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Patent Application Grant (PAG) – Hong Kong – Ultimate Guide

The Hong Kong Patent Application Grant, or PAG, is a government funded initiative to provide financial assistance to local Hong Kong companies and permanent residents interested in seeking patent protection for their inventions.

The application is not simple and will require some work on your part. It will also require an initial investment of around HK$10,000 to complete the application process (partially refunded upon acceptance). If accepted, though, the Patent Application Grant will contribute a maximum of HK$250,000 towards the cost of filing and securing patents, and is therefore a very useful resource for start-ups, SMEs, and lone inventors.

Further information about the grant is available at the websites of the Innovation and Technology Commission (ITC), which is the body responsible for administering the grant, and the Hong Kong Productivity Council (HKPC), which is the implementation agent of the Hong Kong patent application grant.

As the Hong Kong patent application grant process can be a little daunting for those new to patents, we’ve put together a comprehensive step-by-step guide to help you prepare and submit your own application.

Before we get started, though, you need to check that you qualify to apply…

PATENT APPLICATION GRANT ELIGIBILITY CRITERIA

Applicant Country

If the applicant is an individual…

The individual must be either a Hong Kong permanent resident or a Hong Kong resident permitted to remain in Hong Kong for not less than 7 years company.

If the applicant is a company…

The company must be a local Hong Kong company incorporated under the Companies Ordinance (Cap 622).

Ownership of the Invention

The applicant for the Patent Application Grant must be the same as the intended or existing applicant of the patent application for the invention.

The intended or existing applicant of the patent application must own the right to the grant of a patent for the invention.

In the case of an individual or group of individuals that has or have devised an invention, they will own the right to grant of a patent for the invention and should therefore be the applicant(s) of a patent application for the invention. Consequently, at least one of the inventors must be the applicant for the Patent Application Grant.

In the case of a Hong Kong incorporated company, generally speaking, the right to grant of a patent for the invention will belong to the company if the invention was invented by one or more employees of the company. Therefore, the company should be the applicant of a patent application for the invention and, hence, the applicant for the Patent Application Grant.

It’s important to note that if one or more inventors is not an employee of the company e.g. a consultant, or director, the question of ownership may be more complex and will require input from a qualified patent attorney.

No Earlier Granted Patents

An applicant for the Patent Application Grant must not have previously owned a granted patent in any country or territory. This includes utility model patents, short term patents, or so-called ‘petty patents’.

No Previous Patent Application Grant

An applicant for the Patent Application Grant must not have previously been granted funding under a separate Patent Application Grant. In the case of an applicant company, this includes a related company with a common shareholder that owns more than 50% of the related company, or a related company that has the same directors as the applicant company.

For example, Company A has 3 directors, Peter, John, and Paul. Peter owns 60%, and John and Paul each own 20% of Company A. If Company A successfully applies for funding under the Patent Application Grant, Peter cannot apply for a second Patent Application Grant with a different Company in which he is a shareholder.

In a second example, Peter, John, and Paul each own an equal share of Company A, i.e. 33.3% each. If Company A successfully applies for funding under the Patent Application Grant, Peter, John, and Paul cannot apply for a second Patent Application Grant in the name of Company B in which they are shareholders.

The Invention Must Contain a ‘Technology Element’

This is one of the trickier criteria to judge. There’s no legal definition for ‘technology element’ and it’s not a requirement of Hong Kong patent law (or any other foreign patent law that I’m aware of) to be granted a patent.

I’ve discussed this matter with the HKPC and they were unable to give me a precise definition. It seems this additional criterion was included to give the ITC some discretion to refuse applications that are not considered sufficiently ‘techy’ to justify the grant.

Thus, the Patent Application Grant appears to be aimed at inventions relating to more technologically advanced inventions. From past experience, the threshold is not especially high but if you’ve invented a new type of brush or household item that doesn’t include some form of electronics or remote connectivity, you’re likely to struggle.

COMPLETING THE APPLICATION FORM

First, you need to download the Hong Kong Patent Application Grant Form.

Part I of the form is relatively straightforward, simply requiring details of the applicant, inventors, company shareholders (in the case of an applicant company), and a brief description of the business.

It’s important that you carefully read the declaration at section D and ensure you satisfy each of the criteria because, if the declaration is found to be false, the Government may take steps to recover the Patent Application Grant.

Parts II and III is where it gets trickier, so here’s where we’ll go into a little more detail.

The Invention

To show a specific example, we’re going to have to invent something which is new (we think).

