Introductions & F.A.Q.
South African Registrations
Foreign Registrations & the PCT

Head Office
Tel:(012) 342 1774
Fax:(012) 342 3027
222 Richard Street, Hatfield, 0083, South Africa
P.O.Box 13575 Hatfield 0028
Republic of South Africa
Docex 219 Pretoria
hahn@hahn.co.za

Cape Town Branch Office
E-mail: capetown@hahn.co.za

Office Hours:
Mon - Thurs: 08h00 to 16h30
Friday: 08h00 to 14h30
We are closed on Saturdays, Sundays and Public Holidays although our professional staff can often be reached on their emails after hours or by prior arrangement.

Services
Important Notice: This site is primarily intended for local clients. International clients and agents please click here.

Patent prosecution

The South African patents system is governed by the Patents Act, 1978 which affords protection to patents for inventions (including patents of addition). The absence of novelty vitiates a patent absolutely in South Africa and protection is refused obvious inventions. Unless a complete specification is filed in the first instance a priority date is established by an application accompanied by a provisional specification. Applicants deciding to pursue protection thereafter must file a fresh application accompanied by a complete specification within fifteen months of the date of filing of the provisional application claiming priority from that date. Examination is to form only and no examination on the merits takes place. The patent term is twenty years from the date of filing of the complete specification. A patent must be renewed every year from the fourth following the filing date. For more information please click here

Trademark prosecution

The Trade Marks Act, 1993 (as amended) governs the South African trade mark registration system. Distinctive signs of all kinds and descriptions which are capable of graphical representation are registrable as trade marks. The forty two classes of goods and services of the International Classification is followed. The statute is generally compatible with the European Directive concerning trade marks and affords protection against unauthorised use of both identical and confusingly similar marks in relation to the goods or services in respect of which a mark is registered and in respect of similar or dissimilar goods or services in defined circumstances. For more information please click here

Copyright prosecution

Copyright is conferred by the Copyright Act, 1978 without registration.The Act protects literary, artistic and musical works, sound recordings, cinematographic films, computer programmes, radio and television broadcasts, satellite transmissions and published editions. The categories of persons who are afforded copyright protection are defined in the Act and include foreign persons and incorporated bodies from member states of the Berne Convention.

Design prosecution

The Designs Act, 1993 provides protection to aesthetic and functional designs through registration. Functional designs have features which are necessitated by the function which the article to which the design is applied is to perform and includes integrated circuit topography and mask works related thereto. Aesthetic designs relate to designs applied to articles of manufacture because of the pattern, shape, configuration or ornamentation of the design which is judged solely by the eye. Aesthetic designs must be new and original while functional designs must be new and not commonplace. For more information please click here

Plant Breeder's Rights

South Africa is the only country on the continent of Africa which is a member of the UPOV Convention. This has the effect that South Africa is bound to give protection to Plant Breeders' Rights of nationals of other continents of the world, whilst the rest of the countries on the African continent are not. The rights cover propagating material for the relevant variety as well as harvested material, including plants. These exclusive rights consist of the production or reproduction of the aforementioned plant material, the conditioning thereof for the purpose of propagation, the sale or any form of marketing thereof, as well as the exporting, importing and stocking thereof.

Protecting Biotechnological Intellectual Propertyand The Protection of Genetically Modified Crops (Gmc's) under the RSA Patents Act (No.57 of 1978) and/or the RSA Plant Breeders' Rights (PBR) Act (No. 15 of 1976).

Copies of these articles are available on request to mailto:hahn@hahn.co.za

Counterfeit Goods

A Counterfeit Goods Act provides enhanced means for dealing with counterfeit goods, especially at ports of entry to South Africa. The Merchandise Marks Act, 1941 deals with prohibited marks, the marking and covering of merchandise and false trade descriptions and marks.

