Seven Ideas for Reducing Foreign Filing Costs

Many of the patent owners, their IP departments and patent attorneys we speak to are under budget pressure. This is especially the case in the essential – but relatively high-cost – area of international patent protection. A recession might last a year or two, but patents last for twenty years. It’s therefore a delicate balancing act to reduce costs whilst maintaining a pipeline of patent rights that will avoid leaving an IP hole in years to come.  At inoviaip.com we have come up with seven great tips for controlling your foreign patent filing costs that are drawn from industry best practice, shouldn’t compromise your IP strategy and will put a smile on your face – and that of your boss, partner or CFO!

Rule 1: File a PCT application instead of direct foreign filings

Filing a PCT application delays the most significant costs associated with foreign filings by at least 18 months. This critical additional period may allow you to develop a clearer commercial picture before you need commit to the substantial costs of foreign filings by entering the national phase.

The International Search Report can also give an indication (albeit with no guarantees!) of the sort of prior art that might be faced during national examination.

Rule 2: Select countries intelligently

Before selecting countries, do your homework on the competitive landscape, market opportunities and IP system that each potential jurisdiction offers.

For consumer goods, first cover existing markets (including your home country if not already covered), then markets where sales or licensing opportunities are likely. Only then should purely manufacturing jurisdictions be considered – often it’s relatively easy for potential competitors to avoid protection in one such country by having a product manufactured in another country where protection doesn’t extend.

Of course, if your technology is not consumer-related, you should cover whichever jurisdictions make the most sense. Suitable jurisdictions for mining roof-bolts may be distinctly different to those for a pharmaceutical composition!

Rule 3: Ace the patent application process

Sometimes it is not only what you do right but what you don’t do wrong that counts! Plan your decision-making and funding processes to ensure instructions are sent well ahead of deadlines. This will avoid translation urgency fees, and late fees for submitting executed powers of attorney and assignments (where required).

Similarly, review the application to determine whether significant savings can be made in particular countries. For example, Europe, the USA and (to a lesser extent) India have per-claim fees if you have more than a certain number of claims. Reducing the number of claims may save a significant amount of money – is every claim in your application important, or are some just “filler”?

Rule 4: Choose an efficient foreign filing service

Many patent applicants and attorneys don’t realise that there is choice available as to who to use for the foreign-filing component of the patent process. The emergence of specialist foreign patent filing providers utilising technology and purchasing power has created significant efficiencies that translate into cost-savings for the patentee.

There may be similar cost-saving opportunities in areas such as annuities and patent searching.

Rule 5: Batch file to create economies of scale

If you have multiple filings due in a given month or quarter then do a batch-filing to maximise efficiency and minimize costs. And don’t be afraid to ask your service provider for a discount if you can instruct a significant number of cases simultaneously!

Rule 6: Consolidate providers

Selecting only one or two local attorneys to handle patent work can sometimes increase your buying power, giving you more favorable rates. Asking those attorneys to use the same foreign attorneys (ideally with whom favorable rates have also been negotiated) can help too.

Rule 7: Bring tasks in-house – or out-source!

When you look at organizations with larger portfolios a pattern emerges: more and more IP functions are taken in-house. Given sufficient volume it often makes more financial sense to pay an in-house paralegal or patent attorney salaries than to pay the hourly rates charged by a patent firm.

Patentees should look at the different parts of the patent process and take a good look at which tasks they can (or should!) take in-house. Taking patent drafting in-house may not be practical due to the lumpy nature of drafting work. However, instructing foreign filing or coordinating payment of annuities with the help of a specialist service provider can reduce costs while maintaining – or even increasing – the level of control exercised.

About the Author

David joined inovia from Divergent Capital, one of the company’s major investors, where he was Managing Director and a key member of the inovia Board of Directors. Having worked as a management consultant prior to joining inovia, David led a number of client projects through the sales, planning and delivery phases achieving significant benefits for a number of blue chip Australian companies.