PCT to the rescue

According to Wikipedia, “time to market is the length of time it takes from a product being conceived until its being available for sale“. However, the success of the product can often not be determined until the product has been on the market for a period of time. For some products, the success is immediate, for example the Iphone 5S/C sold 9 million copies the first weekend, but for other products, the success may take a while. The SMS-system was invented 1985, but it did not get successful until some years into the 21st century. In 2010, an astonishing 193 000 SMS messages were transmitted each second.

For a patent to be worthwhile the prosecution costs in the application stage, the invention should be potentially commercial. Moreover, since the prosecution cost grows with the number of countries where protection is sought, and since the patent fees after grant depends on where protection is granted, the patent should be potentially commercial in the countries where protection is sought. Imagine the headache this must cause a company when assessing not only if but also where to file a patent application.

The system of priority gives an applicant for patent protection one year from filing the first application for an invention, let’s say in Sweden, until he/she must decide whether to file for patent protection in other countries/regions such as USA, China and Europe for the same invention. As explained above, in many cases, one year may not be enough for determining the success of the invention, especially not in some markets.

Here comes the beauty of the PCT system into play. The PCT makes it possible to seek patent protection for an invention simultaneously in each of a large number of countries by filing an “international” patent application (quote from the WIPO homepage).  Moreover, the applicant has at least 30 months from the filing date or the earliest priority date until he/she has to decide in which countries to seek protection for the invention.

Since more than 50 % of the applications prosecuted by the EPO start as a PCT application (the so-called EURO-PCT’s) it is of course vital for a European Patent Attorney to have great knowledge of the special laws that follow a EURO-PCT. For example, when is it mandatory to reply to the Examination report from the PCT-phase of an application (when the EPO was the search authority) and when is it voluntary (when EPO was not the search authority)? Further, since more than 20 % of the applications filed in Europe are filed via the PCT system, and many more are entering the PCT after the priority year, it is also crucial for patent attorneys, working with customers from all over Europe, to be familiar with the PCT system. The subjects of PCT and EURO-PCT are thus natural and important in the Awapatent in-house EQE basic program and in the attendants’ quest of becoming not only European Patent Attorneys, but also damn good IP consultants.

Daniel Enetoft, Patent attorney and EQE Basic student

Johan Engquist, Associate and EQE Basic student

The (trade) secret of success

We have all heard of success stories such as the Coca-Cola recipe and the Google search algorithm. Many companies value their trade secrets and consider them important for competitiveness and innovative performance.

Although the general understanding is that trade secrets are good for business, there seem to be many incorrect assumptions about their legal protection.

For example, some are under the impression that any own technical or commercial information may be a trade secret, whether kept confidential or not. Others assume that the protection provides exclusive rights that could be invoked against any third party using the information, irrespective of how the information was actually obtained by the third party. Some also take for granted that specific provisions on trade secret protection are in place globally.

Especially Swedish companies may be faced with an unwelcome surprise when realizing the lack of explicit protection in countries where their international business partners operate. In particular when information has already been disclosed without the parties having discussed the delicate nature of the information or a confidentiality agreement.

The fragmented international protection combined with an increase in trade secret theft is an issue that has been recognized by the European Commission. In November last year, a draft directive to harmonize the protection of trade secrets in the EU was presented.

The draft introduces a common definition of trade secrets as well as civil sanctions against misuse. It will surely have a positive effect on cross-border cooperation between business and research partners within the EU, if and when enacted.

As many aspects of the draft text correspond to Swedish legislation, companies that have already introduced a policy and procedure for managing their trade secrets under the Swedish Trade Secrets Act will benefit when it is time to enjoy EU-wide protection of their valuable information.

In the meantime I wish to remind you all that sometimes, silence is golden.

Anita Gillior, Attorney at Law

To hear more on trade secrets you are welcome to our breakfast seminar in Stockholm on April 28. More information and registration (in Swedish)

Fighting the bad guys with customs surveillance

Most classic feel-good Hollywood movies reach a point when things look most bleak, and you almost doubt whether the hero will defy all odds and beat the villain.

The eternal fight against counterfeiting is starting to reach a similar point. As IP specialists and larger companies are aware, one of the most effective remedies in this battle is the cooperation with and help from EU national customs authorities, which offer the free service of monitoring the borders and detaining suspicious consignments being imported from countries outside of EU.

In 2012 EU Customs detained more than 40 million items of fake goods worth approximately EUR 1 billion. However, it is estimated that this only equals around 1% of the total number of counterfeit goods being imported into the EU. Surely, things do not look good for our hero.

When facing the impossible in the world of movies, the average hero typically regroups, changes strategy and returns even stronger.

A similar strategy is being employed by the legislators fighting on behalf of all right holders in this aspect. Accordingly, a new Customs Regulation has come into force on 1st of January 2014 with the aim of streamlining the process and extending customs’ authorities to also include possible infringement of trade names and utility models. The new regulation also introduces a new procedure for small consignments containing 3 or less units, whereby these can be handled by customs themselves and destroyed without contacting the rights holder. Especially the latter part will help right holders in their endeavor as it will limit the costs for the smaller insignificant matters and thereby help both parties focus on the larger consignments.

Furthermore, a major key to successful customs surveillance is for the right holders to provide customs with as much information as possible regarding their authentic products, including the place of production, shipping routes, packaging, distributors, countries of distribution and details of the products. Therefore, the new regulation also introduces a centralized database where all information is shared between the right holders and customs authorities.

Whether this new regulation will make for a happy ending remains to be seen. However, as long as there are customers, the producers of counterfeit products will continue to emerge. Therefore, it is evidently that the many arguments against the strict customs rules due to the protection of the unaware consumers are slowly silenced as the most effective way to fight “the bad guys” seems to be to deter customers from buying such products. This is probably also the reason why the European Court of Justice has recently allowed for the destruction of consignments being purchased for private use.

At Awapatent we stride to help right holders make their customs surveillance more effective and realize that cooperation and sharing of information with customs authorities are key elements in this fight. Counterfeiters also change strategy and are constantly developing their illegal methods and pirated products. Accordingly, the fight continues.

To stay in the movie analogy, the obvious movie comparison is “The Never Ending Story”.

Anders Michael Poulsen, Attorney at Law