Language Services

Hahn & Hahn Inc prides itself on its many international clients and to facilitate relations with our clients we are able to communicate in English, German, French, Korean, Dutch, Polish and Czech. Hahn & Hahn Inc also provides sworn translation services for translations from and to, French and German.

IP Valuation

Apart from Capital Gains Tax (CGT) requirements, significant tax advantages may be realised when acquiring a business which owns intellectual property. In particular, the South African, UK and Australian tax regimes provide that any company purchasing intellectual property (excluding trademarks) is entitled to deduct the purchase price from its pre-tax earnings over the lifetime of the intellectual property. Please note that the company would still be able to depreciate the intellectual property whether or not it takes advantage of the above tax relief.

Whilst companies often spend considerable amounts on securing intellectual property rights, experience has shown that a proper valuation of such intellectual property, in particular the technology aspects thereof, is rerely carried out. By properly reflecting the intellectual property as an asset in the balance sheet as required by the Generally Accepted Accounting Practices (GAAP), a company could significantly improve its shareholder value and benefit from an often neglected, yet important source of value creation.

Furthermore, the valuation of a company's intellectual property will often bridge the gap that typically exists between the marketing and financial departments of large companies. For example, the marketing and R & D departments could justify their expenditure on advertising, research and promotional activities to the financial department by putting a value to the IP arising out of their efforts.

Please note that our IP valuation service is available to clients all over the world.

IP Litigation

Hahn & Hahn Inc has over 50 years experience in all aspects of IP litigation including infringement and validity cases for patents, trademarks and designs, as well as acting in counterfeit goods, unlawful competition and trade secrets matters. Please contact Janusz Luterek (janusz@hahn.co.za) for further information in this regard.

1. Patent Infringement and Validity of Granted Patents

1.1 Infringement and Defences Thereto In order to be successful in an infringement matter in South Africa a patentee must show that an infringing device, system, apparatus, or method includes all of the essential integers of at least one independent claim of a patent.

In defence, an alleged infringer can deny infringement or rely on invalidity of the patent on any one of the grounds set out in Section 61 of the Patents Act 57 of 1978 and/or on use prior to the priority date of the patent in question i.e. the so called "Gillette Defence".

Furthermore, an infringer can counterclaim that the patent in question is invalid and request the Commissioner of Patents to revoke a granted patent.

The patentee may, where there is subject matter in the patent which could form the basis for a valid patent, apply to the Commissioner for leave to amend the patent which, if granted, will result in the scope of the patent being reduced but the amended patent being valid. This may or may not get the infringer off the hook as the amended patent may still be infringed.

An infringement case is heard by the Court of the Commissioner of Patents, a division of the High Court, and may be brought either by way of Summons where damages are sought and will require oral evidence to be led, or by way of Motion where only an interdict, whether urgent, interim, or final, is sought in which case the evidence is by way of Affidavit in most cases. An action brought by way of Summons may take anywhere from 6 to 18 months before it is heard by the court of first instance whereas an application by way of Motion may only take 3 to 6 months to be heard.

It is usual to appoint counsel (barristers) to assist in the litigation. Depending on the complexity of the matter, both a junior and a senior counsel may be appointed. Thus it is not unusual for a matter in which only a junior counsel is employed to cost between EUR25000 and EUR62500 in the court of first instance, and the same costs may be expected in each stage of an appeal.

In an infringement action, besides an interdict, the court may award damages, or reasonable royalties in lieu of damages, and a portion of the costs in suit. Please note however that an order of costs usually only covers about 50 % of the actual costs incurred and are awarded at the discretion of the Commissioner of Patents.

1.2 Validity

In order to be valid, the claims of a South African Patent must be novel and inventive and all formal requirements ought to have been complied with.

The novelty requirement is an absolute requirement i.e. an invention as claimed should be new anywhere in the world, not just in South Africa.

Likewise, the inventive step requirement is an absolute one.

The South African Patent Office is a non-examining office and all patent applications which meet the formal requirements are granted.

