In 2020, the number of standard patent applications filed in Australia fell by 1.8%, to 29,240 from 29,786 in 2019. Much of this decline can be attributed to domestic applicants, which filed around 10% fewer applications in 2020. On the other hand, Chinese applicants filed nearly 20% more applications in 2020 than in 2019, falling only 48 applications short of the number filed by Australian applicants. US residents remained the top users of the Australian standard patent system, being named on 13,037 applications, which was a 1.6% decline on 2019.
Among the leading origins for Australian patent filings, China, South Korea, the UK and Japan all increased their application numbers over 2019, while Canadian, Australian, French, and Swiss applicants filed substantially fewer applications. The leading applicant, for the second year running, was Chinese telecommunications device manufacturer OPPO, which increased its new filings by 39%, to 435, eclipsing second-placed LG Electronics with 236 applications. Rounding out the top three was Huawei, with 229 new applications in 2020. Huawei’s heavy investment in Australian patents is interesting, considering that the company is barred from supplying advanced equipment for use in Australian telecommunications networks due to ‘security concerns’. Perhaps it may yet expect to derive income from the Australian market in the form of licensing revenues from its standards-related and other patents.
The picture is very different for innovation patents – the second-tier rights that are now well into their final year of full availability before being phased out. Chinese applicants seem to have treated the impending abolition of the system as if it is a ‘going out of business’ sale, increasing filings by over 400% and becoming by far the largest users of innovation patents. Indian applicants seem also to have caught on, rather late in the piece, to the advantages of a system that enables a patent to be granted without the time and expense of substantive examination, with applications originating in India jumping from just eight in 2019 to 529 in 2020 (growth of over 6500%, if such a measure were meaningful off this small base). Some US applicants also seem to have jumped at the final opportunity to obtain innovation patents, nearly doubling their filings from 86 in 2019 to 159 in 2020.
As usual, provisional applications were filed almost exclusively by Australian applicants. The total number filed in 2020 was down by 2% on 2019. However, it is likely that the number of ‘quality’ provisional has fallen by more than this number would indicate, with applications prepared and filed with the assistance of external patent attorneys having dropped by nearly 5%, while self-filing increased by a similar proportion.
Standard Patent Applications
‘Standard’ patent applications in Australia are the ‘regular’ form of application available in almost every country (corresponding with US ‘utility patents’), subject to full substantive examination prior to grant, and having a maximum term of 20 years.
In 2020, a total of 29,240 standard patent applications were filed. This represents a decline of 1.8%, following on from the previous fall of 0.6% in 2019. Despite the total decline of 2.4% over two years, the number of standard patent applications filed in 2020 remained above that of 2017, thanks to strong growth in 2018. The number of direct filings decreased significantly (7.8%) in 2020, while the number of applications filed as National Phase Entries (NPE) of international applications under the Patent Cooperation Treaty (PCT) increased by 0.7%.
Of the direct applications, the number of ‘original’ filings (i.e. those not based on a PCT application, or any earlier Australian standard patent application) fell by 19.8%, reflecting applicants’ already strong, and increasing, preference for filing in Australia via the PCT system. Divisional applications (which are, by definition, direct filings) fell by just 2.6%.
Once again, 2020 saw strong growth in applications originating in China, up by 19.4%, on top of 46% growth in 2019. Chinese applicants very nearly eclipsed Australians as the second largest users of the Australian standard patent system, after domestic filings fell by 10% in 2020. Filings from Japan, South Korea, and (surprisingly) the UK increased in 2020, while the most significant declines among the top filers were from Canada, Australia, France, and Switzerland.
| Country | 2020 Filings | YOY Growth |
|---|---|---|
| US | 13037 | -1.62% |
| AU | 2414 | -10.2% |
| CN | 2356 | 19.4% |
| JP | 1646 | 2.31% |
| DE | 1356 | 1.47% |
| GB | 1245 | 5.06% |
| CH | 1037 | -6.75% |
| KR | 817 | 8.94% |
| FR | 742 | -5.39% |
| CA | 557 | -11.0% |
Innovation Patent Applications
The innovation patent is Australia’s second-tier patent right. Innovation patent applications proceed to grant without substantive examination to establish their validity, although they are not enforceable until and unless they pass an optional post-grant examination process and become ‘certified’. Innovation patents have a lower inventiveness threshold than standard patents, and a reduced maximum term of just eight years. Following various reviews, the government concluded that the innovation patent system had failed in its objective of providing more accessible protection for innovations developed by Australian small and medium enterprises (SMEs), and has legislated a phase out of the system that will commence on 26 August 2021.
