The legal landscape of patent regulations is undergoing a transformative phase with the introduction of the Draft Patents (Amendment) Rules, 2023 (“Draft Rules”). Patent applications and prosecution thereof is currently governed under the Patents Rules 2003 (2003 Rules). This article aims to analyse the impact of these proposed amendments on the prosecution of patents being proposed after a gap of 20 years.
The Draft Rules has tried to address the long-standing issue of backlog in patent examination although not to the extent hoped for. By introducing measures to expedite the examination process, such as prioritized examination and stricter timelines for response, the amendments aim to reduce the waiting time for patent grants.
A significant highlight is the increased flexibility offered to divisional applications. Traditionally, pursuing divisional applications demanded demonstrating multiple inventions within the parent application's claims, aligning with the unity of invention principle. The recent amendments alleviate this constraint by permitting divisional application claims to cover subjects beyond those explicitly outlined in the parent application's claims. This newfound flexibility empowers inventors to achieve more extensive safeguarding of various facets of their innovation, enabling strategic development of a strong patent portfolio.
The amendment rules also offer a lifeline to applicants navigating complex patent processes. The provision permitting an extension of up to six months for patent-related tasks provides a buffer for situations demanding careful attention, mitigating the risk of missed deadlines. This adjustment acknowledges the complexities of patent procedures and underscores the importance of diligence, ultimately bolstering the integrity of patent prosecution.
Additionally, the introduction of a "grace period" mechanism is a significant addition. This mechanism offers a remedy for inventors who unintentionally disclose their invention before applying for a patent. It recognizes that the innovation journey may involve public displays, providing a solution to secure patent rights even after such disclosures.
A new step is proposed to be introduced in the pre-grant opposition process. In this step, the Controller must initially determine whether the representation made against the grant of a patent is valid and maintainable. Only once this determination is made, can the Controller proceed to issue a notice of the opposition to the applicant based on the pre-grant representation. This addition aims to ensure that the opposition process is more structured and efficient.
Significant changes also are to be introduced concerning the official fees for both pre-grant and post-grant oppositions. A formal fee is proposed for filing pre-grant opposition, and an increase in the official fee for filing a post-grant opposition is also suggested. The proposed fee for both opposition types is linked to the total amount paid by the patent applicant throughout the patent application process. This sum includes various elements, including the application filing fee, the cost based on the number of specification sheets and claims, fees for requests such as publication and examination, and any additional expenses associated with expedited examination or related modifications. This change represents a logical way of deciding the opposition fees, linking them to the total expenses incurred by the patent applicant during the patent application process.
In the upcoming paragraphs, we'll delve deeper into the details of the Draft Rules.
Deadlines and Foreign Application Disclosure (Rule 12)
The prevailing Clause (2) in Rule 12 mandates a six-month window for the submission of a statement and undertaking in Form 3 subsequent to filing an Indian patent application. This condition remains unchanged, requiring the initial Form 3 to be filed within six months of the application's filing in India. However, the proposed amendments introduce a modification to Rule 12(2), necessitating applicants to inform the Controller about other applications filed in foreign countries within two months from the issuance of the first statement of objections, as per the undertaking required by clause (b) of sub-section (1) of section 8. This amendment shifts the deadline for updating the Controller on foreign application details from six months from the date of such filing to two months from the date of issuance of the first statement of objections. Notably, the amendments do not specify a deadline for recurrently updating the Controller on the status of corresponding foreign applications, leaving this interval undefined until the point of Grant.
According to the newly introduced (3), the Controller must now consider information from public databases during the process of patent examination. This means that the Controller will take into account information about corresponding foreign applications that can be accessed through public databases. This change simplifies the sharing of information and may lead to fewer objections under Section 8(2) for foreign applications, which promotes transparency.
The newly introduced Clause (4) gives the Controller the authority to ask an applicant to provide an updated statement and undertaking through Form 3 within two months after receiving a communication from the Controller. This is allowed if the Controller has reasons to do so, which must be recorded in writing. Applicants will have to follow this directive from the Controller and provide the requested updated information through Form 3.
