Patent Application Process Must Be Compliant with U.S. Export Controls

Commerce Reinforces the Need for Export Compliance in Patent Transactions. The Department of Commerce – through the U.S. Patent & Trademark Office (USPTO) and the Bureau of Industry and Security (BIS) – is reaching out to patent applicants and practitioners in several ways to ensure compliance with U.S. export control obligations relevant in the patent context.

Since late 2007, BIS has required users of the USPTO's EFS-Web to certify that their use of this system does not "violate or circumvent" the Export Administration Regulations (EAR), which BIS administers. More recently, the USPTO extended the certification requirement to include users of the Private PAIR system. The certification is intended to ensure that foreign nationals, whether in the United States or another country, are not given unauthorized access to technology that is controlled under the EAR. The certification may be new, but the EAR has long governed the release of controlled technology to foreign nationals.

This issue came to light when the USPTO realized that providing electronic access to the PAIR system could result in an export regardless of whether the applicant was in compliance with the EAR. Requiring certification makes the responsibility to comply more conspicuous in the patent application process.

Exports of controlled technology in patent transactions have gained importance of late as U.S. companies are increasingly outsourcing various functions – including patent-related activities – to offshore service providers. The USPTO recently issued a notice in the Federal Register addressing this issue, in which it reminded applicants of the EAR's controls and clarified the scope of what may be exported pursuant to a USPTO foreign filing license. Specifically, foreign filing licenses only permit the export of the exact scope of technology that has been included as part of a U.S. patent application (or a petition for a foreign filing license), and only for purposes related to the preparation, filing or possible filing, or prosecution of a foreign patent application. Exports of technology for other purposes, including preparation or filing of U.S. patent applications, as well as releases of technology to foreign nationals via databases and other electronic systems located in the United States, licensing of any of the technology to third parties, and internal corporate collaboration or development, must comply with the EAR. Thus, U.S. companies employing foreign nationals, as well as multi-national corporations, should ensure that protections are in place to comply with U.S. export controls throughout the entire patent preparation and prosecution process.

Click to review the Federal Register notice.