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Harmonizing Patent Systems – A Common Mission at an Economic Turning Point

Under Secretary of Commerce for IP & Director of the USPTO David Kappos

December 9, 2011

IP Week 2011 -- Brussels

 “Harmonizing Patent Systems -- A Common Mission at an Economic Turning Point”

Remarks as prepared for delivery

Good morning everybody, and thank you for that introduction, Peter. It’s a privilege to participate in today’s summit alongside my colleagues, President Avila, President Battistelli and Deputy Commissioner Yuguang. Over the past three days IP Week 2011 has highlighted and dissected trends that are reshaping the topography of the innovation landscape. Open-sourced software, the rapid rise of intellectual property offices in emerging economies, and shifting patent laws—are all retooling IP strategy and policy, world-wide. And that’s why the United States Patent and Trademark Office is eager to participate in a conference that confronts these challenges head on. Particularly because our gathering here in Brussels acknowledges that with 21st century IP questions being global in scope, so too must be their solutions.

We convene at a time where economies everywhere continue to face strong fiscal headwinds and immense political challenges. As we are all being asked to do more with less, contentious debates flare up across continents—and across the ideological spectrum—as to how countries can best reconcile forward-looking policies for growth with economic, environmental and even geopolitical concerns. But what’s remarkable, is that even in the face of these challenges, there is broad-based, bipartisan and burgeoning consensus surrounding innovation policy.

From Asia to North America, to the Euro Zone—actions are being taken that acknowledge and demonstrate how nurturing and building the most innovator-friendly IP architectures will ultimately allow us to manage challenges of costs and growth in the 21st century. Nowhere is this better showcased than right here in Brussels, where historic progress was made this week, by the EU, with an agreement in substance reached on the Unified Patent Court. When details of this agreement are finalized, it will pave the way towards a unitary patent—one that recognizes the important need for consistent patent enforcement in a regional market, and one that will lower costs for applicants in obtaining protection for their cutting-edge technologies—by some estimates, by 80 percent!

This is particularly important, because as more innovators seek to tap markets abroad, it is imperative that the international patent system provides a cost-effective way to obtain reliable and high quality patent rights in multiple jurisdictions.  Patents are the global currency for creating value for products and services for innovators—in all of our countries. But if we don’t keep up with a technological and commercial system that moves ideas & products across borders with increasing speed in a flatter world—we risk devaluing that currency.

Patent offices around the world are repeating the same work done by other countries, ultimately wasting billions of euros a year, clogging the pendency pipeline and leaving the patent system, ironically, as the laggard among commercial legal regimes. Only by moving towards a more harmonized global IP system can we devise real solutions that cut down redundant work. And only through collaboration can we fulfill the social contract embedded in our patent systems, unleash jobs lying in wait, and drive real economic growth.

New products can have one foot in nanotech, another in software, and another in the biological sciences. And they are designed, developed, manufactured, distributed and used in a global environment that often transcends national borders and national patent laws. These realities are welcome, and they certainly are hallmarks of 21st century innovation—but they demand collective, intelligent engagement and a smarter global IP infrastructure to keep up. That’s why patent harmonization is so vital—as it will empower all of us to better manage the collective challenges our IP systems face in an era of globalization.

But in order to best protect and optimize technological growth, our harmonization discussions must be rooted in global best policies and best practices for all nations, developing and developed. And our harmonization discussions must include listening to the needs of countries at all stages of development. Hearing the Brazilian perspective and the Chinese perspective and the Dutch perspective and the UK perspective doesn’t just allow us to find nodes of collaboration, but enables us to evaluate how our varying policies are impacting inventor communities everywhere.  

Now, multilateral agreements like the Patent Cooperation Treaty (PCT) and bilateral relationships through the Patent Prosecution Highway (PPH) are already demonstrating how best practices can be ironed out between our countries on an administrative level. When an inventor’s patent application is being processed in multiple countries, these work-sharing systems enable offices to utilize one another’s search and examination results—avoiding duplication of work and expediting the review process, while at the same time boosting patent quality—as multiple perspectives are brought to bear on the review of a single application.

The PCT of course is the cornerstone of our work sharing systems. The USPTO has invested substantially in improving its PCT timelines and quality in recent years, reaching worlds-best status in international stage processing and making significant progress at leveling the playfield for innovators seeking to access markets everywhere. And we’ve been able to expand our levels of collaboration by recently implementing a program to provide a Common Citation Document (CCD) with our trilateral partners in Europe and Japan.