Let’s imagine we’re the inventor of a wonderful new key fob for opening doors without having to place the fob close to the reader. Unlike existing key fobs, our key fob can communicate with our mobile device to transmit an unlock signal to the reader without having to search through our bag or pockets to unlock the door. The key fob can communicate with the door reader via our mobile device upto 2 metres away so that a door can be automatically unlocked as we approach. This will be particularly advantageous if our hands are full or our fob is hard to access at that moment. The mobile device can store details of unlocking events initiated by the key fob and therefore can provide the user with a log of all times the user’s fob has been used to access a room.

Now to complete the rest of the form…

PART II : BRIEF PATENT IDEA

The Title

This isn’t particularly important or complex but should be fairly specific to your invention. We’ll give the invention the title “Wireless Key Fob”. We’ll provide a corresponding translation into Chinese, as required by the form.

Technologies Involved

We must select one of the following technology options we believe most closely matches the technology involved in our invention:

Biotechnology; Chinese Medicine; Electrical & Electronics; Environmental Technology; Information Technology; Manufacturing Technology; Materials Science; Nanotechnology; Others.

Clearly, it’s not biotechnology or Chinese medicine related. In our case, the most likely candidates are Electrical & Electronics and Information Technology (as there’ll probably be a software element to the invention). Since the key fob is a physical device comprising electronics, we’ll choose “Electrical & Electronics”.

Countries/Territories Intended for Filing the Application

Next we have to list countries or territories in which we would like to file a patent application for our invention. Don’t worry if you don’t know exactly which countries are of interest at this stage. It’s not definitive and can be changed if and when the Patent Application Grant is approved.

For now, we’ll go for some of the more common choices, USA, China, and Europe.

Let’s see how our application form’s shaping up:

Now for the hard parts…

Description of Invention

Background of the Invention

This section doesn’t have to be too detailed (we’ve only got 250 words to play with after all) but it should outline the general area of technology of the invention and the shortcomings of existing products. Here we might say:

“The invention is in the field of wireless key fobs that allow doors to be unlocked. Conventionally, key fobs comprise small self-contained units or cards with circuitry that may be detected by remote readers associated with doors. When a key fob is brought into close proximity to a reader, wireless signals from the reader energises the circuitry in the key fob and cause the key fob to transmit a signal back to the reader. Upon receipt of an authorised signal, the reader transmits an unlock signal to the door lock to allow the door to be released and the user to enter a secured room. A problem with conventional key fobs is they are awkward to use, particularly if a user’s hands are not free to locate and position the fob for unlocking purposes.”

The above brief description explains what conventional key fobs are and their associated problems. This sets us up nicely to introduce our great invention.

Summary of the Invention

Again, we’re limited to around 250 words in this section, so we don’t have to go into great detail at this stage. In this section we’re directed to answer what the invention does and how it functions. Without going too deep into the details, we might say:

“Our invention is a wireless key fob that can communicate with a mobile device such as a smartphone to transmit an unlock signal to a reader of the door up to 2 metres away. The wireless key fob has a short-range transceiver configured to communicate with a mobile device when the wireless key fob is within range of a short-range transceiver of the mobile device. The short-range transceiver of the wireless key fob may be a Bluetooth transceiver. The wireless key fob may have a power source, such as a lithium-ion battery to power the transceiver to communicate with the mobile device. The wireless key fob may transmit information to the reader of the door via the mobile device relating to control of door functions. For example, when the key fob is out of range of the reader of the door but within range of the mobile device, the key fob may communicate unlocking information to the mobile device which relays the unlocking information to the reader of the door via radio frequency channels. Thus, the wireless key fob can unlock the door via the mobile device even when the key fob is out of range of the reader.”

PART III:   DETAILS OF PATENT IDEA

Description of Invention:

Description of the preferred embodiment

I’m afraid this section is likely to involve the most writing… Just as with a patent specification for an invention, the application form requires a relatively detailed explanation of a working example of your invention. Here you can be specific and state which types of components your product will use and how they are put together. If referring to drawings (included in the next section), you can even include reference numerals for various features and include the reference numerals in the drawings pointing toward the relevant part to help understanding.

The clearer your description, the better the chances of your application for the Patent Application Grant being approved. Therefore, you should spend some time here providing as much detail as possible about your invention and how it works or how you anticipate it will work.

Drawings

Drawings can be very helpful in explaining a concept or idea. Imagine trying to describe an everyday item such as a scissors without a drawing! much trickier I’m sure you’ll agree. Therefore, you should include any drawings of your idea in this section or at least attach them as an additional sheet.

For our key fob example, we might include a schematic representation of the fob with the important constituent parts and a separate drawing of a circuit diagram to show how the various pieces are arranged and work together.

