IP Australia Proposes – Mostly – Modest Fee Increases

Back in September we reported the announcement by IP Australia, which encompasses the Australian Patent, Trade Marks and Designs offices, that it was about to conduct a periodic review of the fees charged for various services (see IP Australia News – Fee Review and New Web Site). 

The purpose of the review is to ensure that the existing IP Australia cost recovery arrangements, fees and charges are transparent and consistent with the Australian Government Cost Recovery Guidelines 2005 and the Australian Government cost recovery policy.

The first stage of the review process is now complete, and a Consultation Paper setting out the details of proposed fee changes has been published for comment on the IP Australia web site.

Two stages of fee increases are proposed to take place in 2012, with most changes taking place on 1 July 2012, and a few to follow later, on 1 October 2012.  The later commencement date apples to those fees associated with services for which IP Australia plans to introduce new online or B2B service channels.  In general, where both paper filing and online filing options are available, an incentive is provided to improve efficiencies by charging a lower fee for use of the online channel

Additionally, a new ‘preliminary search and opinion’ service, and associated fee, is expected to commence on or after March 2013.

The arrangements proposed in the Consultation Paper are intended to cover a period up until June 2016, at which time fees may again be adjusted following a review.

GENERAL COMMENTS

For the most part, the proposed fee increases are modest, especially for customers electing to use online service channels.  For example, the current fees for filing a provisional patent application are $80.00 for an electronic filing, and $110.00 for filing by other means (i.e. on paper).  As proposed, on 1 October 2012 the electronic filing fee will rise to $110.00 (a 37.5% increase), while filing by other means will incur a fee of $210.00 (a 91% increase).

Also on 1 October 2012, standard complete patent application fees are proposed to rise from $340.00 to $370.00 (around 9%) for electronic filing, and from $370.00 to $470.00 (around 27%) for paper filing.  Most other fee increases are of a similar order.

CHANGES TO RENEWAL FEES

Currently, annual patent maintenance (or renewal) fees are payable from the fifth anniversary of filing a patent application.  At present, there is only a single fee applicable ($250.00 for the fifth to ninth anniversary fees, $450 for the 10^th to 14th, $1020.00 for the 15^th to 19^th, and $2000.00 up to the 24^th anniversary for patents that have received a regulatory extension of term). 

Two notable changes to renewal fees are proposed to take place on 1 July 2012.  Firstly, an electronic payment channel will become available, the use of which will attract a lower fee.  For example, an electronic payment of the fifth anniversary fee will cost $300.00 (a $50.00 increase over the current fee), while a ‘traditional’ payment will cost $350.00.

The second proposed change to renewal fees is the introduction of a fourth anniversary fee ($300.00 electronically, $350.00 otherwise).  This change in the commencement date of annual maintenance fees will have service providers the world over scrambling to update their software diary systems to ensure that no renewals are missed!

AN END TO INTERNAL CROSS-SUBSIDY

One interesting fact that emerges from the Consultation Paper is that the trade marks group within IP Australia has been cross-subsidising the patents group, i.e. currently the trade marks area over-recovers its costs, while patents activities under-recover. 

IP Australia intends to address this imbalance over the period of the new arrangements and, as a result, the proposed increases in patent fees are proportionally greater than for trade marks fees.  The full anticipated cost of running the patents activities will be passed on, while it will not be necessary to pass on the full increase in costs associated with trade marks activities.

IP AUSTRALIA’S LEAST MODEST FEE

Aside from patent renewals within a term extension period (i.e. more than 20 years after filing), IP Australia’s most expensive fee is for an International Search under the Patent Cooperation Treaty (PCT).  Currently $1900.00, this fee is proposed to increase to $2200.00 from 1 July 2012.

To be fair to IP Australia, this fee is generally at parity with most other comparable International Search Authorities – for example, the International Search fee at the USPTO is currently US$2080.00.

However, what these offices also have in common is that they will perform essentially the same service on a national application for a fraction of the price.  The examination fee in Australia is currently $450.00 (slated to rise to $490.00 on 1 July 2012), while the combined (large entity) search and examination fees at the USPTO total US$870.00.

There is (or should be) no difference in the diligence with which a search is conducted on a national application, and on an international PCT application.  The standard of reporting in a national examination report and a PCT Written Opinion also ought to be the same.  The huge disparity in the fees is therefore difficult to comprehend.  Indeed, the International Search fee is more than twice the total official fees paid from filing to grant on a typical Australian patent application.

Additionally, upon request IP Australia will conduct a similar search, i.e. an ‘International-Type Search’ (ITS), in relation to a provisional patent application.  Currently the ITS fee, at $1400.00, is less than the International Search fee.  It is proposed to eliminate this inconsistency by raising the ITS fee to $2200.00 from 1 July 2012.

We find ourselves increasingly recommending to clients that they take the option – available to Australian PCT applicants – of having the International Search conducted by the Korean Intellectual Property Office (KIPO).  We have found KIPO searches, in high technology areas in particular, to be of a good standard and, at around $1200.00, substantially cheaper than IP Australia.  Furthermore, KIPO examiners have better capabilities than their Australian counterparts to search Korean and Japanese patent literature.  Of course, the suitability of a KIPO search is a matter for consideration on a case-by-case basis, and we would urge PCT applicants to obtain advice specific to their circumstances.

NEW SERVICE, NEW FEE

Finally, the Intellectual Property Laws Amendment (Raising the Bar) Bill 2011, currently before the Senate, includes a new provision for a preliminary search and opinion to be conducted on an Australian standard complete patent application (see Patent Reform Exposed Part VII – ‘Search to Sealing, and Beyond…’). 

According to the Bill’s Explanatory Memorandum the intention is that a preliminary search and opinion might be provided in cases in which it appears likely that the applicant would not have the benefit of any other early indication of patentability, e.g. Australian-originating applications for which no corresponding foreign or international PCT application has been filed.  This was essentially confirmed by the Director General of IP Australia, Philip Noonan, at the ‘IP Forum’ event held in Melbourne last month (which we reported in Patent Office, Professionals, Must Get With the Social Media Program), who indicated that the preliminary search would enable applicants and others to achieve greater certainty earlier in the application process, thereby enhancing the effectiveness of the system.

We are therefore very surprised to see that the new proposed fee for the preliminary search and opinion, expected to commence on or after March 2013 (i.e. after the legislation has passed), is the same as for an International Search or an ITS – $2200.00.  At this price, we find it hard to imagine any applicant choosing this option, particularly applicants who have elected not to spend money on foreign or international applications!

CONCLUSION

In general, the proposed fee increases seem fairly reasonable.  IP Australia is currently seeking feedback on the proposals, although it seems likely that the changes will go through without substantial modification. 

Any comments should be submitted  by Monday 16 January 2012, and can be emailed to FeeReview@ipaustralia.gov.au or sent by mail to:

Fee Review
IP Australia
PO Box 200
Woden ACT 2606

Tags: Australia, Official fees, Patent Office