Five false assumptions that leave your intellectual property vulnerable

By Dr. Jodi Richards

By Dr. Jodi Richards

One of the aspects of protecting intellectual property about which our clients most frequently ask is what needs to happen for that protection to be maintained over time. The process of filing an application for intellectual property protection and achieving the grant or registration of a patent, design or trade mark requires a high level of trained technical expertise.  However,in most countries further robust and accurate legal activity is also needed on a regular basis to ensure that the protection does not expire prematurely. In the case of innovations protected in more than one country the situation can be extremely complex. This article describes five of the understandably common–but false–assumptions that we have encountered and how to avoid leaving your hard won intellectual property vulnerable.

Paul Thompson - Trade marks online

For more information about protecting your intellectual property contact Paul Thompson

1. “Renewal fees only need to be paid once my intellectual property is registered”

In a number of countries, including notably here in Australia, maintenance fees for pending patent applications can often become due long before the patent is granted. In Australia, for example, fees are due from the 4th anniversary of the filing date and continue annually throughout the 20 year lifetime of the patent[1].  These are referred to as ‘continuation fees’ for a pending application, and ‘renewal fees’ on a granted patent.

In other countries, such as Thailand, the situation is even more complex. In Thailand patent renewal fees are only paid once the patent is registered, but the renewal timescales are calculated from the filing date. Therefore, as the first fee is due at the beginning of the 5th year[2] after the filing date, it is not uncommon for one or more of the renewal deadlines to fall before registration.  If this is the case, all of these renewal payments accumulate and are due within 60 days of grant[3].

In countries such as the USA and, until law changes coming into effect later this year, New Zealand, renewal fees are only due after registration. However, once again rules regarding the interaction between renewal deadlines and the date of registration can result in some complex deferments. In general, it is never safe to assume that renewal fees are due only after your intellectual property protection has been granted.

2. “Renewal fees are the same throughout the life of my intellectual property protection”

This is far from the case. In most jurisdictions the cost of renewal fees slowly increases by rule during the life of a patent, for example, and over time patent offices around the world regularly adjust their fee scales. Currently, the official fees for renewing an Australian standard patent, paid using eServices before the due date, are:

4th– 9th Anniversary of filing – $300.00

10th – 14th Anniversary of filing – $500.00

15th – 19th Anniversary of filing – $1,200.00

However, the frequency of fee increases as well as changes in the fees are different in each jurisdiction worldwide.

3. “Renewal fees are the same for patents, innovation patents, trade marks and designs”

In most jurisdictions the frequency of renewal fees due, and the level of these renewal fees can be dramatically different for patents, innovation patents (where available), trade marks and registered designs. In Australia for example, an annual renewal fee of $300-$1,200 for patents is significantly different to the 10-yearly fee of $300 per class for a trade mark, or the one off 5-year renewal fee of $320 for a registered design. As such the total cost of maintaining a trade mark over 20 years can be as little as $300 compared to $10,300 for a patent.

4. “The cost of maintaining a patent, trade mark or design in different countries is the same for each, and fees need to be paid annually”

In reality, the frequency and cost of  renewal fees varies considerably from country to country. If you hold intellectual property rights in more than one country, and of more than one type, the schedule of renewal deadlines can quickly become a maze of overlapping deadlines.

As noted, in Australia renewal fees are due annually for patents, once at the five year mark for registered designs and every ten years for trade marks.  In contrast, in the USA renewal fees are due at 3.5, 7.5 and 11.5 years after a patent has been registered.  Similarly in New Zealand the renewal fees are due at the 4, 7, 10 and 13 year anniversaries of the application filing date, though this is set to change once new legislation comes into effect in September.

The renewal procedures regarding registered designs are even less harmonised.  For example, US design patents require no renewals during their 14 year term; Canadian and Australian registered designs last for a maximum of 10 years from registration, with one renewal payment due after the first 5 years[4]; and European community designs can be renewed every 5 years with the maximum term being 25 years[5].

These different frequencies of payment can substantially affect how much it costs to maintain an intellectual property right in each country. Beyond this though, the official renewal fees themselves charged by individual governments around the world vary significantly. The first maintenance fee for a patent in the USA, for example, is between US$400 and US$1,600 depending on business size, while that in China is around US$150.  Fees can vary considerably based on the business size of the owner, with large corporations paying substantially higher fees than individuals.