Intended Scope of Claims

The claims are probably the hardest part of the application form to complete. It takes a patent attorney many years of training and practice to draft a good set of claims.

Usually, there’s at least one so-called ‘independent claim’ which does not depend on and, hence, does not include the features of any preceding claim. An independent claim should include only the minimum number of features necessary to work the invention.

After an independent claim, there is usually one or more ‘dependent claims’ which, as the name suggests, depend on the preceding independent claim. That is, the dependent claims include all of the features recited in any preceding claim on which they depend. For example, claim 1 may be an independent claim and claim 2 may depend upon claim 1. In other words, claim 2 includes all of the features recited in claim 1 as well as the or each additional feature recited in claim 2.

Let’s have a go with our own example invention. We might decide that our invention requires at least a wireless transceiver to communicate with a mobile phone. Without that, the fob would not achieve the goal of remote unlocking a door when out of range of the door reader. Therefore, we could frame claim 1 as follows:

  1. A wireless key fob comprising a short-range transceiver configured to communicate with a mobile device when the key fob is within range of a short-range transceiver of the mobile device,
    wherein, when the short-range transceiver of the wireless key fob is out of range of a short-range transceiver of the door, information is transmitted from the wireless key fob to the door over a short-range link between the wireless key fob and the mobile device and is relayed from the mobile device to the door over a long-range link between the mobile device and the door.

Then, we might decide that the short-range transceiver being a Bluetooth transceiver, whilst not absolutely essential to the invention and, hence, not required for claim 1, is nevertheless important and should be included in claim 2 as follows:

The key fob of claim 1, wherein the short-range transceiver of the key fob includes a Bluetooth transceiver.

Thus, because claim 2 is dependent on claim 1 and includes all of its features, if written long form, claim 2 would read as follows:

A wireless key fob comprising a short-range transceiver configured to communicate with a mobile device when the key fob is within range of a short-range transceiver of the mobile device, wherein, when the short-range transceiver of the wireless key fob is out of range of a short-range transceiver of the door, information is transmitted from the wireless key fob to the door over a short-range link between the wireless key fob and the mobile device and is relayed from the mobile device to the door over a long-range link between the mobile device and the door, wherein the short-range transceiver of the key fob includes a Bluetooth transceiver.

The additional feature of claim 2 is shown in bold for clarity.

We can continue to add a few more dependent claims which each include features that we believe are important, but not so essential that they must be included in claim 1. For example, we could add a third claim that includes the following feature:

The key fob of claim 1, wherein the information transmitted from the wireless key fob to the door relates to controlling door functions.

The reason for the dependent claims is to provide fall back positions in the event claim 1 is not considered to be new. For example, a patent search may reveal that the combination of features we included in claim 1 have already been disclosed in an earlier patent document. In this case, our invention, as defined by claim 1, is not new and cannot be granted a patent.

Claim 2 on the other hand might be new if there is no earlier document that discloses a key fob with a Bluetooth transceiver. If no such earlier document exists, we may have some chance of obtaining a patent for the invention defined by claim 2.

Since the HKPC may not send an application for the Patent Application Grant to the ITC for approval if the claims are found not to be new, it’s very important to include a number of dependent claims in your patent application grant form as fall-back positions. This might be difficult to do within the suggested 300-word limit but since this is indicated as ‘preferable’ in the form, our suggestion would be to include as many words as you require in this section.

Is There a Prototype or a Demonstration of This Invention Which Is Helpful for the Assessment Process?

This question is fairly straightforward. If a prototype does exist, you can include details here. An advantage of having a working prototype is that it may help the HKPC to better understand your invention and potentially improve the prospects of your application being accepted.

That said, a prototype is not a requirement for the Patent Application Grant and so you can simply answer ‘no’ to this question if no such prototype exists at the time of the application.

Is Further Development of Your Invention Now in Progress or Scheduled?

This is simply a factual enquiry and should be completed according to current circumstances. It might be that your invention is at a very early stage and that little or no progress has been made in terms of developing a working product. That’s ok. Nevertheless, you may want to include some brief details in this section about how you intend to take your idea further, if only to demonstrate your commitment to the idea.

Have You Filed Any Patent Applications on This Invention to Any Patent Offices?

Again, this section should be completed according to current circumstances.

It may be that you’ve already taken steps to file at least one initial patent application to secure protection for your invention. This is perfectly ok and actually a sound strategy. Provided you’ve not been granted a patent for your invention, you can still qualify for the Patent Application Grant.

Simply list the details of any patent applications you’ve filed for your invention and provide a copy of any corresponding filing receipts. Providing the HKPC with this information allows them to build a picture of your activities to date and allows them to request any corresponding patent search results that may have issued in respect of your application. This allows the HKPC to better assess your invention and decide whether or not to put your application forward for approval.

