30 April 2021

March Madness? A Patent Filing Boom Month Defies Recent Trend

BoomI had just finished writing, yesterday, about the latest annual Australian IP Report, and the continuing decline in patent filings in Australia, when I decided to take a look at the numbers for March 2021.  To my immense surprise, March was a boom month for Australian patent applications!  The total number of filings, across all application types (provisional, standard, and innovation patent applications) for the month was 3,906.  To find a month in which more applications were filed in Australia it is necessary to go back eight years, to April 2013, when 7,062 applications were filed.  And that only happened because of the large number of applicants bringing filings forward by up to 18 months in anticipation of the Raising the Bar law reforms, which raised the threshold for the grant of a valid patent and commenced on 15 April 2014.  The only other month that comes close is September 2015, when 3,827 applications were filed.

Of course, part of the reason for the high filing numbers in March is the current surge in innovation patent filings, which are presently running at about four times their ‘natural’ level (based on historical behaviour).  In large part, this is driven by Chinese applicants collecting granted patents in order to claim government subsidies, but also by other users in anticipation of the impending phase-out of the innovation patent system from 26 August 2021.

But innovation patents are not the whole story.  As data presented below demonstrates, there were more standard applications filed in March 2021 than in any month since September 2015.  Even in 2018 – which was a peak year for standard applications – there was no individual month in which more applications were filed.

Nor can the boom month be attributed to Chinese applicants – or any other particular country of origin.  Applicants from seven out of the top 10 countries of origin filed more applications in March 2021 than during the same period last year.

So what is going on here?  I have no idea!  This could be a one-off.  It could be some sort of ‘bounce-back’ from the COVID-19 pandemic (which is, let us not forget, far from over globally).  Or maybe there is something else going on here.  Time – and perhaps a more detailed analysis – will hopefully tell.

So Here are the Numbers…

The chart below shows the total numbers of standard patent applications (combining direct filings, and national phase entries of international applications filed under the Patent Cooperation Treaty), innovation patent applications, and provision applications, every month since January 2015.

Total monthly filings, 2015-2021

As noted in the latest IP Report, provisional filings – which are almost all made by Australian residents – have been in a steady decline for many years.  (It is also notable that these show a regular dip each January, when many Australians are taking their annual summer vacations.)  Historically, innovation patent filings have hovered somewhere around 150 applications per month, but over the past year this has grown to about 600 per month.

The number of standard applications filed each month has tended to be quite volatile, although it looks to have been a little less so over the past couple of years compared to the preceding period.  The jump in March 2021, to 2,882 applications, following a relative low point of 2,231 applications in January, is larger than any seen since September 2015.  The reason for that earlier peak is also unclear, but I suspect that it is related to the huge spike in applications, and commencement of the Raising the Bar reforms in April 2013.  That event led to a period of lower filings which lasted about 18 months – the time at which many PCT applications filed after April 2013 started to come due to enter the national phase in Australia.  It is not immediately obvious to me why this ‘lull’ should have ended with a further ‘bounce’ between September 2015 and April 2016, but that appears to be what happened, and the timing seems more than coincidental.

So, taking the impact of the Raising the Bar reforms out of the equation, the March surge in filings is unprecedented in recent history.  And it does not appear to be explained by the behaviour of applicants from any particular country of origin.  The following chart compares numbers of standard application filings in March 2021 by applicants from the top 10 countries-of-origin to filings over the same period last year.

March 2021 versus 2020 filing comparison

Numbers of filings from the US, Australia, China, Germany, Switzerland, France, and South Korea were all higher in March 2021 than in March 2021.  Filings from Canada were virtually unchanged, while those from Japan and the UK declined slightly.  Overall, then, almost all of the ‘usual suspects’ contributed their share to the March filing boom.

If anybody has any theories or insights into this unexpected surge in filings, I would be pleased to hear them.


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