S.J. Res. 90, 91st Congress, or similar legislation when enacted into law would enable the Secretary of State and the Secretary of Commerce to take all necessary steps to organize and hold a Diplomatic Conference to Negotiate a Patent Cooperation Treaty in Washington, D.C. in Fiscal Year 1970. This legislation would also authorize to be appropriated to the Department of State a sum not to exceed $175,000 for the purpose of defraying the expenses incurred on behalf of the United States as host government of such a conference.

The proposed Patent Cooperation Treaty is the result of a United States initiative in September 1966 in the Executive Committee of the Convention of Paris for the Protection of Industrial Property. This Committee unanimously approved a resolution asking the Secretariat for that Convention, the United International Bureaux for the Protection of Intellectual Property (BIRPI), to undertake a study of practicable means to simplify the patenting of any given invention in a number of countries.

Today patenting in each country is a wholly independent affair and the national laws of most countries as a rule do not take account of the fact that protection for the same invention may be sought in other countries It is estimated that more than 50% of the 700,000 patent applications filed worldwide are duplicates of other applications. Consequently, there is much duplication of effort and a considerable waste of time, talent and money, both for the patent applicant and the national patent offices.

Obtaining foreign patent rights is important to U.S. patent holders and more patent applications are filed abroad by U.S. nationals than by the nationals of any other country. Foreign patents help protect markets for U.S. exports. U.S. firms which manufacture in foreign countries also have a strong interest in effective patent systems to protect their products and processes in these countries. And finally, the increasing number of U.S. firms which license their technology overseas also require patent protection abroad. Preliminary estimates of payments to U.S. firms from abroad for the use of their intangible property--largely but not exclusively patent protected--according to the latest available figures, were running at an annual rate of about $967 million in 1968.

If the full economic benefits of the patent system for American inventors and businessmen at home and abroad are to be maintained, we believe that a multilateral cooperative effort along the lines of the Fatent Cooperation Treaty is essential.

In carrying out the 1966 resolution of the Executive Committee of the Paris Convention, the
Secretariat for that Convention--BIRPI--released a first draft of a proposed Patent Cooperation
Treaty at the end of May 1967. This draft was prepared in consultation with interested governments,
including the United States, and with interested governmental and nongovernmental organizations.

Various meetings of experts were called by BIRPI during the latter half of 1967 and the first half of 1968 to consider the 1967 draft Treaty. In developing the United States position for these meetings the Patent Office and the Department of State carefully considered the views of representative bar and industry groups, with whom we have been meeting on a continuing basis. As a consequence, we proposed several important revisions which were accepted and incorporated in a second draft of the Treaty prepared by BIRPI and released publicly in July 1968. proposals by the United States were incorporated in the current draft of the Treaty which was issued in July of this year.

Additional

It would appear that on the basis of the deliberations at the international meetings held this spring a enerel consensus has been reached. While there are some matters still to be worked out, it is the general view of the countries most concerned that we have reached the stage where a Diplomatic Conference to Negotiate the Patent Cooperation Treaty should be held during the first half of 1970. It seems most appropriate for the United States, which took the initiative for this project and which stands to benefit substantially by it, to offer to serve as host for the Diplomatic Conference.

There has been widespread support for the basic principles of such a Treaty from many important industry and bar groups. These include the Chamber of Commerce of the United States, the Pharmaceutical Manufacturers Association, the National Association of Manufacturers, the American Bar Association's Section of Patent, Trademark and Copyright Law, the American Patent Law Association, the American Group of the International Patent and Trademark Association, the Boston Patent Law Association, and the Electronic Industries Association.

We estimate that about 40 to 45 member states of the Paris Convention will attend the Diplomatic Conference. Interested international, intergovernmental and non-governmental organizations as well as certain key national organizations would be invited as observers The number of delegates mental and non-governmental is estimated at approximately 400.

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The Conference would be held in the Department's International Conference suite for a period of approximately four weeks The official languages of the conference would be English, French, Russian and Spanish.