Guide to patent and design costs(Supplement to ‘An easy guide to Australian patent law for all Australians’)

© Copyright in this guide book is owned by Freehills Patent Attorneys.

This guide book provides a summary only of the subject matter covered, without the assumption of a duty of care by Freehills Patent Attorneys. The summary is not intended to be nor should it be relied on as a substitute for legal or other professional advice.

Contents

Searches Prior art (novelty) searches 1

Analysis costs 2

Design novelty searches 2

‘Free to market’ searches and analysis 3

Patent applications Provisional patent application 4

Complete patent application 4

Convention applications in foreign countries 5

International patent application 5

National phase entry estimates forcommon countries 5

Design applications Australian design application 7

Design examination 7

Foreign design applications forcommon countries 7

Renewal and maintenance fees 8

Page 1

SearchesThe cost of patent and design searching varies because there are different types of searches which are conducted for different purposes. Additionally, each search varies according to the crowdedness and complexity of the technological field.

The cost for a search is calculated on the hourly rate for our patent searcher. Please feel free to enquire about our searcher’s hourly rate. As a more useful guide, we attempt to give some estimates of costs for the various different types of searches.

Prior art (novelty) searches For most countries, the requirement for a valid patent includes that it is not previously published in a printed document anywhere in the world. The purpose of a novelty search is to determine the likelihood of your invention meeting this standard. Because of the worldwide standard, novelty searches are usually conducted out on international patent databases to find relevant patent documents, regardless of what country they are from.

There are several ways of carrying out a novelty search and the choice affects the cost. Generally speaking the more money you spend on a search, the greater the likelihood that all relevant prior art will be found.

We can conduct novelty searches in-house and these range from $2,000 to $7,000 which includes an analysis of the prior art. The cost depends on how complicated the invention is and how ’crowded‘ the prior art field is. An in- house searches may be the only viable option when there is limited time to conduct the search.

We can also arrange for the Australian Patent Office to conduct an international novelty search. This is probably the most cost effective option for a novelty search. The cost of the search is $2,000 plus our costs in analysing the relevant prior art. This option needs at least six weeks for the search to be conducted and the results analysed. A summary of potential analysis costs are provided below.

Page 2

Otherwise, we can arrange for a contract searcher to conduct the search. Costs start from about $2,500 (search costs only) but generally produce the most comprehensive search results.

Analysis costsTypical costs for analysing the search results may range from $500 to $5,000, depending on the relevance of the prior art found by the search. Where little relevant prior art is located by the search then analysis costs could be as low as $500 for merely perusing the search results. Typically, where a number of relevant prior documents are found, the cost for an initial review would typically be $1,500–$2,500. Such an initial review would identify relevant issues and may highlight the need for additional expenditure. For example, further costs could be incurred for obtaining a translation of a foreign patent document and providing a detailed opinion of its relevance.

As discussed below, proper infringement searching is very expensive (see ‘Free to market’ searches and analysis’ below). For this reason, infringement searching is rarely done. Instead, a more viable solution can be to check the results of a novelty search to check whether any of the relevant prior patent documents located give cause for concern. The considerations involved in this analysis are different to the novelty analysis and therefore the costs are additional to the novelty analysis. An initial review of the search documents to identify issues of infringement may be of the order of $1,000. This review may highlight additional avenues of enquiry to check the infringement position.

Design novelty searchesNovelty searches for designs are rarely undertaken. As a rule of thumb, if someone has developed an original design then it will usually be registrable and able to be distinguished from other designs. Because of the relatively inexpensive cost of registering designs, it is usually far more cost effective to apply for registration and hope for the best.

Page 3

‘Free to market’ searches and analysisAnother type of searching is infringement searching to ensure that a new product will not infringe any existing patents and the product will be free to market. While international databases can be a useful tool for locating relevant patents, a properly conducted infringement search is carried out by reviewing the claims of all current patents in any country in which the new product is to be made or marketed.

Infringement searches should be carried out by a foreign patent attorney or a reputable searcher in the particular countries concerned. Generally speaking, we can arrange for the search to be conducted then analyse the results to check whether there are any patents/applications which give cause for concern. If there is something we are concerned about then we can revert to the foreign patent attorneys for a final opinion.

Generally speaking, these infringement searches cost at least $5,000 (search costs only) per country per invention (with some products there may be more than one inventive aspect which requires searching).

