As discussed in our previous article, Canada has implemented a Patent Term Adjustment (PTA) framework to compensate for unreasonable delays in patent issuance by the Patent Office, in accordance with the Canada–United States–Mexico Agreement. Effective January 1, 2025, these changes will provide an additional period on the patent term for Canadian patent applications filed on or after December 1, 2020.
On November 30, 2018, Canada, the United States, and Mexico signed an agreement to replace the North American Free Trade Agreement (NAFTA) with the Canada-United States-Mexico Agreement (CUSMA) to reinforce the strong economic ties between the three countries. In December 2019 prior to ratification and implementation, the agreement was updated, which included a more comprehensive chapter on intellectual property obligations. One of these obligations was the requirement for parties to provide patent term adjustment to compensate patent applicants for “unreasonable” delays in the processing of patent applications.[1] In June 2023, royal assent was granted for the addition of a new section 46.1 of the Patent Act[2] which provides a new framework for an additional term for patents.
On December 18, 2024, the regulations amending the Patent Rules (SOR/2019-251)[3] were published in the Canada Gazette. The amendments outline a structured process for determining when PTA accrual begins and specifies the periods excluded from the PTA calculation. These amendments come into force on January 1, 2025.[4]
Here is a summary of the amendments to the Patent Rules.
PTA Eligibility
Under the amendments, a patentee must submit a request to the Canadian Intellectual Property Office (CIPO) for PTA with the applicable fee ($2,500 as the standard fee or $1,000 for a small entity) within three months of the patent issue date. Upon receiving an application for an additional term, the Commissioner of Patents will conduct an initial eligibility assessment. A preliminary determination of the additional term’s duration will be made, followed by a two-month observation period for submissions from the patentee and interested third parties. The Commissioner will communicate the final determination by issuing a certificate of additional term or dismissing the application.
To qualify for adjustment, the patent must have been filed on or after December 1, 2020 and the patent must have been granted after the later of:
- Five years from the date of national phase entry (for PCT applications), the presentation date (for divisional applications), or the filing date (for other applications); or
- Three years from the examination request date.
The deadline to apply for adjustment is three months after issuance of the patent.
PTA Duration
The additional term starts on expiry of the patent, and is calculated by taking the number of days between the later of five years from the filing/entry date or three years from the examination request date and the issue date, then subtracting the number of days that fall within the prescribed exclusion periods determined under the Patent Rules.
There are 38 categories of excluded periods, which include:
- The period from the date of national phase entry, presentation date, or filing date to the examination request date.
- The period from the mailing date of CIPO notices to the date of response or abandonment.
- Days granted as extensions by the Commissioner.
- Periods during which the patent is in abandonment.
- The period initiated by a request for continued examination (RCE) to the final fee payment date.
- Days specifically designated by CIPO.
Days that fall into multiple categories will only be subtracted once when calculating the additional term.
The amendments allow the Commissioner of Patents to reassess the additional term either independently or upon request by any party. The additional term may remain the same or be shortened but not extended. Additionally, actions can be initiated in Federal Court to further reduce the additional term. There are no provisions for patentees to request a lengthening of the term if it was incorrectly calculated too short.
Canada’s PTA approach differs from the approach of the USPTO where patent term adjustment is guaranteed if issuance of a patent is delayed due to the failure of the Patent and Trademark Office. Under 35 U.S.C. §154(b), the USPTO allows for the extension of the patent term for one day for each day of pendency of patent proceeding, order, or review.[5] In this program, the determination of a PTA is prescribed by the Director and notification is provided to the applicant no later than the date of issuance of the patent. Applicants are afforded the opportunity to request reconsideration of the PTA adjustment after this notification is issued.[6] This contrasts with Canada’s approach where PTA is not automatic, and applicants need to file for the adjustment themselves within three months of the patent issuance.
Fees
The amendments set the PTA application fee at $2,500 (standard) or $1,000 (small entity). If an additional term is granted, annual maintenance fees are required on the anniversary of the filing date. Those fees are $1,000 ($400 for small entities) for each year of the additional term (the 20th and subsequent anniversaries).
Certificates of Supplementary Protection
A certificate of supplementary protection (CSP) can be granted to a Canadian patent to compensate for delays in the regulatory approval process for medicines. The CSP term is calculated as the time from the date of marketing authorization minus the filing date of the patent application minus five years, with a maximum CSP term of two years.
The CSP term starts at the end of the standard 20-year patent term, and it runs concurrently with any additional term granted under PTA.[7] This means the CSP does not extend beyond the basic patent term even if an additional PTA term is granted.
Commentary
The implementation of the PTA represents a significant shift in Canada’s patent landscape, potentially offering greater protection for innovators across the country. However, there are practical challenges and the numerous exclusion periods that may make the PTA calculation onerous. For example, excluded periods which are not included in the adjustment of time through the PTA includes any delay that occurs after the RCE. Therefore, applicants should be aware of the impact that a RCE will have on the PTA calculation.
Another potential challenge relates to the uncertainty as to what constitutes “unreasonable delay” under the new rules. In 2024, CIPO’s Service Standards specified that within 24 months of receiving the Request for Examination, they will send either an examiner’s requisition, a conditional notice of allowance, or a notice of allowance, as specified by the Patent Rules.[8] However, in recent years CIPO has noted they have experienced an unprecedented volume of requests for examination which has affected their ability to meet the published patent service standards.[9] It is unknown how and when delays due to external factors such as additional volume will affect the criteria for a PTA. It is also worth noting that during the launch of the new portal, MyCIPO Patents, CIPO did not grant any patents between July 2 and August 20, and they experienced significant delays in processing incoming correspondence and in their outgoing correspondence. These extraordinary delays may or may not be considered in the new PTA calculation.
Patentees and applicants should remain informed and proactive, ensuring their patent strategies are aligned with the new regulations.
If you have any questions or require further clarity on how these amendments will impact your practice or business, please contact Gillian Burrell and Ashley Chu at info@pckip.com.
Footnotes
[1] https://www.canada.ca/en/privy-council/corporate/transparency/briefing-documents/parliamentary-committees/standing-committee-internal-trade/bill-c-4-canada-united-states-mexico-agreement-implementation-act-february-18-2020.html
[2] Patent Act (R.S.C., 1985, c. P-4), s 46
[3] https://laws-lois.justice.gc.ca/eng/regulations/SOR-2019-251/index.html
[4] Canada Gazette, Part 2, Volume 158, Number 26: Regulations Amending the Patent Rules and Certain Regulations Made Under the Patent Act
[5] 35 U.S.C. 154 (b)(1)
[6] 35 U.S.C. 154 (b)(3)
[7]Canada Gazette, Part 2, Volume 158, Number 26: Regulations Amending the Patent Rules and Certain Regulations Made Under the Patent Act, “Amendments to the Patent Act”
[8] https://ised-isde.canada.ca/site/canadian-intellectual-property-office/en/corporate-information/performance-targets/client-service-standards, “Request for examination fee”
[9] https://ised-isde.canada.ca/site/canadian-intellectual-property-office/en/corporate-information/performance-targets/client-service-standards, footnotes
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The contents of this article are provided for general information purposes only and do not constitute legal or other professional advice of any kind.