Brazilian Supreme Court decides which is the correct term of protection of patents in Brazil

On May 06, 2021, the 11 Justices of the Brazilian Supreme Court finished the trial of the Direct Unconstitutionality Plea (DUP) 5529, filed by the Attorney General for the Federal Government, and decided that the Sole Paragraph of Section 40 of the Brazilian Patent & Trademark Act (Law 9,279/96) infringes the Brazilian Constitution, as it set forth that patents were valid for at least 10 (ten) years as of their issuance by the Brazilian Patent & Trademark office (BPTO).

 

As explained in our Newsletters 7 and 8, of April 2021, the consequence of this decision is that, henceforth, patents may only last for 20 (twenty) years counted as of the filing of the application in Brazil.

 

During the trial, 15 organizations were accepted as amici curiae and filed briefs, supporting both sides of the discussion. Our partner Gabriel Leonardos presented oral arguments on behalf of ASIPI – the Interamerican Association of Intellectual Property in favor of upholding the validity of the attacked provision.

 

However, the majority of the Court ruled in favor of this DUP. The decision was taken by the reporting Justice Mr Dias Toffoli, and by other 8 Justices. The minority was formed by Justices Luis Roberto Barroso and Luiz Fux, who understood that the provision being discussed was aligned with the Brazilian Constitution.

 

Even though the discussions among the Justices were concentrated in the matter of pharmaceutical patents, the unconstitutionality of the provision affects patents in all technological areas. In particular, other areas with chronic delays in the examination by the BPTO are telecommunications and electronics.

 

In view of the existence, as of this moment, of over 30,000 issued patents with this term extension, a modulation of the decision was discussed. A modulation is a special rule enacted by the Court regarding the effects of the decision.

 

As a general rule, a declaration of unconstitutionality has retroactive effects, because it is as if the attacked provision never had any validity. As a result thereof, without modulation, all patents already issued by the BPTO with an extension of their term of protection would have their terms shortened and, among them, approximately 5,000 patents (that are already in force longer than 20 years after filing) would immediately cease to be valid, with the inventions falling in the public domain.

 

In this matter, the Supreme Court decided to postpone the decision as to the modulation of effects to the session to be held on May 12, 2021. 

 

The debates were intense and they covered several aspects of patent protection, focusing on the following matters:

(i) the high price of pharmaceutical drugs that, due to the rule of Sole Paragraph of Section 40, enjoy protection for a term longer than 20 years from filing;

(ii) the scope of the actual protection afforded to owners of patent applications prior to the issuance of the patent; and

(iii) the causes for the inadequate functioning of the BPTO that, on average, took longer than 10 years to examine patent applications. We remain at your disposal to provide you with additional details about this decision.

 

It is worth noting that henceforth it becomes more important that the BPTO be faster in its examination of patent applications. In case you are interested in assessing the possibilities of accelerating the examination by the BPTO, please feel free to approach your customary contact person in our firm, or to write us to mail@kasznarleonardos.com.