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Friday, December 22, 2006

Issue 04/2006 of epi-Information Now On-Line.

The recent issue 04/2006 is ready for download

here (PDF).

This issue brings a report on the 61st epi Council Meeting held in Istanbul, 16th and 17th October, 2006. Remarkably they say that "bearing in mind the advances in electronic communication, and perceived difficulties in electronic filing, Council re-established the Online Communications Committee". Er, what does that mean in cleartext? Where there are fumes there must be fire, at least some kind of smouldering. Probably despite various success stories launched by the EPO, the epoline on-line filing system runs somehow less than optimal. And, Council decided that the compromise package solution for the SPLT proposed by the Chair of the Group B+ countries, is deemed not acceptable.

The Report of EPO Finances Committee comprises some interesting discussion of the EPO's financial situation:

"[...] The EPO's financial position could be good, or it could be bad, depending upon your outlook. The accounts for 2005 show a patent office that is earning more than it is spending and it appears that the EPO is heading for a large operational surplus in 2006. However, the accounts for 2006 will have to be presented under International Financial Reporting Standards [IFRS] and the 2005 accounts will be re-stated under IFRS at that time for comparison. On an IFRS basis the accounts will at first sight look poor since several conditional items currently treated as income or assets will not be permitted to be so treated in future.

For example, pre-payments [e.g. refundable fees such as examination fees] will not be treated as income under IFRS until the relevant service is performed.

Also, under IFRS, assets can only include reasonably certain amounts due. This means that the present value of future income from renewal fees cannot be factored into the EPO's 'wealth'. The abandonment of renewal fees by Italy, and the reduction in renewal fees by Switzerland, show this approach to be prudent.

This will result in the EPO showing more liabilities than assets in the 2006 accounts [i. e. it will appear insolvent]. The accounts can carry notes showing additional items off balance sheet to give a clearer picture than the balance sheet alone - but many people place an undue weight on numbers and insufficient weight on what lies behind the numbers. In summary the EPO could appear anything between: -
a solvent patent office with a well run pension fund
an under provided pension fund with an inadequate source of income.
Given the EPO's monopoly status and the apparent continuing growth in demand, the latter assessment would appear somewhat pessimistic. [...]"

Furthermore, there is an article by Mr. W. Noske "Überlegungen zur Strategie weltweiten Patentierens" ("Considerations on a strategy for world-wide patenting") but in German only.

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