Key Differences Between Japanese and U.S. Patent Systems: Essential Knowledge for U.S. Businesses Operating in Japan

Japanese Attorney at Law - Bengoshi L.L.

• 8 min read

For U.S. businesses engaged in innovation and operating in the global marketplace, Japan stands as a critical jurisdiction for patent protection. While international agreements like the Paris Convention and the Patent Cooperation Treaty (PCT) provide a degree of harmonization in patent procedures, significant substantive and procedural differences persist between national patent systems. Understanding these distinctions between the Japanese and U.S. patent systems is essential for formulating effective intellectual property strategies, managing patent portfolios, and navigating potential disputes in Japan. This article highlights some of the key areas where these two major patent regimes diverge.

1. Foundational Principles: Defining a Patentable "Invention"

The very definition of what constitutes a patentable "invention" differs in its statutory expression and interpretive emphasis.

  • Japan: Article 2(1) of the Japanese Patent Act provides a structured definition: an "invention" is the "highly advanced creation of technical ideas utilizing the laws of nature." This multi-faceted definition requires the presence of (i) utilization of a law of nature, (ii) a technical idea, (iii) an act of creation (as opposed to mere discovery), and (iv) a highly advanced nature (though this last element is often subsumed under the inventive step analysis). The "utilization of a law of nature" is a particularly crucial filter, especially impacting the patent eligibility of software and business method-related innovations.
  • United States: 35 U.S.C. §101 defines patent-eligible subject matter more broadly as "any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof." However, U.S. courts have established judicial exceptions, precluding patents on laws of nature, natural phenomena, and abstract ideas. The application of these exceptions, particularly for software and business methods, is guided by frameworks like the Alice/Mayo two-step test established by the U.S. Supreme Court.

While both systems aim to exclude fundamental principles from patentability, the Japanese approach starts with a positive requirement for engaging with natural laws, whereas the U.S. employs a broader statutory definition curtailed by judicially created exceptions. This can lead to different analytical pathways and, occasionally, different outcomes for borderline subject matter, though there is an observed trend towards convergence in requiring a concrete technical application for more abstract concepts.

2. Securing Priority: First-to-File vs. First-Inventor-to-File

The principle determining who has the right to a patent when multiple parties invent the same thing has historically been a major point of divergence.

  • Japan: Japan has long adhered to a strict first-to-file system (Patent Act, Article 39). The first applicant to file a patent application for an invention is entitled to the patent, regardless of who invented it first.
  • United States: Historically, the U.S. operated under a first-to-invent system. However, the America Invents Act (AIA) transitioned the U.S. to a first-inventor-to-file (FITF) system for applications filed on or after March 16, 2013. While FITF brings the U.S. closer to the global standard, it still retains elements related to "derivation" (i.e., ensuring the filer is a true inventor or derived the invention from one) that are not identical to pure first-to-file systems.

For U.S. businesses, this historical difference (and the remaining nuances of FITF) means that the timing of filing an application in Japan is absolutely critical; there is no recourse based on an earlier invention date if another party files first.

3. Grace Period for Inventor Disclosures (Novelty)

Both countries provide a grace period that allows inventors to disclose their invention before filing a patent application without that disclosure destroying novelty, but the scope and procedural requirements differ significantly.

  • Japan (Patent Act, Article 30 - Shinkisei Sōshitsu no Reigai): Japan offers a grace period, which at the time of most of the source material for this overview was 6 months (with discussions about a potential extension to 12 months that may have since been enacted), for certain disclosures made by the person having the right to obtain a patent (or against their will). To benefit from this grace period, the applicant must explicitly claim the exception at the time of filing the Japanese application and submit supporting documents within 30 days thereafter, proving the circumstances of the disclosure. The types of qualifying disclosures are also specifically defined (e.g., disclosures in printed publications, at designated scientific meetings, through exhibitions).
  • United States (35 U.S.C. §102(b)(1)): The AIA provides a 1-year grace period for disclosures made by the inventor, a joint inventor, or another who obtained the subject matter directly or indirectly from the inventor or a joint inventor. This grace period is generally more automatic in its application for such disclosures.

