Following a lengthy period of uncertainty, the President of the EPO recently submitted a document setting out the proposals for the level of renewal fees for the Unitary Patent to the Select Committee of the Administrative Council.
As many readers will be aware, the Unitary Patent will be enforceable and revocable throughout participating EU member states in a single action. In choosing whether to elect a ‘standard’ European Patent or a Unitary Patent, cost will be a key consideration for many patentees.
According to the document in question, the aim of the Unitary Patent Regulation is to arrive at a level of fees which is low enough to be attractive to users and high enough to ensure a balanced budget of the EPO. In an effort to meet this goal, the EPO proposes to set Unitary Patent renewal fees in accordance with the following three-tier structure:
- Years 3-5 (from filing): the level of the EPO’s internal renewal fees (IRF), which are payable on pending applications. This level has been proposed to provide consistency between the pre- and post-grant phase.
- Years 6-9: a transitional level between the IRF level and the year 10 level
- Year 10 onwards: a level equivalent to the total sum of the national renewal fees payable in the states in which European patents are most frequently validated (TOP level).
For the TOP level, the EPO has two alternative proposals: the TOP 4 level, i.e. the sum of the FOUR most frequently validated countries; and the TOP 5 level, i.e. the sum of the FIVE most frequently validated countries, together with a 25 per cent fee reduction for years 2-10 for certain patentees such as SMEs, universities and non-profit organisations.
Under the TOP 4 proposal, renewal fees in years 2, 5, 10, 15 and 20 would be: EUR 350, 810, 1175, 2830 and 4855, respectively. Under the TOP 5 proposal, the corresponding fees would be: EUR 350, 810, 1475, 3300, 5500. The difference between the TOP 4 level and the (non-reduced) TOP 5 level amounts to EUR 5630 over a 20-year patent term.
The EPO also proposes to introduce a renewal fee for the second year which would apply to the exceptional cases in which a patent is granted in the year of filing, and a 15 per cent reduction for patentees who offer licences of right.
The proposals may come as a disappointment to many since the vast majority of user associations consulted by the EPO were in favour of a TOP 3 fee level, and felt that a TOP 5 level would discourage the majority of patentees who currently only validate in three or four states. A further consideration that will influence patentees is the lack of flexibility of the Unitary Patent, in that unlike ‘standard’ European Patents validated in a number of states, costs cannot be reduced over the patent term by selectively allowing rights in individual countries to lapse. Therefore, for patentees who typically only validate in a few countries, or those who wish to retain flexibility in their markets of interest, a classical EP patent may still be a more attractive option.