Canada: Where Shall I File My Patent Application? Some Pointers On International Filing Strategies

Last Updated: December 14 2011
Article by Euan Taylor

There is a common misconception that one can obtain an "international" or "global" patent. In fact, although one can file an international application under the Patent Cooperation Treaty (a "PCT Application"), ultimately patents are only effective in the jurisdiction of issue. Hence, separate applications always have to be filed for the countries and/or regions of interest. The cost of obtaining patent protection in every possible country is prohibitive, but if suitable filings are not made then an applicant may not get full value from it's invention.

Naturally there are a number of considerations that may affect a decision on where to file patent applications:

Cost - Once a first application has been filed, the Paris Convention allows other applications filed within one year to claim the benefit of that priority date. Individual national or regional filings can claim priority, and so can a PCT Application. Filing a PCT Application is substantially more expensive than a national filing, but it allows the deferral of national filings for 30 months following the priority date. If an applicant is interested in a number of jurisdictions, this may be the best option. It allows time to gather funding before the expense of multiple national and regional applications has to be incurred. Many North American applicants with a limited budget are only interested in US and Canadian filings, and if only a very few jurisdictions are of interest, there may be little benefit to filing a PCT Application.

For budgeting purposes, as a very rough rule of thumb, it may cost around $3,000 to file an already drafted patent application in one country, with a European application being rather more expensive to file. In cases where translation is required, there will be additional costs for the translation. Obviously as each application proceeds there will be further costs incurred to prosecute the application and maintain it in good standing.

The Geographical Scope of the Business - Where will a product be manufactured and where will it be sold? So much manufacturing is now done in China and India that patents in these countries have become important to many clients who have their manufacturing operations there. If the primary target markets are the US and Europe, it would be well to have patents in place there. But even if a company is not currently active in, for example, the Brazilian or Chinese markets, it may be able to license rights there or may have longer term goals to market there. Licensing in additional jurisdictions can be a way to mine further income from the initial investment in an invention. An applicant should try to envisage how its business may grow, where it wants to manufacture and where it hopes to sell and where it has potential partners who may be interested in licensing rights. Bear in mind that a patent can last for 20 years from the filing date, so think long-term as well as short-term.

Goals - Many early stage technology companies have one goal - to be bought out. In this case it may be most important to file applications in the jurisdictions that matter to potential purchasers. Most recently, Europe (more on this below), the US, Canada, Japan, China, India and Brazil are all common choices. China, India and Brazil are not only major potential manufacturing countries, but have become major markets for many products and services. Particular industries may have their own specific issues: Investors in the oil business may want to see patent applications filed in particular middle eastern countries. Companies in forestry related businesses may have a particular interest in Canada, Australia and Russia.

Competitive and Cooperative Strategies - Selected patent filings can protect a market, and also limit a competitors' ability to maneuver. Remember that today's collaborator may be tomorrow's competitor. If an enterprise collaborates closely with a business partner in a given jurisdiction, it is desirable to have patent protection in place there to make sure that the collaborator is not able position itself or its affiliate to independently commercialise any of the technology it acquires from the relationship. Sometimes a solid patent portfolio is valued not to keep competitors out of a market, but rather as a defensive tool. So long as SmithCo and JonesCo have a good relationship they may turn a blind eye to each other's infringement of one or other patent, or may cross-license each other's IP. If a conflict develops however and SmithCo decides to aggressively enforce its patents, JonesCo may want to turn to its own patent portfolio as a basis for possible counterclaims. This form of Mutually Assured Destruction can help to dissuade a competitor from bringing suit simply for nuisance value, and can facilitate settlements.

Regional Patents - There are a number of regional patent systems, probably the most popular being the European. A European patent application can be filed in the European Patent Office ("EPO"). A single regional European patent application can cover many European states. This single application can be prosecuted through to issue and the issued European patent must then be validated in each country of interest to provide full patent protection in those countries. Although a European filing is relatively costly, in the longer term it can save substantial amounts of money compared to filing and prosecuting applications independently in multiple countries of interest. Once the patent has been validated in multiple countries, maintenance fees may have to be paid on each one of these patents. Consequently many applicants will elect to have a European patent validated in only a subset of nations. France, Germany, UK, Italy and Spain are often seen as the most economically important European states, but particular industries or specific businesses may require a different selection. If only a very few European countries are of interest, then it may be cheaper to file in those individual countries directly. Other regional patent systems are administered by the Eurasian Patent Organisation ("EAPO")and the African Regional Intellectual Property Organisation ("ARIPO").

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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