A major flaw that has emerged with the innovation patent is its susceptibility to gaming by foreign applicants motivated by objectives other than securing meaningful IP rights. Chinese applicants, in particular, have taken advantage of the fact that a ‘granted Australian patent’ – even one that has not actually been examined, and is not legally enforceable – can be used to claim government subsidies back in China. As noted by IP Watchdog, a recent USPTO report has also recognised the way in which ‘non-market factors’ have artificially influenced Chinese companies’ filing patterns and use of IP systems.
While there is no evidence that such ‘non-market factors’ have significantly influenced the filing of standard patent applications in Australia, they have resulted in Chinese applicants coming to dominate use of the innovation patent system. In 2020, Chinese applicants filed more innovation patent applications than originated in all other countries combined, including Australia. Additionally, 2020 saw huge growth in innovation patent filings originating in India.
| Country | 2020 Filings | 2019 Filings | YOY Growth |
|---|---|---|---|
| CN | 2565 | 487 | 426.7% |
| AU | 967 | 929 | 4.09% |
| IN | 529 | 8 | 6512% |
| US | 159 | 86 | 84.9% |
| TW | 62 | 64 | -3.13% |
In addition to a breakdown by origin, the green trace on the above chart shows the number of innovation patents filed each year that have subsequently gone on to be examined and certified. The certification rate is lower for recent years, because these patents have not yet had as long to become certified, but it is clear that around 10-15% of all innovation patents filed have, historically, gone on to be certified. However, the massive growth in filings driven out of China (and now India) is not having any noticeable effect on the total number of innovation patents being certified, confirming the lack of interest from these applicants in obtaining enforceable rights.
Provisional Applications
Australia also has a provisional application system. Provisional applications can be used to establish a priority date for subsequent ‘full’ applications in Australia and/or elsewhere. They are never examined, have a one-year life span, and are not published unless subsequently used as the basis for a priority claim in an application that itself goes on to be published. Australian provisional patent applications are almost all filed by applicants resident in Australia, and are the most common ‘entry point’ to the patent system for these applicants.
If they are to provide an effective basis for priority, provisional applications should be drafted in view of the legal requirements for patent validity in all countries that may be of future interest to the applicant, i.e. preferably by a qualified patent attorney. Historically, however, many provisional applications have been prepared and filed by non-professionals – usually the applicant themselves – in order to minimise costs. Few of these applications proceed further, and even fewer go on to result in useful patent rights.
In 2020, the number of provisional applications filed declined by 2.0%. While this is a bad sign for Australian innovation, it was even worse for Australian patent attorneys. The number of applications filed with the assistance of a qualified patent attorney or firm declined by 4.7%, while the number filed by the applicant themselves (or, in a small number of cases, some other representative) grew by 4.8%. One possible explanation for this, of course, is that applicants became even more cost-sensitive as a result of the COVID-19 pandemic.
Top Applicants – Standard Applications
Once again, Chinese company OPPO – known in Australia primarily as a maker of mobile handsets – was the leading applicant for standard patents in Australia, filing 435 new applications in 2020, up from 314 in 2019. Fellow Chinese telecommunications manufacturer Huawei placed 3rd in 2020, with 229 new applications, up from 187 (and 5th place) in 2019. An additional Chinese entrant to the top 30 applicants in 2020 was the China University of Mining and Technology, placing 22nd with 69 applications.
Korea’s LG Electronics held on to second position, with 236 applications, slightly down from 245 in 2019. Apple rose from 6th (with 152 applications) in 2019 to 4th (with 194 applications) in 2020. Qualcomm rounded out the top five, with 161 application, falling from 4th (and 244 applications) in 2019.
Again, the only Australian applicant in the top 30 was Aristocrat Technologies, at 6th with 116 applications, down from 4th place with 238 applications in 2019. New Zealand’s Fisher & Paykel Healthcare, on the other hand, rose from 22nd place (72 applications) in 2019, to 15th place with 94 applications in 2020.