The newly introduced Clause (5) of Rule 12 is significant for addressing delays in submitting Form 3. According to this provision, the Controller can now decide to extend the deadline for submitting Form 3 if there is a valid reason for the delay. To avail this extension, the applicant must make a request using Form 4. By introducing the clause, the draft rules emphasize a balanced approach, ensuring that while adherence to timelines is crucial, there's room for reasonable accommodations.
Filing Divisional Applications (Rule 13(2A))
The Draft Rules introduce a noteworthy addition to patent law through a new provision under sub-rule (2A) of rule 13. This provision brings to the forefront the concept of "divisional applications," a strategic approach that enables applicants to file a separate application branching out from a parent application. The essence lies in the possibility of creating a new application that focuses on a distinct facet or embodiment of the invention disclosed in the parent application. A divisional application can be voluntarily filed under Section 16 by the Applicant. This provision enables divisional applications under section 16 even when the invention is disclosed in the provisional specification. Traditionally, divisional applications address objections to multiple inventions within one application or seek separate protection for different facets. This amendment broadens possibilities by allowing divisional applications for inventions initially disclosed in provisional specifications.
In India, the current practice surrounding divisional applications under Section 16 of the Patents Act, 1970 allows for their pursuit to address objections raised by the Patent Office on the unity of invention or at the discretion of the Applicant, particularly when claims of the parent Application encompass multiple inventions. However, the voluntary pursuit of divisional applications under Section 16 has presented challenges for Applicants, highlighted by recent rulings like Esco Corporation v. Controller of Patents & Design (October 27, 2020)and Boehringer Ingelheim International GMBH v. The Controller of Patents &Anr. (July 12, 2022). In such instances, the burden rested on the Applicant to establish the existence of multiple inventions. Moreover, the acceptance of such divisional applications hinged on two criteria: firstly, a plurality of inventions must be evident not only in the specification but also in the claims of the parent application; and secondly, the claims of the divisional application should differ from those of the parent application, indicating a lack of previous consideration during the parent application's prosecution. This requirement necessitated the identification of multiple inventions from the claims of the parent application. However, the Draft Rules propose a significant shift. They suggest that claims in a divisional application can extend beyond the scope of those in the parent application, liberating Applicants from the previous limitation. This alteration acknowledges the evolving patent landscape and offers Applicants greater flexibility in pursuing divisional applications.
Changes in Timelines for Examination Requests (Rule 24B and Rule 24C)
According to Section 11B of the Patents Act, it is incumbent upon the Applicant to formally request the examination of their patent application. According to the Draft Rules, the current period of 48 months to file Request for Examination (RFE) from the priority date or filing date, whichever comes first, is slated to be curtailed to 31 months. This amendment will have a considerable impact on the process, compressing the time within which applicants must submit their RFE. The introduction of sub-rule (vi) within rule 24B (1) introduces an exception for applications filed before the enforcement of the Draft Rules. In such cases, the timeline prescribed by the Patents (Amendment) Rules, 2006 will continue to apply. As for Rules 24B(6) and 24C(11) of the 2003 Rules, the reliance on sub-rule 5 of Rule 24B and sub-rule 10 of Rule 24C will be removed and replaced with the respective sub-rules.
Grace Period (Rule 29A)
The Draft Rules introduce a structured mechanism for accessing the grace period provided under Section 31 of the Patents Act. This provision offers an exception to the anticipation caused by public display of an invention within a year, prior to filing a patent application. To facilitate this process, the draft Rules present Form 31, a dedicated format that enables patent applicants to formally request the utilization of the grace period along with the requisite fee. The Draft Rules do not aim to reduce the timelines but have provided a grace period for an application with the introduction of Form 31.
Scrutiny of Oppositions (Rule 55(3), 55(4), 55(5), 55(6), 55(7), 55(8) and 56(4))
Amendments to Rule 55 within the principal rules bring about significant changes in the patent opposition process, emphasizing procedural efficiency and clarity.
