TWN Info Service on Intellectual Property Issues (July10/03)
6 July 2010
Third World Network
 
Technology transfer, technical assistance on PCT reform agenda
Published in SUNS #6953 dated 28 June 2010

Geneva, 25 Jun (K. M. Gopakumar) -- Issues related to technology transfer and technical assistance are now part of the reform agenda of the Patent Cooperation Treaty (PCT) administered by the World Intellectual Property Organisation (WIPO).
 
This was a recommendation made by the PCT Working Group at its third meeting that concluded on 19 June. Although the PCT is ostensibly about procedural matters, its application has substantive implications.
 
The Working Group discussed seven items on both policy and technical matters under the agenda item on changes to the procedural and legal framework of the PCT system, viz. need for the improving the functioning of the PCT system, third-party observation system, quality feedback system, eligibility criteria for reductions in certain fees, rectification of obvious mistakes, improvements in the procedure of correction of mistakes and photographs and colour drawings.
 
Both PCT Member States and non-Member States participated in the five-day meeting of the Working Group.
 
The important outcomes of the PCTWG are given below.
 
NEED FOR IMPROVING THE FUNCTIONING OF THE PCT SYSTEM
 
On the item on "the need for improving the functioning of PCT system", discussions centred on a study with the same title. This study was prepared by the WIPO Secretariat based on the decision of the second meeting of the Working Group in the light of strong objections from developing countries against the WIPO Secretariat proposal for PCT reform titled "The Future of the PCT" (Roadmap) (PCT/WG/2/3). (See SUNS #6698 dated 12 May 2009).
 
The study was prepared on the terms of reference (TOR) prescribed by the Member States at the second meeting of the Working Group. The TOR contained the following non-exhaustive elements: Outlining the background of the need to improve the functioning of the PCT system; Identifying the existing problems and challenges facing the PCT system; Analysing the causes underlying the problems; Evaluating the impact of proposed options; Defining and clarifying concepts, such as duplication of work, and unnecessary actions.
 
Unlike the Secretariat's "Roadmap", the new study changed the stand on three critical issues.
 
First, according to the "Roadmap", a general principle of PCT reform should be the granting of patent "on the basis of international applications should have a high presumption of validity if examined, or the likely extent of validity should be easily determined if registered without examination".
 
However, the study recognizes the freedom of PCT Member States and states that "This is not something which can be required by the PCT and is solely a matter of a national policy decision".
 
Secondly, the study changes the stand on the use of international reports produced by a patent office in its capacity as an international search authority. According to the roadmap, the patent office is "not to repeat search work carried out by them acting as International Searching Authorities where the international application enters the national phase before the same Office acting as designated or elected Office".
 
The study now states that such a rule does "not prevent examiners from conducting whatever searches are necessary to ensure a high quality granted patent in individual cases where it can be seen that the scope of international searches was deficient, or where there is other need for additional searching such as because the scope of the claims significantly changed or because some inventions were not searched due to lack of unity of invention".
 
Thirdly, the study also showed flexibility with regard to the right of PCT Members States to retain the reservations on the treaty. The Roadmap had suggested the removal of reservations on the PCT.
 
Developing countries that belong to the Development Agenda Group (DAG) categorically stated in their opening statement that, "reform of PCT system does not entail any harmonization of patent law, in substance or in practice, as stipulated under Article 27(5) of the PCT" (see SUNS #6947 dated 18 June 2010).
 
[The DAG includes Brazil, Cuba, Egypt, India, Indonesia, Iran, Malaysia, the Philippines, Pakistan, South Africa and Sri Lanka.]
 
The DAG further proposed additional recommendations to the study focusing on the following issues, viz. PCT information and technology transfer, technical assistance, as well as information and analyses of the root causes of backlog of patent applications. The proposal was agreed upon with certain amendments through informal consultations between developed and developing countries, which took almost 24 hours.
 
Recommendations were adopted on PCT information and technology transfer.
 
According to the first recommendation to be incorporated as Para 207, "it is recommended that the IB (WIPO International Bureau) work with national offices to deliver effective patent status information covering not only PCT applications and subsequently granted patents but also national applications including information concerning opposition of patents (pre- and post-grant), revocation and lapse patents, issuance of compulsory license etc". The information is expected to be integrated with a search system to identify the technology that has entered the public domain. The IB would undertake a pilot project to integrate the system for automatic update of the status of patent application linking with national patent offices.
 
However, the Secretariat clarified that the IB would carry out the recommended pilot project within the parameters of the existing funding and budget. Further, the project would build on already existing similar projects and existing facilities from within and outside of WIPO.
 
The PCT members also adopted the recommendation on the introduction of a register that encourages applicants to signal their willingness to license their potential patents. This recommendation replaced the recommendation contained in Para 211 of the study, which asked member countries to choose between two options: to promote licensing in the international phase, viz. introduction of a technical system, or support by appropriate national policies in the contracting state.
 
Another recommendation that was adopted, to be incorporated as Para 211 bis of the study, is to conduct a "follow-up study by the IB to review and assess how the PCT system has been functioning in terms of realizing its aim of disseminating technical information and facilitating access to technology as well as organizing assistance for developing countries".
 
