Pay Your Annuities in Brazil!

In Brazil, yearly annuities are due on any pending patent application or issued patent.  Occasionally, mistakes occur and payment of a yearly annuity is not made.  Pursuant to Article 86 of the Industrial Property Law (Law), the lack of such payment results in the abandonment of an application or patent.  However, Article 87 of the Law gives an Applicant or Patentee the opportunity to have the application or patent restored if payment is made within 3 months of publication of a notification of the abandonment.  Specifically, Article 87 states:

 “Article 87 – The patent application or the patent may be restored, if the applicant or patentee requests it, within 3 (three) months counted from the notification or abandonment of the application or extinction of the patent.”

In practice, because of the chronic backlog within the National Institute of Industrial Property (INPI), several years (and hence payment of several years worth of annuities) typically pass before publication of a notice of abandonment.  When published, the notice states that the application or patent has become abandoned due to the failure of the Applicant or Patentee to make several years worth of annuity payments.  The notice recites the years that the Applicant or Patentee has failed to pay annuities.

According to the INPI, many Applicants and Patentees have stopped paying annuities until receipt of the publication of the notification of abandonment.  In view of this perceived abuse, INPI has changed its interpretation of Article 87, stating that an application or patent cannot be restored (namely, revived or reinstated) if an Applicant or Patentee has failed to make multiple annuity payments.  In light of this new interpretation, INPI has held several patent applications and patents abandoned without possibility of restoration.

Clearly, Article 87 provides a right to restore an application or patent as long as an Applicant or Patentee requests restoration and makes the appropriate payment within 3 months of the publication of the notification of abandonment.  Hopefully an aggrieved Applicant or Patentee will challenge INPI’s interpretation before the Courts.  In the meantime, Applicants and Patentees should carefully ensure the timely annuity payment.  Please watch the BRIC Wall for future updates on annuity payments in Brazil.

This post was written by Lisa Mueller and Gustavo de Freitas Morais of Danneman Siemsen.

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