It is not normal practice for Patent Attorneys to conduct patent searches for clients unless specifically instructed to do so as the costs of the searches would often exceed the costs of preparing and filing the patent several fold.

Furthermore, the South African Patent Office records are in a complete disarray and it is not possible to conduct a reliable search for South African Patents at the South African Patent Office.

Yet further, international databases which may be searched cover only the major countries of the world and have only scant information on South Africa, especially data prior to 1994. Thus, even an extensive international patent search does not have a guaranteed accuracy and it is internationally accepted that, despite the high cists thereof, database searches have an accuracy of around 60%.

The validity of a granted patent may only be challenged by way of an Application for Revocation before the Court of the Commissioner of Patents and again, depending on the complexity of the matter, both a junior and a senior counsel may be appointed. Thus it is not unusual for a matter in which only a junior counsel is employed to cost between EUR25000 and EUR62500 in the court of first instance, and the same costs may be expected in each stage of an appeal.

Domain Dispute Resolution

Alan Dunlop, Vanessa Lawrance, Janusz Luterek, and Victor Williams have been appointed as adjudicators on the ZA Domain Name Authority domain name dispute resolution panel with Alan Dunlop, Janusz Luterek and Victor Williams being appointed as Senior Adjudicators. For more information on lodging a dispute with the Domain Name Authority regarding a .co.za domain name please see www.domaindisputes.co.za. Where we are not acting as adjudicators we are able to represent clients in such disputes.

IP Tax

We are specialists in the commercialisation and taxation of intellectual property. Apart from our practical experience in this regard, we have also prepared the training workshops for SARS personnel.

Intellectual property is a field that has long been ignored by SARS.However, the days of immunity have passed. Having skilled up in this area, intellectual property has now become a focus area for SARS.

A few of the intellectual property related tax risks are discussed in the articles on our website, such as: allowances for the acquisition of intellectual property; nature of royalty payments; "roll-up" licences; deduction of up-front royalty payments; accrual of royalty payments; transfer pricing; etc. However, please bear in mind that these articles are intended merely to raise awareness of certain issues.They cannot and do not canvass all potential intellectual property related tax issues.

In addition, we have extensive experience in structured finance transactions using intellectual property (which have recently been tackled extremely successfully and aggressively by SARS) and would be pleased to assist you by providing objective opinions on such structures.

We provide tax-related advice on:

The licensing of intellectual property and the deductibility of royalty payments, including:

  • nature of royalty payments;
  • deductibility of royalty payments;
  • structuring of upfront royalty premiums and royalty payments in general;
  • determination of royalty rates;
  • transfer pricing considerations in international agreements;
  • apportionment of "royalties" in licences that provide for the provision of technical services, ongoing research and development (R&D) and the use of intellectual property;
  • withholdings tax payable on royalties;
  • beneficial ownership of royalty receipts;
  • VAT issues relating to licences;
  • accrual, and taxation of royalty receipts.

Allowances available for the acquisition of intellectual property, including:

  • whether allowances may be claimed;
  • types of intellectual property that fall within our allowance section;
  • quantum of allowances that may be claimed;
  • manner in which the purchase price for intellectual property should be paid; form in which assignment agreements should be drafted.

Allowances available for R&D, including:

  • whether work conducted falls within the scope of the R&D section;
  • options for the purchase of equipment; - options for the acquisition or construction of buildings;
  • whether the R&D should be spun
  • off into a separate company;
  • restructuring of existing R&D programs/structures/arrangements;
  • the manner in which R&D should be funded;
  • potential tax consequences of R&D agreements (in particular the termination of such agreements);
  • the structuring of R&D expenditure where foreign entities are involved;
  • availability of alternative/additional R&D allowances in other countries.

Read more about the R & D Tax Relief Law Amended 7 June 2007

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Patent Litigation Handbook South Africa By JF Luterek Pr.Eng
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Important Memorandum on PCT National Phase in South Africa
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