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New Zealand and Australia: Bypassing the PPH

Just as the world’s five largest IP offices launched a patent prosecution highway (PPH) pilot programme on January 6, New Zealand and Australia decide to bypass the PPH concept entirely and move to a single application and examination process for patents. However, Greg Lynch says there are reasons to consider a less aggressive change


Rugby is a sport with which many New Zealanders and Australians are not merely familiar, but are self-appointed experts. During a match it is not uncommon to hear the cry “Don’t kick it, pass it!” when retaining the ball is thought to be more advantageous than a significant territorial gain and the probable loss of possession. At other times, “Don’t pass it, kick it!” might be heard.

The New Zealand and Australian governments have decided to “kick it” rather than “pass it” by implementing a single application and examination process for patents. In attempting to achieve a significant gain in the push for a single economic market between the two countries, they have chosen a path of greater uncertainty. Introducing a PPH between the countries might have been the more controlled and safer “pass it” approach.

SAP and SEP explained

While most patent practitioners are familiar with the PPH, they may be unfamiliar with the single application process (SAP) and single examination process (SEP) proposals. And, when many other countries are expanding the reach and scope of PPH programmes, why are New Zealand and Australia taking this other path?

A recent report from the Office of the Minister of Commerce in New Zealand outlined the following objectives in developing the SAP and SEP models:


Will New Zealand and Australia's kick toward harmonisation succeed?  Photo source: DamjanBNZ (Flickr)

  • Reduction of time and resources spent by New Zealand businesses applying for and obtaining patents in both New Zealand and Australia.

  • Minimising the administrative costs of running the patent regime.

  • Ensuring patents granted in Australia and New Zealand are of a similar, high quality standard.

  • Ensuring examination approaches are consistent between Australia and New Zealand.

Pros and cons

These are commendable goals, but who really stands to benefit and who stands to lose on implementation of a SAP and a SEP, and does the level of uncertainty introduced justify this model as opposed to a PPH?

Under the proposed SAP, applicants wishing to file a patent application in both New Zealand and Australia will no longer be required to file a separate application in each country. The IP Office of New Zealand (IPONZ) and IP Australia will provide SAP portals on their websites, and either can be used to file in both countries upon payment of a combined fee. Although significant responsibility attaches to the filing of a patent application, the process is largely administrative and the SAP should simplify this step.

The SEP raises more interesting questions. Under the SEP, a single patent examiner will examine the New Zealand and Australian applications simultaneously. The examiner may be either an examiner at IPONZ or at IP Australia. Acceptance of applications, grant of patents and any oppositions will be handled by the office in the country of application. In other words, all processes beyond the examination stage will be handled by the local patent office.

In principle, the SEP concept seems admirable. It ought to be efficient and therefore bring cost savings to applicants. But what about examination quality?

Examination quality

Patent practitioners the world over are well-aware that the quality of an examination can be highly dependent on the particular examiner working on that application. Examination guidelines help with consistency of examination quality and standards, but there can be great variability among examiners in all patent offices. Different people have varying degrees of understanding of an invention, the prior art and the details of local law and practice. Practitioners know that how smoothly an application proceeds through the examination process depends very much on the specific examiner.

The SEP magnifies the uncertainty. If an applicant strikes a poorly trained or underperforming examiner, the quality may well be below an acceptable standard. The outcome may be grant of an overly broad patent, or conversely grant of an unreasonably narrow patent or even no grant of a patent at all. Under the SEP, both eggs will be in one basket - if the New Zealand application is poorly examined, so too will the Australian application be poorly examined. Since the particular examiner assigned to an application is a lottery, the stakes will now be higher.

Which office?

The current understanding is that a patent application filed under the SAP and SEP procedures will be forwarded to a single examiner at either IPONZ or IP Australia. But who chooses? Can the applicant elect whether the application is to be examined at IPONZ or IP Australia, or is this to be controlled by one or other patent office? In theory, it shouldn’t matter. However, because New Zealand patent examiners currently do not examine applications for inventiveness, examination quality may not be consistent between the two patent offices, at least until extensive training has been implemented and quality can be assured.

Patent law reform raises more uncertainty

New Zealand is also in the process of major patent law reform. The new Patents Act 2013 was passed into law last September and will come into force this September. The regulations have been drafted and submissions from interested parties have been sought. Many of the changes will bring New Zealand patent law and practice in line with that of Australia, but there will remain several significant differences that will have an impact. For example, under Australian law, inventiveness is assessed differently than in New Zealand. And, Australia has a considerably more liberal approach to allowing software patents and patents for therapeutic and surgical methods of treating humans and animals. The imminent changes in New Zealand, and ongoing significant differences, will add complexity to the effective operation of a SEP system.

Official fees

Will official fees increase for applicants as a consequence of implementation of the SAP and the SEP? The report from the Office of the Minister of Commerce in New Zealand notes that there will be one-off costs for IT development and on-going operating costs. However, the report also states that the costs have yet to be quantified. What is clear however is that the costs incurred by IPONZ will be recovered through fees. In other words, applicants will undoubtedly pay more.

The PPH option

According to a fact sheet issued jointly by IPONZ and IP Australia, the benefits of patent examination integration are potential savings in professional fees and costs, a faster examination process and consistent and high quality patent examinations. But, there appears to be no analysis of whether a PPH between Australia and New Zealand would also achieve these benefits.

The proposed SAP, being largely an administrative function, has merit. But, the proposed SEP comes with great uncertainty for applicants. If applicants are happy to roll the dice with IP rights, the planned SEP will present no issues. However, those wishing to tread with caution and be more assured of patent quality should elect to have their New Zealand patent applications examined at IPONZ and their Australian patent applications examined at IP Australia.

The New Zealand and Australian governments should pass it, not kick it.

Greg Lynch is a partner at Catalyst Intellectual Property in New Zealand

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