15 February 2011

EU Parliament Gives Go-Ahead for 'Unified Patent' by Enhanced Cooperation As Promised Cost Savings Appear Questionable

[The European Parliament building in Strasbourg]
Despite the - earlier reported and not totally unfounded - efforts of anti-patent groups (see here and here) to urge the European Parliament to not give its consent to a legislative proposal to implement a 'small' EU patent (now called "Unitary Patent") by enhanced cooperation until the ECJ issues its opinion on the compatibility of the EU Commission's draft agreement on the EEUPC on 8 March, the European Parliament did exactly this - it today gave its go-ahead by 471 votes to 160, with 42 abstentions (see here for further reports), as recommended by the Parliament's legal affairs committee (JURI) in January. As the next steps
The Council of Competitiveness Ministers is expected to formally adopt the decision authorising enhanced cooperation on 9 - 10 March [i.e. the day after the issuance of the ECJ's opinion!]. The Commission will then submit two legislative proposals: one establishing the single patent (under the co-decision procedure) and the other on the language regime (consultation procedure).
However, as summarised by EurActiv, there remain severe doubts over the legal compatibility of both the linguistic and jurisdictional regime (as proposed for the Unitary Patent and/or the EEUPC).
[C]oncerns have been raised regarding the status of the new court [i.e. the EEUPC as proposed by the Draft Agreement]. In an opinion issued in July, the Advocates General of the European Court of Justice stated that the new tribunal could be out of step with EU legislation and jurisprudence, declaring the proposal "incompatible with the treaties" [see earlier posting]. The opinion also condemned the draft proposal due to its [...] trilingual system [that] "may affect the rights of defence" of companies based in countries that use a different language [...].
And, if the Court replicates the Advocate General's opinion, as it does in 80% of the cases, a completely new scenario would unfold, since the EU Commission would then have to start from scratch again. Further,
  • in the European Parliament, opposition by MEPs from Spain and Italy could gather momentum and attract members from other countries;
  • the initial idea of introducing a system based on English only could resurface as concerns about jurisdiction are also based on linguistic grounds. Indeed, the English-only regime – backed by Italy and Spain – would not only be cheaper and simpler, but also fairer, as it would avoid giving French and German companies a competitive advantage.
  • a multilingual system based on all the EU's official languages may be the only option left. And after years of talks, this would essentially mean negotiations were back at square one.
It appears that the 8th of March will be a historic date for the decades-old EU patent project, either the hoped-for breakthrough or its downfall.

Besides all this, the big motivation for the EU patent, as repetively preached by the EU Commission, namely that "the current system for obtaining patents throughout the EU was too expensive, costing ten times more than in the United States", is highly questionable, as remarked by Mr Jochen Pagenberg, current President of EPLAW, in an article in the January 2011 edition of AIPPI e-news,
since the figures compared are only the bare filing fees and, therefore, do not reflect the real burden on patentees for an average case when examining the filing practice of industry with regard to EP patents. They clearly ignore the costs of further prosecution [e.g. attorneys fees], not to speak of the expense of later enforcement for which a comparison between the US and continental Europe would give a different picture. [...] [C]ombining a system having more affordable filing fees with an unaffordable enforcement system is wasted money and overlooks the real needs of users, in particular, small and medium businesses.
In fact, the frequently articulated figures, e.g. by Commissioner Barnier and others ("the cost [...] will be reduced tenfold"), appear to be somewhat "political". Considering the fact that the London Agreement has already abolished translation requirements for most of the more important EPC/EU economies like UK, FR, DE, NL, SE, DK, huge cost savings due to reduced translation expenses cannot be expected, especially since the two most important countries that have not entered the London Agreement, namely Italy and Spain, will not participate in the EU patent either.

So one has to fear that some European politicians (and SMEs) will be quite surprised if the political promises do not come true to the desired extent once the Unified Patent is implemented.