Fixing Europe's broken patent system

One of the most painful processes for founders (and really, for all innovators) to deal with is patents. I've felt it firsthand as a hardware founder.

Here's the reality:

• In the US, an innovator can file a provisional patent for $75 to establish a priority date. That gives them 12 months to raise money, collaborate, iterate and talk freely about their idea without fear of losing IP.
• In China, a subsidised, fast-tracked utility model patent can be granted in under a year, giving innovators an enforceable right to their technical innovations.
• In Europe, if you talk freely about your idea before you file a patent, you can lose the right to a patent forever. And filing costs €2,000 to €6,000 upfront. No flexibility. No grace period. No second chances.

Part of why China is dominating drones and robotics - think DJI and Unitree Robotics - is its fast, flexible patent system.

What does this mean in practice?

• Academics & Researchers: Publishing vs. patenting. This dilemma is unavoidable for scientists at Europe's leading universities. Public disclosure of research results in Europe invalidates patentability, so there is a perverse incentive not to share results as widely and as soon as possible.
• Small Inventors: In the US it is possible to file cheap provisional patent applications. This helps independent inventors who can't afford comprehensive patents straight away, but want to secure their rights while raising funding. In Europe they need the money upfront or risk losing their inventions to larger players with deep pockets.
• Startups & Industry Innovators: This is also a problem for startups that want to show their invention to investors, customers or partners. Testing and iterating is the essence of innovation. But there is no grace period in Europe, so showing your innovation might make it unpatentable.

Overall, the place where an invention is made is the trumping criterion, and there is no way around it except relocating. This leads to painful choices that often mean leaving Europe.

Comparing Patent Systems

A Founder's Experience: The Cost of a Demo Day

When we started we had to file a patent before going on a demo day (£6,000), which we did in a hurry, as without one, if we pitched to investors we would probably lose the right to patent.

A few months later our idea had evolved and our first patent was useless, so we had to file a second (£6,000).

In our first year we wasted thousands of pounds (>£12,000) and dozens of hours.

In the US we could have filed a provisional for $75 and evolved our idea for 12 months, filing a full patent once the dust had settled.

This to me isn't just an issue of cost, it is a fundamental issue blocking innovation.

How to Fix It: Three Simple Reforms

This isn't anything outlandish. The US and China are already doing it. Europe could too, without even any subsidies or tax breaks. Just tweak the way that UKIPO and EPO function.

1. Introduce a Provisional Patent System

A provisional patent (£100) establishes a priority date and gives the filer 12 months to perfect the invention, raise funding and decide whether to file for a full patent. This would vastly reduce risk for startups, lone inventors and researchers.

2. Implement a 6-Month Grace Period

Allow inventors to file within six months of public disclosure, e.g. a research publication, a prototype demo, an investor pitch or a crowdfunding campaign. This would reduce the fear of disclosure and promote an open, collaborative approach to innovation.

3. Fast-Track Patents

Cut the cost of search and initial examination for startups, and offer expedited examination for first-time filers (see the UKIPO's existing Green Channel). Cheaper, quicker IP would help startups attract funding and land sales deals.

The Time for Change is Now

Europe is being left behind while the rest of the world offers cheaper, more flexible IP. Poor patent regimes stifle innovation, hold back growth and drive brain drain. It need not be so. This is no call for handouts or subsidies, just recognition that our systems need to reflect the modern economy. If our lawmakers won't champion this change, then we must.

Braindump by Josef Chen