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Patents and their importance in the development of technology, competition and innovation

ESTUDIO DELION - Prestige - Experience - Success

The legal protection that a patent has provided to inventions has been a significant incentive for the development and progress of our societies.

Index

Intellectual Property In Peru

Intellectual property is a system directly related to the creative capacity of the human being. This branch of knowledge feeds on symbols, names, inventions, audiovisual works, written works, images, etc. This system has two major components. On the one hand, we find Copyright (which protects artistic creations and software); on the other hand, we find Industrial Property. Likewise, Industrial Property is divided into protecting distinctive signs and inventions or new technologies. Up to this point, it is pretty consistent with suspecting that these concepts have clear and vital importance in developing competition in the market and encouraging innovation tools.

In the words of Professor Alejandro Nadal,  “The market concept is one of the most important in the history of social sciences. This concept’s evolution has profoundly impacted the structure of the social sciences”  [1]. For practical purposes of this topic, we will say that the market is the physical or virtual space in which the purchase and sale of products and services are carried out. It is also defined as the process of exchanging said products and services at a determined price.

 

Intellectual Property & Distinctive Signs

Taking these concepts into account, it is pretty apparent the significant role that intellectual property will have in the selective process of consumers who will acquire and differentiate a particular product from another with a different business origin (in this case, it refers to distinctive signs).

Intellectual Property & Protection of Inventions

On the other hand, the branch of intellectual property, referring to the protection of inventions and tools that make it possible for an economic agent (after having found a technical solution to a problem or obstacle) to have the exclusivity of patrimonial exploitation, is also of the vital importance of their inventions on the market (in this case we are talking about innovations and their protection through what we know today as patents).

Due to the theme of this article, we will focus on describing and making some summary details about the general aspects of the legal protection that different States offer to inventions and new technologies (patents). Recognizing from now on the importance that the protection of these inventions has had to be able to reward and encourage creativity, and with it, to be able to have a much more developed and technological society.

 

  1. What is a patent?

Since ancient times, the human being has created numerous instruments that have made his life more accessible through his remarkable intellectual capacity. Appliances, devices, tools and processes have helped him carry out tasks more quickly and efficiently. When a human being provides a technical solution to a problem presented to him, we are before the birth of an invention.

Because inventions were perceived as instruments that made life easier for people and thus contributed to the development of societies and their economies, the different States (as an incentive for their creators) saw it as convenient to provide legal protection for inventions. In this case, we are before the birth of a patent.

Patents are exclusive rights granted by states to economic agents that could create an invention. The legislation regulating patents mentions that  “inventions, whether product or process, in all fields of technology, will be patentable, as long as they are new, have an inventive step and are capable of industrial application.”  [2] .

  1. TYPES OF PATENT AND THEIR CHARACTERISTICS

Patents can be of two types. Invention Patents and Utility Model Patents. Both are characterized by sharing the qualities of novelty and aim to create a solution to an existing technical problem.

Invention Patents:

They are the most complex and category inventions par excellence; this type of patent requires vast technical knowledge and rigorous intellectual creation and may require a significant financial investment.

To qualify as an invention patent, an invention must be entirely novel (worldwide). This is ratified in article 16 of Decision 486, which mentions:  “An invention will be considered new when it is not included in state of the art”   [3].

 The term of protection for this type of patent is 20 years from the application’s filing date. After these years, the patent becomes an invention in the public domain.

As examples of patents, we can cite: The telegraph, security lock with sheet metal activation, glass perforator and method for perforating glass, the telephone, the roll of toilet paper, the light bulb or spotlight, the mouse, etc.

Requirements for an invention patent:

The patentability requirements for an invention patent are mentioned in article 14 of Decision 486 and are the following:

  • Novelty:  

As already mentioned, an invention is novel when not included in state of the art. It is worth emphasizing that, for an invention to be considered new, the novelty must exist worldwide.

  • Have an inventive level: 

An invention has an inventive level when it is not obvious or evident to a person versed and experienced in the field in which the invention is venturing.

  • Have an industrial application 

If the invention can be used in any industry (for example, the automotive industry, telecommunications, hydrocarbons, etc.), it will be concluded that it has industrial applications.

