5A Desirable Registered Search Organization System andSpecified Registered Search Organization System(*)

A system was introduced in 1990 to outsource prior art document searches to designated searchorganizations (public interest corporations) that have been designated by the JPO Commissioner, and to use
the search results for patent examination. However, there were growing concerns that the examination
backlog would increase due to such factors as the shortening of the examination request period, an increasein the number of patent filings, and a rise in the examination request rate.
Thus, in 2004, with an aim to use the abilities of the private sector, the government introduced aregistered search organization system, which has removed the requirement of the public interest
corporation status from the designated search organization system. In addition, it introduced a specified
registered search organization system that allows not only patent examiners, but also applicants, etc. to use
the abilities of registered search organizations.
At present, the bump of examination requests has been resolved. With a decrease in the number ofpatent filings and examination requests, the number of outsourced searches is shifting from a period of
expansion to a period of convergence to a constant volume. Currently, the specified registered searchorganization system is not being used sufficiently.
Thus, the author conducted interviews with registered search organizations, private search companies,
overseas patent offices, etc. and made a study on desirable systems in the future.

Ⅰ Introduction
In order to expedite patent examination, theJapan Patent Office (JPO) had introduced a system
in 1990 to outsource prior art document searches
to outside organizations designated by the JPO
Commissioner (designated search organization
limited to public interest corporations), and to use
the results of the prior art document search
conducted by designated search organizations in
the patent examination carried out by patentexaminers.
In 2003, the examination backlog exceeded
500,000 applications, as a result of yearly
increases mainly due to an increase in thenumber of patent filings and a rise in theexamination request rate, and the examination
waiting period reached 25 months. Since thenumber of examination requests temporarily
surged with requests for patent applications
subject to a seven-year request period coinciding
with those for applications subject to a three-year
request period (a bump in examination requests),
there were concerns that the examination backlog
would further increase by 300,000 applications.
Accordingly, the government set a long-termtarget to reduce the examination waiting period to(*)

11 months by 2013, and took the following
measures in 2004 to achieve expeditious andaccurate patent examination:- The government drastically reinforced theexamination system by hiring fixed-term
examiners in addition to additional ordinary
examiners.
- The government revised the Act on Special
Provisions for Procedures related to Industrial
Property Right (Special Provisions Act) toabolish the requirement for designated searchorganizations to be public interest corporations
and to introduce a registered search organization
system in which private companies satisfying
specific requirements can enter into theoutsourced search operations, thereby further
expanding the search outsourcees.
- The government also introduced a specified
registered search organization system in orderto develop an environment for encouraging
applicants to make efficient examination
requests by allowing them to use the services ofregistered search organizations. Under thissystem, registered search organizations can be
specially registered by the JPO Commissioner as
specified registered search organizations that
can also undertake prior art searches from

This is an English translation of the summary of the report published under the Research Study Project on Issues
with Industrial Property Rights System FY2010 entrusted by the Japan Patent Office. IIP is entirely responsible forany errors in expression or description of the translation. When any ambiguity is found in the English translation,
the original Japanese text shall be prevailing.

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IIP Bulletin 2011 Vol.20

1 ●patent applicants, etc. In response to requests
from patent applicants, etc., these organizations
are able to conduct prior art searches withregard to patent applications for which
examination requests have yet to be filed, andissue search reports of the results obtained.
The number of outsourced searches
undertaken by registered search organizations
has been increasing annually, with the number
expanding from about 178,000 searches in 2004 toabout 233,000 in FY2009.
The bump of examination requests has been
resolved since the examination request period
expired for all applications subject to a seven-year
request period at the end of September 2008. In
2009, due to an increase in the number ofapplications withdrawn or waived, the number ofapplications examined temporarily exceeded thenumber of examination requests, causing theexamination backlog to decrease from 888,000
applications at the peak time to 717,000
applications as of the end of 2009. The
examination waiting period is also expected togradually turn to a decline.
The number of patent filings has declined
from the 2006 level and the number of
examination requests has declined from the 2008
level. In addition, the deadline for achieving thetarget set for the examination waiting period isapproaching. The number of outsourced searches
is shifting from a period of expansion to a periodof convergence to a constant volume. Given thisbackground, this research was conducted with an
aim to create basic material for considering
policies for building a desirable registered searchorganization system and specified registeredsearch organization system.