A notable departure from the leader board is Chinese internet giant Alibaba Group (which is now filing via an entity called Advanced New Technologies Co. Ltd), which placed 7th with 159 applications in 2019, but has fallen out of the top 30 with just 51 applications in 2020. On the other hand, Korea’s largest online retailer Coupang has entered the table in 12th place, filing 100 applications in 2020.
| Rank | Applicant Name | Country | Filings |
|---|---|---|---|
| 1 | GUANGDONG OPPO MOBILE TELECOMS LTD | CN | 435 |
| 2 | LG ELECTRONICS INC | KR | 236 |
| 3 | HUAWEI TECH LTD | CN | 229 |
| 4 | APPLE INC | US | 194 |
| 5 | QUALCOMM INC | US | 161 |
| 6 | ARISTOCRAT TECH INC | AU | 116 |
| 7 | UNIVERSITY OF CALIFORNIA | US | 109 |
| 8 | BECTON DICKINSON & CO | US | 104 |
| 9 | HALLIBURTON ENERGY SERVICES INC | US | 104 |
| 10 | SOCIETE DES PRODUITS NESTLE SA | CH | 104 |
| 11 | REGENERON PHARMACEUTICALS INC | US | 104 |
| 12 | COUPANG CORP | KR | 100 |
| 13 | COVIDIEN LP | US | 95 |
| 14 | NOVARTIS AG | CH | 95 |
| 15 | FISHER & PAYKEL HEALTHCARE LTD | NZ | 94 |
| 16 | BRISTOLMYERS SQUIBB CO | US | 91 |
| 17 | F HOFFMANN LA ROCHE AG | CH | 90 |
| 18 | AMGEN INC | US | 87 |
| 19 | SAMSUNG ELECTRONICS LTD | KR | 73 |
| 20 | BAYER AG | DE | 71 |
| 21 | BASF SE | DE | 70 |
| 22 | CHINA UNIVERSITY OF MINING & TECH | CN | 69 |
| 23 | BOEING CO | US | 67 |
| 24 | UNITED STATES OF AMERICA (US GOV’T) | US | 67 |
| 25 | WL GORE & ASSOCIATES INC | US | 67 |
| 26 | DEERE & CO | US | 67 |
| 27 | COLGATE-PALMOLIVE CO | US | 66 |
| 28 | KIMBERLY-CLARK WORLDWIDE INC | US | 66 |
| 29 | CATERPILLAR INC | US | 66 |
| 30 | UNIVERSITY OF TEXAS | US | 63 |
Looking only at Australian resident applicants, the second biggest filer (after Aristocrat) was, once again, national research organisation CSIRO, with 46 applications – down slightly from 51 in 2019. As in previous years, other public research institutions, including a number of universities, also feature on the list. However, very few Australian entities file significant numbers of applications, with just 22 residents filing six or more applications in 2020.
| Rank | Australian Applicant Name | Filings |
|---|---|---|
| 1 | ARISTOCRAT TECH INC | 116 |
| 2 | COMMONWEALTH SCIENTIFIC & INDUSTRIAL RESEARCH ORGANISATION (CSIRO) | 46 |
| 3 | BREVILLE PTY LTD | 24 |
| 4 | UNIVERSITY OF SYDNEY | 18 |
| 5 | MONASH UNIVERSITY | 18 |
| 6 | GRAND PERFORMANCE ONLINE PTY LTD | 16 |
| 7 | UNIVERSITY OF MELBOURNE | 14 |
| 8 | NEWSOUTH INNOVATIONS PTY LTD | 14 |
| 9 | CHEP TECH PTY LTD | 13 |
| 10 | UNIQUEST PTY LTD | 13 |
| 11 | ASSA ABLOY AUSTRALIA PTY LTD | 11 |
| 12 | TECHNOLOGICAL RESOURCES PTY LTD | 10 |
| 13 | BLUESCOPE STEEL LTD | 9 |
| 14 | CANVA PTY LTD | 9 |
| 15 | RMIT UNIVERSITY | 8 |
| 16 | OAKMOORE PTY LTD | 7 |
| 17 | CSR BUILDING PRODUCTS LTD | 7 |
| 18 | TNBT HOLDINGS PTY LTD | 7 |
| 19 | QUEENSLAND UNIVERSITY OF TECH | 7 |
| 20 | UNIVERSITY OF WESTERN AUSTRALIA | 7 |
| 21 | GRAINS RESEARCH & DEVELOPMENT CORP | 6 |
| 22 | BARAJA PTY LTD | 6 |
Top Applicants – Innovation Patents
As I have already noted, Chinese applicants dominated innovation patent filings in 2020. In past years, however, filings from China have comprised small numbers of applications by a large number of individual entities. In 2020, however, this pattern changed, with a number of more substantial organisations – including many universities – filing 15 or more applications. As a result, the list of leading filers of innovation patent applications is dominated by Chinese applicants, and includes no Australian residents! The only ‘serious’ users of the innovation patent system in the top 25 are US companies Caterpillar and Apple.
