The reform of the french patent system

On May 23rd, 2019, the law relating to the “Action Plan for the Growth and Transformation of Enterprises”, known as PACTE, was published, announcing profound changes in the French industrial property system1, which have since been clarified by several implementing texts. With regard to patents, this Law introduced before the INPI the examination of inventive step (I), which constitutes, with the introduction of an opposition procedure by the ordinance 2020-116 of February 12th, 20202 (II), the essential part of the reform. These measures complement a decree of January 8th, 2020, which modified the utility certificate system (III) and created the “provisional patent application” (IV).

The stated objective of this package of measures is to strengthen the quality of the French patent. What about its substance?

The reform of trademark law, implemented through the order no. 2019-1169 and the decree 2019-1316 of December 9th, 2019, was presented in our two previous newsletters.

Specified in Decree n° 2020-225 of March 6th, 2020.

1. EXAMINATION OF THE INVENTIVE STEP OF PATENT APPLICATIONS

What changes: until now, the INPI could only refuse the grant of a patent on the grounds of exclusion or exception to patentability or manifest lack of novelty. Only the judge was competent, at the litigation stage, to assess the lack of inventive step. However, the Loi Pacte henceforth authorises the INPI to reject a patent application on this ground.

This change will apply to patent applications filed as of May 23rd, 2020. It will therefore be implemented concretely as of 2021, taking into account the deadlines for issuing preliminary search reports.

In practice: this will result in a more complex examination of patent applications with a more uncertain outcome, whereas their vast majority resulted so far in a grant by the INPI. In return, patents, once granted, should be less exposed to cancellation3, especially if they have also overcome the opposition test (see hereafter).

This evolution should also lead to a convergence of INPI examination practices with those of the EPO and thus offer greater legal certainty to holders. The INPI also seems to be considering assessing inventive step, in particular according to the “problem-solution” approach practiced by the EPO for nearly forty years, and which has been adopted by the French courts4.

In other fields as well, such as that of intellectual and mathematical methods, the case-law of the Paris Court of Appeal seems to have adopted for the past few months the EPO’s approach5. The INPI could join this movement.

Nevertheless, applicants will now have to assess the opportunity to file an application when it has low chances of being granted, or even opt for other means of protection such as the utility certificate, which system is also modified (see below). In any case, it will be preferable to file a patent before May 23 if the invention is questionable in terms of its inventive step.

The other expected effect of this reform could be a decrease in the attractiveness of the French patent compared with the European patent, and a questioning of the classic strategy of first filing in France, in favour of a first European filing. Nevertheless, the fee of the preliminary search report, which is very competitive in France, remains unchanged6, as does its quality, as the INPI continues to subcontract it to the EPO. Furthermore, in the event of a subsequent extension at the European level, applicants will still be able to benefit from the reimbursement of the search fee by the EPO. All of these factors should allow the French patent to remain attractive, but will there be an interest in maintaining it through to grant stage? The answer will depend in particular on the quality of the national examination, as well as on the duration of the procedure before the INPI and the Court of Appeal compared to that of the EPO.

Finally, if the European patent with unitary effect was one day to enter into force in spite of the multiple obstacles that stand in its way, it should be remembered that the dual protection by French and European patents will be authorised in this context; it will allow the patentee to bring an action in front of the national court on the basis of their French patent when infringement is committed only in France, rather than the Unified Patent Jurisdiction (UPJ) on the basis of their European patent, with a risk of cancellation of the title for all the countries covered.

TO KEEP IN MIND: review its invention memoirs current inventory, in order to decide whether a French patent has to be filed before May 23rd, 2020 (without in-depth examination), or afterwards.

3. According to a statistical study by Pierre Véron on the period 2000-2009, 31% of French patents were cancelled by the courts and only 21% of European patents.