Ⅱ Survey Outline
In this research, data for considering thefollowing matters was collected through aninterview survey, and was analyzed:(i) the environment for entry of registeredsearch organizations;(ii) registered search organizations' awareness ofcurrent problems and business vision;(iii) the environment for entry of specified
registered search organizations;(iv) opinions on the specified registered searchorganization system;(v) the prior art search market; and(vi) the situation overseas.
An interview survey was conducted by
selecting sample organizations that are suitable●for collecting the respective data of (i) through(vi) above.
Data on the following matters were collected
through interviews from all nine registeredsearch organizations that currently engage inoutsourced search operations: "the environment
for entry of registered search organizations," "theregistered search organization's awareness ofcurrent problems," "the registered searchorganization's business vision," and "theenvironment for entry of specified registeredsearch organizations."
Also data on the following matters werecollected through interviews from 20 sample
prior art search companies selected from the listsof patent information providers published on the
JPO website: "the environment for entry ofregistered search organizations from theviewpoint of a private prior art search company,""specified registered search organizations fromthe viewpoint of a private prior art searchcompany," and "forms of business of prior art
searches." Moreover, data on the following
matters were collected through interviews fromthree companies that have used search reports ofspecifiedregisteredsearchorganizations:"specified registered search organization from theviewpoint of a user," "the status of
implementation of prior art searches," and "thestatus of use of private prior art searchcompanies."
Prior art searches are also being outsourced
in other countries. Therefore, data on thefollowing matters were collected throughinterviews from two prior art searchorganizations that undertake searches from the
Korean Intellectual Property Office (KIPO) andthe United States Patent and Trademark Office(USPTO): "search outsourcing systems overseas"and "outsourced search operations overseas."
Furthermore, data on the following matters werecollected though an interview from an overseas
global company: "the status of implementation ofprior art searches" and "the status of use ofprivate prior art search companies." An interview
was also conducted with another prior art searchcompany to ask about "forms of business of priorart searches."

Ⅲ System and Practice Outline
1

SystemLaws and regulations on registered searchorganizations include the following: the Special
2 ●IIP Bulletin 2011 Vol.20

Provisions Act, the Order for Enforcement of theSpecial Provisions Act, the Ordinance for
Enforcement of the Special Provisions Act, andthe Order on Fees Related to the Patent Act, etc.
Article 37, paragraph (1) of the Special
Provisions Act provides that, when an application
for registration has been filed and the application
satisfies all requirements for registration, the JPO
Commissioner shall register the applicant as aregistered search organization.
Article 37, paragraph (1), item (i) of theSpecial Provisions Act specifies the required
qualifications and the minimum number of those
who implement the search operations at aregistered search organization as requirements
concerning search staff. Specifically, the Act
provides that those who implement the search
operations should have a specific level ofacademic background and job experience, andshould have completed a specific training program,and provides that the minimum number of such
staff members should be ten per search category.
Article 37, paragraph (1), item (ii) of the Special
Provisions Act prescribes computers and thenecessary programs as requirements concerning
the equipment that a registered searchorganization should have. Articles 39-2 through39-5 of the Special Provisions Act stipulate about
registration of specified registered searchorganizations.
Specifiedregisteredsearchorganizations are registered for each relevant
registration category of registered searchorganization, and are not subject to any new
requirements when they are registered as
specified registered search organizations.
Applicants who request an examination bypresenting the search results of a specified
registered search organization can enjoy a
reduced examination request fee, which is134,900 yen plus 3,200 yen per claim for eachapplication. Applicants need to pay a search fee
when they request a specified registered searchorganization to conduct a search.
2

Practice(1) Outsourced search operations by aregistered search organization
Patent examiners can only outsource
searches with regard to patent applications thatare laid open.
Search staff use an F-term search program
installed on a search terminal. In principle, using
such search key as the F-term and File Index (FI)is essential, and a full-text search alone is●