Sub-rule (3) of the amended Rule 55 introduces an important change: In place of the single term 'representation', the amendment inserts a comprehensive clause that reads 'representation, the Controller shall first decide the maintainability of the representation and thereafter'. This change in the process highlights the importance of first checking if the opposition is valid before making any official decisions. Once a pre-grant or post-grant opposition is filed, the Controller shall first decide the maintainability of representation filed and thereafter issue a notice to the Applicant. The Draft Rules make it a necessary initial step before moving forward with any actions.
The amendment extends to sub-rule (4) of Rule 55, where the term 'three' is replaced by 'two'. The time limit granted to an application to file a response and evidence to such opposition has been reduced from 3 months to 2 months. This change reduces the timeline, thereby accelerating the process, for the Controller to issue a notice after the representation is deemed maintainable.
The newly introduced sub-rule (6) of Rule 55 outlines that after the parties have presented their submissions, the Controller will make a decision within a period of 3 months. This decision could involve either dismissing the representation and granting the patent or acknowledging the representation and rejecting the grant of the patent for that particular application.
The Draft Rules introduce sub-rule (7), which harmonizes the hearing process with the established framework delineated in sub-rules 2 to 4 of rule 62 and rule 63. This means that the procedural guidelines laid out for these rules will, to the extent relevant, also be applicable to the hearing process under this particular rule. This alignment aims to maintain clarity and uniformity in the proceedings, ensuring a cohesive approach to the hearing stage.
Sub-rule (8) directs that applications facing opposition representations, once validated and held as maintainable, will undergo examination following the guidelines of rule 24C.
According to 56(4), the opposition board is required to present its report within a period of two months starting from the day of receipt of documents.
Advance Payment of Renewal Fees(Rule 80)
In the amended sub-rule (3) of Rule 80, patent owners can now pay annuities for multiple years in advance. This is a useful option provided by the new Draft Rules. It simplifies the process of fee payments and gives patent holders more flexibility in managing their responsibilities. What's interesting is that if a patent owner chooses to pay renewal fees online and does so a minimum of four years in advance, they get a significant incentive. The discount is 10% in such cases. This encourages people to use online filing and rewards those who plan ahead for longer periods. This change is in line with the trend of of digitization of the judicial system. It also means patent owners don't have to worry about renewals every year, making things easier.
Designs Act in Patent Agent Exam (Rule 110)
In rule 110 of the principal rules, in sub-rule (2), the proposed amendments aim to enhance clarity regarding the scope of the Patent Agent Exam. The changes clarify that Designs Act and Rules also fall within the examination and that the reference to the Patents Act and Patent Rules include the Patents Act of 1970, the Patents Rules of 2003, the Designs Act of 2000, and the Designs Rules of 2001. Additionally, the term "patent specifications" has been clarified to mean both patent and design specifications. The recent change is that successfully clearing the Patent Agent exam now not only allows individuals to handle patent-related matters but also enables them to file and process Design Applications.
Relaxation in filing Annual Reports(131(2))
Section 146(2) of the Patents Act mandates patentees and licensees to provide information about the commercial revenue earned using their patented invention within India. While the 2003 Rules previously required Statement of Working of Invention reports annually from the date of the patent, the recent Draft Rules bring a change. The proposed amendment allowsthe patent holders to submit the required documents once every three financial years. The Controller maintains the authority to condone any delay. Provision for condonation of delay has to filed through Form 27. This shift aims to streamline reporting while aligning with financial periods, providing a more comprehensive view of the patented invention's commercial activity and granting some relaxation to patent holders.
More Power to the Controller (Rule 138)
The Draft Rules bring forth a substantial transformation in Rule 138, making a comprehensive change in the manner of timeline extensions. The proposed amendments remove the existing exceptions that permitted limited extensions, giving the Controller broad discretionary power to extend timelines for various actions. These amendments aim to simplify and streamline the process of time extensions by introducing, a general principle that applies across different rules, eliminating the need for specific classifications for different types of extensions. This revision introduces a streamlined process, wherein applicants can request extensions through Form 4 before the initial six-month period concludes, subject to a fee of approximately USD 610 (INR 50,000) per month of extension. This alteration, though incurring costs, aims to offer applicants greater flexibility to manage unforeseen challenges during the patent process, striking a balance between adherence to deadlines and addressing genuine circumstances that require additional time. The request for extension of time shall be made in Form 4. The change also acknowledges past instances of litigation due to non-extendable deadlines, signalling a concerted effort to provide more accommodating measures for applicants.
