2023 Issue 2
EPC National Validation Translation Requirements and the London Agreement – Rewards and Risks
The London Agreement, which initially took effect in May 2008, has reduced some of the translation burden for patentees who use the EPC system, but in some instances it can also create an ‘out of sight out of mind’ risk.
A single European patent application currently gives the possibility of obtaining patent protection in up to 44 countries, being the 39 EPC member states and the 5 non-EPC extension / validation states. The decision on which of those countries to seek patent protection in only needs to be made once the EP application is granted, but to maintain the application a designation fee needs to be paid within 6-months from the publication of the European search report.
If the EP application proceeds to grant the default procedure for validation in all or some of those states is to file a translation (if required) of the patent or at least the claims with the national patent office. Article 65 of the EPC 2000 allows member states to require that a translation into one of the official languages of the member state is filed within 3-months of the date of mention of grant in the EP Bulletin if the EP application is granted in a language that is not one of its official languages.
However, the London Agreement provides for exceptions to this default procedure depending upon whether the London Agreement member has an official language in common with one of the EPC official languages of English, French and German.
Currently 22 EPC member states are also members of the London Agreement. Of these 9 have an official language in common with one of the official languages of the EPO and so get granted in the national office automatically and instantaneously without the need of validation. This is the case for Belgium, France, Germany, Ireland, Luxembourg, Switzerland (and Liechtenstein), Monaco and the United Kingdom.
There are a further 13 EPC member states that are a member of the London Agreement, but which do not have English, French or German as an official language. Namely: Albania, Croatia, Denmark, Finland, Hungary, Iceland, Latvia, Lithuania, Netherlands, North Macedonia, Norway, Slovenia and Sweden. These member states need to specify which of the EPC official languages the description is to be translated into and generally only require the title and claims to be translated into their official national language. Fortuitously for the owners of EPs that are granted in English these member states have either specified English as the language for the description or have elected to remove the requirement for the description to be translated.
Given the significant costs in obtaining a translation of the full specification EPC member states that are also a member of the London Agreement are likely to be viewed favourably when deciding where to validate.
However, the automatic and instantaneous granting of EP’s in member states that are also members of the London Agreement and which have an EPC official language as one of their official languages can put those national grants at risk of not being renewed. Given that active steps are not required to validate in those countries, and particularly for lesser opted states such as Luxembourg, Switzerland, Liechtenstein and Monaco, the owner may not know or expect that their patent is in force there and so be at risk of not subsequently renewing them. This risk can be heightened by the somewhat opaque nature of the EP Register, which is not very clear at giving the national statuses of a granted EP as it only shows the states where it is not or no longer in force. If opted into, the advent of the Unitary Patent system can reduce this risk, but it will still remain for Switzerland (and by implication Liechtenstein, which Swiss patents automatically extend to) given that those countries are not in the EU and so cannot participate in the UP and UPC system.
(Ambiguous) Late Fee Change of Practice by IPONZ as PCT Receiving Office
On the 18th May 2023 IPONZ advised that with effect from 15th May 2023 it no longer charges a late fee when the required collective Transmittal, International Filing and International Search fees for PCT International applications have not been paid or have inadequately been paid.
In accordance with Rules 14.1(c), 15.3 and 16.1(f) of the PCT Regulations the Transmittal, International Filing and International Search fees respectively are standardly allowed to be paid up to 1-month from the date of receipt of the international application by the PCT Receiving Office. However, Rule 16bis of the PCT Regulations provides that if those fees have not been paid or have inadequately been paid within that standard time period, then the Receiving Office is required to invite the applicant to pay the outstanding fees within one month of the date of invitation together with an optional late fee. If charged, the late fee is the higher of 50% of the outstanding fees or the Transmittal fee, but it cannot be higher than 50% of the International Filing fee (excluding fees for sheets in excess of 30).
The notification by IPONZ of its change in practice is somewhat ambiguous and may not comply with Rule 16bis of the PCT Regulations. Relevantly, IPONZ’s notification states:
Previously, whenever we received a new PCT application, we required its fees to be paid by a given deadline, or a late payment fee would be applied.
For new PCT applications from 15 May 2023:
• We will no longer charge late payment fees for these PCT applications.
• If the application fee is not paid by its given deadline, we will withdraw the PCT application after this deadline has lapsed.
It is not clear what is meant by ‘a given deadline’. Given that the late payment fee was applied if the required fees were not paid by the given deadline, then the most (if not the only) reasonable interpretation of this is that the given deadline is the standard deadline of 1-month from the date of receipt of the international application by the PCT Receiving Office in accordance with Rules 14.1(c), 15.3 and 16.1(f). That interpretation, though, is incompatible with Rule 16bis. While IPONZ has the option of not charging a late fee, it is still required to invite the applicant to pay the outstanding fees within one month of the date of invitation. Had IPONZ meant to state its new practice in a way that is compliant with Rule 16bis it should have said something to the effect of:
For new PCT applications from 15 May 2023:
• We will no longer charge late payment fees for these PCT applications.
• If the application fee is not paid by its given deadline, we will invite the applicant to pay the outstanding fees within one month of the date of invitation.
• If after this extra deadline has lapsed the required fees remain unpaid we will withdraw the PCT application.
