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Let's Talk Payment of Patent Maintenance Fees

Let's Talk Payment of Patent Maintenance Fees


Published on 3 September 2019

In Intellectual Property lingo, a patent maintenance fee is an official fee that is payable at prescribed intervals to a National Patent Office over the lifecycle of a patent application or a granted patent, in order to keep the patent application or the granted patent in force in that particular jurisdiction. It is payable by an applicant or a patent owner (an assignee or a patentee, as the case may be).

Patent maintenance fees are an integral part of the patenting process and may also be referred to as patent annuities, patent annuity fees, patent renewal fees, or patent annual fees. The failure to pay a patent maintenance fee could have serious and far-reaching consequences, including the patent application or the granted patent being treated as lapsed, withdrawn, or abandoned in that particular jurisdiction.

When is the Payment of Patent Maintenance Fees Due?

Usually, patent maintenance fees are payable on an annual basis, and the fee for a particular year is to be paid in advance, at the end of the preceding year. Alternately, it may also be paid after the expiration of the preceding year within a prescribed “grace period”, with or without a surcharge. Depending on the jurisdiction, the due date may generally be calculated based on the date of filing of the patent application, or the date on which the patent was granted or issued.

Patent Maintenance Fees: Payments Which Begin at the Patent Grant or Issue Stage

In this article, we shall delve into the patent maintenance fees in the jurisdictions in which the payment of said fees begins at the patent grant stage or patent issue stage, or are calculated from the date on which a patent is issued or granted. The main advantage of such a patent maintenance fee system is its friendliness on an applicant's pocket; the said fees need not be paid for a pending patent application and are to be paid only upon the decision of a National Patent Office to grant a patent.

Further, we shall exclude the jurisdictions in which the payment of annual patent maintenance fees get accumulated till patent grant. Our earlier article on accumulated patent maintenance fees can be accessed here.

Patent Annuity Fees or Patent Maintenance Fees by Country

Let us now study the patent annuity fees by country for the period between March 2019 through March 2029 in China, Chile, Israel, Japan, Malaysia, Mexico, South Korea, and the United States of America. Of the top 50 patent jurisdictions as per the World Intellectual Property Indicators 2018 report published by the World Intellectual Property Organization, these are the only jurisdictions in which the payment of patent maintenance fees begins at the patent grant stage, or are calculated from the date on which a patent is granted. Typically, there are two categories of costs involved: official fees and attorney charges.

For the purposes of this article, we shall consider a patent specification with 15 claims and three independent claims which is to be filed by a company (i.e., large entity) to which the patent filing rights in China, Chile, Israel, Japan, Malaysia, Mexico, South Korea, and the United States have been assigned. Further, we shall assume that the applicant does not intend to license the patent.

The total estimated patent maintenance fees that are payable from March 2019 through March 2029 range from about US $1,500 in Chile to about US $6,000 in the U.S. (Table 1). The estimates are inclusive of the Value Added Tax in China, Chile, Israel, Malaysia, and Mexico, which has been added to the attorney charges.

Patent Maintenance Fees - China, Chile, Israel, Malaysia, Mexico, Japan, South Korea, and the United States

Payment of Patent Maintenance Fees in China

Payment of patent maintenance fees in China begins at the patent grant stage; the first patent maintenance fee is to be paid for the year in which the patent has been granted, along with the official patent grant fee, with the deadline for the payment of the subsequent patent maintenance fees being the anniversary of the patent application filing date each year. The estimate shown above is for a patent that will be granted in 2022.

Payment of Patent Maintenance Fees in Chile

In Chile, the patent maintenance fees for the first ten years are to be paid, along with the patent grant fee, within 60 days of the Chilean National Institute of Industrial Property's decision to grant a patent. A subsequent patent maintenance fee for the next decade is payable on or before the expiration of the first ten-year period, with the deadline for payment being the anniversary of the patent application filing date.

Payment of Patent Maintenance Fees in Israel

In Israel, the patent maintenance fees for the first six years are to be paid within three months from the decision of the Israeli Patent Office to grant a patent. The subsequent patent maintenance fees are payable every four years, with the deadline for payment being the anniversary of the patent application filing date.

Payment of Patent Maintenance Fees in Malaysia

Payment of patent maintenance fees in Malaysia begins in the second year following the date of grant of a patent, with the first patent maintenance fee being payable on or before the expiration of twelve months from the patent grant date or patent issue date. The subsequent patent maintenance fees are payable on an annual basis in advance, with the deadline for payment being the patent grant date each year. The estimate shown above is for a patent that will be granted in 2022. Further, the estimate is for the electronic payment of patent maintenance fees.

Payment of Patent Maintenance Fees in Mexico

In Mexico, the patent maintenance fees for the first five years are to be paid, along with the patent grant fee, within two months of the Mexican Institute of Industrial Property's decision to grant a patent. The subsequent patent maintenance fees are payable every five years, with the deadline for payment being the anniversary of the patent application filing date.

Payment of Patent Maintenance Fees in Japan and South Korea

In Japan and South Korea, the patent maintenance fees for the first three years from grant are to be paid at the patent grant stage, with the deadline for the payment of the subsequent patent maintenance fees being the anniversary of the patent grant date each year (starting from the third anniversary of the patent grant date). The estimate shown above is for a patent that will be granted in 2022 in South Korea and in 2023 in Japan. Further, an interesting aspect of the patent maintenance fees in Japan and South Korea is that the fees depend on the number of claims in the granted specification.

Payment of Patent Maintenance Fees in the United States

Like in Chile, Israel, and Mexico, the patent maintenance fees for a U.S. patent are also not payable on an annual basis. The first patent maintenance fee is to be paid at 3 to 3.5 years after the date of issue, with subsequent maintenance fees to be paid at 7 to 7.5 years after the date of issue, and 11 to 11.5 years after the date of issue. The estimate shown above is for a patent that will be issued in 2021.

Patent Management Software and Patent Portfolio Software

Worried about keeping pace with the dynamic Intellectual Property/Patent costs landscape? The Global IP Estimator and the Portfolio Estimator – Patents are smart, robust, and cutting edge international Patent cost calculators from the stables of Quantify IP, which greatly simplify the arduous and challenging task of Intellectual Property budgeting management. They offer what traditional Patent Portfolio and Trademark Management software do not - they can instantly and accurately calculate the costs of worldwide protection for either a single patent, trademark, design, or utility model, or a portfolio of patents, designs, or utility models, respectively. The calculations may be fine-tuned to the level of any particular stage of an Intellectual Property across its lifecycle, such as patent maintenance fees. Therefore, they can also function as patent maintenance fee calculators.

The addition of Quantify IP's Patent Cost Calculators has empowered the decision-makers in many Fortune 500 companies and over 70% of the top 100 IP law firms in the U.S. to solve diverse challenges in managing Intellectual Property budgets. To see what we can do for you, email us at qipcontact@quantifyip.com or call us at +1-808-891-0099.

Venkatesh Viswanath (Senior Content Strategist, Quantify IP) contributed to this article.

Exchange Rate Used: 1 U.S. Dollar = 6.72 Chinese Renminbi, 3.63 Israeli Shekels, 4.08 Malaysian Ringgit, 19.36 Mexican Pesos, 110.74 Japanese Yen, and 1,135.9046 Korean Won

Note: The estimates and fees depicted in this article are based on the Official Fee Schedules as on March 29, 2019

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