Considerations for International Inventions – Foreign Filing Licenses

Guest Post by Brent M. Dougal and Philip M. Nelson.  Dougal and Nelson are IP Attorneys with Knobbe Martens Olson & Bear LLP.

In today’s age of international commerce, product development often takes place on an international scale.  Many companies have design centers in multiple countries, with design teams that span the globe.  What are the patent implications if an invention is developed in China or some other country outside the U.S. and the company wants to obtain international patent protection?

U.S. law requires that inventors obtain a “foreign filing license” before filing foreign patent applications on inventions that occur in the U.S.  This allows the government to assess, for example, whether the technology could threaten U.S. national security.  Some other countries such as Spain (Article 119-122), Italy, and India also require foreign filing licenses for inventions developed domestically but for which foreign patent protection is sought.  In countries that provide foreign filing licenses, these licenses generally do not issue quickly or efficiently.  Thus, it is advisable to file first in the country of invention to avoid the delay and difficulty of obtaining the foreign filing license. (The US and Canada are notable exceptions to this general rule.)

By contrast, other countries, such as China (Article 20) and Vietnam, have no provisions for obtaining a foreign filing license. These countries require that patent applications on domestic inventions be filed first domestically.  In China, domestic inventions include all inventions occurring in China, whether or not funded by a foreign company.  Failure to file in China may lead to invalidity of a corresponding Chinese application and criminal penalties if the invention relates to security or other vital state interests.  One way a U.S. or English-language company can deal with this requirement is to file a Patent Cooperation Treaty (PCT) application in English with the Chinese Patent Office as the PCT receiving office.

Canada has one of the most unique foreign filing laws.  There a foreign filing license is only required—and indeed, only available—if the inventor is an employee of the Canadian government. Instead of review by a separate government entity as in the U.S., Canadian government employees must obtain permission of the minister of his or her department.

Other countries, including the U.K. and Germany, have limited restrictions related to national security and military applications (requirements for EPO countries can be found here).  Thus, a foreign filing license is only required for select technologies.

The table below summarizes many of the current restrictions, breaking down the listed countries into four main groups:

 

Foreign Patent Filing Restrictions

None

Limited to National Security and Military Applications

License Required 

First Filing Must be Domestic

Countries

Argentina, Australia, Austria, Brazil, Hong Kong, Indonesia , Ireland, Japan, Liechtenstein, Mexico, Monaco, New Zealand, Philippines, Poland, Portugal, South Africa, Sri Lanka, Switzerland, Taiwan, Thailand, Venezuela

Belgium, Czech Republic, Denmark, Finland, Germany, Israel, Korea, Luxembourg, Netherlands, Slovak Republic, Sweden, United Kingdom

Canada1, France2, India, Italy, Malaysia, Singapore, Spain, United States

Belarus, China, Cyprus3, Greece3, Hungary3, Kazakhstan, Russia, Vietnam4

1 Only required for government employees.

2 Only applies where inventors are French nationals or the company’s principle place of business is France (Article L. 614-18, 614-20). A European patent application can also be filed as the first filing without obtaining a foreign filing license.

3 First filing must be domestic where inventors are nationals (and in some cases permanent residents).

4 Also requires Vietnamese inventors without an obligation to assign to file first in Vietnam.

Though only a limited number of countries have foreign filing restrictions, those that do include many significant markets, not to mention the world’s most populous countries.  As companies continue to expand internationally, their attorneys will need to take an international perspective.  In order to preserve international rights, attorneys should explore inventorship and the foreign filing laws of the country of invention early on in the disclosure and application preparation process.

__________________________

This discussion is provided without guarantees and is not to be considered legal advice. We highly recommend seeking legal counsel in the country of invention.  The information has been compiled with the assistance of foreign associates from various countries, with some independent verification.

Any invention which may have a military application or could be considered important to national security is likely restricted not only by a country’s patent laws, but also by export laws, which are not addressed here.  We highly recommend seeking legal counsel in the country of invention.

