CHANG TSI
Insights
In today’s increasingly competitive intellectual property landscape, the invention patent risks faced by companies are no longer limited to granted valid patents, but also extend to pending patent applications under substantial examination. How can potential risks be mitigated cost-effectively and efficiently before a competitor’s invention patent application is granted? The third-party observation (TPO) serves as a “invisible sniper” capable of striking silently and precisely during the patent examination phase.
Summary: The third-party observation is a low-cost, high-efficiency mechanism enabling pre-grant intervention. It complements post-grant invalidation, forming a vital part of corporate patent risk management. To maximize impact and adoption, it is advisable to engage professional counsel for strategic preparation and submission.
The third-party observation refers to the legal procedure in which any third party submits opinions and evidence to the China National Intellectual Property Administration (CNIPA) between the publication of an invention patent application and its grant, arguing that the application does not meet the requirements for grant.
According to regulations, anyone (including anonymous entity) may submit comments on published but ungranted invention patent applications for examiners to consider during substantive examination. This mechanism provides enterprises with a legal and convenient channel to intervene in risk prevention and control before a patent is granted. The identity of the submitter is not disclosed to the examiner or the applicant, ensuring confidentiality and avoiding direct confrontation.
The submission of the third-party observation is, in essence, an inevitable outcome of market competition and technological rivalry, with its core needs centered on critical aspects of corporate development and risk management.
1. Fierce Competition in Industry Niche Sectors
As the volume of patent applications in China rises year by year, the activity surrounding applications for invention patents, utility model patents, and design patents continues to increase. This reflects the unleashing of social innovation vitality but also signifies intensifying industry competition. In many niche sectors, particularly those limited to the domestic market or regional markets within a specific province, there are often only two or three core competitors. The technological rivalry and competition over patent portfolios among them are particularly intense. Patent intelligence has become a key factor in corporate competition. When a company discovers that a competitor’s published patent application may pose an obstacle to its own products, technologies, or market strategy, intervening early during the substantive examination stage through the third-party observation becomes one of the optimal choices for mitigating potential threats.
2. The Need for Precise Countermeasures Against Competitors
When two companies are embroiled in patent litigation, both parties conduct a comprehensive assessment of the other’s patent portfolio, particularly focusing on patent applications that have been published but not yet granted. To prevent competitors from strengthening their litigation leverage through newly granted patents, companies typically employ the third-party observation to preemptively target pending patent applications that pose a threat to their own interests. By preventing these applications from being granted, they weaken the opponent’s litigation advantage at the source.
3. Avoiding Conflicts Between R&D and Patent Applications
Different companies in the same technological field often have overlapping R&D directions and similar technical approaches, which can easily lead to conflicting patent applications. When a company discovers that another company’s pending patent conflicts with its own R&D direction or product design, and that granting such a patent might restrict its own development, filing a request for the third-party observation becomes an effective means of avoiding such conflicts.
1. Low Cost, No Official Fees
Compared to post-grant invalidation proceedings, no official fees are required by the CNIPA for filing a third-party observation. Even when engaging a professional firm to draft the public comment, the legal fees are significantly lower than those for invalidation cases, as there is no need to address all grounds for invalidation comprehensively. This “low-threshold, high-return” characteristic makes it the preferred tool for enterprises to manage patent risks.
2. High Level of Confidentiality, Avoiding Direct Confrontation
The third-party observation can be submitted anonymously; neither the examiner nor the patent applicant can identify the submitter. Submitting via postal mail further enhances confidentiality, allowing companies to execute precise countermeasures while maintaining the advantage of “keeping the opponent in the dark,” thereby avoiding direct confrontation with competitors.
3. Proactive Interception to Seize the Initiative
Intervening before a patent is granted is far less difficult than seeking invalidation after grant. At this stage, the patent application has not yet been granted rights, and the examiner has not yet formed a definitive opinion. A public comment that provides precise comparative documents and offers professional, compelling analysis can fully leverage the “first-in-mind” effect—either preventing the problematic patent from being granted or forcing it to narrow its scope of protection, thereby resolving risks proactively.
4. Dynamic Adjustment and Sustained Pressure
After submitting the third-party observation, companies can continuously monitor the examination status of the target patent application. Based on the Office Action, the applicant’s response, and changes to the claims, they can decide whether to submit additional comments and evidence. This ability to engage in “ongoing monitoring and response” significantly increases the likelihood that the comments will be adopted.
The submission of third-party observations is not arbitrary but is based on clear legal grounds and standardized procedures. Mastering these key points ensures that comments are effectively considered by examiners.
1. Clear Legal Foundation
Article 54 of the Implementing Regulations of the Patent Law explicitly stipulates: From the date of publication of a patent application for an invention until the date of the announcement of the grant of the patent, any person may submit comments to the State Council’s patent administrative department regarding a patent application that does not comply with the provisions of the Patent Law, and provide reasons for such comments.
Section 4.9 of Chapter 8, Part II of the Patent Examination Guidelines (2023 Revised Edition) further specifies: Any comments submitted by the public shall be filed with the application dossier for consideration by the examiner during substantive examination; if comments are received after the examiner has issued a notice of grant of patent rights, they need not be considered; furthermore, the Patent Office is not required to notify the public who submitted the comments of the outcome of their consideration. This means that the submission of third-party observations is subject to a strict time window, and their effect is “advisory” rather than binding; In practice, however, the impact of the submission may be inferred from subsequent examination actions.
