What is patent annuity?

  • Patent annuity is the fee that is paid to a patent office to maintain a granted patent or patent application in force. It is also known as renewal fee or maintenance fee.
  • In countries where renewal fee or continuance fee is to be paid annually, it is sometimes called patent annuity.
  • Patent laws differ based on regulations concerning not only the amount payable but also the promptness of the payments.

How to make patent annuity payment?

  • Annuity or patent renewals are paid to the respective patent and trademark offices (PTOs) as per the fees stipulated by the patent law of a country. The renewal fees can be paid by different methods such as online fee payment, wire transfer, check, and cash. Certain countries require the payment to be made only by a local patent attorney or agent, e.g., China, Korea, Japan, etc.

How does patent annuity payment differ from one country to another?

  • Country-wise patent laws stipulate distinctive guidelines both with respect to the amount payable and the timeliness of payments.
  • Some jurisdictions require the payment of fees for pending patent applications and other countries only after the patent is granted or issued.

How to calculate patent annuity payment?

  • Annuity fees are due at different intervals depending on individual jurisdictions; some patent renewals are calculated annually.
  • In some cases, the payment of annuity, provided that the patent is still valid, coincides with the grant date.
  • In the USA, patent renewals are paid 3.5, 7.5, and 11.5 years from the date of grant.
  • In the European Union, the fee is paid to the European Patent Office (EPO) until the patent is granted.
    • If the patent application is published by the EPO during the course of the second year after the filing date of the application, renewal fees are payable for the third and subsequent years only. This means that one does not pay annuity fee for the first two years.
    • The renewal fee is then calculated from the month the application was filed at the EPO, and the due date for payment is the last date of that month.
    • Once a European patent is granted, then the subsequent renewal fee is paid to the corresponding European countries where the applicant wishes to validate the patent.

What is the importance of making annuity payments?

  • Annuity payments are a necessary part of maintaining an intellectual property portfolio without lapse.
  • Annuity payments encourage an applicant and patent holder to re-evaluate the economic value of the application and patent on a frequent basis.

What are the challenges in making patent annuity payments in-house?

  • Processing patent annuities in-house means managing an international network of agents, which involves a lot of risks. Managing the network of agents by an outside counsel is expensive. Therefore, using an annuity service provider is an attractive option. However, not all providers of annuity services allow visibility into the cost structure. It could be hard to track PTO fee adjustments in the various jurisdictions as well, and fees are often hidden or higher than anticipated, making budgeting difficult.
  • Acquiring a patent is in itself a time-consuming and tedious task involving many trial stages. In view of the commercial importance of a patent, as well as the technological and business risks involved, it becomes vital to protect it during its tenure by timely renewal payments.
  • The level of administrative work related to the maintenance of patents is grossly understated. It is a complex task, which is why many patent owners engage the services of renewal service providers.
  • Making annuity payment demands particular expertise and creates considerable work and added expense if carried out directly with national patent offices around the world.

What will happen if the patent annuity fee is missed out?

  • Payment of a renewal fee may still be validly made up to six months (commonly referred to as the surcharge period) in a few countries from the ultimate deadline, provided that an additional fee equal to 50% of the belated renewal fee is paid within the same period.
    • If payment of the belated renewal fee and the additional fee is made within the surcharge period, then the application will remain in force.
  • Failure to pay a renewal fee by the end of the surcharge period will result in the application/patent lapsing. In certain circumstances, it is possible to restore the right in a few countries.
    • These conditions may include payment of the outstanding renewal fees and making a request for restoration to the patent office with reasons and evidence explaining the nonpayment of renewal fees.

Patent Annuity Services from MaxVal

  • MaxVal’s Annuity Payer™ is a cost-effective and intuitive patent annuity management solution powered by MaxVal’s patent experts and the AP web-based platform. Annuity Payer patent annuity management solution offers cost-effective annuity payment with simplified workflow and transparent fee structure.