Winter may be coming to an end, but the glacial pace of examination of patent applications at the UK Intellectual Property Office (IPO) does not show any signs of abating. So much so, that the IPO has now withdrawn the service displaying expected examination dates, the following having been posted on their website.
“The Office is in a situation whereby the volume of work outstanding exceeds our ability to process this work in normal expected time periods. This is particularly true of examinations, where reasons for this include resource issues and higher priority work, e.g. searches. The unpredictable nature of the volume and the subject matter of new applications also makes it very difficult to estimate on an individual basis when examination reports are likely to issue, so regrettably we are unable to offer a predicted date.”
Oh dear. Clearly, the IPO is overwhelmed at the moment, the examining division struggling to cope with the sheer volume of applications being processed at the moment.
So, what is the reason for the snail’s pace of progress. Evidently, more applications are being submitted than can be examined within a reasonable period, but why? Presumably the Patent Box scheme has had more than a small part in this increase in application volume.
The Patent Box scheme allows companies to reduce their rate of corporation tax payable on profits earned after 1 April 2013 from patented inventions to 10%. The savings are being phased in over four years, but this means that a substantial number of patent applications are being submitted in order to make use of the possible savings on offer.
The scheme was introduced to encourage companies to locate their research and development facilities in the UK, bringing the associated benefits to economic growth with them. Is this economic growth being felt then, and are we reaping the rewards of the scheme?
Clearly someone thinks so, since the patent box schemes across Europe are presently under investigation by the EU, the suggestion being that the tax reductions on offer are damaging competition across the Common Market, being in breach of the Code of Conduct of Business Taxation, a non-binding, albeit highly persuasive code on business taxation conduct for member states.
The investigation is due to complete by the end of 2014, but as there are several countries operating their own patent boxes, some with even greater corporation tax reductions than the UK. Indeed, given that the UK government has strongly backed the Patent Box relief, then it would appear as though such schemes are likely here to stay.
Returning to the issue of the slowdown in the examination of UK patent applications, it must not be forgotten that it is indeed possible to accelerate examination of patent applications for certain commercial reasons, such as potential infringement of your invention, or the need for accelerated grant in order to secure investment. Indeed, in these situations, the IPO has set a target of responding to 90% of examination reports issued in connection with accelerated cases within 2 months.