Commission seeks to improve patent system in Europe

The European Commissioner for Internal Market and Services, Charlie McCreevy, said in Berlin recently that he personally has doubts in regards to patent policy.

charlie mccreevy 88 298 (photo credit: Bloomberg)
charlie mccreevy 88 298
(photo credit: Bloomberg)
"Patents are a driving force for promoting innovation, growth and competitiveness, but the single market for patents is still incomplete. Our 2006 stakeholder consultation showed that the EU simply must deliver, in particular on the Community patent and sound litigation arrangements, because in today's increasingly competitive global economy Europe cannot afford to lose ground in an area as crucial as patent policy. That is why I propose to have a fresh look at the various options and to work with the Council and the Parliament towards political consensus on real improvement of the patent system."[Internal Market and Services Commissioner Charlie McCreevy] The European Commission set out its vision last week, in the form of a Communication, for improving the patent system in Europe and for revitalizing the debate on this issue. Making the Community patent a reality and improving the existing patent litigation system, together with supporting measures, it is hoped will make the patent system more accessible and bring cost savings for all. The European Commissioner for Internal Market and Services, Charlie McCreevy, said in Berlin last week (March 29) that he personally has doubts in regards to patent policy. He said everyone agrees that the EU needs to streamline the existing patent systems and that it needs a simpler, more cost-effective system that maintains the highest standards in the quality of patent examination and grants. However, he added solemnly, Europe already has been struggling for more than two decades to work out how to get there. "The figures and the facts speak for themselves," he pronounced. "Recent studies have shown that a European patent designating 13 countries is about 11 times more expensive than a US patent and 13 times more expensive then a Japanese patent. Heavy translation and legal costs make registering, enforcing and challenging patents expensive and cumbersome." It is common knowledge that the Commission needs to improve access for SMEs (Small and Medium Enterprises) to the patent system. Hence, the Commissioner proclaimed that he will work to adapt the patent system to the specific needs of SMEs. Apart from addressing cost and litigation issues, he clarified this requires specific support for SMEs such as awareness-raising campaigns and actions aimed at improving knowledge of patent issues among SMEs. Why a Communication on patents? The Communication highlights that Europe's current patent system is considerably more expensive than the US and Japanese systems. A Community patent would be far more attractive than models under the present system, which is a bundle of national patents. The existing system of patent litigation in the EU, with the risk of multiple patent litigation in several countries on the same patent issue, leads to unnecessary costs for all the parties involved and causes lack of legal certainty. The difficulties in making progress on patents, and especially on the creation of a Community patent, led the Commission to launch, in 2006, a broad consultation of all interested parties on the future patent system. The results leave no doubt on the urgent need for action to provide a simple, cost-effective and high-quality patent system in Europe. The Communication is intended to draw operational conclusions from the stakeholder consultation and to allow the European Council to launch deliberations on patent reforms, in particular on the Community patent and jurisdictional arrangements. It addresses various supporting measures for an improved patent system, such as patent quality, knowledge transfer and enforcement issues. A separate and comprehensive Communication on Intellectual Property Rights (IPR) is planned for 2008, to complement the Patent Communication and address outstanding non-legislative and horizontal issues in all fields of intellectual property. The Community patent Many stakeholders support the Community patent as the approach that will yield most added value for European industry under the Lisbon strategy. However, they criticize the European Council's Common Political Approach adopted in 2003 because of high translation costs and excessive centralization of the proposed jurisdictional system. The Commission is reported to believe that a truly competitive and attractive Community patent can be achieved provided there is political will to do so. The Commission announced it is aware that concerns about an overly centralized jurisdiction should be taken into account in the work on the creation of an integrated EU-wide jurisdiction for patents. On translation costs, the Commission is about to explore with Member States how to improve the language regime with a view to reducing translation costs while increasing legal certainty. An integrated EU-wide jurisdictional system for patents Recent discussions between Member States show polarized positions on patent jurisdiction arrangements with, on the one hand, Member States supporting the draft European Patent Litigation Agreement (EPLA) in the context of the European Patent Convention and, on the other hand, Member States favoring the establishment of a specific Community jurisdiction for patent litigation on European and Community patents based on the EC Treaty. Under these circumstances, the Commission declared it believes that consensus could be built on the basis of an integrated approach that combines elements of both EPLA and a Community jurisdiction. The way forward could be to reflect on the creation of a unified and specialized patent judiciary, with competence for litigation on European patents and future Community patents. This system could be inspired by the EPLA model but could allow for integration in the Community jurisdiction. As a first step, work should concentrate on building consensus among Member States around principles on which consensus is emerging. Head of the International Department at the Joseph Shem-Tov law firm