News from Abroad: Canada's New Patent Rules -- Twelve Notable Changes and Tips

by McDonnell Boehnen Hulbert & Berghoff LLP
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[authors: David Schwartz* and Jeff Leuschner**]

On December 1, 2018, the Canadian government released its proposed new Patent Rules in the Canada Gazette, Part I.  This is one of the last steps necessary for implementing significant changes to Canada's patent law, which are expected to come into force in 2019.

There will be many changes to Canadian patent law and practice.  In this article, we discuss the most notable changes expected, and some tips for safe and effective practice under the new rules.

Six changes to look forward to

The intent of many of the changes is to implement the Patent Law Treaty and to help minimize the risk of loss of rights.  Changes we look forward to include:

1.  Restoration of priority will be available

Currently, in order to make a valid priority claim in Canada, the Canadian patent application must be filed no more than 12 months after the filing date of the priority application.

The new system will allow for the 12-month priority period to be extended to 14 months if the failure to meet the 12-month deadline was unintentional.  This change will bring Canadian practice into line with the right of restoration of priority provided for in Rule 49ter of the Regulations under the PCT.

However, the Federal Court of Canada can reverse the restoration of priority and declare the priority claim invalid if it is later determined that the failure to meet the 12-month deadline was intentional.

Tip: The "unintentional" standard for restoration of priority in Canada will likely be easier to meet than a "due care" standard applied by some other patent offices.  Consider Canada as a favourable choice for situations in which restoration of priority must be relied upon.

2.  Easier to secure a filing date in Canada

Under the current system, in order to obtain a filing date in Canada, the patent application must be in English or French, and a filing fee must be paid.

The new system will relax this requirement for direct filings not entering through the PCT: if the filing fee is not paid, or if the patent application is not in English or French, then the Canadian Patent Office will still grant a filing date.

It will also be possible to obtain a filing date on a day the Canadian Patent Office is closed, e.g., on a weekend or holiday, by filing the application electronically.  It will even be possible to defer filing a specification and drawings by instead making reference to a previously regularly filed application.

However, most of these relaxed filing requirements will not apply to PCT national phase applications.  For example, it will remain necessary to pay the filing fee at the time of national entry and, if the international application is not in English or French, a translation into English or French must be submitted at the time of national entry.

Tip: As discussed in greater detail below, restrictions will be placed on amendments after a translation is filed.  Care should be taken to ensure that all translations submitted to the Canadian Patent Office are free of errors.

3.  Opportunity to submit missing content contained in a priority application

A patent application occasionally is filed missing content, e.g., due to a clerical error when preparing the application.

Under the new system, the applicant may add the missing content, without loss of the original filing date, if the addition is wholly contained in a priority document, and the addition is made within two months from filing or, if the Commissioner of Patents sends a notice indicating that a part of the application appears to be missing, within the earlier of two months from the notice or six months from filing.  The addition cannot add to the claims of the application.

Tip: This procedure is only applicable to direct filings not entering through the PCT.  Advise immediately if missing content is discovered because the deadline to add the missing content may expire as soon as two months from filing.

4.  Amendment after allowance practice streamlined

Currently, only very limited amendments are permitted after an application is allowed.  In order to re-open prosecution, it is necessary to allow the issue fee deadline to pass such that the application becomes abandoned, and then reinstate the application.  This is complex and time-consuming.

Under the new system, the procedure will be streamlined such that the notice of allowance can be withdrawn and prosecution re-opened simply upon payment of a fee within four months of the date of allowance (and before the issue fee is paid).

Tip: Use the new simplified amendment after allowance procedure to add claims instead of filing a "voluntary" divisional application that could be rejected for obviousness double patenting.

5.  Excess page fees will not apply to a sequence listing submitted in electronic form

Currently, the issue fee is CAD $300 plus $6 for each page of specification and drawings in excess of 100.

The fee schedule will be updated to clarify that the excess page fee does not apply to pages of a sequence listing submitted in electronic form.  This will come as welcome news to biotechnology patentees who have in some instances been stuck with exorbitant issue fees due to long electronic sequence listings.

Tip: Consider deferring allowance of applications having very long sequence listings until after the new Rules come into force, in order to avoid excess page fees.

6.  More certainty regarding the deadline to correct certain errors

The current system allows for the correction of "clerical" errors, ultimately at the discretion of the Commissioner of Patents.  This has led to a complicated body of law concerning whether an error truly is "clerical" and, if it is, what if anything the Commissioner ought to do about it.

The new system does remove the ability to request correction of "clerical" errors, but it introduces more certainty by establishing clear deadlines for correcting common types of errors.  For example, specific deadlines are set in relation to correcting errors in priority claims, correcting errors in the inventor and applicant, and correcting obvious errors found in the patent.

Tip: Check filing documents and granted patents promptly, and advise immediately if an error is discovered.  In some cases, the window in which to correct an error is small.

Six changes to prepare for

Some of the expected changes will reduce the rights of patent applicants/patentees.  Changes we suggest you prepare for include:

1.  No more 42-month national phase entry by right

Under the current system, a PCT application can enter the Canadian national phase as late as 42 months from the priority date, although a late fee must be paid if the applicant enters the national phase more than 30 months from the priority date.

Under the new system, the option to enter late by right is removed.  If the applicant fails to enter the national phase by the 30-month deadline, it is still possible to enter national phase within 42 months of the priority date, but only upon submitting a statement that the failure to enter the national phase by the 30-month deadline was unintentional.