| Rank | Applicant Name | Country | Filings |
|---|---|---|---|
| 1 | SICHUAN AGRICULTURAL UNIVERSITY | CN | 105 |
| 2 | CATERPILLAR INC | US | 61 |
| 3 | NANJING FORESTRY UNIVERSITY | CN | 51 |
| 4 | LIBO YUAN (MR) | CN | 45 |
| 5 | QILU UNIVERSITY OF TECH | CN | 43 |
| 6 | INSTITUTE OF GEOLOGY & GEOPHYSICS CHINESE ACADEMY OF SCIENCES | CN | 36 |
| 7 | XUZHOU UNIVERSITY OF TECH | CN | 34 |
| 8 | SHENZHEN THOUSANDSHORES TECH LTD | CN | 34 |
| 9 | APPLE INC | US | 33 |
| 10 | UNIVERSITY OF SCIENCE & TECH BEIJING | CN | 31 |
| 11 | GUILIN UNIV ELECTR TECHOL | CN | 30 |
| 12 | SOUTHWEST UNIVERSITY | CN | 30 |
| 13 | HARBIN ENGINEERING UNIVERSITY | CN | 22 |
| 14 | QINGDAO AGRICULTURAL UNIVERSITY | CN | 22 |
| 15 | GUILIN UNIVERSITY OF ELECTRONIC TECH | CN | 19 |
| 16 | SHANGHAI OCEAN UNIVERSITY | CN | 19 |
| 17 | OXTI CORP | TW | 18 |
| 18 | SB CHORDIYA | IN | 17 |
| 19 | ZHEJIANG UNIVERSITY | CN | 17 |
| 20 | INSTITUTE OF FOOD SCIENCE & TECH CHINESE ACADEMY OF AGRICULTURAL SCIENCES | CN | 17 |
| 21 | TECHTRONIC CORDLESS GP | CN | 17 |
| 22 | CHINA UNIVERSITY OF GEOSCIENCES BEIJING | CN | 17 |
| 23 | SUZHOU YUANLIAN SCIENCE & TECH PIONEER PARK MANAGEMENT LTD | CN | 16 |
| 24 | LOVELY PROFESSIONAL UNIVERSITY | IN | 15 |
| 25 | TONGJI UNIVERSITY | CN | 15 |
| 26 | JILIN UNIVERSITY | CN | 15 |
The table below lists all Australian residents that filed three or more innovation patent applications in 2020. The most frequent Australian applicants filed only eight applications apiece.
| Rank | Australian Applicant Name | Filings |
|---|---|---|
| 1 | OZDOCS INTL PTY LTD | 8 |
| 2 | SARA MARTHA LOUISA PERTOT (MISS) | 8 |
| 3 | BALAJI DEVARAJAN (DR) | 8 |
| 4 | HANNAY DOUGLAS PTY LTD | 5 |
| 5 | PATRIOT CAMPERS HOLDINGS PTY LTD | 5 |
| 6 | BENELEC PTY LTD | 5 |
| 7 | IB OPERATIONS PTY LTD | 4 |
| 8 | KENNETH LINDSAY PAGDEN (MR) | 4 |
| 9 | MARK ANDREW FRASER | 4 |
| 10 | MDG DESIGN PTY LTD | 4 |
| 11 | GOV VAN EK (MR) | 3 |
| 12 | HUNG THANH PHAN (MR) | 3 |
| 13 | LOGICAL CO | 3 |
| 14 | OZGREEN ENERGY PTY LTD | 3 |
| 15 | NONDRILL PTY LTD | 3 |
| 16 | CMTE DEVELOPMENT LTD | 3 |
| 17 | MICHAEL GRAHAM WORTHINGTON (MR) | 3 |
| 18 | BOOK OF HEALING PTY LTD | 3 |
| 19 | WHOLESALE GROUP INTL PTY LTD | 3 |
| 20 | MATHEW RAYMUND NORTON (MR) | 3 |
| 21 | MOSTAFA SHARIFZADEH | 3 |
| 22 | SEIDAC PTY LTD | 3 |
| 23 | KESTER SOLOMON (MR) | 3 |
| 24 | LEDGER ASSETS PTY LTD | 3 |
| 25 | COUPLEMATE INVESTMENTS PTY LTD | 3 |
| 26 | JOHN PAUL BONNICI (MR) | 3 |
Top Applicants – Provisional Applications
The leading filer of provisional applications for 2020 was an individual who self-filed all 64 of his applications, many of which appear (from the titles) to relate to various medical and other applications of extracts from cannabis plants. Of the 24 applicants that filed 10 or more provisional applications, 11 are universities and other public research institutions, led by the CSIRO, which filed 56 new provisional applications in 2020, down from 62 in 2019. The only non-Australian applicant on the list is Mesoblast International Sarl, however this appears to be a Swiss IP holding company associated with Australian pharmaceutical company Mesoblast Limited. (Just why Mesoblast is exporting its locally-generated IP to Switzerland is not clear, but I am sure it has its reasons!)
