the largest backlog contributor. However with the reform of the PCT chapter II, the majority of the workloads will be taken up by authorities in Australia, Canada, China and South Korea.

Trilateral Co-operations
Co-operation between the EPO, USPTO and the Japanese Patent Office (JPO) began in 1983 at the annual trilateral conferences, with the aim of improving the efficiency of the global patent system, and to exchange information and views on patent administration and examination practice.
In 2006 the backlogs of applications increased by 8 per cent before the EPO, 11 per cent before the JPO and 13 per cent before the USPTO. With these figures in mind in November 2007 at the 25th annual Trilateral conference (held in Washington) the Trilateral offices signed the memorandum of understanding for quality enhancements, harmonization of patent practises, improving timeliness and reducing redundant work.

On 14th November 2008 at the 26th Trilateral conference (held in Hague), the heads of the three offices agreed to move forward with the work-sharing projects, and will contribute to further develop the Patent Cooperation Treaty so that it acts as an infrastructure for global patent filing to ensure harmonization and avoid duplication of work. This will not only benefit the patent offices but will make the system more efficient for companies and individuals who want to protect their inventions in several parts of the world.

Changes in technological trends over the past ten years have increased the complexity of innovation within an application, where much of the growth of patent activity has come from new and emerging technologies. With these changes and patent activity becoming more global, it has become clear that the volume of work required to handle this increase is far greater than can be handled by one office. It has been argued that the global backlog may never be defeated; however with greater co-operation between patent offices we may be getting one step closer to harmonizing the global patent system.

Additional information
For further insight into how Global Patent Warming is impacting patent information services, see One in a million - China provides the millionth DWPI record for 2008 [ADD LINK}

References:
Trilateral statistical report 2007, 2006
Summary of 25th Trilateral conference at (9th November 2007)
EPO Press Release (14th November 2008)
EPO Annual Report 2007
Future Workload (November 2007), A study prepared by The Board 28 (The Board of Administrative Council set up under article 28)
WIPO Patent Report 2007 (B2)
“Objectives and Incentives at the European Patent Office”
Urgent Call to ease patent backlogs (16th September 2008)
Shining a light on Patents and innovation (5th September 2008)

© 2008 Thomson Reuters

• PRIVACY POLICY
• TERMS OF USE
• COPYRIGHT
• CONTACT US