This CCD, for the first time will enable practitioners and innovators pursuing patent protection in the trilateral offices to see all the prior art being considered by all three offices, in one place and cataloged in a single format. And it will enable our patent examiners to do the same. Our thanks to the EPO for its brilliant implementation of the CCD. And for those who have not seen it in action, I would recommend it to you—linkable from our websites. Moreover, with respect to the PPH program, more than 8,000 applications have already made their way through the US PPH to date, and conversations are ongoing to develop new parameters to further streamline work-sharing procedures through a new and improved version of PPH that we refer to as PPH 2.0. 

PPH 2.0 will offer a more user-friendly eligibility requirement whereby the work to be relied upon for the PPH request does not have to be from the office of first filing, but can be work done by any participating office on a patent family member. This will enable us to reach even higher. And in this regard, the USPTO is targeting a total of 16,000 PPH entries by the end of 2012. Which, in turn, is translating into: many millions of dollars saved by US patent filers—a faster time in which their inventions can be marketed and distributed—and improved competitiveness in the global market place.

The success of programs like PPH gives us a chance to hold a critical lens up to examination standards, and envision a system where administrative protocols are ironed out and incompatible patent systems no longer keep us up at night. If we can now harmonize our patent systems, we’ll eliminate repeated work, free resources for inventors, patent offices and courts, and ultimately generate the economic lift that comes from moving ideas to the market place more efficiently.

And now we’ve began engaging the ideal of an improved global patent system, a harmonized global patent system, by identifying areas of the law where further coordination and development across jurisdictions would be helpful. At a meeting in Tegernsee, Germany, last summer, several important topics were selected for a matrix study on patent harmonization. The study is analyzing the legal and conceptual differences among the varying IP systems—actively identifying points of possible convergence and developing a plan to move forward.

But the leaders of the IP world need to truly own our role and continue to engage the international business community; not only in making the case for why a global economy demands a global innovation architecture to keep up, but also to ensure that developing nations are included in the conversation. And let me assure you that the United States will continue to do its part. In a truly historic moment—just less than 3 months ago—President Obama signed sweeping patent reform legislation in the U.S., re-engineering the United States IP system from the ground up. This new law fundamentally makes it easier for business, inventors, and entrepreneurs to turn ideas into products and services, and contribute to economic growth.

At its core, this legislation transitions the US from a focus on what inventors do in secret, to a focus on what they do to make their inventions available to the public by disclosure or sale of a product. That in turn marks a powerful shift—the first in any patent system on the planet—to transparency, clarity, and collaboration. Ultimately, the move engineered by the America Invents Act to a more efficient and reliable American patent system, through provisions like first to file and a more transparent grace-period, is anchored in the desire to more effectively match the rate and pace of the patenting process to the rate and pace of invention, and the rate and pace of commercialization. And these two features – first-to-file and the grace period – have been contemplated as part of patent harmonization for over 25 years. So on either side of the Atlantic, countries are realizing that policies to foster innovation must rise above partisan riffs, and the ensuing 21st century IP dialogue must be a global one.

But even beyond harmonization, and indeed beyond existing work-sharing programs—our commitment to global patent coordination stems from the fundamental fact: that granting higher quality patents, and adjudicating their scope and applicability more efficiently, truly empowers innovators to engage the global marketplace and unleash their creativity.

This puts the onus on the world’s IP leaders to decide whether we want to enhance and accelerate progress.  I believe we owe it to all of our countries’ citizens to continue moving forward with discussions aimed at optimizing our global patent system. We owe them an end to excuses. We owe them an end to stalemate. We owe them leadership and success.

That’s why I look forward to today’s dialogue. I look forward to discussions that will empower us to build a system that incubates great ideas, offer the highest quality reviews, swiftly brings the best products to the marketplace, benefits innovators and governments alike, and writes the next chapter of economic growth for all of our nations. I urge that we redouble our efforts at patent law harmonization.  I urge us all to search for common ground. I urge us all to let best global policy and best practices, among all nations, be our guide. 

Thank you.

United States Patent and Trademark Office
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Last Modified: 12/9/2011 9:59:04 AM