Intellectual Property Office of New Zealand moves to curb “daisy-chaining” of pre-2013 Act divisional applications

On 16 September 2016, the Ministry of Business Innovation & Employment (MBIE) and the Intellectual Property Office of New Zealand (IPONZ) issued a consultation document. The document asks for submissions on proposed changes to the transitional provisions of the Patents Act 2013, which relate to the filing and/or examination of divisional applications from an application made under the Patents Act 1953. Submissions are due by 14 October 2016.

The Patents Act 2013 came into force on 13 September 2014. The Patents Act 2013 raised the standard for which examination was conducted, including by requiring examination for inventive step for the first time.

All applications which were filed in New Zealand after this date, or, in the case of PCT applications, entered national phase in New Zealand after this date, are subject to the Patents Act 2013. Applications filed prior to this date, and any divisional application filed from such an application are subject to the Patents Act 1953.

Under the 1953 Act a divisional application can be filed from a divisional application at any stage prior to acceptance. This allows the filing of divisional applications in a serial manner – a process sometimes called “daisy chaining” - for the lifetime of the patent.

MBIE and IPONZ are concerned that the continued allowance of daisy chaining under the Patents Act 1953 causes problems for third parties. In particular, they point out that, as inventive step is not examined, third parties will still need to be wary of patents being granted which would not be granted under the Patents Act 2013. The situation could persist until the early 2030s if divisional applications are continually filed for the 20 year lifetime of the patent.

The consultation document also notes that the continued existence of applications under the 1953 Act means that IPONZ is required to maintain the capacity to examine under the 1953 Act as long as divisional applications remain pending. This means that they will need to continue to train examiners to examine under the provisions of the 1953 Act.

The consultation document identifies three different options:

i. No change to the transitional provisions of the 2013 Act (the status quo);

ii. Amend the transitional provisions to provide that, after a specified date, it would not be possible to make divisional applications from a parent patent application that is, or is treated as, a 1953 Act application; and

iii. Amend the transitional provisions to provide that, after a specified date, divisional applications made from a parent application that is, or is treated as, a 1953 Act application under section 258 of the 2013 Act, will be examined under the criteria set out in the 2013 Act.

Of these options, MBIE and IPONZ prefer the third option, which would mean that divisional applications filed after a certain date will be examined under the provisions of the Patents Act 2013. It is suggested that the date be no more than three months after the necessary amendments are made, but still allowing applicants reasonable time to file divisional applications prior to that date. It is worth noting that, in addition to examination for inventive step, the Patents Act 2013 also has higher standards for support, utility and has certain specific exclusions on subject matter which apply throughout the lifetime of the patent. All of these may be reasons an applicant would prefer the application proceed under the 1953 Act.

What is not clear from the consultation document is whether a divisional application filed after the implementation date will be merely examined under the requirements of the Patents Act 2013 (including obviousness), but otherwise fall under the Patents Act 1953, or whether such an application will be considered a 2013 Act application and be subject to all of the requirements of that Act. The consultation document seems to support both approaches.

This is relevant as to whether a request for examination is required. If the former approach is taken, then there should be no need for a separate request for examination, since examination of 1953 Act applications is automatic. However, if the latter approach is taken, then it will be necessary to request examination and pay the examination fee (currently $500).

Regulation 71 of the Patents Regulations 2014 also sets a limit of five years from the filing date in which to request examination of an application. Since a divisional application is deemed to be filed on the date of the original parent application, the five year deadline is calculated from the filing date of the original parent. This already applies to divisional applications filed from an application made under the Patents Act 2013.

If the whole of the Patents Act 2013 applies to a divisional application filed from a 1953 Act application, but after the specified date, then it will be necessary to request examination within five years from the original filing date. If this deadline has already passed when the divisional application is contemplated it will not be possible to file a divisional application that can be examined and granted. We are seeking further clarification from MBIE regarding this point.

This document is open for submissions until 14 October 2016. Please let us know if you would like our assistance in preparing submissions or require any further information.

If MBIE and IPONZ decide to proceed with any of the amendments, then they would be included in an omnibus bill. The consultation document states that it may be some time before an appropriate vehicle becomes available.

September 2016 - David Nowak / Frank Callus

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