Should I file a PCT patent application or file directly in key markets?

24 Nov

So, you have a provisional patent application and you’ve done all the gold standard things during its 12-month term.

Now you are at this well-trodden junction in the road:

Do we file a PCT application to keep our options open, or skip the PCT and file directly in Australia (and maybe overseas) at the 12-month mark?

This is one of the most common and stressful decisions for Australian founders and product teams. Typically:

there is some early customer or investor interest, but nothing that feels “proven” yet
budgets are tight
there is still a fair amount of uncertainty about markets, partnerships and product direction.

This article walks through a practical framework you can use to decide between:

filing a PCT (Patent Cooperation Treaty) application at 12 months; and/or
filing directly into Australia and any other key markets at 12 months (e.g., the US, Europe, New Zealand, China etc).

1. What is actually happening at the 12-month deadline?

Twelve months from your earliest priority date (usually the filing date of your first provisional patent application), your right to claim priority from that provisional will expire.

By that 12-month deadline, you essentially have three options:

File patent applications in each jurisdiction of interest.
File an international PCT application.
Do nothing and allow the provisional to lapse (this can sometimes be the right call).

This article will focus on the choice between options 1 and 2.

2. What is a PCT application in this context?

The Patent Cooperation Treaty (PCT) is an international system that allows you to file one international patent application which can later be converted into individual national or regional applications (for example, in Australia, the United States, Europe, China and many others).

A few key points:

A PCT application is not a “world patent” and does not itself become an enforceable patent. It is a procedural step that preserves your options.
If you file the PCT within 12 months of your provisional, you can keep your priority claim to that original filing date of your provisional.
Instead of deciding all your countries at 12 months, the PCT gives you an additional 18–19 months from your earliest priority date to enter the “national phase” in each country or region of interest.
A PCT application receives an early, independent view on the prior art and the likely patentability of your invention.

So the crux of the decision is this:

Do we want to invest now in a PCT application to buy time and flexibility, or commit now to specific countries and skip that intermediate step?

3. Option A – Filing a PCT application at 12 months

You might lean towards a PCT application when:

Future markets are uncertain ❓
You have hypotheses about where demand will come from, but distribution, partnerships or regulatory pathways may pull you into other regions later.
You expect capital raises or partnership discussions 💬
Investors and strategic partners often like seeing that you have kept your international options open while you validate the opportunity.
You want to defer the biggest foreign filing costs 💰
A PCT allows you to pay one set of international filing fees at 12 months, and then push the more substantial national filing and translation costs out towards 30–31 months.
You value an early, structured look at patentability 🧐
The international search report and written opinion can be useful data points when deciding whether to double down, refine the claims, or pivot.

Benefits of the PCT path:

Time to learn 🕒
You gain ~18 extra months to test markets, gather traction, have investor conversations and understand which jurisdictions truly matter.
Flexibility to respond to new opportunities 🤝
If a serious investor, distributor or acquirer appears from a country you had not originally considered, you are more likely to still have the option to file there.
Centralised early procedure 🌐
One international application and search, rather than a scatter of separate national filings all at once.

Downsides and risks of the PCT path:

Sunk cost if you do not proceed 📉
If you ultimately decide to only file in one or two countries, or not proceed at all, the relatively heft PCT official fee (usually around AU$4,500) becomes a sunk cost.
Higher total lifetime cost in many scenarios 💸
You are adding a PCT “layer” on top of later national phase filings. Over the life of a portfolio, the total spend is often higher than a purely direct-filing strategy.
It does not fix a weak case 💩
A PCT will not turn an unpatentable or commercially weak concept into a good investment. It simply gives you structure and time to find that out.

4. Option B – Filing directly into Australia (and any known key countries)

When you might lean towards direct national filings:

You already know your key markets 🎯
For example, your solution is clearly focused on Australian customers, or a very specific cluster of regions, and you are confident that is unlikely to change.
Budget is tight and you want to minimise overall spend 📊
Rather than pay for a PCT that might only ever be used for one or two countries, you could put that money straight into national filings.
You want earlier movement in one or two jurisdictions 🚀
Sometimes you want faster examination or grant in particular countries (commonly the United States) for investor optics, licensing leverage or enforcement reasons.

