Over the past couple of years, major amendments have been made to the European, Australian and U.S. systems, and these will be implemented over the next year or so. The Australian and U.S. changes will be fully implemented (apart from the inevitable transition provisions) within a month or so. So what do these changes mean for an Australian technology developer? As I will explain below, if the promise and intention of the changes is realised, the international system will get cheaper, probably faster, and probably more predictable. This is because of changes on several important fronts.
Patentability Rules
The U.S. has moved to a first inventor to file system, in line with the rest of the world. Directly, this avoids a whole raft of disputes, and improves certainty in transactions. The U.S. substantive rules on novelty and obviousness have been clarified and are now closer to other major patent offices, and also to Australia. Overall, a lot of idiosyncratic U.S. rules have been either removed or limited.
In Australia, we have removed some of the restrictions on the type of material that can be used to mount an inventive step attack, and also increased the requirements for disclosure to support valid claims. The latter brings us consciously more in line with the U.S. and Europe.
Aligning with everyone else allows work product from the USPTO to be more readily used by other patent offices, as well as allows the USPTO to more readily use the Examiner’s work done in other patent offices. This should, over time, reduce the extent to which each Examiner approaches each national version of the same patent application as if it has never been seen by an Examiner before.
Burden of Proof
In Australia, it is currently difficult for a patent to be ultimately refused by the Examiner. The amendments mean that it is now up to the applicant to show that, on the balance of probabilities, the patent is valid. Additional grounds for re-examining granted patents are also now available.
U.S. law applies two different standards to assessing validity, depending upon the stage of the patent’s life and the process being undertaken. At the patent office, the standard is preponderance of evidence – that is, that there is a preponderance of evidence suggesting that on each of the various grounds, the patent should be granted. In court proceedings, in relation to validity, a much higher standard applies of ‘clear and convincing evidence’. As a result, there are situations where on the same evidence, a patent would be held invalid in Australia, Europe or Japan, but not in the U.S. There are several new ways to challenge patent validity at the patent office in the U.S., which rely on the ‘preponderance of evidence’ standard.
Overall, the effect of these changes is to ensure that it is less likely that dubious patents will be granted, and that there are better avenues for challenge at the patent office level, avoiding the expense and delay of court proceedings.
One European patent (sort of)
The EU has had a patent system for 35 years. The European Patent Convention imposes common laws on most aspects of patent validity and infringement. However, the grant stage requires translations in many countries, and formalities to be undertaken to achieve effective grant in each member country. This is time consuming and inefficient, making an EU patent many times more expensive than a U.S. patent, despite covering a similar market size. Another problem relates to enforcement - this has to be country by country at present, with no common appeal court, so that there is divergent law in each country.
A treaty has been agreed allowing for the option of a unitary European Patent, covering the EU except for Spain and Italy, who have opted out. This will be able to be enforced using a unified patent court system. Hence, if a party is infringing in France, Germany and Finland, one court action can address all of these, obtain enforceable judgements, and provide a common set of procedures no matter where the case is heard.
In combination, these measures will lower the cost of obtaining a patent across Europe, as well as increase the value of the patent as it can be centrally enforced across the EU.
Conclusion
The process of harmonisation continues within the patent system, and is hugely beneficial to applicants from countries such as Australia who need protection in much larger export markets. There are also moves towards a treaty on substantive patent law, to further align the law particularly in the developed countries.
As the cost and complexity of international filings are reduced, and their effectiveness is improved, the benefits for Australian technology developers are clear. There are good prospects for even greater harmonisation just around the corner.
by Peter Franke
