Building an International Patent Portfolio – A Guide for Australian Innovators
Patents provide their holders with a monopoly – but only on a national basis. Australian companies who seek patent protection must be strategic in their decision making to ensure that their rights are covered in jurisdictions that are central to their business goals.
The Australian IP Report 2025 indicates that the leading destination markets for Australian originating patent applications are the US, the European Patent Office (EPO), China, Japan and Canada. While the data indicates that Australian originating filings into the USA, Japan and New Zealand have declined, these declines have been offset by growth in filings into China and India.
Australians can seek patent protection in other countries by filing through the Patent Cooperation Treaty (PCT) or by filing directly at IP offices in their target markets. However, the question is how Australian innovators can target the right markets and maximise the advantages their intellectual property yields. In over ten years of being a patent attorney, I have worked with small, medium and large sized companies with varying goals and varied patent portfolios. I can safely say that there is no “one size fits all” policy. However, here are some criteria that I have used in the last few years to counsel clients on global considerations for their patent portfolio.
Building an International Patent Portfolio
It is both impractical and expensive to get patent protection in every country around the world.
In most instances, Australian applicants typically file an initial provisional patent application (domestically) and then utilise the PCT which provides a unified procedure to obtain patents in over 150 countries by filing the PCT Application within 12 months from filing the provisional patent application. Even though a single patent application (the PCT Application) is filed, a prior art search and written opinion is provided, and the patentee then gets to nationalise the PCT Application in the countries of interest, entering the “national phase” in these desired jurisdictions. It is at this stage that Australian patentees must be strategic in their selection of countries. Filing and prosecuting these national phase applications incurs both costs and resources and there must be alignment between the patent owner’s strategy and patent filing strategy to derive maximum value out of a patent portfolio.
Procuring patent rights in jurisdictions where competitors operate is vital. Australian companies should always consider competitors and their international patent portfolios when preparing a shortlist of countries for consideration.
Obtaining patents in markets where future consumers will be located and where possible licensees operate is also an important consideration.
Finally, it is equally important to examine or seek advice on a country’s track record on patent enforcement and file accordingly. Countries that do not have an effective judicial system for patent enforcement may not be a good choice for at least some Australian patent applicants.
Leveraging International Patent Portfolios
Leveraging and monetising patent portfolios by way of licensing arrangements or selling products in key markets is a crucial consideration. In most instances, jurisdictions such as the USA, Europe and China seem to be popular and important among Australian applicants.
When enforcing patents in jurisdictions such as the USA or China, it is also important to be aware of the various options that could be available should patent litigation commence. Even though a lot is written and said about patent litigation costs in high value jurisdictions such as the USA, every dispute does not have to end in litigation. In many instances, disputes often get settled through commercial negotiations and arrangements including cross-licensing arrangements. Procuring patent rights in overseas jurisdictions should be viewed as a steppingstone to high value potential deal-making and negotiations and not just as litigation.
Having a large global patent portfolio that has been achieved by filing into multiple jurisdictions on corresponding patents for the same technology presents strategic challenges for maximizing value from monetisation and enforcement. Investors looking to invest in Australian companies or looking to acquire an Australian company are more likely to invest and value a patent portfolio that covers key markets of interest.
Finally, it is also important to have an agile patent filing strategy and re-evaluate every few years. In many instances, markets may have shifted, or technology priorities might have changed.
Strategic Abandonment
Patent Applications have to be filed relatively early in the product cycle and there is little opportunity to test the patented product’s commercial viability in key overseas markets before filing. If the patented product is no longer being pursued commercially in one or more overseas markets where patents have been filed, then strategic culling of the international patent portfolio might be necessary.
Here are some questions I ask clients at the time of considering overseas patent filings:
- Are you looking at using your international patent portfolio to get acquired?
- Are you looking to raise capital through various funding rounds or seeking private equity investment?
- Are you looking at a possible listing position by becoming a public company to raise capital?
- Are you an established company and is your goal to use your patent portfolio to defend yourself?
- Are you looking to use your patents in cross licensing and partnerships?
- Is your plan just to license your patent portfolio?
Need Advice?
At MBIP, we have worked with clients who have successfully leveraged their IP portfolio to achieve double- and triple-digit million-dollar licensing and acquisition deals. A number of our clients have also successfully listed on the Australian Stock Exchange and NASDAQ. If you have questions about building global patent portfolios, come and talk to us.
