Revision of Utility Model System

March 4, 2004
HARAKENZO WORLD PATENT & TRADEMARK PATENT LAW FIRM
Patent Attorney Kazuki MATSUMURA

The cabinet of Japanese government has endorsed "Bills for partial reform of patent laws to accelerate patent examination" on February 10, 2004, and most of the bills are to become effective on April 1, 2005. The reform is to practice "nation-building based upon intellectual property" which has been rapidly promoted under intellectual property organic laws approved in 2002 as well as "the creation, protection and utilization of intellectual property right" announced in July, 2003 and the like.
The law bills include a revision of utility model system along with permission to outsource prior-art search, augmentation of patent examiners, a revision of corporate invention system and so on.
It is the first substantial reform made in 11 years, since 1993.

While maintaining the standard of patented inventions, utility model system has been the system to protect so-called small inventions that are not protected under the patent system, and when our technology standard was yet to be improved, it had been a complement of the patent system. However, the number of patent applications has started to surpass since 1981 due to improving technology standard of our nation and the like while the number of utility model applications has radically dropped since the reform of multiple-claim system. On the other hand, as technical fields of products with short life cycles such as toys, everyday goods and sports equipment have expanded, utility model system has started to be enforced remarkably sooner after the applications, and it has been amended to non-substantive examination system in 1993 for the purpose of providing appropriate protections to technologies with short life cycles.

At that time, the number of the utility model applications was projected to increase, and reasonable amount of patent applications that requires prompt enforcement of the system was expected to be changed to utility model applications, consequently contributing for acceleration of patent examinations. However, in reality, the number of utility model applications had kept declining even after the amendment to non-substantive examination system, and by the year 2002, the number has dropped to approximately 8,000 applications from 200,000 around the year 1985, while the number of patent applications in the same year, 2002, was approximately 420,000. And amid growing calls for a reform to simplify the system, some suggested the system be abolished.

Under such circumstance, the continuing existence of utility model system is now approved, and the system that can be substitution for patent application is to be promoted by raising interest in the system. The grounds for the continuation are as follows:

(1) Amid the tendencies of shortening product-life cycle, and the corporate lead time of development, there are persistent demand for appropriate protections of technologies with a shorter time to get into operations, though the period of patent examination is shortened to about 24 months by the year 2002, which used to be about 31 months in 1991.

(2) Utility model system, though limited, enables a prompt enforcement of the rights, while the patent system only provides protection by the entitlement of right to demand compensation during the period between applications and the registrations.

(3) The cost for a utility model registration is less than that of the patent registration.

(4) Abuse of a right caused by non-substantive examination system is restrained by reinforcing the obligation of submitting technical opinion, the liability for damages and the like.
And the reforms are to be made based upon the following main items in order to simplify the system and to make contributions for the protection of rights in earlier stage.

(1) Extending the duration of the right from 6 years to 10 years

(2) Enabling to change a utility model, even after its registration, to a patent application by adopting a patent application system based upon the utility model registration

(3) Permitting to restrict a scope of claimed utility model registered under a certain requirement

(4) Reduction of the registration fee

(5) Expanding the information service system by providing information regarding ground for invalidation, except for printed publications.

Among the reforms above, focused are the items (1) to (3). The right duration was extended as described in the item (1) on the ground that the decline in the utilization of utility model system was partially attributed to the duration of utility model right, which is remarkably shorter compared to that of the patent right, and that the average product-life cycle of all business fields was estimated to be approximately 8 years.

Perhaps, the most significant reform is the item (2). This item is to enable a patent application in accordance with the utility model right even after the registration of a utility model, on the ground that there were number of applications which utility model right had been considered to be sufficient at the time of the application, but then an entitlement of patent right that enables stable enforcement of right was preferred for the utility model, due to changes in business plans and changes in the technology trends.

In such case, the original application date of a utility model registration is reserved providing that the descriptions in the patent documents such as the specification are within the scope of the description for the utility model (Japanese patent law 46bis (2)). The based utility model is to be disclaimed at the time of the patent application, and the exceptions of first-to-file rule are prescribed (Japanese patent law 39 (4)), though established as the prior applicant of the utility model. However, the patent application must be made within three years from the utility model application date, as the period for requesting patent examination is three years from its application date (Japanese patent law 46bis (1) Item 1), and patent application after the request for examiner's technical opinion is forbidden on the ground that the subject is deemed to request protections under utility model right (Japanese patent law 46bis (1) Item 1, and Item 2). Moreover, in case of a invalidation trial, patent application after the elapse of period to submit written answer is not accepted in order to avoid wasting already-made proceeding (Japanese patent law 46bis (1) Item 1). This reform enables protections of a technology under utility model right until the technology is patented, and protections of the same technology under patent right after the patent is granted.

As for the item (3), it is to enable to restrict the scope of utility model claims within a range that does not overload the stress on monitoring by a third person, in order to improve the convenience for the right holders, assuming that inconvenience of the system was partially attributed to the fact that an elimination of a claim was the only measure to amend a scope of right, and also it enables to use a disagreement with requirement for correction as the reason of invalidation (Japanese utility model law 14bis). This item is similar to what it used to be before the reform in 1993.

Considering the radical drop in the number of applications and rapid implementations of pro-patent policies in recent years as well as the trends of shortening the period of patent examination, I, myself, had thought that utility model system which tends to become insufficient protection due to the strict regulation of the right enforcement would be abolished sooner or later, despite the ability of providing a prompt protection. Now, as it is resolved that the utility model system is to be improved to enhance more active utilization of the system instead of its abolishment, I would like to hope that the system will be effectively utilized, consequently contributing for acceleration of patent examination as intended. By the extension of the right duration, the right seems to approach steps closer to the required durations based upon the product-life cycle, or to the duration required by the right holders as well as the prospective right holders, thus the entire system seems to become more attractive than the conventional system. Moreover, a certain level of effect seems to be promising by this system for concretizing the purpose of reforms in 1993 "appropriate protections for swiftly implemented ideas", despite the regulation banning double-protection under utility model right and patent right as the system that allows a patent application of an already-registered utility model requires the disclaim of the utility model right, and the request for technical opinion is not accepted after the patent application.

On the other hand, Japanese utility model law 29ter for preventing abuse of a right is not particularly amended, and basically, a right holder still is the one who bears liability for damages him/ herself in case of a failure in performance of his / her duties. This is on the ground that non-substantive examination system is the backbone of current utility model system in Japan, and that it is inevitable unless otherwise any possibilities of abuse of a right with ground for invalidation is eliminated which leaves a difficult problem of providing both an earlier protection and a stable right enforcement yet to be solved. Perhaps, more applications will be changed to patent applications rather than retaining their utility model right in respect of right enforcement.

As for a question regarding expansion of the range for shapes and the like of items subject to the protection that was excluded in this reform, since further discussion will be held upon this issue regarding computer software or the like, which tends to require a prompt protection, the realization of the appropriate protections are awaited.
Whether this reform raise once again the inventors interest in utility model system, which once disregarded, remains as of yet unknown, however does it attract my attention to the future utilization and employment of this system.

"Enhancement of Attraction of Utility Model System" - Japan Patent Office website
http://www.jpo.go.jp/shiryou_e/toushin_e/shingikai_e/pdf/en_utility/report.pdf
"Summary of Japanese Patent Law 13th edition" revised by Yoshifuji Kousaku, Kumagai Kenichi

"Full Description of Japanese Industrial Property Law 16th edition-Japan Patent Office "