Licence Of Right: A Possibility To Reduce Maintenance Fees

Maintenance fees, sometimes referred to as renewal fees or annuity fees, for patent rights have to be paid annually in most countries. The differences from one country to the other are the starting point of the first payment and the amount of the maintenance fees. A few countries provide reductions on fees if you are an individual or your company has a small entity status. But what can you do if you are a large entity? Basically not much - besides reducing the number of your patents.

There is, however, one legal institute that is available to any entity irrespective of its size and nature that requires at first and foremost the willingness to grant a licence on your patent right.

The owner of a patent can apply to the Intellectual Property Office to have the patent endorsed for licence of right (L.O.R.). This application by the patentee is a declaration of willingness to grant a licence to anyone. The endorsement acts as an invitation to third parties to apply for a licence. The advantage of the licence of right is that it lets other people know that licences are available and that maintenance fees are reduced by 50%.

Unfortunately, not many countries provide for licence of right. The European Patent Convention does not provide for L.O.R. - grant of a licence is governed by Art. 73 EPC but this is not our subject here.

There are approximately 20 countries which have this option. Among them are some important patent filing jurisdictions:

Germany (Licence of right is called Lizenzbereitschaft and is governed by §23 Patentgesetz); Italy (Licenza di diritto, Art. 80 Decreto Legislativo of 10th February 2005 no. 30); Spain (Licencia de pleno derecho, Art. 81 Ley 11/86 de 20th March 1986); United Kingdom (Licence of right, Art. 46 Patents Act 1977). France is no longer among the countries. Art L 613-10 governing L.O.R. was abolished by Law no. 2005-842 of 26 July 2005. Since provisions of L.O.R. have minor differences from country to country, the following paragraph deals...