How the timing of patent grants shapes innovation, commercialisation and competition in Australia
The time between filing a patent application and receiving a granted patent is a critical but often overlooked feature of the innovation system. In Australia's deferred examination system, applicants have substantial influence over when examination begins and therefore when a patent is granted.
This flexibility provides firms with time to evaluate inventions, secure investment, develop products and refine commercial strategies. At the same time, extended patent pendency can create uncertainty for competitors and influence the diffusion of knowledge and technology throughout the economy.
This publication series combines a comprehensive review of international evidence and two empirical studies. They present the most comprehensive evidence to date on the effects of patent grant timing on applicants and their competitors.
Together, the findings show that patent pendency involves an important balance between supporting innovators and maintaining a dynamic and competitive innovation ecosystem.
At a glance
- The studies use linked data from IPRAPID, PATSTAT, and Patentsview drawing on a sample of over 316,000 patents granted at IP Australia from 2004 to 2016.
- During the study period, 4.5 years was the average time between application and patent grant, with around 75% of the delay driven by applicant decisions rather than patent office processes. More recent data confirms 1.3 years is the median time between exam request and patent acceptance.
- Around 60% of applicants wait until the latest possible opportunity to request examination, reflecting a range of factors contributing to delayed grant outcomes.
- In general, applicants use of IP Australia's freely available options to speed up examination is linked to stronger post-grant outcomes – meaning they are more likely to renew, commercialise, and build on their patents.
- Flexibility matters most for small innovators. Smaller firms gain the greatest innovation and commercialisation benefits from applicant-controlled delays.
- Patent grant delays tend to narrow and slow follow-on innovation by an applicant's domestic rivals. A one-year increase in grant delay increases the time to first competitor citation by around 8%, slowing the diffusion of new technologies.
- Directions to request examination are a powerful policy lever, enabling patent offices to reduce excessive delays while preserving applicant flexibility.