For small to medium sized enterprises (SMEs), patent protection
can be complex and costly. And yet, for many of them, patent
protection is a must to maintain their competitive edge. A fast and
cheap option for protecting mechanical inventions, products, and in
some cases compositions are utility models, also often called
“petty patents” or “innovation
Utility models are similar to patents in that they provide an
exclusive right to prevent unauthorized commercial use of the
invention for a period of time. The period of protection for
utility models is shorter; typically 7 to 10 years, which cannot be
extended or renewed. As such utility models are ideal for products
with an anticipated short commercial life.
While utility models are not offered in Canada, the US or the
UK, they are an option for a number of industrialized countries
including Argentina, Australia, Brazil, China, France, Germany,
Italy, Japan, Mexico, Republic of Korea, Russian Federation and
Spain. In some countries, utility model protection can only be
obtained for certain fields of technology and only for products,
The requirements for acquiring a utility model are less
stringent than for patents. Novelty is required, but an inventive
step or non-obviousness often is not.
Utility models are often registered within three to six months,
without examination. With quick registration comes quicker
publication, which otherwise takes 18 months post-filing in patent
applications. If patent protection is also being sought, it is
important to consider both timing of filing the utility model in
relation to patent applications, and the novelty requirements in
the countries of interest. Where an invention has already been made
public, a number of countries that do not provide a grace period
for patent filings may provide one for utility models.
Quick registration also means that the registered utility model
can be enforced against potential infringers much sooner than a
patent application, which can sit pending at the Patent Office for
years In most countries, utility models follow the same legal
proceedings as patent litigation. Validity of utility models is
thus assessed by a civil court or similar body.
Another appealing feature is that a utility model can be
branched off a pending patent application. A utility model may
claim priority from an earlier patent or utility model application.
It is also possible to use a PCT application as the basis for a
utility model application in the national phase.
Also, during a limited period, many countries allow conversion
of a patent application into a utility model application. Some
countries even allow conversion after a patent application has been
refused. In some countries, it is possible to obtain and keep both
a patent and a utility model for the same invention.
In summary, utility models are much more cost and time efficient
to obtain and to maintain than patents and are therefore considered
particularly suited for SMEs, in particular, SMEs who make
"minor" improvements and adaptations of existing
products, who may not otherwise meet the inventive step
requirements for a patent.
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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Under Canada’s tax laws, a taxpayer may deduct a "terminal loss" from its taxable income, where (i) the taxpayer has incurred a capital cost in acquiring property which may depreciate in value and (ii) the property has depreciated in value when the taxpayer disposes of the property.