Tip: This change affects PCT applications having a filing date on or after the coming-into-force date of the new Rules.  For such applications, plan ahead for Canadian national phase entry no later than 30 months from the priority date.

2.  More complex maintenance fee regime

To maintain a Canadian application or patent, a maintenance fee is due each year beginning on the second anniversary of the filing date.  Under the current system, a missed maintenance fee may be paid up to 12 months late as a matter of right.  In the case of a pending application, this requires a request for reinstatement and reinstatement fee, whereas only a late fee is required in the case of a missed maintenance fee on a patent.

The new system will have a benefit in that it will require the Canadian Patent Office to issue a late notice if a maintenance fee is missed.  Also, anyone will be able to pay a maintenance fee on a pending application.

However, the new system adds complexity and uncertainty: if the maintenance fee deadline is missed, the deadline for late payment of the maintenance fee is not immediately known and therefore cannot be immediately docketed.  Instead, the deadline for late payment is dependent upon when the Canadian Patent Office issues the late notice.  If the deadline for late payment is also missed, then in order to restore rights, a submission showing "due care" must be filed within a prescribed period.  What constitutes "due care" is currently unknown, and restoring rights under the due care standard may be subsequently challenged in Federal Court.  Also, an exemption from infringement ("third party rights") may apply beginning six months after a missed maintenance fee payment, which is also a concept new to Canadian law.  Furthermore, because anyone will be able to pay a maintenance fee on a pending application, it will be more difficult to know with certainty whether a maintenance fee payment deadline has been met.

Tip: Do not miss a maintenance fee deadline.  Take steps now to put in place robust procedures for the payment of maintenance fees on Canadian patent applications and patents.  Consider providing instructions to pay maintenance fees as they come due, absent positive abandonment instructions.  Additionally, consider providing instructions to pay the maintenance fee in the event that the Canadian Patent Office issues a notice indicating that the maintenance fee payment was missed (we anticipate the notice will be sent to the Canadian patent agent of record), and absent positive abandonment instructions.

3.  More significant consequences if the deadline for requesting examination is missed

Before a Canadian patent application is examined, examination must be requested and an examination fee paid.

Under the current system, the deadline to request examination is five years from the filing date of the patent application.  If the deadline is missed, the application is abandoned, but may be reinstated as of right within 12 months.

Under the new system, the deadline for requesting examination is reduced to four years from the filing date of the patent application.  The term for requesting examination in a divisional application filed after the original examination request deadline is reduced from six months to three months from the presentation date of the divisional application.  Also, complexities similar to those described above in relation to maintenance fees are introduced if the deadline for requesting examination is missed.  For example, missing the deadline to request examination could ultimately result in a situation in which third party rights and due care reinstatement applies.

Tip: It may be advantageous to delay the examination request until close to the deadline so that examination can proceed on the basis of claims allowed in a corresponding application filed in another country.  However, do not miss the deadline for requesting examination.  Consider having standing instructions to request examination close to the deadline, absent positive abandonment instructions.

4.  Strict limits on amendments when a translation is filed

An amendment to a Canadian patent application must be reasonably inferred from the application as originally filed, assuming the amended subject matter is not admitted prior art.

However, an additional requirement will be imposed under the new system: if a translation into English or French is filed, then any future amendment to the Canadian patent application must be reasonably inferred from both the application as originally filed (in the foreign language) and the filed translation.

Tip: Take extra caution to ensure that the translation of your patent application is accurate and complete.

5.  Certified copy of priority applications now required

Under the new system, it will be necessary to submit a certified copy of each priority application to the Canadian Patent Office, unless a certified copy is otherwise made available through prescribed means.

Submission of a certified copy to WIPO during the international phase of a PCT application will avoid the need for a certified copy during the Canadian national phase.  So this change will primarily impact direct filings, not entering through the PCT, in which a claim to priority is being made under the Paris Convention.  The deadline to submit the certified copy of each priority application in such a situation will be the later of four months from the filing date of the Canadian patent application and sixteen months from the date of the earliest priority application.

The proposed Rules permit making a priority application available to the Canadian Patent Office in a digital library specified by the Commissioner of Patents, but details are still forthcoming.

Tip: For direct filings not entering through the PCT, or if a certified copy was not filed in the international phase of a PCT application, provide a certified copy of each priority application with your original filing instructions.

6.  Shortened prosecution deadlines

The new system reduces the time the applicant will have to meet certain deadlines and to respond to certain requisitions.  The term for requesting examination will be reduced from five years to four years from the filing date.  Examiner's Reports will have a standard term for response of four months rather than six months.  The final fee will be due four months rather than six months from the notice of allowance.

Tip: It may be possible to extend the time to respond to Examiner's Reports by an additional two months (i.e., six months from the date of the Report).  However, if such an extension of time is obtained, it will not be possible to request or continue accelerated examination under the "special order" procedure.

Conclusion

There is a 30-day public consultation on the proposed new Rules, ending on December 31, 2018.  Subsequently, the final Rules will be published in the Canada Gazette, Part II.  We presently anticipate that the new Rules may come into force later in 2019.  If you have any questions or would like further information, then please contact a member of our firm's Patent group.

* David Schwartz is a partner in Smart & Biggar's Ottawa office.
** Jeff Leuschner is a senior associate in Smart & Biggar's Ottawa office.

This article was reprinted with permission from Smart & Biggar.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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