Wednesday, 24 June 2015

Epo sets level of renewal fee for unitary patent

The EPO announced that the level of the renewal fees for a unitary patent will be set according to the 'true Top 4' level. This makes this the first of the new fees that have been definitely decided and is out of the draft phase. As to the EPO, they remain on course for granting the first unitary patent in 2016 (if all other parties will also remain on course remains to be seen, as discussed earlier.)

Not knowing what the renewal fees would be was frequently cited as the major stumbling block for applicants in planning their filing strategy. Ignoring the fees for eventual litigation, there are three fees that will be relevant when deciding for or against the unitary patent: the opt-out fee, the renewal fee, and the cost of requesting unitary effect. The renewal fees are now decided. I'm not sure the cost for requesting unitary effect has been formally, but is has been known for some time that this will be free. In the current draft, an opt-out for a patent or patent application will cost €80.

Based on these fees, an applicant can take a look at its patent portfolio and run the numbers.

The true top 4 renewal fee are based on the sum of the renewal fees currently paid for the four most frequently validated countries (Germany, France, UK and the Netherlands). Speaking purely financially, this would make the unitary patent attractive for:

  • Applicants who currently validate in four or more countries
  • Applicants who currently validate in fewer than four countries, but who expect that the reduced validation and renewal overhead compensate for increased renewal fees
  • Applicants who currently validate in fewer than four countries, but who want 'more protection per renewal euro'
The renewal fees cover 'the territory of the participating 25 EU Member States'; so I do not expect the renewal fee to increase if more countries ratify. However, the renewal fees may be revised after four years. (I presume this means in 2019, not necessarily after four years of unitary patents.)

Battistelli commented that
"I am confident that today's decision strikes a positive balance, ensuring that the fees represent a real cost saving to the user and also providing a healthy operating budget for the EPO and the participating Member States. This is another major step in achieving truly uniform patent protection in Europe." 
The Select Committee now needs to decide how the renewal fee income will be distributed between the member states. For sure this will not be an easy discussion, but this will not make as much of an impact on the end users of the new system.

4 comments:

  1. Is there any legal certainty that the renewal fees will maintain at this level and only get changed for inflation, or is there a risk that -if the system is successful- the renewal fees are significantly increased at some moment in the future and all users have no choice than to accept that - as they can no longer revert back to national validations?

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    1. The renewal fees can and will be periodically revised, just as national renewal fees are. Increasing the renewal fees would be a decision of the administrative council in which all member states have a vote.

      A sudden increase in the renewal fee would apply to existing unitary patents, but it would make the system less attractive for new patent applicant who have to decide whether or not to apply for unitary effect or not.

      Though possible, I wouldn't consider this the most likely problem you may have with a unitary patent.

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  2. The Top4 system seems to be a bargain for proprietors that are used to validate in many countries, such as pharma, food and standardization-driven high tech, whereas SMEs that usually only validate in one or two are worse off (and the amount of the fee reduction is not sufficient to compensate that) -- in contrast to the usual approach of Brussels, which is to stimulate and help the SMEs and let the strong shoulders of rich entities carry their own weight and preferably a bit more?

    MrRenewingUPIsTooCheap

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    1. Opinion is divided on how much of a bargain the unitary patent is, when you compare to US patents...

      For patents that are renewed for the full 20 years, the unitary patent may already be more cost effective from about 3 countries (taking reduced agent overhead and translations into account). The specifics really depend on country selection and overhead. Of course there is always the possibility to use a classic validation if you don't like the unitary patent.

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