Publication

Has the invention been publicly disclosed, displayed, offered for sale, published, or publicly used?

This is a fairly loaded question because any public disclosure of your invention before a patent application has been filed could affect the patentability of your invention and, hence, whether or not a valid patent can be obtained. Even your own public disclosures can be used to assess the patentability of your invention. This is why it is critical to keep an invention secret until a patent application has been filed.

If you have disclosed your invention to the public, you should provide details in this section. However, this information could reduce the likelihood of your application for the Patent Application Grant being accepted. Therefore, if you have publicly disclosed your invention before a patent application has been filed, we recommend you speak to a patent attorney before submitting your Patent Application Grant application to discuss how you might proceed.

Are any public displays, trade shows, or publications concerning the invention planned?

As above, this is a relatively straightforward question and should be answered according to current circumstances. If you are planning to publicly display your invention, for the same reasons given above, you should ensure a patent application is on file before such disclosure, whether or not the Patent Application Grant has been accepted, so that you do not affect the validity of a subsequent patent for your invention.

If you are not in a position to file a patent application before the intended disclosure, you should delay the public disclosure until you can file a patent application.

Prior Art

This is a very important section for the HKPC’s assessment of your application. Prior art represents all publicly available information that is of relevance to your invention. In our key fob example invention, the prior art will include all key fobs that have ever been sold and/or described in publicly available literature.

Prior art is used to assess whether or not your invention is new and inventive and may be granted a patent. The HKPC’s goal is to put forward for approval applications for the Patent Application Grant that relate to inventions that have a prospect of being accepted for grant. Therefore, the HKPC will consider any prior art of relevance to your invention when making its assessment.

List and Describe Any Other Products/methods Known to You Which Attempt to Accomplish the Same Result

You can include in this section any products you are aware of that you believe relate to your invention.

List and Describe Any Patents or Publications Known to You Which Are Similar to the Present Invention

Again, you include in this section a list of all public literature you are aware of that might be of relevance to your invention. If you have already filed one or more patent applications and a search report has been issued by the relevant Patent Office, you should include in this section details of any prior art citations that were revealed by the search.

In our key fob example, we might include the following web page as an item of relevant literature in the public domain:

State Why the Present Invention Is Technically and/or Functionally Different From the Listed Prior Art

In this section you have the opportunity to explain why your invention is different from the prior art you’ve listed above. Take some time to elaborate on any differences because, often, it’s not immediately clear where the differences can be found. It might be that there’s a very important but subtle difference that needs to be explained to aid the HKPC’s understanding.

A clear explanation in this section that points out all the key differences between your invention and the prior art could really improve the chances of successfully applying for the Patent Application Grant , so investing some time here could pay off.

THE APPLICATION PROCESS

So we’ve completed the application form as best we can and included all relevant information. Now what?

Well, the obvious first step is to submit the application to the HKPC for assessment. But what’s involved in this assessment, how much does it cost, and how long does it take?

Form and Fee

The completed form can be submitted to the HKPC or the ITC. However, since the HKPC is the body responsible for processing the application, we suggest submitting your application to the HKPC at the following address:

Hong Kong Productivity Council
78 Tat Chee Avenue, HKPC Building, Kowloon Tong,
Kowloon.

Two copies of the form, each with original signatures, must be submitted by post or in person together with a cheque for HK$3,000 made payable to the “Hong Kong Productivity Council”. The HK$3,000 payment is a deposit to cover part of the HKPC’s costs in arranging the so-called “patent search-cum-technical assessment” in respect of the application.

This deposit is non-refundable unless the Patent Application Grant is approved in which case the cost of the patent search-cum-technical assessment is reimbursed from the grant.

In our experience, assuming a straightforward case with no serious objections, the whole process takes around 6 months from filing the application to approval.

Patent Search-cum-technical Assessment

The assessment involves the following:

  • a review of the application form to ensure completeness;
  • an assignee search to check if the applicant is the owner of or has owned any previously granted patents;
  • an official prior art search (if not provided by the applicant);
  • a third-party opinion from a patent attorney (if the prior art search is unfavourable);
  • compilation of an assessment report to be sent to the ITC for approval.

Initial Checks

The HKPC’s initial review of the application form may result in one or more questions for the applicant. For example, the HKPC may ask the applicant to further explain the ‘technology element’ of the invention. Alternatively, the HKPC may request further explanation about the differences between the invention and the prior art.

These questions are a normal part of the process so don’t be disheartened if your application is challenged. Each time any additional information is requested, simply provide a detailed response within the time period allowed.

