WIPO Workshop Looks At Potential Impact Of Reducing Patent Fees For Universities

The World Intellectual Property Organization’s main financial resource is from the global patent treaty it manages, allowing inventors to file international patent applications and gain protection in a large number of countries. WIPO members have been debating for some time whether universities should benefit from a fee reduction, in particular those from developing countries to encourage patent filing. A workshop held at WIPO this week pondered whether a fee reduction would lead to more patenting of inventions by universities. The answer is apparently not clear-cut.

The workshop on Patent Cooperation Treaty (PCT) fee reductions for universities took place on 18 June, in the context of the 11th session of the PCT Working Group, being held from 18-22 June.

A time table [pdf] for the PCT session was issued yesterday. Formal discussions on fee reduction for universities are scheduled tomorrow afternoon.

The workshop follows a proposal [pdf] by Brazil on a PCT fee policy to stimulate patent filing by universities.

Among the topics addressed by the workshop programme [pdf] were the impact of the proposal to introduce fee reductions for universities on the PCT fee income, other incentives than fee reduction to encourage patenting by universities, and perspectives from developed and developing country universities.

Opening the PCT Working Group 11th session, WIPO Director General Francis Gurry underlined “the great success” of the PCT system, which celebrated its 40th anniversary in January, and which he said is “an extremely successful example of international cooperation.” The upward trend of PCT applications was again confirmed in March when WIPO released annual PCT statistics (IPW, WIPO, 21 March 2018).

University Patent Filings Low, Especially in Developing Countries

Hao Zhou, head of the Data Development Section, Economics and Statistics Division of WIPO, said [pdf] although university filings are increasing, they are still very low.

In 2017, applications by university-only applicants accounted for CHF 14 million (US$14 million), with universities from developed countries paying the most (CHF 10.8 million).

According [pdf] to WIPO Chief Economist Carsten Fink, developing country universities are more price sensitive than developed country universities. However, this conclusion is based on the assumption that universities of all sizes in developed or developing economies would have the same reaction to a large fee reduction, he said, which might not be the case.

For [pdf] Alison Campbell, director of Knowledge Transfer Ireland, universities are finding difficult to identify new inventions, and make correct market assessments.

It happens, she said, that universities have a week to decide whether they want to make a patent application when it is known that an invention is to be disclosed in a paper or at a conference.

McLean Sibanda, chief executive officer of the Innovation Hub, South Africa, noted [pdf] significant growth in South Africa university PCT applications in recent years, adding that most of those applications are made in the biotech area. The South African government grants subsidies for patent applications and a reduction of those subsidies would impact filings, he said.

Sibanda suggested specific discounts in certain sectors to stimulate research in such sectors and the establishment of local industries.

Patenting Not Only Way

According to [pdf] Suma Athreye, professor at Essex Business School, Management Science and Entrepreneurship, University of Essex, United Kingdom, universities use multiple vectors of knowledge transfer, including publication, conferences and seminars, education and training, and consultancies with industry.

Privileging one vector over the others might cause displacement effects, she said. She underlined the difficulty for knowledge transfer offices in assigning value to patented inventions.

Patenting is the least important knowledge transfer activity for universities, she said, and it varies across countries and technology fields.

Catalina Martinez Garcia, deputy director, Institute of Public Goods and Policies, Madrid, Spain, said [pdf] that more than 50 percent of academic-invented patents are owned by firms in many European countries.

University patenting is not the only channel to protect and transfer academic inventions to society, she said. One advantage of university patenting is that it makes academic inventions more visible for and within the patent system for potential commercial partners, and to signal academic prior art, she added.

Fazilet Vardar-Sukan, professor at the Faculty of Engineering and Natural Sciences at Sabanci University, Turkey, said [pdf] the country is a modest innovator, and described the inherent weakness of the Turkish system, including a “one-size fits all” concept, rigid institutional structures restricting initiative taking, limited interdisciplinary and institutional cooperation, and limited cross-fertilisation for research and economic output.

Anne Lane, executive director UCL Business PLC, London, UK, said [pdf] a 2014 report showed that almost 80 percent of UK universities viewed patent costs as a barrier to filing, while another study found that reducing patent fees increases the number of patent applications, but not the levels of innovation.

A PCT fee reduction might result in cost savings for UK universities, but it is not clear if this would increase the ability to access the patent system, she said.

PCT Fee Reduction Not Enough

Marli Elizabeth Ritter dos Santos, director of the Technology Transfer Office of the Pontifical Catholic University of Rio Grande do Sul, Porto Alegre, Brazil, said [pdf] reducing the PCT fees for universities would appeal to institutions with a tight budget, but underlined the importance of the quality of patents.

More than the value of the PCT fees, the cost of national phases is a major obstacle to technology transfer, she said, suggesting that WIPO negotiates with regional and national offices to reduce costs.

Workshop participants underlined the need to tailor the needs according to the national context and restrain from copying a model which might have worked in another country, such as the successful model of the United States.

Measuring the innovation output of university cannot rely only on the number of patent filings, but should be based on more qualitative measures, including the quality of patent filings, Campbell said.

Bo Stenhuus, commercial officer, Research and Innovation Technology Transfer at the University of Copenhagen, Denmark, pointed out the enforcement issues, and whether government funds could go to universities so they can enforce patents. It is mostly unlikely that universities enforce their IP rights, he said, because it is very expensive and would make for bad public relations if the university lost money against a company. Being able to enforce patents would add credibility to university patents, he said.

Fee Reduction Beneficial for University: Open Question

Speakers at the workshop had very nuanced answers concerning the direct benefit of a PCT fee reduction for universities, and if such a reduction would encourage more patent filings.

Campbell said although costs can be inhibitory “bucketing” whole developed countries or developing countries and all size of universities makes it difficult to evaluate the potential effect of fee reduction.

Vardar-Sukan added that there could be other monetary incentives, and the aim really should be to improve quality instead of “playing for numbers.”

Martinez Garcia pointed to a lack of empirical evidence to show a potential beneficial effect. The PCT phase might be more important for universities and small and medium-sized enterprises than for firms to find commercial partners, she said. Countries such as Spain and Portugal which exempted public universities from patent fees could serve as case studies, she added.

Brazil Proposal: 50% Off for Developing Country Universities

The Brazilian proposal suggests a 50 percent PCT fee reduction for developing and least-developed countries, and a 25 percent PCT fee reduction for developed country universities.

According to the proposal those fee reductions would stimulate the use of the PCT system by universities and increase the geographic diversity in the demands for patent protection and of PCT international application filing activities.

A ceiling of applications would be applied per university per year, 20 applications for developing country universities, and 5 applications from developed country universities, according to the proposal.

PCT fees and Reductions

According to WIPO, PCT applicants pay three types of fees: an international filing fee of CHF 1,330 (US$ 1,330); a search fee varying between CHF 150 to CHF 2,000; and “a small” transmittal fee which varies depending on the receiving office.

After a PCT application is made, the granting of patents remains under the control of the national or regional patent offices, according to WIPO.

To encourage the use of the PCT system by applicants from developing countries, “fee reductions of 90% for certain fees, including the international filing fee, are available to natural person,” and the same reduction applies to nationals or residents of least-developed countries.

Image Credits: WIPO