  • Have a clear and complete description of the invention: 

Although, this requirement is not expressly mentioned in the regulations above. In the patent of invention, clarity and coherence in the wording of its descriptive memory and its claims are also necessary. Being the claims, the novel technical characteristics on which it is desired to obtain legal protection.

Utility model patents:

This protection is given to inventions that offer a technical improvement to an existing design. This invention allows a better operation and utility or incorporates a technological advantage to a current novel object. The complexity of this type of patent is less than that of an invention patent, which is why its processing follows the same path, and the term of protection of this type of patent has a shorter duration than an invention patent. The time of protection for this type of patent is ten years from the date of application.

What is not considered a utility model?

The legislation mentions that the following will not be considered utility models: plastic works, architecture, or objects that are solely aesthetic in nature. Likewise, it is said that the procedures and matters excluded from the protection by the invention patent may not be subject to a utility model patent [4].

As examples of utility models, we can mention: Chair-bed for vertical births, an ice bucket with a lid, a feeder for guinea pigs, a pocket can opener, etc.

  1. EXCEPTIONS TO PATENTABILITY

Article 15 of Decision 486 expressly mentions what is not considered an invention. In that sense, we know that the following is not considered an invention:

  1. a) Scientific theories and mathematical methods;
  2. b) The whole or part of living beings as they are found in nature, biological and natural processes, biological material existing in nature or that which can be isolated, including the genome or germplasm of any natural living being.
  3. c) Literary and artistic works or any other protected by copyright.
  4. d) The plans, rules and methods for exercise intellectual activities, games or economic-commercial activities.
  5. e) Computer programs or software (software since that is considered copyright), as such; and,
  6. f) The forms of presenting the

What inventions are not patentable

Complementary to the above, article 20 of Decision 486 tells us which inventions are not patentable. These are:

  1. a) Those whose commercial exploitation in the territory of the respective Member Country must necessarily be prevented to protect public order or morals. The commercial exploitation of an invention will not be considered contrary to public order or morality only due to the existence of a legal or administrative provision that prohibits or regulates said exploitation;
  2. b) Inventions whose commercial exploitation in the respective Member Country must necessarily be prevented to protect the health or life of people or animals or preserve plants or the environment. For these purposes, the commercial exploitation of an invention will not be considered contrary to the health or life of people, animals, or for the preservation of plants or the environment only because there is a legal or administrative provision that prohibits or that regulates such exploitation;
  3. c) Plants, animals and essentially biological procedures for the production of plants or animals that are not non-biological or microbiological procedures;
  4. d) Therapeutic or surgical methods for human or animal treatment and diagnostic methods applied to human beings or animals.

Opinion about software

In our modest opinion, software should be protected by a patent; however, worldwide, it was decided to preserve software as a copyright. In practice, this measure is advantageous because copyright does not require registration. Copyright is a declarative right; protection has been worldwide since its creation and has a long term (it has protection throughout the life of the author and 70 years after his death).

  1. IMPORTANCE OF THE REGISTRATION OF A PATENT

Patents are constitutive rights of exclusivity granted by the States so that an inventor can give legal protection to the invention resulting from his creativity, effort and knowledge. The patent is a concession title granting certain subjective rights to the inventor regarding the administration and exploitation of his invention in front of all community members. With this protection, the patent owner is given the right and exclusivity to earn large amounts of money from his inventions and obtain recognition for them.

  1. IS PATENT REGISTRATION MANDATORY FOR THE COMMERCIALIZATION OF AN INVENTION?

 

This is a recurring question among many inventors. The answer is no. Registering a patent before an administrative authority is not mandatory so that the invention can be used. However, dispensing with the registration of a patent (far from being a decision that saves money) can end up being a decision that seriously affects possible earnings that an inventor could receive thanks to an invention of his authorship. Not patenting your invention deprives it of legal protection and leaves the way open for other market agents to exploit an invention without recognizing any credit or patrimonial benefit to its creator.