Practical Implication: U.S. applicants accustomed to the broader and more automatic U.S. grace period must be extremely cautious. Relying on a prior U.S. disclosure without meticulously following Japan's stricter procedural requirements for its grace period can lead to a loss of patent rights in Japan due to lack of novelty.

4. Patentable Subject Matter Nuances

While both systems protect a wide range of technological innovations, certain areas have traditionally received different treatment:

  • Methods of Medical Treatment: In Japan, methods for the medical treatment of human beings (including surgical, therapeutic, and diagnostic methods practiced on the human body) are generally considered to lack "industrial applicability" and are therefore not patentable subject matter. This is a JPO practice based on policy considerations. However, pharmaceutical products, medical devices, and methods of manufacturing them are patentable.
  • United States: Methods of medical treatment are generally patentable subject matter. However, 35 U.S.C. § 287(c) provides certain limitations on remedies against medical practitioners performing patented medical activity.
  • Software and Business Methods: As discussed, Japan's "utilization of a law of nature" requirement poses a specific hurdle, often necessitating a clear link to hardware or a physical process for patentability. The U.S., using the Alice/Mayo framework, analyzes whether such inventions are directed to an abstract idea and, if so, whether they contain an "inventive concept" that transforms them into a patent-eligible application.

5. Claim Interpretation in Litigation

The approach to determining the scope of patent claims in infringement litigation also has distinct procedural and doctrinal features.

  • Japan (Patent Act, Article 70): Claims are the basis for determining the technical scope, interpreted in light of the specification (description and drawings) and the prosecution history. The doctrine of "prosecution history estoppel" (kinhangen) is significant. Furthermore, Japanese courts in infringement actions can effectively consider the validity of the patent under Article 104-3; if the patent is found to be one that "should be invalidated by a patent invalidation trial," rights cannot be enforced.
  • United States: Claim construction is also central, with claims interpreted in light of the specification and prosecution history (intrinsic evidence). Courts often conduct Markman hearings to determine claim scope as a matter of law. While validity is also assessed, the procedural interaction between infringement and validity determinations (e.g., district court vs. Patent Trial and Appeal Board (PTAB) proceedings) differs from Japan's Article 104-3 mechanism.

6. Doctrine of Equivalents

Both systems recognize that infringement can occur even if an accused product does not literally fall within the claim language, under the Doctrine of Equivalents (DoE).

  • Japan: The Supreme Court's decision in the Ball Spline Bearing case (February 24, 1998) established a five-factor test for applying DoE. Prosecution history estoppel is a key limitation, as further clarified by the Supreme Court in the Makisakarushitōru case (March 24, 2017), particularly regarding subject matter disclosed but not claimed.
  • United States: DoE is also a well-established judicial doctrine (e.g., Graver Tank, Warner-Jenkinson). While the specific tests (e.g., function-way-result, insubstantial differences) are formulated differently, the underlying equitable principle of preventing easy circumvention through minor changes is similar. Prosecution history estoppel is also a critical limitation (e.g., Festo).

7. Indirect Infringement

Liability for acts that contribute to or induce direct infringement by others is handled differently.

  • Japan (Patent Act, Article 101): Defines specific "acts deemed to be infringement." This includes objective indirect infringement (supplying articles "exclusively used" for the patented invention) and subjective indirect infringement (knowingly supplying "indispensable" non-staple articles for the patented invention).
  • United States (35 U.S.C. § 271(b) & (c)): Addresses induced infringement (requiring intent to cause infringing acts) and contributory infringement (requiring knowledge of the patent and the infringing use of a non-staple component with no substantial non-infringing uses). The elements and standards of proof differ.