4. See in particular TGI Paris March 11th, 2016, PIBD 1053 III 536

5. CA Paris, pôle 5-2, November 22nd, 2019, Bull ; pôle 5-1, May 21st, 2019, Thales, appeal pending

6. €520, or €260 for beneficiaries of fee-rate reductions, instead of €1350 for a direct European patent

2. CREATION OF AN OPPOSITION PROCEDURE BEFORE THE INPI

What changes: while the examination of the inventive step – already well known from the French courts – will profoundly modify the practice of the INPI regarding the grant of patents, the reform adds the implementation of an opposition procedure before this same Office, which allows any third party – without justifying an interest to act – to challenge the validity of a patent, within 9 months after its granting. This procedure applies to any patent granted from April 1st, 2020 (i.e., including patents that have not been subject to an upstream inventive step examination).

An opposition may be based on grounds of lack of patentability (exceptions to patentability, exclusions from patentability, lack of novelty or inventive step), insufficient description or extension of the subject of the patent beyond the content of the application. It is subject to a fee of 600 €. When several oppositions are filed against the same patent, they are joined ex officio.

After a first examination of admissibility, the opposition takes place in 4 phases: a first “information phase” (which will begin not earlier than after the expiry of the 9-month-period), during which the proprietor of the patent responds to the opposition, followed by the notification by the INPI, within 3 months, of a “notice of investigation” (the validity of the patent is only examined in the light of the arguments raised by the opponent), after which one or two further exchanges between the parties take place during a “written debate phase”, and, finally, a potential oral phase.

The INPI will have to make a decision within 4 months of the end of the investigation.

The combination of the periods of these successive phases could in theory lead to an opposition procedure lasting more than 20 months (the Intellectual Property Code authorizes the INPI to set deadlines of 2 to 4 months to the parties). However, the INPI seems to favour a faster processing time of about 15 months. These estimated times are close to those of a “dry” nullity action before the Courts.

If the opposition is recognized entirely or partly founded, the INPI will pronounce the total or partial “revocation” of the patent (a new concept in French industrial property law but which will have the same absolute and retroactive effect as “nullity”7) or its “maintenance in a modified form”. It can be assumed that partial revocation will be pronounced when the patentee has not proposed an acceptable amendment to his patent during the procedure, and maintenance in a modified form when the INPI will simply ratify the modifications proposed by the patentee (in this respect, the patentee will be able to file several sets of modified claims during the procedure, corresponding to main and subsidiary requests as before the EPO, the modifications being accepted only if they meet a ground for opposition). Following a partial revocation, the patent proprietor must submit a modified set of claims to the INPI; its potential rejection by the INPI may give rise to an appeal before the Court of Appeal.

Finally, the texts provide that, in principle, each party shall bear its own costs incurred in the procedure. However, the INPI may also decide to distribute them differently for reasons of equity, within the limit of a prefixed scale.

In practice: This new opposition procedure (in particular its oral phase) is directly inspired by the one which apply before the EPO, but also by the traditional inter partes procedures before the INPI.

However, it differs from the opposition before the EPO on several major aspects:

– The INPI’s provisional opinion (“the notice of investigation”) will be notified by the INPI immediately after the patentee’s first reply, whereas it is addressed by the EPO at the end of the procedure.

– In the case of a partial revocation, the modified claims must be submitted by the patentee (without any particular deadline) to the INPI for assessment following the opposition procedure, thus avoiding the opponent’s contradiction; the opponent shall be particularly vigilant, even if it means appealing against the INPI’s decision validating the modified claims, if they do not satisfactorily reflect the scope of the opposition decision. A subsequent limitation of the patent will only be possible after the publication of the new patent specification.

– It will not be possible for a third party sued for infringement to intervene in a pending opposition.

– The INPI will not have the possibility to prosecute an opposition ex officio in the case of a withdrawing of the opposition.

– The opposition will be suspended in the case of a nullity action pending on the day of its filing, or at the request of the parties for up to 12 months. The judge seized of a nullity action while an opposition is pending may, for his part, stay the procedure without being obligated to do so.

