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Brazilian Supreme Court Limits Patent’s Extended Term

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19 de maio de 2021

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In Brazil, as a general rule, Patents of Invention are valid for a 20-year term, while Utility Models have a 15-year term of validity, both counted from the filing date before the Brazilian Patent and Trademark Office (“BPTO”).

However, aiming to guarantee a minimum term of protection in cases where there was an excessive delay in the examination by the BTPO, the Sole Paragraph of Article 40 of the Brazilian Patent Law allowed a minimum term of 10 years of protection for Patents of Invention and of 7 years for Utility Models, counted from the granting date.

Due to the substantial backlog in the examination of Patent Applications, a considerable number of patents has been granted with the applicability of the extended term. On 2016, a Direct Plea of Unconstitutionality (“ADI 5529”) was filed by the Federal Public Prosecutor’s Office (“FPP”), aiming to declare the unconstitutionality of the Sole Paragraph of Article 40 based on the allegation that the provision would cause legal uncertainty.

In a session that occurred on May 6th, 2021, the Brazilian Supreme Court declared the Sole Paragraph of Article 40 unconstitutional, considering that the extended term violated the principles of legal certainty and freedom of competition, among others.

On May 12th, 2021, in a new session, the Supreme Court set the transitional parameters for the unconstitutionality ruling effects (referred to as effect modulation), in order to limit the decision’s consequences, so that:

1-) Once the decision is published (which has not yet occurred), all Patents of Invention that are eventually granted by the BPTO will be limited to a 20-year term, counted from the filing date;

2-) With respect to the Patents already granted considering the extended term, the term of validity will be reduced to the general term only to Patents:

a-) covering pharmaceutical products and processes, medical equipment and materials for use in healthcare; or

b-) object of lawsuits (filed until April 7th, 2021 and still in progress) with the aim to discuss the legality of extended term.

Finally, in what it relates to patents that have already expired, but to which the extended term was applied to, those will not be affected by the decision, i.e., eventual legal measures adopted by the patent owner against third parties or royalties that were received due to licensing will be considered valid.

Our Intellectual Property team is available to assist and clarify any doubts you may by e-mail pi@smabr.com or by phone +55 (11) 3146-2400.

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