Recent amendments to the Patent Rules came into force on June 2, 2007. These amendments clarify the definition of a "small entity" and permit the correction of fees mistakenly paid at the small entity level. Among other noteworthy changes, the amendments allow an applicant who is not an inventor to submit a declaration of entitlement to apply for and be granted a patent, rather than have to file evidence of entitlement.
Small Entity Regime
The amendments eliminate some of the previous uncertainty about the definition of a small entity and provide a limited relief mechanism for correction of insufficient fee payments (i.e., when the applicant mistakenly pays fees at the small entity level). In particular, the amendments include the following changes:
- The definition of a "small entity" has been refined to be "an entity that employs 50 or fewer employees or that is a university, but does not include an entity that (a) is controlled directly or indirectly by an entity, other than a university, that employs more than 50 employees, or (b) has transferred or licensed, or has an obligation, other than a contingent obligation, to transfer or license any right in the invention to an entity, other than a university, that employs more than 50 employees."
- For non-PCT national applications, small entity status will be determined on the filing date of the application in CIPO and, for PCT national phase applications, on the date of national phase entry in CIPO.
- The Commissioner of Patents is now authorized to grant patent applicants/holders an extension of time to correct fees mistakenly paid at the small entity level, provided that the Commissioner is satisfied that the small entity fee was paid in good faith and that the application for extension was filed without undue delay. When a time extension is requested, patent holders/applicants will be required to pay the difference between the small entity fee and the standard fee, plus the extension fee for each fee that was incorrectly paid. This change will allow retroactive correction of insufficient fee payments only where the Commissioner is satisfied that the circumstances justify the extension.
When The Applicant Is Not An Inventor
The recent amendments to the Patent Rules have removed the requirement that an applicant who is not an inventor file evidence (usually an assignment) of entitlement to apply for and be granted a patent. Now, such applicant must submit information about the basis for entitlement by way of a simple declaration, either in the petition or a separate form.
The declaration must be worded as set out below, with such inclusion, omission, repetition and re-ordering as are required to correctly and fully define the applicant's entitlement as at the filing date:
"… (applicant's name) is entitled to apply for and be granted a patent by virtue of the following:
(i) … (name) of … (address) is the inventor of the subject matter for which protection is sought by way of [the] [this] international application
(ii) … (name) [is] [was] entitled as employer of the inventor, … (inventor’s name)
(iii) an agreement between … (name) and … (name), dated …
(iv) an assignment from … (name) to … (name), dated …
(v) consent from … (name) in favour of … (name), dated …
(vi) a court order issued by … (name of court), effecting a transfer from … (name) to … (name), dated …
(vii) transfer of entitlement from … (name) to … (name) by way of … (specify kind of transfer), dated …
(viii) the applicant’s name changed from … (name) to … (name) on … (date)"
The deadline for submitting the declaration for a Patent Cooperation Treaty (PCT) national phase entry application is three months from the date of effecting national phase entry. If this due date is not met, the Canadian Intellectual Property Office (CIPO) will issue a requisition setting a deadline for submission of the required declaration and payment of a prescribed completion fee.
For non-PCT national filings, the declaration must be submitted before the expiry of the 15-month period after the earliest priority date (or the filing date, if no priority claim is made). If this due date is not met, CIPO will issue a requisition setting a deadline for submission of the required declaration and payment of a prescribed completion fee.
The declaration is only applicable to events that have occurred before the filing date. If subsequent changes in ownership are made, it will still be necessary to submit and record evidence of any change in title to ensure that CIPO records are kept up-to-date.
The amended Patent Rules include transitional provisions that specify that, for any application that was filed prior to the amendments coming into force, the applicant may either submit evidence of entitlement or a declaration of entitlement (as set out above), provided that the relevant deadlines are met.
Sequence Listing Format Requirements
The Patent Rules have been amended to require that the format for sequence listings filed for both non-PCT applications and PCT national phase applications be in the PCT format.
The Patent Rules specify a number of circumstances in which a patent applicant/holder may request and obtain a refund of fees paid. Formerly, there had been no deadline for requesting such refund. The amendments now set a deadline of three years from the date of payment within which to request a refund.
PCT National Phase Entries
For a PCT application to be deemed to have entered the national phase in CIPO, certain minimum requirements prescribed by the Patent Rules must be met. In the past, if these requirements were not met, CIPO would typically send a "courtesy" letter inviting the applicant to submit the required documents/information within a prescribed time before deeming the application never to have entered the national phase. However, as CIPO was under no obligation to send such courtesy letter, the application could have been deemed never to have entered the national phase without CIPO ever having given notice to the applicant. The amendments obligate CIPO to provide notice to PCT applicants that certain requirements have not been met. Abandonment, or a deemed failure to enter the national phase, will not occur until after the applicant has been notified of the deficiency and provided an opportunity to respond.
The Patent Rules have also been amended to clarify that the prescribed late entry fees for a PCT national phase application must be paid before the expiry of the 42-month period after the earliest priority date.
Additional Minor Amendments
Additional minor amendments to the Patent Rules include: allowing new translations to replace faulty ones during PCT national entry; requiring a PCT national phase application to be withdrawn before being filed again; standardizing the format for electronic forms; retaining only the electronic version of a sequence listing (as opposed to paper form); not allowing a trade-mark, coined word or the name of a person in the title of an invention; and requiring CIPO to provide free certified copies of documents to the Federal Court.
The amendments were largely made in keeping with the Canadian government's initiative on Smart Regulation and the Paperwork Burden Reduction Initiative. For example, by removing the requirement to record evidence of the applicant's entitlement to apply for and obtain a patent, CIPO estimates that approximately 37,000 applicants per year will no longer be required to record assignments. This translates into a significantly reduced workload for patent formality agents. The amendments will also result in cost savings for patent applicants who will no longer have to incur the associated registration fee.
Probably the most significant impact of the amendments concerns the application of the small entity regime. The amendments to the definition of "small entity" and the addition of a limited relief mechanism for correcting fees mistakenly paid at the small entity level are intended to encourage small businesses and individual inventors to take advantage of the reduced fees available. However, the onus remains on the patent applicant to ensure that small entity status is correctly determined. Unless corrected, fees mistakenly paid at the small entity level will continue to result in a loss of patent rights. Therefore, extreme care should be taken when claiming small entity status.
Stephanie White is a Registered Patent Agent with the Canadian Patent Office and with the United States Patent and Trademark Office. She practises in the Intellectual Property Department in Osler's Ottawa office and is a member of the Technology Business Group.
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