Towards seamless patent registration and protection in 25 EU countries

Viviane Reding, Vice-President of the EC in charge of Justice, Fundamental Rights and Citizenship, went to Sofia where she met with Rosen Plevneliev, President of Bulgaria (22/07/2013). After returning from Sofia, Reding announced the initiative for a seamless patent registration and protection legal environment in 25 EU countries, (EC Audiovisual Services).

Slowly but steadily the European Commission works towards the creation of a seamless patent registration and protection legal environment in 25 member states (Italy and Spain are not participating). To this effect the EU’s executive arm is now proposing new legislation to fill the legal gaps for unitary patent protection. In detail the Commission on 29 July issued a proposal to “complete the legal framework for Europe-wide patent protection by updating EU rules on the jurisdiction of courts and recognition of judgements (the so-called “Brussels I Regulation”)”. The new laws will pave the way for a specialised European patent court, the Unified Patent Court.

Once the new Regulation approved and becomes operational it will be much easier for companies and inventors to protect their patents. It must be reminded that on 19 February this year twenty-two EU member states signed the international agreement establishing the Unified Patent Court (UPC) of the Union. After that more countries joined the initiative. The unitary patent package will allow patent protection to be obtained for the 25 member states taking part on the basis of a single application and without further administrative formalities, like validation and translation requirements, in member states.

Understandably this new proposal before becoming EU law must be ratified by member states and by the European Parliament. The Commission in order to speed-up the procedure encourages all member states to approve in their Parliaments the Unitary Patent Court Agreement as quickly as possible. On top of that there is a lot of legal and administrative work to be accomplished for the Court to become operational. Only then it will be possible for the first unitary patents to be granted.

Where we stand today

As EU law stands now, in disputes concerning the validity or an alleged infringement of a patent, the legal case is judged by the courts of the member state in which the patent is registered. Infringements proceedings however may be brought before several courts, e.g., alternatively, the courts of the member state of the defendant’s domicile or before the courts of the member state where the infringement occurred or may occur. The Commission observes that “In many patent infringement proceedings the defendant makes the point that the patent is invalid. This falls under the exclusive jurisdiction of the state to which the patent is attributed. In practice this means the patentee may have to litigate in parallel proceedings, involving considerable cost, complexity and potential divergent outcomes in court decisions”.

As mentioned above the first step towards the creation of the Unified Patent Court was realized on 19 February by 22 member states. On that day the European Sting wrote “during the Council of the European Union meeting, twenty-two member states opened a new page in the history book of the EU, by signing the international agreement for establishing a Unified Patent Court (UPC). Once the agreement enters into force, the signatory countries will form a unified area in terms of patent law. Since the 1970s, the EU member states have been in agreement on the necessity of setting up a common system of patents. Today this became possible”.

The UPC

The Central Division of the Court of First Instance will be in Paris. Given the highly specialised nature of patent litigation and the need to maintain high quality standards, thematic clusters will be created in two sections of the Central Division, one in London (chemistry, including pharmaceuticals, classification C, human necessities, classification A) and the other one in Munich (mechanical engineering, classification F). The Court of Appeal with the Registry will be in Luxembourg and the Patent Mediation and Arbitration Centre will have two seats, in Lisbon (Portugal) and Ljubljana (Slovenia).

Filling the gaps

It is not a simple thing though for the UPC to have jurisdiction over the 25 states. “By making changes to the rules on recognition of judgements, we are paving the way for the new Unified Patent Court to begin its work. In the event of a dispute, companies will no longer have to launch actions before a number of courts in different countries,” said Vice-President Viviane Reding, the EU’s Justice Commissioner. “Removing bureaucratic obstacles, extra costs and the legal uncertainty of having 28 different and often contradictory systems makes the single market more attractive. This is a very good example of how justice policies can stimulate growth.”

The growth effect

The ‘growth effect’ from the creation of a seamless patent registration and protection jurisdiction is obvious. According to the Commission only 62 000 European patents were delivered in the EU during 2011. In comparison 224 000 patents were granted in the US during the same year and 172 000 in China. One reason for the difference is the excessive cost and the complexity of obtaining patent protection throughout the EU’s single market. At present, whoever seeks to obtain Europe-wide protection for an invention has to validate European patents in all 28 EU member states. By the same token the patent holder may become involved in multiple litigation cases in different countries on the same dispute.

The background

The European patent with unitary effect will be based on two regulations which will be adopted in the framework of enhanced cooperation of 25 Member States (all Member States but Italy and Spain). This was necessary because an agreement between all 27 Member States could not be found. Eventually, 25 Member States have decided to proceed with enhanced cooperation in order to create this system of unitary patent protection in Europe. Member States not participating now can join later.

Enhanced cooperation is a possibility ensured by the Treaties that can only be adopted by the Council as a last resort, when it has established that the objectives of such cooperation cannot be attained within a reasonable period by the Union as a whole, and that at least nine Member States participate in it. Another well-known example of enhanced cooperation is the introduction of the Financial Transaction Tax (FTT) to be applied in 11 Eurozone member states, which have initially accepted the relevant Commission proposal.