Article by Jennifer Smith and Brett Slaney © 2007, Blake, Cassels & Graydon LLP

Originally published in Blakes Bulletin on Intellectual Property, December 2007

On June 2, 2007, amendments to the Patent Rules came into force. The main changes involved the small entity regime, the type of evidence required to show entitlement when the applicant is not the inventor, and harmonization of the Canadian standard for sequence listing with the Patent Cooperation Treaty (PCT) standard.

Small Entities

Reduced fees for "small entities" were introduced in 1985 to encourage universities and small businesses to use the patent system. Prior to 2003, the Patent Office would accept ‘top-up’ payments if entities mistakenly paid small entity fees but later realised that they should have paid the standard fees. However, in the 2003 Dutch Industries Ltd. v. Commissioner of Patents decision, the Federal Court of Appeal held that the Commissioner of Patents lacked the authority to accept these ‘top-up’ payments, thereby calling into question the validity of many issued patents and pending applications.

The 2007 amendments to the Patent Rules were intended to remove the uncertainty surrounding the small entity regime. The new rules modify the definition of "small entity" as follows:

"small entity," in respect of an invention, means 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.

The rules now specify that small entity status will be assessed on the filing date for regularly filed applications and at national entry for PCT applications.

The amended rules also establish a corrective mechanism enabling patent holders/applicants to correct certain fee payments mistakenly made at the small entity level. This mechanism requires the patent holder/applicant to file a statement indicating that the small entity fee was paid in good faith and that the extension application is being filed without undue delay. The patent holder/applicant must pay the difference between the amount of the small entity fee that was paid and the standard fee, as well as an extension fee.

Declaration Of Applicant’s Entitlement

Prior to the 2007 amendments, an applicant who was not the inventor was required to file evidence (usually in the form of an assignment) that the applicant was entitled to apply for and be granted a patent.

Under the new rules, the Patent Office requires a declaration as to how the named applicant is entitled to apply for and be granted a patent as of the filing date. For PCT national phase applications, the filing date would be the filing date of the international application. Specifically, the declaration must identify which of the following circumstances apply, namely:

  1. The applicant is the inventor
  2. The applicant is an employer of the inventor
  3. An agreement exists between the inventor and the applicant
  4. An assignment from the inventor to the applicant has been executed
  5. Consent from the inventor in favour of the applicant has been obtained
  6. A court order has been issued by a particular court affecting a transfer from the inventor to the applicant
  7. A specific type of transfer of entitlement exists from the inventor to the applicant
  8. The applicant’s name has changed.

The declaration must also identify the parties involved and the relevant dates, and should include any other basis for the applicant’s entitlement that is not listed above.

This amendment is consistent with the requirements under the PCT and also reflects international trends to move towards a simpler way of providing this type of information.

It is still necessary, however, to register title documentation to show change of title from the original applicant and any change of title after issuance of the patent.

Sequence Listings

Under the previous Patent Rules, a non-PCT application containing a nucleotide or amino acid sequence required a different format than a PCT application.

The new rules incorporate the Standard for the Presentation of Nucleotide and Amino Acid Sequence Listing in International Patent Applications (the PCT sequence listing standard) into non-PCT applications, thus bringing the Canadian format for submitting sequence listings in line with the PCT standard. By referencing the PCT sequence listing standard in the Patent Rules, Canada’s standard will automatically change whenever the PCT standard changes, thereby ensuring that its standard remains consistent with the international standard.

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