October, 2018

Since establishing of the patent system of the Republic of Kazakhstan patent legislation had been amended several times and next year it shall celebrate its 25 years anniversary.

As of July 3, 2018 the Law on amendments into some legislative acts of the Republic of Kazakhstan related to IP legislation development entered into force in Kazakhstan (hereinafter – Law on Amendments).

The Law provides for the amendments into patenting of inventions, utility models and industrial designs in the Civil Code of the Republic of Kazakhstan, Patent Law of the Republic of Kazakhstan, Tax Code and some other legislative acts.

In this article we shall focus on only the most significant amendments in patent legislation in 2018.

1. The procedure for the examination of applications for the issuance of patents for an invention, utility model and industrial design has been changed.

The system of examination of applications in the expert organization and authorized body has changed from a two-level to a single-level. The expert organization (Republican State Enterprise on the Right of Economic Management of the National Institute of Intellectual Property - Republican State Enterprise NIIP), after conducting an examination decides on issuance of a patent, and does not issue any conclusion as it was before. The stage of issuing a decision by an authorized body (Ministry of Justice of the Republic of Kazakhstan) on the grounds of a conclusion of an expert organization has been excluded. This amendment simplifies the procedure for consideration of an application and, of course, shall speed up issuance of a patent.

It should be noted that the payment of a state fee for issuance of a patent has been eliminated. The applicant pays NIIP only for preparation for issuance of a patent and publication.

If NIIP refuses to issue a patent, the opposition is filed as earlier with the Board of Appeals, which is the group unit of the Ministry of Justice of the Republic of Kazakhstan.

Currently Rules for the Examination of Industrial Property Items Applications, Annex 2 to the Order No. 1349 of the Minister of Justice of the Republic of Kazakhstan dated August 29, 2018 (hereinafter – Examination Rules) had taken effect. These Examination Rules cover inventions, utility models and industrial designs and contain provisions related to the filing of applications, drafting and presentation of materials for applications, examination of applications, keeping correspondence, and entering amendments into the application, prolongation and restoring terms.

2. The procedure for issuing patents for industrial designs has been changed.

NIIP now registers not only inventions, utility models and industrial designs in the relevant state registries, but also issues patents for these industrial property items, that is to say issuance of patents is excluded from the powers of the Ministry of Justice of the Republic of Kazakhstan and referred to the competence of the NIIP.

It is also legally stipulated that the relevant state registries are located on the Internet resource of NIIP, and NIIP every week publishes in the newsletter the information related to the registrations. These amendments shall speed up the issuance of patents and simplify access to information related to the patents.

It should also be noted that the Law on Amendments excluded the issuance of Annexes to patents, which concerned changes to patents, extension of terms of patents, transfer of rights to patents, etc. and were an integral part of patents. NIIP shall now forward relevant notifications about undertaking these actions and enter them into the State Registers of inventions, utility models and industrial designs.

3. The definition of the scope of legal protection provided by a patent for an industrial design has been changed.

The scope of legal protection is now determined exclusively by the combination of its essential features reflected on images of the product appearance. A product is now recognized to contain a protected industrial design, if it contains all of its essential features reflected on images of appearance.

In determining the scope of protection of industrial design the combination of verbal list of essential features of the industrial design shall not be used. Images became the main documents in determining the scope of protection and patent infringement to an industrial design.

Accordingly, an independent list of essential features of the industrial design was excluded from the description of an industrial design. This amendment simplifies procedure for drafting of materials of application related to issuance of an industrial design patent and eliminates the subjectivity and complexity in the describing of verbal list of essential features of an industrial design. The description of an industrial design, however, remained in list of documents for establishing the filing date of an application related to issuance of an industrial design patent.

Pursuant to the Examination Rules description contains the same sections as before, including industrial design analogues, the essence of an industrial design. Drafting of a description with the specified sections takes time and extends terms for preparing and submitting an industrial design application.

4. The procedure for challenging patents and declaring them invalid has been changed.

Pursuant to the Patent Law, a title document may be challenged and declared invalid in whole or in part during the entire period of validity on the grounds of challenging against its issuance in the following cases:

1) failure to comply with patentability criteria established by the Patent Law;

2) availability in the claims of invention, utility model or in complex of essential features of an industrial design features that were not reflected in the initial application materials;

3) issuance of a title document if the applicant violated provisions of Article 37 of the Law;

4) incorrect indication of an author (authors) or the patent owner in a title document.

Previously, patents on the first and second grounds were challenged in the Board of Appeals of the Ministry of Justice of the Republic of Kazakhstan. Pre-court review of oppositions was mandatory. Patent attorneys exclusively represented interests of foreign applicants and patent owners in the Ministry of Justice of the Republic of Kazakhstan.

Pursuant to the amendments in the Patent Law, recognition of patents of the Republic of Kazakhstan for inventions, utility models and industrial designs, as well as recognition of a Eurasian patent for an invention invalid in whole or in part shall now be reviewed exclusively by the court.

It should be noted that the procedure of challenging and invalidating patents for failure to comply with the patentability criteria is indeed a complicated process. As our practice shows, mainly Kazakhstan and Eurasian patents for inventions relating to medicines and methods of their preparation had been disputed.

Another challenging issue is challenging utility models, as a product, including the substance, device, microorganism strain, method, and application can be items recognized as utility models in Kazakhstan.

