Canada: Canada Prepares For Patent Law Treaty

The Canadian Patent Act (the "Patent Act") is undergoing amendment courtesy of Bill C-43, known as the Economic Action Plan 2014 Act, No. 2 tabled in the House of Commons on Oct. 23, 2014. Canada is fulfilling its undertakings to adhere to the Patent Law Treaty ("PLT") adopted in Geneva on June 1, 2000, which provides for worldwide harmonization of national patent formalities, simplification of national patent office procedures and standardization of mechanisms to help avoid unintentional loss of patent rights resulting from failure to comply with formalities and specified time limits. However, the amendments introduce additional changes beyond Canada's treaty obligations.   

The changes to the Patent Act provided by the amendments focus on a number of different areas, including: time limits for payment of fees; reinstatement periods; priority requests; application content; application/patent transfers and noted other changes. The amendments also provide the authority of the Governor in Council to make regulations under the Patent Act in order to implement the amendments to the Patent Act.

Fee Payments

Fee payments under the Patent Act include: an application fee for filing the application; annual maintenance fees required to maintain the application (or a patent) in force; and an examination fee required to initiate formal examination of the application. 

Under the current Patent Act, the application fee must be paid in order to obtain a filing date. Under the amendments, if the application fee is not paid on the date on which all of the other filing date requirements are met, the Commissioner of Patents will send a notice informing the applicant of non-payment and requiring payment with a late fee by a prescribed date.

Under the current Patent Act, each maintenance fee to keep an application alive or a patent in force must be paid either by its prescribed date or within a reinstatement period of 12 months of that prescribed date with an additional late fee.  Failure to provide payment within the reinstatement period will result in a "dead" application or lapsed issued patent. Under the amendments, similar to the application fee, if the maintenance fee is not paid within the prescribed date, the Commissioner of Patents will send a notice informing the applicant of non-payment. Payment must be made within the later of six months from the prescribed date or two months from the date of the notice.

These amendments replace the straightforward reinstatement period (see Reinstatement Periods below) of the current Patent Act by inserting an extension period of at least six months following the original deadline before a new more onerous reinstatement process is triggered. 

A similar process is instituted by the amendments in relation to requests for examination. However, the extension period is a maximum of two months from the date of a notice from the Commissioner of Patents when the original payment deadline is not met.

Reinstatement Periods

Abandonment of an application or patent under the current Patent Act will occur if certain deadlines such as making fee payments, filing good faith responses to examination requisitions, etc. are not met. Currently, reinstatement rules are simple and the same for all types of abandonment: within 12 months of the abandonment the applicant must complete the action that was required to be taken to avoid the abandonment and submit a simple reinstatement request with a reinstatement fee. 

However, under the amendments, new and more onerous reinstatement requirements are provided for abandoned applications and patents. The reinstatement process will be more complicated, as an additional requirement is that the applicant or patentee must additionally state "reasons for the failure to take action that should have been taken to avoid the abandonment". Further, the Commissioner of Patents must determine that the failure occurred in spite of the due care required and inform the applicant or patentee of this determination.  Another provision in the amendments is that the required "reasons for the failure" can be challenged in the Federal Court if the stated reasons contain a material allegation that is untrue. 

As a result of these amendments it appears that applicants will no longer be permitted to electively abandon an application after allowance to reopen prosecution.

Prudent applicants and patentees may wish to make greater efforts to comply with prescribed dates to avoid abandonment and reliance upon the reinstatement process.

Priority Requests

Under the current Patent Act, a request for priority to a previously filed patent application (the "priority application") can only be made if the application is filed within 12 months of the filing date of the priority application. Under the amendments, advantageously this 12 month period is extended to 14 months, as long as any delay in filing after the 12 months by the application was unintentional. However, the amendments also provide for the Federal Court to revoke the priority claim if it is determined that the delay was intentional.

Application Content

Under the current Patent Act, no "new" descriptive or illustrative material can be added to a filed application. In other words, any changes to the description or drawings of an application must be "inferable" from the description or drawings as originally filed. Under the amendments, a stated "reference" to the priority application can be provided at the time of filing the application rather than explicitly providing all or part of the description or drawings contained in the priority application. The stated reference can also be provided up to six months after filing the application. Use of the stated reference will advantageously allow added description or drawings to the filed application that would have otherwise been considered "new" under the current Patent Act, so long as the added description or drawings can be deemed as completely contained within the priority application.   

Application/Patent Transfers

The Amendments introduce new title transfer provisions directly into the Patent Act. These provisions include 1) voiding the submission of a patent transfer, in the event of recordation against title of the patent has already occurred, even if the patent transfer is dated earlier than the recordation and 2) the Commissioner of Patents can remove the recording of a transfer of an application or patent upon receipt of evidence satisfactory that the transfer should not have been recorded. These new title transfer provisions will influence timeliness of submitting patent transfers as well as the ability to void the recordation of patent/application transfers.   

Noted Other Changes

Among the many other amendments contained in B C-43, the following are noteworthy:

Under the amendments, third party rights may be affected in relation to applications that were abandoned or where certain fees were paid short of abandonment during extension periods. No action for infringement of a patent lies against a person in respect of an act that would otherwise constitute an infringement of the patent if that act is committed in good faith by the person during a period that is established by regulations to be made under the new amendments. Similar rights may be extended to acts or preparations undertaken by a person during a period that is established by regulations to be made under the new amendments where the business of the third party is transferred to another.

The amendments provide powers to the Governor in Council to make rules or regulations "respecting the circumstances in which an applicant, patentee or other person may or must be represented by a patent agent or other person in business before the Patent Office". Also noted is that the amendments repeal section 29 concerning non-resident applicants (those applicants not residing in or carrying on business at a specified address in Canada) and representative nominees for non-resident applicants. The Canadian patent profession will, no doubt, be interested in how these amendments will be interpreted and implemented. 

Also changed by the amendments is section 12(1)(j.8) of the current Patent Act, whereby the Commissioner of Patents is authorized to extend the time period for doing anything under the Patent Act "during or after the end of the time period", if the Commissioner of Patents "considers that circumstances justify the extension". This is an interesting change and its scope of effect remains unknown. Under the current Patent Act the Commissioner of Patents does not have a carte blanche authority to extend time periods, once ended, "for doing anything under the Act". 

The changes to the Patent Act will come into force on a date to be fixed by the Governor in Council. It will take some time to prepare the new regulations and ready the Patent Office for the changes. If recent changes to the Trademarks Act are any guide, the changes are not likely to be in force until after 2015.

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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