– The appeal against the opposition decision will not be brought before a board of appeal internal to the INPI as before the EPO; it will be an appeal for reconsideration before the Paris Court of Appeal. And this appeal will have a devolutive effect, which will allow the opponent to add new grounds for opposition and new prior arts (as in a judiciary action for nullity).

It will, from now on, be necessary to define the best strategy to obtain the invalidation of a patent, between an opposition and a judiciary action for invalidation. It is not certain that the cost will be very different, as no fees have to be paid before the Courts. However, the issue will be limited to the question of validity, without the risk of a counterclaim for infringement or unfair competition. Furthermore, it will be possible to bring an action before the INPI without having to prove an interest in acting, or even by using a straw man, unlike a legal action for nullity.

In any event, this reform further reinforces the utility of a competitive intelligence in order to identify patents granted to its competitors and be able, if necessary, to challenge them in time through an opposition procedure which is framed by a very limited time window (9 months). The firm is at your disposal for any question relating to the implementation of such a watch.

3. CHANGES TO THE UTILITY CERTIFICATE SYSTEM

What changes: the utility certificate is a traditional alternative to patent, adapted to innovations with shorter life cycles since it confers a shorter duration; it has the advantage of being inexpensive and exempt from patentability examination and search report at its filing stage, hence of an easier access. It confers in principle the same protection as a patent. Nevertheless, in order to be able to subsequently bring an infringement action on its basis, its holder must request a search report from the INPI, which constitutes a major disadvantage since the validity of the certificate remains subject to considerable uncertainty up to this stage. The Loi Pacte brings several changes to the utility certificate system.

On the one hand, it extends its duration from six to ten years (extension applicable to any utility certificate less than six years old on January 10th, 2020).

On the other hand, whereas it was only possible to convert a patent application into a utility certificate application during the examination procedure, the reverse is now also possible. The request for conversion must be filed within eighteen months from the application filing or priority date and, in any case, before the completion of the technical preparations for publication. It results from this mechanism that, unlike a patent application filed as such at the initial stage, a patent application resulting from the conversion of a utility certificate application will often not have its preliminary search report at the publication stage. This will increase the time taken for examination and grant.

In practice: these amendments, balanced against the introduction of the examination of the inventive step of patent applications by the INPI, may induce adjustments in the filing options between patent and utility certificate.

The filing strategy will have to be defined bearing in mind that the utility certificate is not subject to the inventive step examination nor to the opposition procedure, contrary to what was envisaged during the preparatory work for this reform. Greater uncertainty as to its validity will therefore persist until its holder decides to invoke it against a third party in an infringement action, where it will have to provide a search report.

4. CREATION OF THE PROVISIONAL PATENT APPLICATION

What changes: the provisional patent application is created by Decree n°2020-15 of January 8th, 2020. It can be filed before the INPI by producing a request for grant, a description, drawings and payment of the filing fee within one month, the claims and the summary being optional. Within a period of 12 months from its filing or its internal priority date, its owner may “bring it into conformity”, i.e. convert it into an ordinary patent or utility certificate application, by producing the claims and paying research fee. Failing this, the provisional application shall be deemed withdrawn.

This mechanism will enter into force on July 1st, 2020.

In practice : compared to a patent or utility certificate application, the only interest of this provision lies in the possibility of further delaying of certain documents and in particular the claims, since a traditional patent application does not require claims to benefit from a filing date either.

However, the applicant should not neglect the drafting of his description, since it cannot be subsequently modified and will have a major impact on the content and scope of the future claims. In practice, this often leads to having to limit the subject matter claimed to only the combination of features initially described, without being able to use more generic formulations or to dissociate the essential features from those which might be optional. This tool therefore proves to be risky, and should only be considered in exceptional cases, for example in the event of imminent disclosure in an exhibition or a scientific publication. As a result, considering that a disclosure made on the same day of the application is not opposable, an urgent drafting of a patent with even a brief set of claims remains an option to be considered.