IIP Bulletin 2011 Vol.20

unacceptable. With regard to category 30 (organic
compounds), a chemical structural formula searchis conducted in addition to an F-term search.
Search staff conduct searches of patent and utility
model gazettes issued by the JPO and published
Patent Cooperation Treaty (PCT) international
applications filed in the Japanese language. The
data to be searched are published documents that
could constitute prior art under the provisions ofArticle 29, 29-2, or 39 of the Patent Act. Foreign
patent gazettes and non-patent documents are notsubject to searches in outsourced search
operations. When a search has been completed, aregistered search organization delivers a written
search report, etc. in electronic data and in paper
to the JPO. In the case of outsourcing of aninteractive search, a searching staff member
explains such matters as the details of thetechnology claimed in the application concerned,
the search policy, the search results, and thedetails of the technology disclosed in thepresented documents to a patent examiner at the
JPO through a dialogue. If the examiner instructs
a supplementary search during the dialogue, thesearch staff member conducts within the JPO a
search of the scope of documents specified by theexaminer, and also explains the results of suchsupplementary search.
(2) Operations by a specified registeredsearch organization
Prior art search operations can be conducted
for laid-open applications for which an
examination request has yet to be filed for theregistration category. To ensure fair and neutral
operations,specifiedregisteredsearchorganization cannot conduct prior art searches forpatent applications filed by themselves or by theirsubsidiary companies. When specified registeredsearch organizations conduct prior art searches,
they must have their search staff carry out the
searches. An applicant can enjoy a reduced
examination request fee if he/she indicates thesearch report number in the written examination
request. A search report is submitted by aspecified registered search organization to the
JPO, and an examination requester does not needto submit it when they make an examination
request.
As of January 18, 2011, nine organizations
were registered as search organizations, and one
organization was registered as a specified
registered search organization.

3 ●Ⅳ Results of Interviews on theRegistered Search Organization
System1

Environment for entry of registeredsearch organizations

According to the results of interviews withregistered search organizations, the difficulties
they faced when entering into the business weresecuring personnel, dealing with the initialinvestment costs, and receiving the statutory
training at INPIT. Among these, the difficulty of
securing personnel was mentioned by manyorganizations. The results of interviews withprivate prior art search companies showed thatthey similarly faced difficulties in securingpersonnel and dealing with the initial investment
costs.
The period of the statutory training is almost
two months. Therefore, some interviewed
organizations indicated that, in order for asearcher in an existing business to receive thetraining, he/she needed to substantially reduce
the time of being engaged in the existing business.
Because of this, organizations could not use thepersonnel engaged in an existing business as thesearch staff, and needed to launch a businessseparate from the existing business by hiring new
personnel in order to enter into the business ofoutsourced search operations.
2Registeredsearchorganizations'awareness of current problems

With
regardtopersonnel,
someorganizations mentioned that registered searchorganizations were effectively functioning as aplace for reemployment of retired engineers,
while other organizations showed concerns about
aging of staff due to the difficulty of employing
relatively young workers.
Multiple organizations voiced desires for the
statutory training at INPIT to also be held at
locations other than Tokyo. There are calls for the
statutory training to also be provided in regional
areas since the training period is relatively longand the training imposes a large financial burden
on the organizations and physical and mental
burdens on the trainees if their location is far
from the venue.
As for the search system, the following
problems were indicated to occur in line withspecification changes, due to the high cost of thesystem:●- If a search system is installed with only a shortperiod remaining until the next specification
change, the cost of the search system increases,
and the search outsourcing cost also rises as aresult.
- There is periodical risk that investment in asearch system would become unrecoverable.
Many organizations also voiced concerns
about the intensifying competition between
registered search organizations and about orders
becoming unstable in the future. Some
organizations expressed anxieties about not only
the intensification of competition at present, butalso how the resolution of problems related to theexamination backlog and the examination waiting
period in the near future would subsequently
affect the outsourced search business. In the
public offering of outsourced search operations in
FY2011, the number of publicly offered
operations decreased from the previous year for
the first time since the 2004 revision of theSpecial Provisions Act, suggesting that thecompetition between search organizations willfurther intensify in the future.

