Overview
- To make up for arbitrary delays in the issuing of patents by the Canadian Intellectual Property Office, Canada has passed laws introducing patent term adjustments (PTAs).
- The Canada-United States-Mexico Agreement (CUSMA) of 2020 made patent term modifications mandatory, even though Canada had never previously done so.
- On March 28th, 2023, Bill C-47 (which contains the PTA provisions) was introduced in Parliament. On June 22nd, 2023, it was given royal assent. Unless the Governor in Council orders an earlier date, PTAs are expected to go into effect on January 1, 2025.
- Bill C-47, which is referenced as the Budget Implementation Act, 2023 No. 1, is a so-called omnibus bill, meaning that it addresses amendments to several different pieces of legislation. Bill C-47 is currently undergoing second reading in the House of Commons.
- In July 2023, Canada will be implementing a Patent Term Adjustment (PTA) system that applies across various fields, including Agriculture, Pharmaceuticals, Fine Chemicals, and other foundational technologies such as Information Technology (IT).
Patent Term Adjustment -is like a bonus time given to the owner of a patent. If the process of getting the patent takes longer than usual because of delays from the government, the owner can get extra time added to the normal length of their patent. This is to make up for the time they had to wait due to reasons beyond their control. It’s a way to be fair to the patent owner when things take longer than expected.
Canada-United States-Mexico Mandate
Prior to the North American Free Trade Agreement (NAFTA) being replaced by CUSMA( Canada-United States-Mexico Agreement )on July 1, 2020, Canada’s patent legislation did not offer compensation to patent owners for delays in the processing of a patent application. However, in order to make up for unjustified delays in the issue of a patent, Parties are required by CUSMA’s Article 20.44 to offer changes to the patent term.
CUSMA defines a “unreasonable delay” as “a delay in the issuance of a patent of more than five years from the date of filing, or three years from the request for examination”, whichever is later. Delays that can be directly linked to the patentee may be excluded from this evaluation.
Bill C-47: Introducing Patent Term Adjustment
On June 22, 2023, Bill C-47, a piece of legislation establishing a general patent term adjustment (PTA) system, was approved by Canada’s federal government. Without any substantive changes, the provisions revising the Patent Act to include PTA were passed and will take effect no later than January 1, 2025.
Eligibility for a Patent Term Adjustment
To be eligible for the grant of an additional term, the filing date of the application must be on or after December 1st, 2020. The patentee must apply for an additional term within three months of the patent being issued and pay a prescribed fee (which has not yet been set).
Duration
The duration of the PTA term will be determined by first calculating the number of days between the day the patent was issued, and the later of:
- five years from the filing date of the patent application (or from a “prescribed day” in the case of a PCT national phase application or a divisional application); and
- three years from the day that examination was requested.
The “applicable day” is the date of filing of the patent application except for divisional applications and PCT National Phase applications. For the latter, the definition of “applicable day” is to be determined in upcoming regulations.
Duration of Additional Term
The calculation of the additional term is subject to deductions to be determined under future regulations. It is presumed that these deductions will be in accordance with Article 20.44 of the CUSMA, which under paragraph 4 states that the following periods may be excluded from the determination of a patent term adjustment:
- Periods of time that do not occur during the processing or examination of the patent application by the patent office;
- Periods of time that are not directly attributable to the patent office; and
- Periods of time that are attributable to the patent applicant.
Reconsideration of PTA term
The proposed amendments to the Patent Act additionally CIPO to reconsider the duration of a PTA term that has been granted. This reconsideration can occur on CIPO’s own initiative or on application by “any person”. Notably, on reconsideration, CIPO will only have the authority to shorten the duration of the additional term, but not to lengthen the PTA term.
Additionally, “a person” will be able to bring an action in the Federal Court against a patentee for an order to shorten the duration of a PTA term that has been granted. Again, the proposed amendments make no mention of a patentee being able to bring an action to lengthen a PTA term.
No Double Counting with CSPs
A Certificate of Supplementary Protection (CSP) extends rights for delay in the process of regulatory approval of medicines. PTA term runs concurrently with CSP term. CSP term and PTA term do not run one after the other.
Maintenance Fees
Annual patent maintenance fees will be due during the PTA term. It is noted that no maintenance fees are due during a CSP term.
Impact on CSP term
Notably, for pharmaceutical patentees, any PTA term would run concurrently with any Certificate of Supplementary Protection (CSP) term. Running the terms concurrently is inconsistent with the different objectives of these regimes. While CSP term is intended to restore patent term lost over time spent in research and development and regulatory approval, PTA term is intended to compensate for delays before the patent office. If passed, Canada will be offside with its US trading partner, which runs its equivalent additional patent terms consecutively.
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