EPO reforms feeding through to grant, backlog and opposition numbers, data analysis reveals
Recent years have seen a number of major changes at the European Patent Office, driven by the management team headed up by office president Benoît Battistelli. As anyone who keeps an eye on Europe’s IP landscape will know, many of the reforms during the Battistelli era have been highly controversial, especially internally; with a significant proportion of staff coming out strongly against moves to, among other things, increase productivity while remodelling salary and benefits packages.
As President Battistelli sees out his final months, the big question is how much of an impact the changes have had. Well, if research by James Ward and Frances Wilding, partners at Haseltine Lake LLP, is correct, the answer is a great deal. In the following overview of detailed number-crunching they have done, the pair explain that the amount of grants the office made in 2017 is likely to have exceeded 100,000 for the very first time, while the examination backlog could be on the way down; though the number of oppositions is on the rise. What the numbers cannot tell us is whether there has been any impact on the quality of the rights the EPO issues – that, of course, will always be subjective (IAM readers have always seen the office as being the leader of the pack among the IP5).
This is what James and Frances have to say:
The number of patents granted by the EPO in 2016 was much higher than in any previous year and a high level of grants was maintained in the first half of 2017. EPO grants are preceded by notices of allowance which, generally speaking, are issued about six months before grant takes place.
Based on the number of allowances in the first half of 2017, it seems likely that the level of grants will be even higher in the second half of 2017, with around 60,000 grants likely. This means that the total number of grants in 2017 will probably exceed 100,000.
More grants = more patents opposed?
Given the EPO opposition term of nine months from grant and given that by far the greater proportion of oppositions are filed towards the very end of the opposition term, increased grants could be expected to be followed nine months – three quarters of a year – later by an increase in the number of patents opposed.
Though the record of the number of patents opposed in the third quarter of 2017 is not yet finalised, it seems clear that this expected “more patents opposed” effect has occurred.
At the latest from the first quarter of 2017 there has been a marked increase in the number of patents opposed.
A continuing trend?
Perhaps with regard to a possible need to plan for more opposed patents and more oppositions, it could be of interest to understand the cause of the significant increase in grants in 2016 and 2017. It seems safe to say that this has not been driven by increases in the numbers of applications filed in prior years. The leap in grants is out of all proportion to any increase in applications filed.
It also seems safe to say that the increase in grants is not the result of decreases in the numbers of applications refused, withdrawn or deemed withdrawn. In general, those numbers have not decreased over time.
The EPO may have had increased resources to process applications in recent years, at least in terms of the numbers of examiners available. According to EPO annual reports, examiner numbers have increased fairly steadily - from 3,664 in 2007 to 4,310 in 2016, with an additional 83 examiners in 2016.
It is doubtful, however, that such a relatively slight and progressive increase in numbers of examiners could alone account for the increase in the numbers of applications processed to allowance, and hence to grant, which has occurred.
Rather, it seems evident that examiner productivity increases caused by the various measures introduced by the EPO have resulted in this significant increase in the numbers of applications processed to allowance and to grant.
Numbers of allowances in the years 2012, 2013 and 2014 vary from month to month and are even subject to “seasonal” variations (EPO activity seems to fall around the August and December holiday periods), but the general level of allowances was more or less constant from year to year.
The following years, 2015, 2016 and 2017 differ significantly. From year to year, allowances have stepped up in number. With a degree of smoothing out of the monthly and seasonal variations in the number of allowances per month, year-by-year upward steps in allowance numbers are more apparent.
Looking at the three-month moving average of allowances per month there is an indication of the upward steps, which seem to take place in the spring, perhaps following new policy, such as new examiner targets, implemented in January. The question remains as to whether these measures have had a knock-on effect on quality of examination.
Clearing the examination backlog?
The total size of the backlog of applications not yet processed to a conclusion is not known. A crude estimate is that it may be around four to five years in terms of numbers of applications filed per year.
In 2016 the number of applications processed to a conclusion (allowed, deemed withdrawn, withdrawn or refused) exceeded the number of new applications in that year. This was a rare event, though it seems likely that this will also be the case in 2017. It seems that the examination backlog is diminishing in size.
Clearing the opposition backlog?
The 2015 and 2016 EPO annual reports included information on oppositions relating to first instance decisions, which may not be legally final.
In each of the five years from 2012 to 2016 more opposition cases were decided in the first instance than the number of patents newly opposed, with a thousand more first instance decisions in 2016 than in 2014.
In total, from 2012 to 2016, the backlog of oppositions pending in the first instance fell by over 2,500. Annual reports also included information on the outcomes of the oppositions in the first instance – in general: patent revoked ca. 30%, patent upheld as granted ca. 30%, patent upheld in amended form ca. 40%.
Final results of opposition
According to the official record as represented by the EPO Online Bulletin (accessed in November 2017), which records opposition outcomes which become legally final (without or after appeal), the picture is not the same.
In general, in legally final decisions on oppositions, the outcomes were: patent revoked ca. 40%, patent upheld as granted ca. 20%, patent upheld in amended form ca. 35%. It seems that for final decisions, there has been a higher chance of revocation than for first instance decisions, arguing a tougher stance from the Boards of Appeal on granted patents than the Opposition Divisions.
Sources: All stats taken from EPO website here: http://www.epo.org/about-us/annual-reports-statistics/annual-report.html and here: http://www.epo.org/searching-for-patents/legal/bulletin.html#tab-1. Charts: To view the supporting charts that accompany this article, please visit: January 2018 Opposition Newsletter on Haseltine Lake website