Ⅴ System and Practice of Search
Outsourcing in Other Countries
1

Outline of search outsourcing in South
Korea

Searchers are required to have a specificlevel of academic background and to havecompleted a training program. The minimum
number of searchers required is ten persons pertechnical field. The training is an 80-hour online
education consisting of introductory lessons on
patent information, lessons on prior art searchtheory, and practical training on prior art search.
There are three designation categories of
specialized organizations: machinery, metal, andconstruction; science and biotechnology; andelectrical,
electronics,
information
andcommunications.
There is no designated search tool foroutsourced search operations, allowing searchorganizations to choose a search tool of theirpreference. Specialized organizations are required
to possess databases containing patent/utility
model documents of South Korea, Japan, theUnited States, the EPO, and WIPO, or to have anenvironment to constantly access and searchdatabases containing such documents. The prior
art to be searched includes South Korean
patent/utility
model
gazettes(laid
4 ●IIP Bulletin 2011 Vol.20

open/published), Japanese patent/utility model
gazettes (laid open/published), U.S. patentdocuments, EPO patent documents, andpublished PCT international applications, and if
necessary, non-patent documents such astreatises.
Specialized South Korean organizations areused by the private sector for the purpose ofpreferential examination (equivalent to theaccelerated examination in Japan). An applicant
who submits a search report of a specializedorganization to the Patent Office can receive a
preferential examination.
The organizations designated as specialized
are the Korean Institute of Patent Information(KIPI), WIPS Co., Ltd., and IP Solution Co., Ltd.
All three have received designations for all
designation categories. Only KIPI undertakes
outsourced
searchoperationsof
PCT
international searches.
2

Outline of search outsourcing in the
United States

The
USPTO
does
not
adopt
a
registration-based search outsourcing system.
The relationship between search outsourcees andthe USPTO is specified by contract.
The only outsourced search operations
conducted for the USPTO is PCT international
searches. The searches for the search reports set
forth in Chapter I of the PCT are 100% conductedby search outsourcees.
Outsourced search operations are conductedby private search companies that have been
selected as search outsourcees through arequest-for-proposal (RFP) process.
An RFP issued by the USPTO in 2006
expressly states that contractor search companies
are obligated to create a PCT international search
report (Form 210) and a written opinion of theinternational searching authority (Form 237). As aresult of the RFP in 2006, contracts wereconcluded with two outsourcees. The two
outsourcee organizations are Landon IP and
Cardinal IP. A new RFP is to be announced in thefirst half of 2011.
The responsibility of selecting searchers andensuring the quality of search reports lies on theoutsourcees. The RFP does not specify the
numberofsearchers.
Outsourcees
areresponsible for furnishing the personnel thatsatisfy the contractual requirements and that are
sufficient for processing the number of searches
actually assigned by the USPTO.

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IIP Bulletin 2011 Vol.20

The USPTO's outsourced searches are
divided into eight technical categories. At present,
one of the two current outsourcees has concluded
contracts for all eight technical categories, andthe other outsourcee has concluded contracts forfour technical categories.
No search tool is designated. Eachoutsourcee is responsible for implementing
searches in accordance with such criteria as those
set forth in the PCT International Search andPreliminary Examination Guidelines issued by
WIPO. Search outsourcees have access to data
including the USPTO's public version of
Web-based Examiner's Search Tool (PubWEST).
The data to be searched is not designated, but
search outsourcees are obligated to discover thebest prior art.

Ⅵ Results of Interviews on theSpecified Registered Search
Organization System
In order to perform the operations of a
specified registered search organization, an
organization needs to separately furnish a searchsystem and an area for conducting the searches
separately from those for outsourced search
operations. In the interviews with registeredsearch organizations, many expressed theirwishes to be able to carry out the operations of a
specified registered search organization by using
the facilities already furnished for the outsourced
search operations.
In the interviews with private prior art
search companies, there was a company thatviewed specified registered search organizations
as its competitors and indicated concerns that
their presence would affect its business.
The interviews with applicants that haveused search reports by specified registeredsearch organizations revealed that they highly
evaluate the search quality.
There was also an opinion that, even withthe measure for reducing the examination request
fee, the search fee charged by specified
registered search organizations is higher thanthat of private prior art search companies, and thecurrent amount of reduction in the examination
request fee does not serve as an incentive forusing the specified registered search organization.
Hopes were also voiced that specified registeredsearch organizations, which currently only
conduct searches for laid-open applications, will
also conduct searches before the filing of
applications or before the laying open of
5 ●applications. There was also an organization
pointing out that applicants need to request
searches after selecting applications, because asearch request can only be filed with a specified
registered search organization for applications ofwhich technology falls under the searchorganization's registration category.