Some countries have dramatically different regimes. In Fiji for example, no renewal fees are payable at all, while trade marks remain in force for 14 years from the application filing date, before becoming ‘indefinitely renewable for like periods’[6].

5. “There’s a grace period to protect me in case I miss a renewal deadline”

If payments are not made by the renewal deadline, the majority of countries do offer a grace period in which to pay the fees – but critically, not all. If you are going to rely on the grace period to defer fees, then ensure that each specific country does indeed offer one.

The picture can be further complicated in some counties; in Canada for example there is a grace period on registered patents, but not applications[7].

Renewing in the grace period does not come without penalties; in Australia the renewal grace period for a patent is 6 months and with each month that passes the fee increases[8].

Over-coming these complexities

The challenges involved in maintaining an IP portfolio include identifying and recording which countries you have selected for IP protection; monitoring  the renewal due dates; obtaining renewal estimates for budget forecasting; and understanding the procedures in each relevant jurisdiction, throughout the lifetime of your IP. These lifetimes can vary widely across your portfolio and often stretch for decades.

In addition, applicant details and other publicly available information that is released as part of applying for intellectual property protection has resulted in the rise of a small, but regrettable, number of scams in which criminals convince IP holders to part with money on the spurious basis that it is required to maintain their rights. 

In meeting these challenges it is vital to ask your patent or trade mark attorney at the beginning of your application process what the renewal process will be for the jurisdictions and IP rights that you have selected. All attorneys will be very happy to provide you with a detailed understanding of this process.

Once your application is underway, most reputable firms of patent and trade mark attorneys offer a renewals service as standard which will ensure that you do not miss any deadlines, and the renewals service will shoulder the burden of administration across your portfolio.

Most professional renewal services will include, but not be limited to:

  • Monitoring due dates and grace period deadlines for all of your IP rights, throughout the world; sending multiple renewal reminders ahead of all due dates and throughout the grace periods as necessary.
  • Keeping abreast of relevant law changes around the world and informing you if you will be affected.
  • Providing estimates of the costs as well as ensuring renewal fees are paid promptly, using the lowest cost option.
  • Communicating with and instructing overseas associates, where necessary, for international filings.
  • Organising the execution of any forms, such as Power of Attorney, required for the renewal.
  • Providing status reports on request, and answering your queries by email, fax or telephone.
  • Forwarding official communications from the IP Office and explaining their significance.
  • Protecting you from scammers by dealing with all renewals requests.

Regardless of any on-going stages of an application, your continued use of your IP, or any cases that might be before the courts, when renewal payments are missed and the grace period (if there is one) exceeded, your IP right will lapse, and it may not be possible for it to be recovered.

Ensuring that you have the full information regarding when and how your rights need to be maintained, and that your information is unerringly organised and acted upon is the only way to guarantee the on-going benefits of your IP.

By Dr Jodi Richards – jrichards@fak.com.au

 


[1][1] IP Australia, Manage your patent (23 November 2013), [4] < http://www.ipaustralia.gov.au/get-the-right-ip/patents/manage-your-patent/>.

[2] Wolters Kluwer Law and Business, Manual for the handling of applications for patents, designs and trademarks throughout the world, Thailand, Patents, Requirement for Renewals, (Kluwer Law International) Supplement No. 140, September 2012.

[3] Ibid.

[4] Canadian Intellectual Property Office, A Guide to Industrial Designs, How long does the registration last < http://www.cipo.ic.gc.ca/eic/site/cipointernet-internetopic.nsf/eng/h_wr02300.html>.

[5] Office for Harmonization in the Internal Market, Manage, [1] https://oami.europa.eu/ohimportal/en/rcd-manage.

[6] Wolters Kluwer Law and Business, Manual for the handling of applications for patents, designs and trademarks throughout the world, Fiji, Trade marks, Requirement for Renewals, (Kluwer Law International) Supplement No. 134, February 2011.

[7] Canadian Intellectual Property Office, Tariff of Fees – Patents http://www.cipo.ic.gc.ca/eic/site/cipointernet-internetopic.nsf/eng/wr00142.html.

[8] IP Australia, Patent fees, Standard Patent Renewals fee table (4 March 2014)  <http://www.ipaustralia.gov.au/get-the-right-ip/patents/time-and-costs/fees/>.