2. Standard Operational Procedures
The operational procedures for the third-party observation are clear, and the key points can be summarized as follows:
(1) Initiator: Any person, without the need for specific qualifications, is eligible to submit comments. Typically, these are enterprises, individuals, or institutions with a vested interest in the patent application, and submissions may be made anonymously—a core manifestation of the system’s “confidentiality.”
(2) Timing of Submission: The core time window is “from the date of publication of the invention patent application to the date of the announcement of the grant of the patent.” The optimal time is after the patent enters the substantive examination stage but before the issuance of the first notice of examination—at this point, the examiner has not yet formed a preliminary judgment, and the influence of the third-party observation is greatest.
(3) Submission Authority: The China National Intellectual Property Administration (CNIPA). Submissions may be mailed to the Receiving Office of the Patent Office, CNIPA, No. 6 Tucheng Road, West of Jimen Bridge, Haidian District, Beijing.
(4) Scope of Application: Applies only to invention patent applications that have been published but not yet granted. It does not apply to utility model or design patents (as these are published only after grant, leaving no room for public input during the substantive examination stage).
(5) Submission Methods: There are two methods: online and offline. Offline submissions may be made by mailing a hard copy of the “Statement of Opinion” (available for download from the CNIPA website, document number 100012); online submissions may be made through the “New Third-party observation” module on the client or web version of the “Patent Examination and Review Platform” within the Patent Business Processing System. Note that feedback from electronic submissions is not part of the statutory examination procedure; in practice, submitting a hard copy by mail is more strongly recommended.
1. Timing: Early Intervention, Early Benefits
Based on practical experience, the optimal time to submit the third-party observation is after a patent application enters the substantive examination stage but before the first Office Action is issued. At this stage, the examiner has not yet formed a preliminary conclusion and is more likely to objectively consider external perspectives. If comments are submitted after the Office Action is issued, the difficulty of having them fully adopted increases due to examination deadlines and response time limits.
2. Drafting Content: Adopt the Invalidity Standard and Follow the Examination Logic
When drafting the third-party observation, it is recommended to mimic the format of the Office Action to facilitate the examiner’s reference. In terms of content, the primary focus should be on novelty and inventive step, providing arguments based on various combinations of prior art; at the same time, do not overlook “non-novelty” grounds such as insufficient disclosure, lack of support, and lack of clarity. Especially when the prior art is not sufficiently strong, these grounds may become important points of entry.
It is important to emphasize that while third-party observations may resemble a Notice of Examination Opinions in form, they should essentially meet the standards of a Request for Declaration of Invalidity: thorough search, compelling comparisons, rigorous logic, and clear reasoning.
3. Evidence Preparation: Diverse Combinations, Targeted Approach
Evidence may include patent documents, books, and journals, as well as web pages, product promotional materials, WeChat Moments, official accounts, QQ Spaces, and other information. The authenticity, legality, and relevance of the evidence are crucial. The combination of evidence must also be carefully designed to ensure that alternative options can promptly fill the gap if the examiner rejects a particular set of evidence.
4. Monitoring and Communication: Continuous Follow-Up and Dynamic Adjustment
After submitting the third-party observation, the examination status of the target patent application should be continuously monitored. If the examiner does not adopt or fully adopt the comments, one may attempt to communicate with the examiner via telephone to understand their preliminary stance and the considerations behind the rejection. If necessary, new evidence or more targeted technical analyses should be submitted.
1. “Prompting” Opponents to Build Stronger Patents
If the evidence submitted in the third-party observation is not strong enough to effectively challenge the current claims, it may instead prompt the applicant to incorporate more defensive content from the specification into the claims, thereby strengthening the patent’s stability. Countermeasure: Carefully assess the effectiveness of the evidence before submission. If the existing evidence can only challenge the current claims without addressing potential directions for amendment, a strategic approach of waiting until after grant to initiate invalidation proceedings may be a better option.
2. The Commercial Risk of “Revealing Your Hand”
For companies operating in highly competitive sectors, the evidence submitted in the third-party observation may constitute a valuable “trump card” that could be held in reserve for future litigation. Revealing it too early could pose commercial risks. Countermeasure: Comprehensively assess the strategic value of the evidence, weigh the pros and cons of “preemptive action” versus “striking later,” and make decisions aligned with the company’s business objectives.
As a “third-party participation mechanism” within the patent examination process, the third-party observation has become an indispensable component of corporate patent risk management systems due to its unique advantages: low cost, high confidentiality, preemptive interception, and dynamic adjustment. They serve as both an “invisible sniper” for companies to counter competitors’ patent threats and a “correction tool” to safeguard the public interest and address the limitations of the patent examination system.
However, the effective use of the third-party observation is not simply a matter of “submitting and succeeding.” It requires corporate IPR professionals to possess solid knowledge of patent law, professional search capabilities, rigorous logical analysis skills, and a deep understanding of technological developments in the industry. For this reason, entrusting a professional patent agency to elevate the third-party observation from “formal opinions” to “substantive weapons” is the only way to truly achieve “preemptive planning and precise interception” on the patent battlefield.
In the knowledge economy era, whoever can deploy the third-party observation—this “invisible weapon”—earlier, more accurately, and more skillfully will seize the initiative and gain the upper hand in fierce market competition