Ⅶ Prior Art Search Market
1

Forms of business of private prior art
search companies

There were 11 search companies dealing
with searches in all technical fields, and there
were five search companies dealing with almost
all technical fields except for any of the medical,
biotechnology, and chemical fields. Four searchcompanies were specialized in specific technicalfields.
There were 20 private search companies
whose total number of searchers was 2 to 80
persons. Many search companies had fewer than
30 searchers, indicating the small number ofsearchers they have in contrast to the extensive
technical fields they deal with. At present, eachsearcher deals with a broad scope of technology.
The interviews revealed that customers ofsearch companies included regular large
corporations (15 companies), regular SMEs (twocompanies), SMEs subject to the SME searchsupport project (one company), patent firms (onecompany), and public organizations. The results
show that most search companies have regularlarge corporations as their main customers.
Of the technology trend searches, prior art
searches, invalidity searches, and patentclearance searches that are included in the searchbusiness, a comparison was made between thepercentage of prior art searches in the total
number of searches and the percentage of sales ofprior art searches in the total sales of searches.
As a result, for many search companies, prior art
searches constituted a large percentage of thetotal number of searches, but not such a large
percentage in the total sales of searches. While
the percentage of prior art searches exceeded
80% of the total number of searches for threecompanies, the percentage of prior art searches
exceeded 50% of the total sales of searches for
only one company. Search companies secure thesales of their search business by undertaking not
only prior art searches, but also various othertypes of searches such as technology trend
searches, invalidity searches, and patent●clearance searches.
As a result of a survey on applicants' needs
with regard to the timing of prior art searches,searches prior to the filing of domestic
applications accounted for the highest percentage
in the total number of searches for 11 prior art
search companies, searches prior to an
examination request accounted for the highest
percentage for five prior art search companies,
and searches prior to the filing of foreign
applications accounted for the highest percentage
for one prior art search company. When including
cases where searches prior to the filing ofdomestic applications do not account for thehighest percentage, 17 companies were
undertaking searches conducted prior to the filingof domestic applications. With regard to prior art
searches based on private-private contracts
between applicants and prior art searchcompanies, search companies were undertaking
searches for highly confidential inventions prior
to the filing of domestics applications.
2

Needs for prior art search companies

The results of interviews with companies are
as follows:<Domestic companies>- While emphasis is placed on in-house searches,outside search companies are also used toresolve the man-hour shortage of search
operations of in-house personnel.
- Outside search companies are used toreconfirm the results of in-house searches.
Search companies are used in order to makeuse of their high search abilities.
- Outside search companies are used to reducethe costs for implementing searches using
in-house resources.
<Overseas companies>- All outside search companies are outsourced inorder to ensure the objectivity of searches, anddeal with the man-hour shortage of in-housepersonnel.
- All prior art searches are outsourced to outside
search organization due to the search skill
shortage and the search man-hour shortage of
in-house personnel.
- Prior art searches are sometimes outsourced
when in-house personnel cannot implement
searches due to a lack of time, expert
knowledge, or foreign language skills.

6 ●IIP Bulletin 2011 Vol.20

Ⅷ Summary
1

Desirable registered search organizationsin the future(1) Securing personnel<From the viewpoint of the environment forbusiness entry>
At least from the viewpoint of whether or notsearch organizations can deal with searches as anorganization, it is necessary to prescribe an
appropriate number of searchers to be employed
by a search organization as the minimum numberof searchers required. In addition, if the numberof searching staff of a business operator isinsufficient, the proportion of indirect costs will
grow, which has a disadvantageous effect on
outsourcing costs. Thus, when considering arevision of this requirement, the above
viewpoints need to be taken into consideration.
(2) Initial investment costs for a searchsystem<From the viewpoint of the environment at thetime of entry>
A study should be made on providing more
affordable hardware for outsourced search
operations. Considering the ease of entry, more
affordable hardware could be provided as an
option even with lower specifications than thoseof JPO examiners' terminals.
<From the viewpoint of the environment after
the entry>
There is a problem related to the fact thatthe search systems of registered searchorganizations are renewed once in approximately
four years in line with specification renewal of
JPO examiners' terminals. Since the searchsystem needs to be changed every four years at
the longest, the costs related to the outsourced
searches would differ between the case of
installing a search system at the time new
specifications have been established, and the caseof installing a search system a few years after that.
Also, since search orders are not guaranteed
institutionally, the risk that the installed searchterminals would be an excessive investment willarise every time the specifications are changed.
This problem could also be resolved by providing
affordable hardware with lower specifications. If
the current conditions for use of search systems
remain “as is,” another possible measure would
be for the JPO to provide the search systems on arental basis.

