EPO consults on patent grace periods (again)

The EPO has launched a user consultation on grace periods for patents, the results of which will be published in early 2022 (EPO press release). The EPC as it currently stands does not permit a grace period in which inventors may disclose their invention without prejudicing a future patent filing. Whilst this is not the first time the EPO has considered whether there would be any benefits to introducing a patent grace period, so far widespread support for introducing a grace period in Europe has always been lacking. EPO users are set-up for operating in a file-first, publish-after system, and few would welcome the legal uncertainty that a European grace period would introduce. Nonetheless, the EPO clearly believes that it is time once again time to take the temperature on their no-grace period approach. 

Legal Background: Grace Periods

According to Article 54 EPC, the state of the art for determining novelty constitutes everything that was made available to the public before the priority date of the patent application, regardless of whether the applicant/inventor was responsible for the publication. By contrast, the US patent system retains a grace period for patent applications. In the US, disclosures made by an inventor (or someone who obtained the subject-matter from the inventor), up to 1 year from the priority date, do not constitute prior art for the patent (AIA 35 U.S.C. 102(b)(1)(A)). If the inventor has disclosed their invention during the grace period, then further disclosures by third parties also don't constitute prior art (AIA 35 U.S.C. 102(b)(1)(B)).

The mismatch between the EPO's and USPTO's approach to grace periods can necessitate very different prosecution strategies for the same PCT patent application in Europe and the US. Far broader claims may be achievable in the US than Europe, given the potential for prior art that is citable in Europe and not the US. The availability of the grace period in the US also provides the advantage that the patentability of an invention is not immediately destroyed by an unintentional disclosure or prior use by an inventor unfamiliar with the patent law (IPKat). 

Amazing Grace

The main argument against grace periods is that they increase legal uncertainty on entitlement and freedom to operate, and complicate novelty assessments. The legal uncertainty can be ameliorated somewhat by requiring the applicant to declare on filing that they intend to rely on the grace period, and by preventing patentees relying on the grace period after the patent has been granted. However, critics argue that this would remove a key benefit of having a grace period, in that it would no longer protect an applicant who was unaware at the time of filing of a previous prejudicial disclosure.  

Revisiting the issue of grace periods

There has been a history of consultations and surveys on the potential of introducing grace periods in Europe. In 2015, the EPO's Economic and Scientific Advisory Board (ESAB, 2012-2015) carried out an economic analysis of the benefits of introducing a grace period. There was "no consensus" amongst ESAB members regarding the desirability of a grace period in Europe. It was however agreed that, if a grace period were to be introduced, it should be internationally harmonised. Introducing a grace period would therefore not only require agreement between the member states of the EPO (in order to facilitate amendment of the EPC), but would require an almost unprecedented consensus between the major patent jurisdictions.

The issue of grace periods was also considered in the Tegernsee Process (2011-2015) (IPKat). The Tegernsee group reached similar conclusions to the ESAB, in that there was little appetite for introducing a grace period without international harmonisation on the length and scope of protection that the grace period would afford. In the current system, for example, some jurisdictions only provide grace periods with respect to the national filing date. In South Korea, for example, the national KR filing has to be filed within 12 months of the disclosure. Consequently, the grace period is not extended to 12 months before a foreign priority date. A national-filing only grace period puts foreign applicants at a disadvantage, and has few proponents. As such, if any form of consensus were to be reached on grace periods, it seems likely that this would be for an internationally recognised grace period.

Grace periods and UK trade negotiations

The topic of patent grace periods have more recently raised its head in the context of the UK's post-Brexit international trade negotiations (IPKat). Back in 2019, Jeremy Corbyn's labour party pounced on a leaked dossier from the UK-US Trade & Investment Working Group. The Opposition party proclaimed this to be evidence that the US was interested in "extending patents” in the UK. In reality, the relevant discussions were about data exclusivity periods, not patent term. More interestingly, the dossier confirmed the US preference for the UK to adopt a 12-month grace period for patent applications. Unsurprisingly, the UK response was that a grace period was incompatible with the EPC, and would thus put the UK's membership of the EPC at risk (IPKat). 

The US-UK negotiations are not the only ones in which patent grace periods have been raised. The same concerns have been raised following the UK's formal request to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). The CPTPP also requires a 12-month grace period. However, it seems probable that the UK would be able to negotiate an exception to this provision, given that UK exit from the EPC is also unlikely to be regarded as beneficial for other members of the CPTPP.

EPO considers grace periods again

Meanwhile, the EPO clearly feels that it is time to revisit the issue of grace periods. According to the 22 December 2021 press release, the EPO has commissioned an international research agency to conduct a survey on the impact of the lack of a grace period for European patent application. The survey will be conducted amongst "randomly selected" EPO patent applicants, based in Europe, the US, Japan and elsewhere. Representative user associations will also be consulted. The results of the survey are scheduled to be published in "spring 2022". 

Why has the EPO decided to consult users on grace periods again? Are they expecting a different answer to before? Or are they just looking for more recent evidence than the Tegernsee Process and ESAB reports to cite against external pressure to change the current system? We await the outcome of the survey with interest.