Definitely, the transfer of challenging on these grounds to the court shall complicate the process. This is due to fact that majority of judges are not ready to review these difficult issues, the non-obligatory presentation of foreign entities by patent attorneys competent in this field, and the involvement of specialists and experts. There is no doubt that challenging in court shall also increase the costs of those involved in the court proceedings, complicate the notification of the defendants, who are in the most cases are foreign entities, and shall delay the time for consideration of statement of claims.

It should be underlined that earlier provisions of Article 37 of the Patent Law provided that in order to check an application for the availability of information constituting state secrets, an industrial property application was submitted to foreign countries only after three months after filing an application with NIIP, that is, after checking the application for availability of state secrets and information that could significantly affect the economy of the Republic of Kazakhstan. In case of violation of this provision, the patent of the Republic of Kazakhstan could be revoked. The amended provision of Article 37 contradicts international treaties such as Patent Cooperation Treaty and Eurasian Patent Convention and is worded in such a way that on the grounds of this provision it is now impossible to challenge a patent.

5. The rules regarding the assignment of rights to industrial property items and license agreements and their registration have changed.

First of all, it should be highlighted that the Law on Amendments provides for a single –level procedure of registration of agreements. That means that instead of a two-level procedure which consisted of examination of agreement by NIIP, that included preliminary examination and substantial examination with issuing a decision on registration of agreement and recorded information with the registry of registered agreements and NIIP published information related to the registered agreement in official bulletin and issued relevant annex to the patent.

Pursuant to the new procedure, NIIP registers an agreement with the relevant state register of inventions, utility models or industrial designs and publishes information related to the agreement in official bulletin that means that the whole registration procedure is held in NIIP. The examination of agreements by NIIP and maintenance of the register of registered agreements by the Ministry of Justice of the Republic of Kazakhstan were excluded.

The term for registration of agreements was significantly reduced to 10 business days in the Patent Law from the date of receipt of the application for agreement registration. Previously under a two-level procedure the term stipulated by law for registration of agreements made 47 business days.

The Patent Law provides for and there are already in power the Rules for Registration of Assignment of the Exclusive Right, Granting the Right to Use Industrial Property Item, Open or Compulsory License in the Relevant State Registers approved by the Order No. 1347 of the Minister of Justice of the Republic of Kazakhstan dated August 29, 2018 (hereinafter – The Rules).

According to the old wording of the Patent Law, the Rules were not provided for and the Patent Law itself contained a list of documents required for registration, in particular it should be necessary to submit an application in the Kazak and Russian languages, four copies of agreement in two above stated languages, the subject matter of agreement had to be homogeneous items of industrial property, accompanied with a title page or copies certified by the notary.

Currently the Rules provide for the following list of documents for registration: application in 1 language (Russian or Kazakh); the original of an agreement or a copy certified by the notary in 1 language (Kazakh or Russian) in 1 copy; document evidencing payment for NIIP services for registration.

The Law on Amendments does not provide for payment of state fee for registering an agreement.

Many amendments relate to license agreements.

The definitions of two types of licenses are clarified. A license agreement may provide for the licensor granting the licensee the right to use an industrial property item:

- with the right of the licensor to use it, but without the right to issue a license to other persons (single license);

- without the right of the licensor to use and without the right to issue a license to other persons (exclusive license).

Consequently full license is now an exclusive license and exclusive license is a single license. In addition to registration of license agreements and sublicense agreements, registration of agreements of a complex license and registration of another agreement including provisions of a license agreement is provided for.

In our opinion, the registration of this another agreement also indicates to the option of registering extracts from a license agreement.

The six-month restriction for filing a license agreement for registration is excluded.

The term of the license is legally defined, and if it is not specified in the agreement, it is stipulated as 5 years by default.

As the above provisions show, basically the amendments related to the procedure for registration of agreements are positive.

6. The powers of NIIP and the Ministry of Justice are clarified.

The powers do not cover:

- issuance of title documents (patents) for inventions, utility models and industrial designs;

- supervision over the activities of individuals and legal entities using industrial property items;

- drafting reports and review of disputes related to administrative offenses, the imposition of administrative penalties.

The Patent Law enlists regulations which are now not only approved but also developed by the Ministry of Justice. Presently many of them have already been approved and entered into power.

Regarding the competencies of NIIP, first of all, its activity in the amended Patent Law is not defined as monopoly in contrast to the previous version of the Patent Law. We hope, however, that in practice NIIP’s monopolistic activity in Kazakhstan shall be maintained and shall not be diluted, at least for part of its main activities and at least based on the confidentiality conditions of applications for inventions, utility models and industrial designs before publishing information about patents. The list of NIIP functions with respect to patents is not detailed and is not exhaustive.

The Patent Law also provides for that NIIP, in coordination with the Ministry of Justice, approves the prices for services in the field of protection of industrial property items, provided for full reimbursement of expenses incurred for by NIIP, breakeven point of its activities and funding from its own income. Previously, prices were set by the Ministry of Justice in coordination with the anti-monopoly body of the Republic of Kazakhstan.

Work on the improvement of legislation in the field of intellectual property shall not be stopped with the introduction of the Law on Amendments and we hope to cooperate in this direction with all interested parties.

We are also ready to give more detailed information and comments on new amendments in the patent legislation. Please feel free to contact us.