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IIP Bulletin 2011 Vol.20(3) Training<From the viewpoint of the environment forbusiness entry>
The current period of statutory training islong, making it difficult for organizations to enter
the business by using the workers of an existing
business as search staff. When entering into thebusiness, organizations would need to hire all
search staff anew or substantially reduce the time
their staff consumes for an existing business tohave the staff receive the training. There is room
to consider developing statutory training that canalso be taken by workers engaged in otheroperations, also for the purpose of gathering
personnel from a broad range of age groups.
<From the viewpoint of the environment after
the entry>
At present, two organizations implement
outsourced search operations at locations otherthan Tokyo. In order to activate entry of searchorganizations located in regional areas into thebusiness in the future, it is essential to consider
holding the statutory training in regional areas aswell. Although no special opinions wereexpressed in the interviews about desirable
training at the time of registering for additional
categories, many search organizations haveindicated a plan to expand their registration
categories as a future business vision of aregistered search organization. Thus, there may
be a need to consider simplifying the statutory
training if the search staff that has alreadycompleted statutory training receives training fora different category. A measure to make it easierfor organizations to make registration for
additional categories is also expected to have aneffect to activate entry into this business.
(4) Future competition environment
At present, consideration is under way tolower the examination request fee, and thedemand for cost reduction is likely to grow further.
For example, one option could be to set a unit
price for outsourcing as a condition forundertaking outsourced searches. In order to doso, however, the problems that registered searchorganizations are currently aware of, such aschanges in the handling of search systems and themethod for assigning the number of outsourced
searches, need to be addressed promptly.
Favorable competition only occurs under anappropriate competition environment. It is
important to develop a good environment forcompetition so as not to demotivate privatecompanies from entering the business of
7 ●registered search organizations.
2

Desirable specified registered searchorganizations in the future(1) Search systems<From the viewpoint of the environment forbusiness entry>
Many organizations opinioned in theinterviews that they hoped that they would be
able to implement the operations of a specified
registered search organization by using facilities
that are already installed for outsourced search
operations (the search system and the area for
conducting the searches). Accordingly, a study
should be made about allowing use of searchsystems for outsourced searches in implementing
the operations of a specified registered searchorganization.

<Competition with private prior art searchcompanies>
Many private search companies indicatedthat specified registered search organizations are
their competitors. When promoting the use of
specified registered search organizations byfurther reducing the examination request fee,
consideration should be given so as not to impede
competition with private search companies.
(Senior Researcher: Hidetake NISHIZAWA)(2) Promotion of use and the problems
involved<Registration categories of specified registeredsearch organizations>
Since there is only one organization thatcurrently serves as a specified registered searchorganization, there is a problem that only specificapplicants can use the organization. This problem
could be resolved by promoting organizations'entry into the business of specified registeredsearch organizations. Since registered searchorganizations are currently making efforts to
expand their registration categories, if their entry
into the business of specified registered searchorganizations becomes active, inaccessible
categories are likely to decrease gradually.
<Promotion of use leveraging on the search
quality>
Searches of a specified registered searchorganization are equivalent to outsourced
searches that are of high quality. It may bepossible to promote more active use than atpresent by identifying searches that require highquality. A specified registered search organization
only conducts searches for laid-open applicationsat present. However, searches for highly
confidential applications prior to the filing areoutsourced to private search companies based on
private-private contracts. Accordingly, the use of
specified registered search organizations could bepromoted if their scope of search could be
expanded to applications prior to the laying open
or to those prior to the filing.

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8 ●IIP Bulletin 2011 Vol.20