| Rank | Applicant Name | Country | Filings |
|---|---|---|---|
| 1 | ANTONIO TORRES (MR) | AU | 64 |
| 2 | COMMONWEALTH SCIENTIFIC & INDUSTRIAL RESEARCH ORGANISATION (CSIRO) | AU | 56 |
| 3 | RESMED LTD | AU | 54 |
| 4 | NEWSOUTH INNOVATIONS PTY LTD | AU | 49 |
| 5 | MONASH UNIVERSITY | AU | 42 |
| 6 | ADAM MCGREGOR GARDNER | AU | 37 |
| 7 | UNIVERSITY OF SYDNEY | AU | 33 |
| 8 | UNIVERSITY OF MELBOURNE | AU | 27 |
| 9 | UNIQUEST PTY LTD | AU | 25 |
| 10 | ANNE MARIE EBOKOLOJECOP | AU | 17 |
| 11 | NTHALMIC HOLDING PTY LTD | AU | 16 |
| 12 | WIREMAN PTY LTD | AU | 16 |
| 13 | ARISTOCRAT TECH INC | AU | 15 |
| 14 | MESOBLAST INTL SARL | CH | 15 |
| 15 | BREVILLE PTY LTD | AU | 14 |
| 16 | RACE ONCOLOGY LTD | AU | 13 |
| 17 | TECHNOLOGICAL RESOURCES PTY LTD | AU | 13 |
| 18 | UNIVERSITY OF ADELAIDE | AU | 11 |
| 19 | RMIT UNIVERSITY | AU | 11 |
| 20 | UNIVERSITY OF SOUTH AUSTRALIA | AU | 11 |
| 21 | QUEENSLAND INSTITUTE OF MEDICAL RESEARCH | AU | 11 |
| 22 | MASOUD TAHGHIGHI JAFARZADEH | AU | 10 |
| 23 | WEIR MINERALS AUSTRALIA LTD | AU | 10 |
| 24 | UNIVERSITY OF WESTERN AUSTRALIA | AU | 10 |
Conclusion
It would be fair to say that 2020 patent filing numbers do not bode well for Australian innovation. Domestic applicants filed 10% fewer standard applications than in 2019. A drop of just 2% in provisional filings seems mild by comparison, but it is important to note that provisional applications prepared with professional assistance – and thus more likely to provide a basis for valuable future patent rights – fell by nearly 5%.
Looking at individual organisations, many of the top domestic applicants filed fewer applications in 2020 than in the previous year, although there are some notable exceptions, including Resmed which lifted its new provisional filings from 37 to 54. A number of universities also maintained, or increased, their filings in 2020.
Australians filed a few more innovation patent applications, increasing from 929 in 2019 to 967 in 2020. But this is still well below the 1244 applications filed by domestic residents in 2011 and 2012, and the innovation patent system – which has come to be dominated by Chinese applicants – is set to be phased out from 26 August 2021. From this date it will no longer be possible to file brand new innovation patent applications.
As we are all aware, 2020 was a difficult year, and its challenges have not magically been resolved with the transition to a new year! Doubtless the economic and business impacts of the COVID-19 pandemic played a part in the decline in domestic filings, and perhaps we can hold out some hope for a rebound by Australian applicants in 2021 and beyond. On the other hand, filings originating China continued double-digit growth despite everything, and in all likelihood will exceed Australian resident filings in 2021, even if we see some recovery this year.
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