Recognition of a Patent registration

Recognizing a patent registration is a great asset and incentive for inventors. Not only does it follow that, but thanks to said protection, the patent owner can also use and dispose of his invention in equity. In addition, the owner may file an infringement complaint with INDECOPI and a criminal complaint with the prosecutor’s office specializing in crimes against customs offences and against intellectual property against any economic agent that uses its patent without authorization. This is vitally important. If the patent is not duly registered, the inventor of a patent may not prohibit other economic agents from copying, manufacturing and marketing his invention on the market.

  1. EMERGENCE OF THE PATENT SYSTEM AND ITS IMPORTANCE WITHIN THE FIELD OF RESEARCH AND INNOVATION

People, by nature, respond to stimuli and incentives. In an increasingly competitive world, any protection for our creativity or effort derived from the law will be highly positive and stimulating to develop our abilities. As mentioned in previous lines, patents are incentives that States grant to inventors. However, these incentives did not always exist. The legal protection currently provided to inventions (patent system) is a phenomenon that took time to develop.

Inventions and the Development of Humanity

Inventions have always accompanied humanity. Since the human being presented his first challenges with nature, inventions were survival instruments developed thanks to the human intellect. Spears, arrows, hooks, metallurgy, etc., were inventions developed long before legal protection. In these times, inventions occurred sporadically and essentially responded to survival.

14th and 15th centuries

It was only in the 14th and 15th centuries, where the first traces of the invention protection system were found, that the rulers of Venice and Florence began to notice the good economic, military and social impact that inventions generated and therefore, they began to create the “privileges of the invention.” With these privileges (which consisted of life annuities, positions in the state administration – sums of money), the inventors were encouraged to continue their intellectual and creative effort to create inventions that generated social, economic and military benefits for the community. In this context,  «Italy was the country that began with the first manifestations of protection and regulation of its inventors and inventions, expressed in the Venice Statute of 1474» [5], known as the first codified patent system in the world. This statute gave rights to any new and ingenious device not previously made, so long as it was helpful. From then on, the codification of the patent system evolved and became more sophisticated, up to what we know today.

  1. PATENTS ENCOURAGE THE CREATION OF INVENTIONS THAT CAN BE BENEFICIAL IN CRITICAL SITUATIONS

When an inventor obtains his patent registration, the Patent Office of his country grants him exclusivity of use and exploitation and allows him control of the invention. That is, the inventor (whether a natural or legal person) has the option of releasing the knowledge so that third parties can use it without the need to demand royalties. On this point, and writing this article in a «post-pandemic» context, it is pertinent to give an example of what happened recently with the ABBVIE, INC laboratory, which requested before the National Institute of Industrial Property of Chile (INAPI) the release of six of its patents linked to drugs for experimental use for Coronavirus [6]. This teaches us that the legal protection of inventions through patents will always be beneficial for the progress and care of societies. By encouraging inventors, a more significant benefit is achieved for the community.

  1. PATENT PROTECTION IN PERU

It is in charge of the legal protection of a patent in our country, INDECOPI. More specifically, the Directorate of Inventions and New Technologies. In this office, invention patents, utility model patents, industrial designs, integrated circuits, plant varieties and collective knowledge of the Indigenous Peoples of Peru are processed and protected. As mentioned in previous paragraphs, in the strict sense, patents are patents for inventions and utility models. There is the erroneous belief that an Industrial Design is a patent when this is not the case.  Industrial Design is a registration that protects the aesthetic characteristic of a product; it does not solve any technical problem. Therefore, it is not a patent.

  1. THE SITUATION OF PATENTS IN PERU

According to the former president of INDECOPI, Ivo Gagliuffu, from 2011 to 2017, in Peru, patent applications have increased by almost 200%. Our country has a clear tendency to apply for utility model patents. Thus this type of patent represents 70% of patent applications in the country, while the remaining 30% would be invention patent applications [ 7].

Patents in 2015 and 2019

Between 2015 and 2019, Peru experienced notable growth in terms of the recurrence and use of the patent system; thus, a total of 1,653 (one thousand six hundred and fifty-three) national applications for invention patents and utility model patents were presented to INDECOPI by independent inventors, universities, companies and Peruvian research centers [8].

“In Peru, the use of the patent system has made incredible progress in recent years. Thus, from an annual average of 98 national applications filed with the National Institute for the Defense of Competition and the Protection of Intellectual Property (INDECOPI) between 2000 and 2011, an annual average of 214 national applications was reached between 2012 and 2014, which represents an increase of more than 118% in these figures. In fact, in 2014, 275 national patent applications were processed, a record number in Peruvian history”  [9].