Patent Search

An official patent search is required as part of the assessment. This is to allow the HKPC to check whether or not your invention is new and has a chance of ultimately being granted a patent.

If you’ve already obtained a patent search from an official search authority such as the China State Intellectual Property Office (SIPO) or the UK Intellectual Property Office, you can include this in your application. This should avoid the need for the HKPC to request a further search and, hence, save you some money.

If no search report is available, the HKPC can arrange for this to be conducted by an approved searching authority. Usually, the HKPC will arrange for the search to be conducted by SIPO at a cost of approximately HK$2,000 if the application is in Chinese or HK$5,000 if the application is in English. You may opt for a different searching authority if desired. For example, the HKPC can arrange for the Swedish Patent Office to conduct the search but this is likely to cost in the region of HK$10,000.

The applicant must pay for the search but, again, this is eventually reimbursed from the Patent Application Grant if approved. A favourable search report i.e. one that does not reveal particularly relevant prior art and, therefore, suggests your invention is patentable, is a very positive sign that your application for the Patent Application Grant will be successful.

Patentability Advice

If the search report is unfavourable and reveals one or more documents that suggest your invention is not patentable, the HKPC may request advice from a patent attorney. The HKPC has a list of approved attorneys but you may choose your own preferred patent attorney if you wish. The cost of obtaining the advice is likely to vary but should be in the region of HK$4,500. This is not refundable from the Patent Application Grant even if approved.

Assignee Search and Report

If the search report is favourable or the patentability advice indicates a patent might be obtained despite an unfavourable search report, the HKPC will conduct an assignee search to ensure the applicant has not already been granted a patent. As discussed above, this is because an earlier granted patent precludes an applicant from obtaining funding via the Patent Application Grant.

Provided the assignee checks are clear, the HKPC will prepare its assessment report for sending to the ITC for approval.

The HKPC’s cost of conducting the assignee search and preparing the report is around HK$3,000 to HK$4,000. As above, this cost is incurred by the applicant but will be reimbursed from the grant if approved.

ITC Assessment

The ITC is the body responsible for making the final decision as to whether or not to approve the grant. In our experience, if your application has passed the HKPC’s checks and made it this far, the chances of success are high.

If approved by the ITC, the HKPC will communicate with the applicant to discuss the next steps and the release of the funds.

APPROVAL!

You’ve finally made it and received final approval from the ITC! Congratulations! What’s next…

Firstly, you’ll have to commit some more money… whilst the cost of the patent search-cum-technical assessment is reimbursed from the grant, the applicant is expected to fund 10% of the total grant.

The idea is that the ITC will provide a maximum grant of HK$250,000 which amounts to 90% of the total grant. Thus, the applicant is expected to fund the remaining 10% which equates to approximately HK$27,800. Nevertheless, I think you’ll all agree it’s not a bad deal!

Using the Grant

Once all the funds are in place, the applicant informs the HKPC of the countries in which to file patent applications for the invention and which patent attorney to use.

The HKPC then communicates with the patent attorney to obtain cost quotations for the work proposed by the applicant. This will be highly variable and will depend on the countries of interest and whether or not an initial patent specification describing the invention needs to be prepared. Regardless, the grant will help the applicant to go quite far into the patenting process!

Upon receipt of the cost quotations, the HKPC communicates with the applicant for approval. If the applicant agrees to the cost quotation, the HKPC will provide the patent attorney with a purchase order and approval to proceed with the agreed work.

When the patent attorney has completed the agreed work, an invoice equivalent to the cost quotation is sent to the HKPC for processing. The HKPC applies a 20% administration fee to the invoice and subtracts the total from the grant.

For example, if the applicant wishes to file a patent application in the US, and the patent attorney provides a quotation of HK$35,000, upon completion of the work and issue of the invoice, the total cost of the work, including the HKPC’s fee, is approximately HK$42,000.

Therefore, out of a total grant of HK$278,000, when the HKPC’s 20% fee is taken into account, the applicant has a total of around HK$222,000 to cover the cost of its patent applications (minus the cost of the patent search-cum-technical assessment). Still not too bad a deal, I’m sure you’ll agree but not quite the HK$250,000 you thought was promised!

The grant must be used within 3 years of approval but, depending on how ambitious you are with your patent coverage, the likelihood is that you’ll have exhausted the fund before this deadline. Even if not, it is possible to extend this deadline upon request to the HKPC.

So, there you have it. Simple!

If you have any questions about the Patent Application Grant or require any assistance in completing the form, we’d be happy to help. Simply get in touch and we’ll give you some guidance as to how to proceed.

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