Insiders Give New Patent Fee Policy a Cautious Welcome

Industry insiders have welcomed a recently-announced policy that focuses on cutting patent-related fees, saying that it will give further support to financially-strapped companies. Concerns have been raised, however, about the strictness of the requirements for individuals and companies applying for reductions in their patent application costs.

The policy, which was released by the Ministry of Finance and the National Development and Reform Commission, will come into effect on Sept 1. It aims to further reduce the burden on both companies and individuals applying for and maintaining patents.

Chen Xueying, secretary-general of the Quanzhou Intellectual Property Protection Association, said the new policy differs from the old one in that it allows organizations to save money if they make a collective application for patents, a Quanzhou local newspaper reported.

Chen said the reduction for single organizational patent applicants and owners has also increased under the new policy.

The patent fees reduced in the new policy include the annual fee payable in the six consecutive years following the authorization of a patent, and part of the filing cost. The new reduction percentage for single patent applicants and owners, including businesses, is 85 percent and group patent applicants and owners may receive a discount of 70 percent.

Zhu Xiduo, secretary-general at the Z-Park Non-governmental Science Technology Entrepreneurs Association, said the new policy means a further fee reduction for micro and small innovation startups, Beijing Business Today reported.

Micro, small and medium-sized enterprises make heavy capital investments in the research and development of technologies and products, and the return cycle on their investments is long, Zhu said, adding that the cost of patent filings following successful research and development can be prohibitive for such firms.

According to Beijing Business Today, available statistics show that the annual fee for maintaining an invention patent's 20-year validity in China is slightly less than that in Germany. However, it is 2.2 times that of the United Kingdom, 80 percent higher than in France, 70 percent higher than in Japan and 2.7 times higher than in South Korea.

Despite the likely benefits the new policy will bring for enterprises, insiders have questioned the strictness of its requirements for both individual and company applicants.

According to the new policy, individuals with an average monthly salary of less than 3,500 yuan ($525.55) in the year prior to their application, and companies whose taxable annual revenue was less than 300,000 yuan, are eligible to apply for the reduction.

Li Binglin, general manager of the patent division at Chofn IP, said the average monthly income stipulation of 3,500 yuan is problematic for many inventors, especially those working in cities such as Beijing and Shanghai, as monthly salaries in such places are much higher than the requirement.

He added that the 300,000 yuan requirement is also less than many small and medium-sized companies' annual taxable revenue. If companies cannot benefit from the preferential policies, their enthusiasm for filing patents will be dampened, Li said.

Chen from the Quanzhou IP protection association echoed the concerns around the strict requirement for companies, adding that larger companies, especially listed ones, would be unable to benefit from the patent-related fee reduction.

Source: China Daily