Katrine Ritto Tvede is a law student at the University of Copenhagen on exchange at Osgoode Hall Law School and is enrolled in Professor Ikechi Mgbeoji’s Patents class in Fall 2011. As part of the course requirements, students are asked to write a blog on a topic of their choice.
Through innovation, patents are an important enabler of economic growth. Studies on patent activity are therefore often carried out. These studies have revealed that the European Union, the EU, lags seriously behind other major international players such as the US and Japan in patent activity. The explanation given is that the EU single market for patents is still not complete. Despite numerous calls from Heads of States and major efforts since the 1970’s the EU has not succeeded in making a unitary patent system: an EU patent valid in all EU Member States.
Currently two different patent systems are in effect across Europe; a national patent system governed by the national law of each state and a European patent system governed by the European Patent Convention (EPC). The EPC is not an EU convention, but an agreement between 38 European countries. Under the EPC a European patent can be granted to the inventor if applied for. However, the European patent is not a unitary right, but consists of 38 independent patents. Each patent is governed by national law and is therefore only nationally enforceable and nationally revocable. After a patent has been granted through the European Patent Office (EPO) it has to be approved by the national patent offices in each country in which the inventor wants his invention to be protected. This means that the patent application has to be translated to each of the languages used in these countries. Renewal fees have to be paid in each country and auxiliary provisions in the different national laws make the maintenance of the patents burdensome on the inventor.
The administrative complexity and high translation costs (studies have shown that the translation fees amounts to around 70% of the total cost of applying for the patent) of this system has serious consequences for the competitiveness of the EU in relation to other major international players and has led companies to voice a demand that costs be significantly reduced.
In April 2011, this led the European Commission to table a package, consisting of two legislative proposals, aimed at creating a unitary patent protection system that will reduce costs of patents within the 25 participating EU countries by 80%. The new system has two main features: the creation of unitary EU patent protection and the creation of a unified patent court for the EU. If adopted, this system will significantly simplify the current system under the European Patent Convention.
As mentioned the Commission’s proposal firstly provides for a system under which a European patent granted by the EPO entails unitary protection in each of the 25 countries without the need for further action. The patent will ensure the same level of protection in all 25 countries. The system still requires the application to be submitted to EPO. The application can be submitted in any language, but the EPO will continue to examine applications and grant patents in its three official languages: English, French and German. The cost of translation into one of these languages will be compensated. The unitary patent will practically be a European patent granted under the EPO and given unitary effect upon request. In relation to the unitary patents, the EPO will take on further tasks. The EPO will be responsible for collecting, administering and remitting renewal fees for unitary patents and for keeping a register of unitary patents, which would include legal-status information such as transfers, limitation or revocation – all of which are presently dealt with by national authorities under national law.
The second important aspect of the proposed system is a joint patent litigation system. This litigation system will consist of the Unified Patent Court (UPC). The UPC will comprise of a Registry, a Court of First Instance and a Court of Appeal. The Unified Patent Court will have exclusive jurisdiction in respect of litigation relating to the infringement and validity of a unitary EU patent.
As there is currently a strong political will to get rid of the expensive and complicated system currently in place, the EU is eager to push forward with the Commission’s proposals and significant progress has been made for the first time in several years. Discussions concerning the location of the Unified Patent Court are currently taking place with meetings in the Competitiveness Council that took place on 29-30 September 2011 and more meetings scheduled for 5-6 December 2011. The EU expects the first unitary patents to be granted in 2013 and hopes that the new system will significantly boost research and innovation within the EU. Further, it is anticipated that the new system will increase patent activity and make the EU able to compete with the US and Japan. From a Canadian perspective, the implementation of the unitary patent system will mean easier and less expensive access to EU-wide protection for Canadian inventions.
One Response
This is a somewhat starry-eyed view of the Unitary Patent in its current form. One point is that it fails to mention that Spain and Italy currently refuse to take part – so ‘unitary European patent’ has a rather special meaning.
Secondly, we all hoped the new system would significantly boost EU research and innovation. Many now fear it will have the opposite effect. We believe that it will make life more difficult for smaller companies, not easier. True, those smaller companies who routinely protect their inventions in all 27 countries of the EU will find it much cheaper to do so (‘up to 80%”, the EU says). However, the number of small companies who do this have been (and may well remain) a vanishingly small class. For any foreign filing list, cost increases more or less linearly – potential benefit falls away much more rapidly. Well-advised small companies often file in three EU countries (UK, Germany, France). This will likely still be cheaper than obtaining a ‘unitary patent’ – probably in prosecution and grant costs, certainly in total renewal fees. Many companies are concerned about ‘bifurcation’ – in which infringement and validity are judged in separate courts, giving a considerable (and many would say unfair) advantage to the patentee, including the opportunity to obtain an injunction on a patent whose validity has not been upheld by a Court. Others worry about the jurisdiction given to the European Court – a body without specialist knowledge of intellectual property law, whose numerous decisions on trade mark matters have frequently been criticised. To avoid this system (as some will wish to do) it will become necessary to file national patents directly, since patents granted by the European Patent office will in future all fall under the jurisdiction of the new Courts.
It may thus be correct to say that the system will mean ‘easier and less expensive access to EU-wide protection for Canadian inventions’: but this overlooks that such EU-wide protection will still be a substantial expense – and usually bad value when compared with protection in a smaller selection of EU countries.
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