The follow-up study would contain recommendations and suggestions on how to improve the aim of dissemination of technical information, including on the sufficiency of disclosure of information. The study would be submitted for the consideration of PCT Member States at the 4th Session of the PCT Working Group. Appropriate changes will be carried out in the proposed third-party observation mechanism including sufficiency of disclosure.
 
A new Para 204 bis is incorporated in the study to address the issues related to technical assistance. According to this recommendation, a study will be conducted by the IB to "look into the issue of coordination of Technical Assistance for developing countries as envisaged under Article 51 of the PCT". The study will be guided by the principles of the Development Agenda adopted earlier by WIPO Member States in October 2007. The study will also make recommendations on the terms of reference for the possible establishment of a technical assistance committee. The study will be presented at the 4th meeting of the Working Group.
 
Thus, this recommendation is a step forward towards the establishment of a Committee on Technical Assistance, as mandated under Article 51(1) of the PCT.
 
The study will also identify and assess the existing agreements with relevant international financial organizations and intergovernmental organizations for financing technical assistance, as mentioned under Article 51(4) of PCT.
 
The original proposal of the DAG was to set up the Committee on Technical Assistance as mandated under Article 51 as early as possible to look into the issues of technical assistance for developing countries in the area of patents in a focused manner with the guidance of the Development Agenda principles.
 
A new Para 149 bis is added to the study to address the issue of backlog. According to this recommendation, the IB is to conduct "a study to analyze the root causes behind the surge of patent applications and the consequent heavy load on the international patent system". While conducting the study, the IB should involve WIPO's chief economist.
 
In examining the root cause of the increasing number of patent applications and the overloading of the international patent system, the study is important not only in the context of the PCT but also in the context of the patent system in general. The justification for the radical reforms suggested in the Roadmap by the Secretariat, which are opposed by the developing countries, is the increasing number of patent applications and the resulting backlog. In response to the "Roadmap", the developing countries always maintained that there is need to find out the root causes for the flood of patent applications in order to effectively address the issue of backlog.
 
The last recommendation is incorporated in Para 213, which states the desire of many PCT Member States to have all working documents of the Working Group to be available in all six official languages of the UN.
 
THIRD-PARTY OBSERVATION SYSTEM
 
The Working Group also decided to establish a third-party observation system permitting third-party observations to be made on the PCT applications during the international phase. This system would be established on an informal basis without amending the treaty or establishing any new rules. There was consensus on the need for such a system, which is expected to increase the quality of international preliminary reports on patentability. It also has the potential to improve the quality of search and examination reports at the national level.
 
Initially, the scope of observations would be permitted only with respect to citation of relevant prior art and an indication of how it was relevant to novelty and inventive step. Many developing countries, including India, demanded that the scope should be expanded to cover all grounds of patentability, especially the sufficiency of disclosure. Such observation would be permitted only during the international phase.
 
The IB is expected to undertake consultations on the technical details of the third-party observation system through PCT circulars or web-based consultations.
 
QUALITY FEEDBACK SYSTEM
 
The quality feedback system is a proposal from the Swedish Patent Office, which is a complementary mechanism to the third-party observation mechanism. Under this system, examiners of national patent offices who are part of the PCT system get an opportunity to comment on the quality of an international search report and international preliminary report on patentability prepared by an international search authority (ISA). However, it is optional for the examiners to send feedback to an ISA. The Working Group has recommended to the IB to begin the development of a quick quality feedback system.
 
ELIGIBILITY CRITERIA FOR REDUCTIONS IN CERTAIN FEES
 
The IB has proposed new eligibility criteria to reduce fees for natural persons (as opposed to corporate entities) who file PCT applications. In this proposal, there are two conditions. First, the per capita gross domestic product (GDP) of the PCT Member State is below US$25,000 according to the most recent ten-year average per capita GDP figures at constant 2008 US Dollar values published by the United Nations.
 
Secondly, patent filing by the residents of a Member State should be less than 10 international applications per year (per million population) or less than 50 international applications per year (in absolute numbers), according to the most recent 5-year average yearly filing figures published by the International Bureau.
 
However, there was no consensus among Member States. Singapore stated that it wished to highlight that the use of per capita and per million population parameters could unfairly disadvantage countries with a smaller population.
 
Rejecting the new criteria, Barbados reiterated that the eligibility criteria for reductions in certain PCT fees should be equitable and balanced, taking into account the special needs of developing countries; the per capita income as a determinant of eligibility for a PCT fee reduction was not an accurate indicator of which countries required a stimulus at the international level to encourage innovation; and to use the per capita income criterion without more resulted in inequity with respect to small economies such as Barbados.
 
It proposed that there should be carve-out space for small economies in line with their NAMA (Non-Agricultural Market Access or industrial) trade or the fee reduction should be applied to all developing countries.
 
In the absence of consensus, the Secretariat stated that it would further consider the issue with a view to finding alternative solutions.
 
The adopted report will be submitted to the WIPO General Assembly meeting in 2010 and the 4th meeting of the Working Group is proposed for May 2011. +