Our charges for analysis can be of the order of $5,000 upwards per country. Where a very relevant United States of America patent is located, an opinion from our United States of America Associates may be desirable. Such opinions are very expensive, starting at $10,000 per patent.

Page 4

Patent applicationsAttorney services for drafting of patent applications are charged according to an hourly rate for the patent attorney concerned. These rates vary according to the qualifications and experience of the patent attorney concerned. Please feel free to enquire about your attorney’s hourly rate.

Our filing department attends to the administrative requirements for filing patent applications such as the preparation of forms and routine correspondence. Charges for filing of patent applications include a standard charge for these administrative services. Additionally, overseas applications and national phase entries incur foreign patent agent’s charges.

As a guide to anticipated costs, we attempt to give estimates below for various different types of patent applications.

Provisional patent application The cost for drafting and filing an Australian provisional patent application is generally about $4,000 to $8,500, depending on the complexity of the invention. A typical mechanical invention may cost about $4,500 whereas a more complex electrical or software invention, for example a system with a complex screen interface, may be at the upper limit of the above range, or more.

Complete patent application The cost for preparing and filing a complete patent application (within one year from the provisional application) is about $3,000 to $6,000. The cost depends on whether there are many changes to the invention that need to be incorporated into the complete specification.

Page 5

Convention applications in foreign countriesThe costs for filing Convention applications in foreign countries (within one year from the provisional application) are similar to the estimates given below for National Phase Entries and these estimates may be used as a guide.

International patent applicationThe cost for preparing and filing an international patent application (within one year from the provisional application) is typically about $10,000 to $15,000. The cost depends on the complexity of the invention and the number of changes to be written up.

National phase entry estimates for common countries(estimates provided in $A)

Australia $2,100

New Zealand $2,100

Canada $5,000–6,000

United States of America $7,000–9,000

Japan $12,000–15,000

China $8,000–10,000

Europe $14,000–16,000

United Kingdom $5,000–6,000

Germany $8,500–9,000

Singapore $4,000–5,000

South Africa $5,000–6,000

India $5,000–6,000

Brazil $7,000–8,000

Page 6

The above are estimates only and can vary according to fluctuations in exchange rates, the size of the specification and number of claims, and the amount of our foreign Associates’ charges.

Each of these cost estimates is for filing the application only. Each application will be examined by the national patent office concerned. To process the application in each country through to grant, you should budget for at least the same as the filing costs for that country. For United States of America applications, it would be prudent to budget for a processing cost which is approximately double the filing cost.

Generally speaking, the earlier the instructions are provided, the cheaper the cost. This is because costs will be reduced if all relevant information and forms can be provided to our foreign Associates at the outset. Double handling causes increased costs and some patent offices impose penalties for late filing of documents.

Page 7

Design applications

Australian design applicationAn Australian design application costs about $1,500–$2,000. The application cost includes registration costs which are usually charged at the outset. This cost assumes that appropriate drawings are provided. Otherwise, we can arrange for professional drawings ($500–$1,500).

Design examinationThe above design application costs represent the cost of achieving registration. However, if you want an enforceable design registration, it is necessary to have the design examined and certified by the Designs Office. The cost for requesting examination is about $1,000. There will be additional costs if the examiner raises objections.

Foreign design applications for common countriesThe following are typical costs for filing design applications in common countries.

(estimates in $A)

China $3,500

Europe $4,500

Japan $4,500

New Zealand $1,500

United States of America $4,500

There are also processing charges for processing designs through to registration. For each application, you should budget downstream costs at about half the filing cost.

We can provide more specific estimates for a particular matter.

Page 8

Renewal and maintenance feesIn many countries annual renewal or maintenance fees are payable to maintain patents and applications in force. The commencement of these annual fees varies but generally they commence within four years of filing the complete or international application. The fees are of the order of $250 per country and increase as time passes. A patent may be abandoned at any stage if the costs are considered to outweigh the usefulness of the patent.

Notes

Notes

www.freehillspatents.com

Melbourne101 Collins Street Melbourne Vic 3000 AustraliaTelephone +61 3 9288 1577 Facsimile +61 3 9288 1389

SydneyANZ Tower 161 Castlereagh Street Sydney NSW 2000 AustraliaTelephone +61 2 9225 5777 Facsimile +61 2 9225 5389

Registered Patent Attorneys in Australia and New ZealandAssociated with Herbert Smith Freehills

MPB00004_Supplement_A5 Cover_161 130813