22 thoughts on “Considerations for International Inventions – Foreign Filing Licenses

  1. 6

    The statement that there is no provision for obtain a foreign filing license in China is no longer correct. My understanding is that the third revision to the Patent Law of the People’s Republic of China law (2010) implemented such a provision (Article 20).

    “Article 20 Any unit or individual that intends to apply for patent in a foreign country for an invention or utility model accomplished in China shall submit the matter to the patent administration department under the State Council for confidentiality examination. Such examination shall be conducted in conformity with the procedures, time limit, etc. prescribed by the State Council.”

  2. 5

    Since the U.S. foreign filing security clearance is almost always automatically provided shortly after the U.S. filing, at no cost to or effort by the applicants, what is the problem? In the rare case where the clearance is needed for filing in some other country first, or simultaniously, such as for joint inventors from different companies noted below, I was able to take a draft of the proposed application and walk it through the PTO security branch for a clearance in advance. Isn’t that still possible?

    1. 5.2

      what is the problem? In the rare case where the clearance is needed for filing in some other country first, or simultaniously, such as for joint inventors from different companies noted below, I was able to take a draft of the proposed application and walk it through the PTO security branch for a clearance in advance. Isn’t that still possible?

      The problem is that outside of “national security” issues the rule is completely daft. Other countries have figured that out. Why can’t we?

      1. 5.2.1

        So you would have seen no reason to object to prompt publications of patent applications on proximity fuses, radar, etc. in WWII?

    2. 5.3

      I faxed an application to the PTO and got a foreign filing license the same day, with a call to the licensing branch. It’s pretty straightforward.

  3. 4

    Is there a more ridiculous set of rules than this “foreign filing license” requirement?

    What a racket!

    I get the national security angle. But the number of applications that implicate “national security” is way, way less than 1%.

    And given that my First Amendment rights allow me to freely communicate all kinds of technical information to anybody in the world, what on earth is the point of criminalizing my failure to obtain a “license” when that information is deemed “related” to obtaining a patent in a foreign country? What is the logic?

    At least in the US (other countries can do what they want), let’s get rid of these dumb license requirements, except in those extremely rare cases where the potential harm to “national security” is “manifest” or something like that.

    1. 4.1

      Adding: this strikes me as an area of US patent law extremely ripe for reform. Who would object to moving our US “licensing” system closer to that of the UK or Germany, and why?

    2. 4.2

      “And given that my First Amendment rights allow me to freely communicate all kinds of technical information to anybody in the world, what on earth is the point of criminalizing my failure to obtain a “license” when that information is deemed “related” to obtaining a patent in a foreign country? What is the logic?”

      Quite a bit of information is export controlled. So you can’t file outside the U.S. until you have a license, or outsource the drafting of the application.

      I doubt protein bits or DNA fragments are export controlled, so don’t worry.

      1. 4.2.1

        Quite a bit of information is export controlled.

        That’s a meaningless sentence. What’s “quite a bit” in this context? Seems to me that it is equal to “pretty much nothing.” Essentially nobody in this country who communicates oversease on a regular basis worries about information they are “exporting”, nor should they. I sure don’t. Nobody I know does. Why would we?

        Then again, I’m not plotting to destroy the country. Unless of course my opposition to software patents means I’m a menace to “national security” <— yes, that is a joke that most people will get

        you can’t file outside the U.S. until you have a license, or outsource the drafting of the application.

        Uh … I already know about this dumb rule. What do you think I was commenting about?

        Anyways, thanks for the valiant effort to find some common ground. You keep fighting to keep this dumb rules in place. Meanwhile, I’m going to keep communicating all sorts of new technical ideas to my overseas friends because, well, I’m perfectly free to do that. Enjoy.

        1. 4.2.1.1

          That’s a meaningless sentence. What’s “quite a bit” in this context? Seems to me that it is equal to “pretty much nothing.” Essentially nobody in this country who communicates oversease on a regular basis worries about information they are “exporting”, nor should they. I sure don’t. Nobody I know does. Why would we?

