June 3, 2021

Patent News

Revision of the Patent Act of Japan in 2021: Japan to Lessen a Burden of Maintaining, Using and Enforcing Rights on Patents

To make the Patent Act of Japan more adapted to recent business activities with digitalization, remote works and non-contact due to the COVID-19 pandemic, the bill of the revision of the Patent Act was enacted on May 12, 2021 and promulgated on May 21, 2021, which includes the following revisions. Under the revised Patent Act, the patent system in Japan is anticipated to lessen the burden of maintaining, using and enforcing rights on patents.

1. Abolition of the requirement of obtaining consent from licensees in correcting patents

Correcting patents is one of patentee’s strategies to defend the patent in patent invalidation proceedings or patent infringement proceedings. For example, if a patent disputed in patent invalidation proceedings threatens to be invalidated due to lack of novelty in view of a certain prior art, the patentee can correct the patent to narrow and differentiate the patented invention from the prior art and thus to prevent the patent from being invalidated. However, under the Patent Act before the revision, unlike other jurisdictions such as the United States, the United Kingdom, Germany and China, a patentee was not able to correct patents without consent from all licensees of the patent. This is difficult or unrealistic especially if there are many licensees. In fact, in the patent infringement lawsuit of the Tokyo District Court’s judgment of July 13, 2016 (Case No. 2013 (wa) 19418), the patentee argued patent infringement based on the “corrected” patent; however, the court dismissed the patentee’s argument indicating that the patentee has not obtained consent from all licensees in correcting the patent and thus the correction of the patent was inadmissible. In this regard, there was a criticism that the requirement of obtaining consent from all licenses in correcting patents was an obstacle to enforce patents effectively and flexibly.

In response to this criticism and from the perspective of harmonizing with other jurisdictions, under the revised Patent Act, obtaining licenses’ consent is no more required in correcting patents (Article 127 of the revised Patent Act) except in a case where a license in question is a “registered exclusive license” (senyo-jisshiken) where the licensee enjoys rights similar to a patentee. This revision is expected to become effective around May 2022 (within one year from the date of promulgation).

2. Introduction of a new system of inviting third parties’ opinions in patent infringement lawsuits

In these days, new technologies such as AI - IoT technology are developing rapidly, and it is expected that patent infringement lawsuits will involve such new technologies as well as new legal issues and will become more sophisticated and complicated. In such a case, judges may need to have opinions widely from third parties, which enables the judges to refer to a wide range of opinions. In fact, about 7 years ago, in the Apple v Samsung case that involved a then-new question of whether a patent subject to FRAND (Fair, Reasonable and Non-Discriminatory) declaration can be enforced, although there was no legal system of inviting third parties’ opinions like amicus briefs in the Unites States, the Intellectual Property High Court (the “IP High Court”) managed to invite third parties’ opinions on this FRAND-related question in an “unofficial” manner (the IP High Court’s judgment of May 16, 2014 (Case No. 2013 (ne) 10043)).

Considering these circumstances, the Patent Act has been revised to introduce a new system of inviting third parties’ opinions (amicus briefs) in patent infringement lawsuits (Articles 65, 105-2-11 of the revised Patent Act).

Under the revised Patent Act, in patent infringement lawsuits, the court can invite third parties’ opinions widely when a party to a patent infringement lawsuit requests to do so and the court considers it necessary. In inviting third parties’ opinions, the court needs to hear the other party’s opinion but does not need to have the other party’s consent. Invitation of third parties’ opinions is available both in infringement lawsuits of patents as well as utility models before the first instance (the Tokyo District Court and the Osaka District Court) and the IP High Court. However, the revised Patent Act does not stipulate that the system of inviting third parties’ opinions is available in patent invalidation proceedings before the IP High Court, namely, lawsuits for rescinding the Japan Patent Office’s decisions (however, as the IP High Court did in the Apple v Samsung case mentioned above, there can be room to conduct invitation of third parties’ opinions without the legal framework expressly provided under the revised Patent Act). This new system of invitation for third parties’ opinions enables anyone including persons outside Japan who is interested in the outcome of patent infringement lawsuits to deliver its opinions directly to the court. This revision is expected to become effective around May 2022 (within one year from the date of promulgation).

3. Easing of requirements for restoring rights on patents which extinguished due to expiration of time limits

Before the revision of the Patent Act, if an annual fee for maintaining a patent has not been paid within a period required by the Patent Act and thus the patent is considered to have expired, the patentee cannot restore the patent unless there is a reasonable ground for having failed to pay the annual fee. However, the requirement of “reasonable ground” was considered to be too strict for patentees. In fact, among court cases where a patentee seeks revocation of the JPO’s decision to reject to restore the patent, there seems no case where the court found that there had been a “reasonable ground” for having failed to pay a required annual fee and thus the patent should be restored.

Under the revised Patent Act, in order to protect patentees’ rights on patents in Japan, this requirement of “reasonable ground” has been abolished, and a patentee will be able to restore the patent by paying additional fees within a certain period (to be determined later) unless the patentee intentionally failed to pay the annual fee (Article 112-2 of the revised Patent Act).

Similar to this revision, “reasonable ground” for having failed to do certain actions with periods required by the Patent Act has also been abolished for filing translations of patent specifications in a foreign language (Articles 36-2, 184-4 of the revised Patent Act), filing a patent application with claim of priority (Articles 41, 43-2 of the revised Patent Act), filing a request for examining a patent application (Article 48-3 of the revised Patent Act) and filing a notification of appointment of a patent administrator for an international patent application filed by a resident abroad (Article 184-11 of the revised Patent Act). This revision is expected to become effective around May 2023 (within two years from the date of promulgation).

4. Other revisions of the Patent Act

In addition to the above revisions, under the revised Patent Act, the JPO will be able to hold oral hearings using web conference systems in invalidation proceedings, that is, parties to the invalidation proceedings do not need to be present physically at the JPO (Articles 71, 145, 151 of the revised Patent Act).

Also, a patentee is exempted from surcharges for late payment of an annual fee for maintaining a patent if the patentee failed to pay the annual fee within the period required by the Patent Act for reasons not attributable to the patentee such as a pandemic (including COVID-19 pandemic) and disasters (Article 112 of the revised Patent Act). These revisions are expected to come into effect around November 2021 (within six months from the date of promulgation).

Written by: Mr. Masahito Imai (Attorney at Law and Patent Attorney)