Forthcoming PCT International Phase Fee Changes for Australia and New Zealand
Effective from 1st July 2023 the International Filing fees will change for Australia. The table below gives the changes in the equivalent amounts in AUD: (PCT Newsletter; 2023/5)
PCT Intl Filing Fees / Intl Filing Fee / Fee per sheet over 30 / PCT-EASY Reduction (Varies according to electronic format)
Current Fee (AUD) / 2,088 / 24 / 314 – 471
Fee from 01/07/2023 / 2,247 / 25 / 338 – 507
Effective from 1st June 2023 the Handling fee for an International Examination carried out by the KIPO will change as indicated below. (PCT Newsletter; 2023/5)
IPEA (Currency) / IPEA Handling Fee (Current) / IPEA Handling Fee (01/06/2023)
KIPO (KRW) / 267,000 / 286,000
Effective from 1st July 2023 the Handling fee for an International Examination carried out by IP Australia will change as indicated below. (PCT Newsletter; 2023/5)
IPEA (Currency) / IPEA Handling Fee (Current) / IPEA Handling Fee (01/07/2023)
IP Australia (AUD) / 314 / 338
Hague Agreement Update
As previously noted China (CN) became bound by the Geneva Act of the Hague Agreement Concerning the International Registration of Industrial Designs (Hague Agreement) a year ago on 5th May 2022.
From that date China could be designated in applications filed using the Hague system and people who are Chinese nationals or domiciled in China or having a habitual residence or legal entities that have a real and effective industrial or commercial establishment in China could file applications using the Hague system.
In the past year about 1,100 international applications have been filed by applicants in China and over 900 international applications by applicants outside of China have designated China. Designation of China does not also designate Hong Kong or Macao, as design protection needs to be applied for directly for those special administrative regions. Another significant addition to the Hague Agreement will occur on 1st August 2023 when Brazil becomes bound to the Geneva Act.
A person or legal entity in a country that is not a contracting party to the Hague Agreement can still use the Hague system if they are:
- a national of a contracting state; or
- domiciled in a contracting state; or
- have a habitual residence in a contracting state to the Geneva Act of the Hague Agreement; or
- have a real and effective industrial or commercial establishment in a contracting state.
Prior to China becoming bound by the Hague Agreement there were nearly 1,300 Hague Agreement international registrations held by a party based in China. Both Australia and New Zealand have yet to join the Hague Agreement. So far there have been 71 Hague Agreement registrations held by a party based in Australia and 9 held by a party based in New Zealand.
Both Australia and New Zealand have recently completed a free trade agreement with the United Kingdom, and these will enter into force by the end of this month. Although membership of the Hague Agreement is not a prerequisite for the respective free trade agreements to enter into force, both Australia and New Zealand are obliged to make all reasonable efforts to join the Geneva Act of the Hague Agreement.
China’s accession to the Hague Agreement also makes accession by Australia and New Zealand more likely, given that many Australian and New Zealand businesses outsource the manufacturing of their designs to manufacturers based in China. Other regional countries where manufacturing is outsourced to, such as Japan, South Korea and Vietnam, are also members of the Hague Agreement. This will help to counterbalance the cost to the local economies due to the majority of locally registered designs belonging to foreign businesses – which would likely be further exacerbated by acceding to the Hague Agreement.
There are not many requirements that need to be met before a country can join the Geneva Act of the Hague Agreement, with membership of WIPO (and by implication the Paris Convention) and a maximum term of at least 15-years from the filing date being the main ones.
New Zealand’s design’s legislation appears to be already compliant with the Hague Agreement, although it would need to make declarations regarding optional aspects that differ from the approach adopted under the Hague Agreement. In particular, the Hague Agreement allows publication to be deferred for up to 30-months from the priority date, whereas New Zealand currently has no option to defer publication. Apart from some exceptions New Zealand requires applications to be accompanied by a statement of the features of the design for which novelty is claimed. This will likely require a declaration that the application must contain a brief description of the reproduction or of the characteristic features of the design that is the subject of that application. As the Hague Agreement does not examine for novelty New Zealand’s local novelty standard (albeit taking into account internet publications) is not an issue.
In order to be compliant with the Hague Agreement the maximum term of Australian designs will need to change from 10-years to at least 15-years from the filing date. It will also require a declaration stating that it allows publication to be deferred by a maximum of 6-months.
The Hague Agreement is one of several international treaties that have been formulated through diplomatic conferences held in the city of Hague in the Netherlands. China recently deposited its instrument of accession to another such international treaty - the Hague Convention Abolishing the Requirement of Legalisation for Foreign Public Documents (Hague Convention), also known as the Apostille Convention, which will enter into force in China on 7th November 2023.. This convention reduces the chain of authentication needed to certify documents in order for them to have legal effect. The Convention reduces all of the formalities of legalisation to the simple delivery of a certificate in a prescribed form, entitled “Apostille”, by the authorities of the State where the document originates. This certificate, placed on the document or on a slip of paper attached thereto called an "allonge", is dated, numbered and registered. Once this convention takes effect in China it will reduce business costs for businesses in other convention states (such as Australia and New Zealand) and similarly reduce the costs for Chinese businesses transacting with businesses in other convention states.