How much are you paying in patent maintenance currency costs?
This week, we continue our deep dive into patent maintenance costs and dig into one of the more controversial and expensive areas – foreign currency costs.
What are currency costs?
If your portfolio includes patents worldwide, you’re being charged to purchase the currency needed to pay the foreign PTO.
Conceptually, it’s no different from the service fees you pay your credit card company when you buy a souvenir in Paris or change money at the airport after landing.
One big difference is that credit card companies disclose the fees and rates you pay, while only a few annuity vendors are willing to do the same.
What's Reasonable?
Most vendors have extremely vague currency language in their contracts, making it difficult to hold them accountable for currency costs.
The situation is further complicated by the fact that vendors are invoicing clients for payments that are being made in the future – they frequently reference this risk as a reason for additional currency costs.
Forward contracts can easily be purchased for major currencies to lock in rates, so this assertion is usually just a smokescreen.
Considering that credit card companies charge 2% to 3%, paying vendors 10%, 20%, or 30% for foreign currency exchange doesn’t make much sense.
Tips for controlling patent maintenance currency costs
Most vendors don’t make it easy to understand currency costs, but that doesn’t mean you shouldn’t try.
Here are three tips to help you get control of your currency costs:
- Require that your vendors provide the foreign exchange rates used for any currency conversion.
- Spot-check your invoices for currency costs. This can quickly be done with payments in jurisdictions with no agent fee.
- Revisit your annuity contract, strengthen language related to currency, and add a currency cost cap.