Benefits of the direct path:

Earlier, concrete national rights in your key markets 🚩
Getting national applications on foot sooner can help in negotiations with investors, distributors and potential licensees.
Potentially lower total cost 👌
If you are genuinely confident about a small set of countries, skipping the PCT and going direct can be more cost-efficient over the long term.
Forced clarity 🔍
Having to decide your markets at 12 months can be a healthy discipline that prevents you from perpetually kicking the can down the road.

Downsides and risks of the direct path:

Missing a market you did not foresee 😔
If, 18 months after your 12-month decision, a major opportunity arises in a country where you did not file, it is often too late to go back and claim your original priority date.
Over-committing too early 🥲
You may spend heavily on several national filings at 12 months, only to have the product or business pivot in a way that makes some of those filings marginal.

5. A hybrid path: targeted direct filings + PCT “top-up”

Sometimes it can make sense to combine both strategies. For example, you might:

file directly into one or two absolutely critical countries at 12 months (for example, Australia + United States), and
file a PCT application to keep options open for additional countries later.

This hybrid approach can be a good fit where:

one or two markets are clearly central to your strategy and you want to move them ahead faster, but
you still want to preserve flexibility for other regions that might prove important.

The trade-off is cost: you are paying for some direct national filings and a PCT patent application at the 12-month mark. This can be pricey and should be justified only where the commercial upside is significant and reasonably well-founded.

6. A practical decision framework you can walk through

How certain are you about future markets?

Low certainty: E.g.: Platform-type tech, partner-driven distribution, global SaaS, health or deep-tech with uncertain regulatory pathways.
→ Stronger case for PCT (or PCT + targeted filings).
High certainty: E.g. Clearly defined domestic or regional markets that are unlikely to change.
→ Stronger case for direct national filings and possibly skipping the PCT.

What does your funding runway look like?

Short runway and very tight cash 🤌
– You may prefer to minimise overall spend, perhaps focusing on Australia only or one or two high-priority countries.
→ Direct filings only, or even a deliberate decision not to proceed.
Reasonable runway or realistic prospect of funding 📈
– Spending on a PCT to preserve international options can be seen as part of your broader investment in R&D and go-to-market.
→ PCT more likely to be justified.

How important is signalling to investors or partners?

If you are about to raise capital or negotiate with strategic partners, having a PCT application on foot or direct filings in key markets can send a stronger signal than simply having a provisional.

How central is the invention to your competitive advantage?

If the invention is core to your moat and hard to work around, that generally favours keeping options open via PCT (or at least a carefully chosen suite of direct filings).
If it is more incremental or supporting, you may decide to be more conservative.

7. The bigger-picture test: which future regret can you live with?

Another way to approach the 12-month decision is to step back from spreadsheets and forecasts and ask:

Which version of my future self am I optimising for?

There are a few “future selves” worth checking in with.

The 3–5 year version of you

This is the version of you who knows how the product launch went, which markets actually cared, and whether investors or partners came on board.

From that 3–5 year vantage point, there are two common regrets:

“We spent money on a PCT and only ended up filing in [insert country].”
Here, the sting is mainly financial. You paid for flexibility you did not ultimately use.
“We skipped the PCT and now can’t protect the invention in markets that turned out to be important.”
Here, the sting is more strategic and can haunt you with “what ifs”. You might have strong traction or a serious partner in a particular country, but far less leverage because you closed that door at 12 months.

The 10-year version of you

Ten years from now, regardless of how your venture plays out, you will look back at the choices you made under uncertainty:

Will you be more at peace knowing you took a calculated chance on protecting something you believed in, even if it did not fully pay off?
Or will you be more at peace knowing you played it safe with cash, accepted some closed doors, and kept downside tightly controlled?

For some, the answer is:

I’d rather know I gave this a proper shot, even if it cost more up front.

For others, it is:

I’d rather know I protected the business by not stretching our finances too far, even if that meant walking away from some possibilities.

Neither instinct is right or wrong. The key is to be honest about which one feels more aligned with the kind of founder – and person – you want to be.

The “end of life” perspective (without getting too morbid)

If you take it all the way to the “deathbed test”, the question becomes:

Looking back on my life, will I regret more that I took this risk, or that I didn’t?

For some, the deeper regret is: I didn’t back myself.

For others: I threw good money after bad.

Framing the decision this way does not replace the financial and legal analysis, but it can make the trade-offs much clearer, and help ensure that whichever path you choose is one you can live with in the long run.

Warren W