Changes to Fee Structure
The proposed amendments in the Draft Rules involve changes to Schedule I of the fee structure. The fixed fee system for filing oppositions has been replaced with a fair system of calculating fees based on the expenses incurred by the patent applicant. The fee for applications under Section 28(2) is eliminated, while fees for applications under Sections 28(3) or 28(7) remain unchanged. Certain items such as 14A, 14B undergo removal, accompanied by alterations in Items 13 and 14. Importantly, the Draft Rules propose the inclusion of forms for Section 31 and Rule 29A Grace period in the Second Schedule, along with the introduction of new Form 1, Form 3, Form 4, Form 27, and Form 31, and an updated Schedule IV. This change represents a comprehensive effort to streamline the patent application fee structure and introduce new forms to enhance clarity and efficiency in the process. Below is a concise overview of changes proposed to Schedule I and Schedule II:
Fees (First Schedule)
1. Discount for "Patent of Addition" Application (Entry 1): Under this entry, when filing a "Patent of Addition" application pursuant to section 54, a discount of 50% in the filing fee is granted, as compared to other types of patent applications.
2. Reduced Fee for Specification under Section 54 (Entry 2): Applicants filing a specification for a patent application under section 54 can avail a discount of 50% on the fee for the specification.
3. Extension of Time Request Fee (Entry 4): A new row has been introduced, designated as (v), which pertains to the request for an extension of time under rule 138. The associated fees for this extension are set at Rs 10,000 for natural persons and Rs 50,000 for entities other than natural persons.
4. Modified Fee Structure for Pre-grant and Post-grant Activities (Entry 9): This entry involves alterations to the fee structure and conditions applicable to pre-grant and post-grant activities, signifying a comprehensive review and adjustment of associated charges.
5. Removal of Certain Entries (Entries 13, 14, 14A & 14): Entries 13, 14, 14A, and 14 have been removed, indicating a streamlining of the fee schedule by eliminating specific categories or requirements.
Forms (Second Schedule)
1. Form 1 - Patent Prosecution Highway (PPH) Inclusion: This form incorporates new entries to accommodate the "Patent Prosecution Highway" concept. Paragraph 2 now includes "Type of Application," and paragraph 4 integrates "Inventors." Additionally, optional details such as "Gender" and "Age" are added to paragraph 3A ("Applicant(s)"), while the entry for "Educational Institution" is introduced within paragraph 3B ("Category of Applicant").
2. Form 3 - Amendments in Paragraphs 2 & 3: Paragraph 2 undergoes modification from "Date of grant" to "Date of disposal." Paragraph 3 is adjusted to reflect the undertaking that the Controller shall be kept informed, in writing, about corresponding patent applications filed outside India in accordance with section 8 and rule 12, until the patent is granted.
3. Form 4 - Extension of Time Requests: This form provides a mechanism for requesting extensions of time for filing Form 3, Form 27, and other actions as per the proposed amendments to Rules 12(5), 131(2), and 138, respectively.
4. Form 27 - Amendments in Paragraph 1: Amendments are introduced in paragraph 1 of this form. Additionally, paragraphs 4 and 5 are removed from the form's structure.
5. Form 31 - Grace Period for Public Displays: A newly introduced form, Form 31, facilitates the utilization of a grace period of twelve months in cases of anticipation caused by public displays, addressing inadvertent disclosures and providing inventors with an avenue to secure patent rights.
With the passage of two decades since the last major amendments, these new rules aim to address critical issues within the patent ecosystem and adapt to the changing needs of inventors, applicants, and the patent office itself. While the amendments may not completely eradicate the patent examination backlog, they present a concerted effort to streamline and expedite the examination process through mechanisms such as prioritized examination and stricter response timelines.
The authority has announced that in case there are any suggestions or objections regarding the Amendment, they can be communicated to firstname.lastname@example.org and email@example.com by September 22, 2023. Readers are kindly requested to email valuable suggestions to the aforementioned addresses.