          It’s considerably more than “essentially nobody,” MM. A few of the areas covered by export controls affect quite a few high-tech international companies. I had to worry about export controls (at least a little) in a previous life. At least the big companies who are affected by the export controls are quite aware of them, and worry about them.

          That said, I agree with you that the foreign filing license requirement is largely a pointless waste of resources, and really only made sense (if ever) in a pre-Internet age. It should be reserved for those technology areas that are already covered by export restrictions, of which there are already at least two different sets, as I recall. The people who deal in the relevant technologies already know about those restrictions – let them be responsible for obtaining whatever licenses are needed.

          1. 4.2.1.1.1

            It’s considerably more than “essentially nobody,” MM. A few of the areas covered by export controls affect quite a few high-tech international companies.

            Divide the number of those corporations by the population of entities who communicate information to people overseas without worrying — and without needing to worry — about “export controls”.

            The fraction obtained is vanishingly small.

            That was my point. I’m not denying that some information is “export controlled” nor am I denying that some information should be “export controlled.”

            In any event, we seem to agree that the current rules are dumb to the extent they present even potential traps for people who are posing zero national security threat.

            Given that their dumb, wasteful and indefensible, let’s get rid of them.

        2. 4.2.1.2

          “What’s ‘quite a bit’ in this context?”

          The list of information and technology that is export controlled is quite extensive. But as I said, I don’t think protein fragments and DNA bits are covered so you probably have nothing to worry about.

          “Essentially nobody in this country who communicates overseas on a regular basis worries about information they are ‘exporting’, nor should they. I sure don’t. Nobody I know does. Why would we?”

          Well, in the company of 330,000+ employees where I work, we “worry” about it every day. Then again, we’re doing work that’s a little more important than cloning enzymes or whatever it is you do all day.

          “You keep fighting to keep this dumb rules in place.”

          I’m not “fighting to keep this dumb rule in place.” It’s the law. And I follow it.

          “Meanwhile, I’m going to keep communicating all sorts of new technical ideas to my overseas friends because, well, I’m perfectly free to do that.”

          I’m sure the world is eagerly anticipating your new technology for splitting amoebas. Feel free to shout it from the mountain top.

          “Anyways, thanks for the valiant effort to find some common ground.”

          Wasn’t doing that at all.

  4. 3

    The statement that China does not have a foreign filing license process is incorrect. Although Art. 20 does not refer to a foreign filing license, Art. 20 provides for obtaining a “secrecy examination” for any invention accomplished in China where a foreign application is intended. This procedure was added by a change in the law in 2008 or 2009, I think.

    Regarding multi-country issues, at least one large company I know of deals with that situation by first requesting a US foreign filing license, then submitting a request for an IN or elsewhere foreign filing license using the same materials provide to the USPTO.

    1. 3.1

      If you need to file first in IN, just request the US ffl and file a provisional in IN. For most cases, it’s barely even ministerial.

  5. 2

    A tricky situation comes up when an invention is conceived jointly in two different countries, BOTH of which require the application to be filed domestically in their country first (e.g. joint invention made in both US and India). Which country’s security laws get priority, particularly if a statutory bar is coming up? I suspect that most multi-national companies – if security clearance couldn’t be obtained in time – would take a monetary value approach and choose to file in the US first to avoid forfeiture of any resulting US patent, and leave their Indian employee-inventors to take their chances on any possible criminal prosecution.

    1. 2.1

      The real issue is that for multinational companies, these rules no longer make sense. The invention is a collaboration between inventors in different countries and therefore the disclosure has already occurred. The laws were made when companies weren’t multinational. Now, if you really are in an industry that may have inventions with national security interests, you should not have inventors in multiple countries. The vast majority of companies aren’t in these areas, though.

      1. 2.1.1

        I had a similar problem with US and Russian inventors. Whether or not the rules make sense, they are still the rules (for now).

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