8. Remedies for Infringement

The available remedies for patent infringement show notable differences:

  • Damages:
    • Japan (Patent Act, Article 102): Provides statutory methods for calculating damages, including patentee's lost profits (based on infringer's sales x patentee's unit profit), presumption based on infringer's profits, and a reasonable royalty. There are no punitive or treble damages for willful infringement, though Article 102(4) allows courts to reduce damages exceeding a reasonable royalty if the infringer proves they acted without intent or gross negligence.
    • United States: Damages can include lost profits and reasonable royalties. Courts can award up to treble damages for willful infringement (35 U.S.C. § 284).
  • Injunctions:
    • Japan (Patent Act, Article 100): Injunctive relief is a primary remedy and generally granted if infringement and patent validity are established. Preliminary injunctions (karishobun) are also available. However, equitable considerations, such as in the context of Standard Essential Patents (SEPs) subject to FRAND commitments, may influence the availability of injunctions, as seen in the IP High Court Grand Panel decision of May 16, 2014 (Apple v. Samsung).
    • United States: Following the Supreme Court's decision in eBay Inc. v. MercExchange, L.L.C., permanent injunctions are no longer virtually automatic upon a finding of infringement. Courts apply a four-factor equitable test. Preliminary injunctions also require a showing of equitable factors, including irreparable harm and a likelihood of success on the merits.

9. Post-Grant Challenge Mechanisms

The systems for challenging the validity of a granted patent after its issuance also differ:

  • Japan: Offers two main administrative routes:
    • Patent Invalidation Trial (Mukō Shinpan): Can be initiated at any time during or after the patent term by an "interested party" on broad grounds.
    • Post-Grant Opposition (Tokkyo Igi no Mōshitate): Can be filed by "any person" but only within a strict six-month window after the patent grant is published. Grounds are somewhat more limited than for invalidation trials.
  • United States: Provides several mechanisms through the U.S. Patent and Trademark Office (USPTO), primarily administered by the Patent Trial and Appeal Board (PTAB):
    • Post Grant Review (PGR): Must be filed within nine months of patent grant, wider range of grounds.
    • Inter Partes Review (IPR): Can be filed after nine months from grant (or after PGR termination), primarily on grounds of anticipation or obviousness based on patents or printed publications.
    • Ex Parte Reexamination: Can be requested at any time by anyone based on patents or printed publications.

These systems have different timings, grounds, standards of review, and estoppel effects.

10. Disclosure Requirements During Prosecution

The obligations on applicants regarding disclosure of information during patent prosecution vary:

  • Japan: Requires an enabling disclosure (Art. 36(4)(i)) and support for claims in the description (Art. 36(6)(i)). Since a 2002 amendment, there is also a requirement to disclose known relevant prior art in the specification (Art. 36(4)(ii)); failure to do so can be a reason for refusal of the application (Art. 49(v)).
  • United States: Requires written description, enablement, and best mode (35 U.S.C. § 112). Crucially, applicants and their representatives have a duty of candor and good faith in dealing with the USPTO, which includes the obligation to disclose known information material to patentability through an Information Disclosure Statement (IDS). A breach of this duty can lead to a finding of "inequitable conduct," rendering the entire patent unenforceable.

11. Utility Model System (for "Lesser Inventions")

  • Japan: Maintains a separate Utility Model System (実用新案法 - Jitsuyō Shin'an Hō) which offers protection for "devices" (考案 - kōan) relating to the shape, structure, or combination of articles. These are often considered "lesser inventions" or minor improvements. The system features no substantive examination before registration and provides a shorter term of protection (10 years from filing).
  • United States: Does not have a direct equivalent to the utility model system. (Design patents in the U.S. protect ornamental designs, not functional "lesser inventions").

Conclusion

While Japan and the United States share the fundamental goal of promoting innovation through patent protection, their legal systems exhibit significant differences in defining patentable subject matter, procedural requirements, enforcement mechanisms, and post-grant challenges. For U.S. businesses seeking to protect and leverage their intellectual property in Japan, a keen awareness of these distinctions is not just beneficial but essential. Proactive legal counsel from experts versed in Japanese patent law and practice is indispensable for navigating these complexities and formulating an IP strategy that is effective in the Japanese context.