New Excess Claims Fees in Australia

This article first appeared in The Watermark Journal Vol 24 No 1 (March 2007)

The Australian Patent Office has implemented a five-fold increase in excess claims fees. Accordingly, applicants may now wish to consider strategies to reduce or avoid these charges.

Excess claim fees apply for each claim over twenty. The fee of A$20 per excess claim was first introduced in September 2002. However, for any application accepted (allowed) on or after 1 March 2007, the fee has now increased to A$100 (US$80, €60) per excess claim. Hence, the official fee payable upon acceptance of an application having, for example, 100 claims will increase by A$6,400 (US$5,000, €3,800).

The stated aim of the excess claims fee is to deter applicants from submitting unnecessarily large claim sets’. However, excess claims fees are calculated on the number of claims at acceptance of the application by the Examiner. The number of claims at filing is irrelevant. This means applicants may file a larger number of claims, delay the decision on which claims are ultimately to be granted and reduce or delete claims just prior to acceptance to reduce the excess claim fees payable. Importantly, we note that amendment to reduce the number of claims after acceptance by the Examiner (whether before or after advertisement or grant) will NOT reduce the fees payable.

To reduce the number of claims without losing any scope of protection may be possible. The most straightforward tactic is to ensure multiple dependency of claims wherever possible. This may have particular application to claims drafted in the US. Some less straightforward strategies available under the current legislation include filing a divisional application or an application for a Patent of Addition.

Where the number of claims in excess of twenty is particularly large (ie large enough that the excess claims fees outweigh the cost of filing a further application), the applicant may delete the excess claims immediately prior to acceptance and simultaneously file a divisional patent application directed toward those deleted claims. However, this would ultimately result in extra maintenance fees for those claims, and their granting would be delayed.

The above option may be very useful where an application having a large number of claims has inadvertently proceeded to acceptance without an amendment to reduce the number of claims: a divisional with fewer claims is filed and proceeds to acceptance and grant, while the application with excess claims may be allowed to lapse.

Another option is the filing of a Patent of Addition which may be granted in respect of claims considered to be novel, but not necessarily inventive, over the original or ‘parent’ patent. The Patent of Addition does not attract maintenance fees while the parent is in force. However, this will obviously only be useful where a number of the excess claims might be considered to be inventive when compared with the claims granted in the parent.

We also note that the current legislation leaves it open for the applicant to: 

• prosecute all claims, until the Examiner has no substantive objections but maintains a formality objection such as a withheld Notice of Entitlement; 
• make an amendment to delete some or all dependent claims such that there are no excess claims; 
• address the formality objection such that the application is accepted; and 
• subsequently file a further post grant amendment to re-insert the dependent claims.

In this case, the fee is calculated on claims at acceptance, only the acceptance fee of A$140 would be charged, with no excess claim fees applied. Unless this ‘loophole’ is closed, this may be the most useful method for reducing excess claim fees (after ensuring multiple dependency). The method of avoiding fees in this way appears very attractive – there is no official fee for the deletion of claims and the post acceptance reinsertion of claims has an official fee of A$200. As attorney costs would not in general exceed $1000 the exercise may be more cost-effective than paying excess claim fees for a patent with 100 claims.

However, there are risks associated with this strategy which should be carefully considered for each application. If the application were to be opposed by a third party, there could be a significant delay before the claims can be reinserted. The amendment to reinsert the claims is itself open to third party opposition. Accordingly, there could be a delay of several months before the deleted claims are re-introduced. If the deleted claims are infringed during this period, any loss or damage suffered in this period cannot be recovered from the infringer. For cases where litigation is likely, it could be wise to file a divisional application that can be kept pending while waiting for the opposition period to expire.

It can also be expected that the Patent Office may not view this tactic kindly if it perceives that it is being done purely to evade fees. While the Patent Office has no substantive basis to refuse the insertion, post-acceptance amendment is at the discretion of the Commissioner.

In summary, excess claim fees may be minimised through: 

• maximising multiple claim dependency; potentially by pre- and post-acceptance amendment;
• or by filing a divisional application.