Many inventors and inventive enterprises ignore the benefits of patenting their new inventions purely because they argue that the cost of acquiring and maintaining patents is unaffordable.

Ultimately, to patent or not is foremost a business decision which should be aligned with strategic and financial objectives. However, before any decisions are made, the "cost" of patenting should ideally be seen as an investment, rather than an expense. It is therefore our aim with this article to give an evaluation of the administrative costs associated with a European patent application from an investor's point of view. In addition to the administrative cost, some advice regarding indirect patenting cost will also be discussed.

Basic Administrative Cost of a European patent application

When applying for a patent through the EPO (new application – not PCT), the applicant will encounter the following minimum costs:

Please bear in mind that each application will be unique—applicants can only strive to limit administrative fees to the above minimum.

Once a company or inventor has decided to patent their invention, there are various strategic steps to take in order to save cost.

Search Cost

An applicant should never assume that just because his/her product is not on the market yet, that it will automatically meet the requirements of patentability. In order to ensure that an invention is novel and non-obvious, a proper prior art search prior to filing the application will guarantee to a certain extent that filing-and-search fees are not wasted.

A proper prior art search could:

• expose any potential infringement on other's patents;
• assist in anticipating possible objections from the examination division;
• offer information on other patents in the field, thus determining how useful the granted patent would be from a commercial point of view; and
• aid the applicant in modifying claims to avoid infringement.

Drafting Cost

Some examples of issues a professional drafter will consider include:
1.  Unity of Invention: Understanding the concept of Unity of Invention can save an applicant the cost of filing additional patents if the drafter can skillfully link a group of inventions to form a "single inventive concept".
2. Excess Claims Charges: For applications with more than 15 claims, charges are Euro 210.00 for the 16th and each subsequent claim up to the 50th claim; Euro 525.00 for the 51st and each subsequent claim!
3. Excess Page Charges: For applications with more than 35 pages, the charge is Euro 16 per page.

In summation, professional European patent drafters will be knowledgeable of the process, the pitfalls and the specific requirements of the EPO, avoiding additional cost for the applicant and securing a quality, enforceable patent!

Don't be penny wise and pound foolish!    

Payment Due Dates

Applicants should firstly be aware of the time-payment deadlines, thereby allowing for their own financial planning and hopefully the successful commercialization of their inventions. Ideally the commercialization income generated from the invention should cover the cost of patenting.

Furthermore, missing deadlines results in additional surcharges levied against the applicant for late payment. It is therefore of cardinal importance that the applicant, inventor, and patent agent maintain proper, timely communication about the specific requirements of each individual application.

EPO fees for further processing in the event of late payment of a fee are 50% of the relevant fee (plus the relevant fee!). In the case of late performance of certain non-fee related cases, a surcharge of EURO 225.00 is levied for further processing.

Other considerations which determine Cost

The cost of patenting depends on a number of factors specific to each case – some of them which may include:

• Technology field of the invention;
• Length of the application;
• Number of claims;
• Rate of the patent agent and total time to prepare and prosecute the patent;
• Number of countries to be designated
• Translation of applications (London Agreement)
• Number and nature of objections raised by the patent examiner
• Whether the application will encounter any opposition proceedings (within the 9 month after grant of the European patent)
• Route of the application (PCT/ Direct European / National Route)

Conclusion

Without a doubt, patenting anywhere in the world requires a significant financial investment – and the EPO is no exception. Bear in mind that once a European patent is granted and designated to its 38 member states, such a patent will be enforceable in an area inhabited by roughly 493 million people (EU population in 2009 v. USA's 308 million), and with a GDP of Euro 11.8 trillion (approximately US$ 16.16 trillion) compared to the USA's GDP of US $14.3 trillion (2009). It is therefore not surprising to see that EPO patent applications for 2010 have increased by 10%!