Finally, observing more current data, INDECOPI published -as part of Intellectual Property Week- a digital statistical compendium with detailed information on the evolution of national patent applications processed in Peru in the last 30 years [10]. The publication reveals some important data:

  • Universities with the most Patent Applications in Peru between 1990 and 2021:

National University of Engineering (202 applications), the Private University of the North (127), Pontifical Catholic University of Peru (82), the National University of San Marcos (63) and the Peruvian University of Applied Sciences (59).

  • Three Peruvian companies with the most registered patents :

Corporación Sealer’s SA (security seals) (15 patents), Famesa Explosivos SAC (12) and Sociedad Minera Cerro Verde SAA (9).

Regions with the highest number of patent applications filed with INDECOPI, not including Lima : 

  • Arequipa (229 applications), Junín (118) and La Libertad (137)
  1. CONCLUSION

The legal protection that has been provided to inventions has been a significant incentive for the development and progress of our societies. Innovations that solve technical problems serve to make people’s lives less complicated. At the moment in which a branch of law intervenes to benefit the characters who create these inventions, it becomes an incentive tool that penetrates and interrelates with technology for the benefit of the community.

Although it is true, our country (and Latin America in general) is still distant regarding patents concerning countries such as China, Japan, the United States or European countries.It is also true that the statistics tell us that there is a growth in patent applications and registration in Peru. This only positively impacts the growth and development of our nation. The existence of a more significant number of inventors who want to patent their inventions is an indicator of trust in institutions and more excellent creative activity.

This article was initially published in IUS360 – the Legal Portal of IUS ET VERITAS.

References

 

[1] ALEJANDRO NADAL (2010) The Concept of the Market. Q.1

[2] Article 14 of Decision 486 Common Regime on Industrial Property

[3] Article 16 of Decision 486 Common Regime on Industrial Property: The state of the art will include everything that has been accessible to the public by a written or oral description, use, commercialization or any other means before the date of presentation of the patent application or, as the case may be, of the recognized priority

[4] Article 82 of Decision 486 Common Regime on Industrial Property

[5] Fernando Villarán de la Puente (2015) History of patents and inventions in Peru. P.18

[6] News item developed at  https://www.inapi.cl/sala-de-prensa/detalle-noticia/liberan-en-chile-patentes-de-medicamentos-de-uso-experimental-para-coronavirus

[7] Interview with the former president of INDECOPI in November 2018 on the program Marcando Agenda on TV PERU HD.

[8] Indecopi repository  

[9] Fernando Villarán de la Puente (2015) History of patents and inventions in Peru. P.13

[10] Patent PE

Authors

Alain C. Delion

Partner and legal manager of Estudio Delion. Alain C. Delion graduated in Law from the Pontifical Catholic University of Peru and specialized in Intellectual Property and Free Competition. He is also the general manager of various companies nationwide.

In February 2020, the results of the 2020 edition of the best lawyers ranking «Best Lawyers Peru» were published in the newspaper Gestión. On this occasion, Alain C. Delion obtained recognition in the section of the best Peruvian lawyers in Competition/Antitrust Law.

During his professional development, he has represented large corporations and brands, such as Samsung, Toyota, Manchester United, Steve Madden, etc. Likewise, he has represented large, medium, and small companies regarding their intellectual property rights, achieving success in essential and complicated cases such as Royal Bank of Canada vs. Insurance La Fénix Peruana, among others.

LUIS ALFREDO FLORES HEREDIA

Associate and legal deputy manager of Estudio Delion. Graduated in Law from the Universidad Nacional Mayor de San Marcos and specialized in Intellectual Property and Free Competition.

During his professional development, he has been responsible for the legal protection of various brands of recognized importance, such as Philipp Plein, ELEMENT, Mercedes-Benz, Xiaomi, Arcor, etc. Likewise, he has managed important and complicated cases such as PHILIPP PLEIN vs. INDECOPI, among other

Fayssy C. Delion

Fayssy C. Delion

Founding Partner and General Manager