08 June 2012

Controvercy on Unified Patent Court is developing into a Beacon for Europe's policy-making capability

In a series of four postings on our ksnh::law blog we comment on both the latest developments of the negotiations for a Unified Patent Court Agreement at the recent Competitiveness Council Meeting and its future perspective before the background of Europe's looming financial crisis:
Below please find a short overview of the main facts and observations raised therein: 

Document 10362/12 summarises the poor result that once more no political solution was reached. Its crucial passage reads
The Council held a preparatory debate in order to gather consensus on the location of the seat for establishing a unified patent court, with a view to a successful decision on the seat by the European Council at its meeting on 28-29 June 2012.
It is apparent that the political actors in the EU Council and the Polish and Danish Council Presidencies have meanwhile completely stopped to listen to expert advice and now try force a breakthrough by some purely political decision on the seat of the central division of the Unified Patent Court, as for a couple of months now the official line of argumentation is that all problems but the seat of the central division are solved (see e.g. Commission President José Manuel Barroso's press release).

Now, as the matter has finally reached the top flight of EU decision-making (see here), Angela Merkel and all of her colleagues on EU level are now poised to undertake a final approach to find a political solution at the the European Council on June 28 and 29, 2012, where, however, the Patent issue will only be a side aspect as fire-fighting the financial crisis will bind most resources. 

Up to now, the political game of power went so that Paris, presented as a compromise candidate for the opposing London and Munich bits, was initially rejected but recently declared favorite, while the  Italian change of attitude to support the Unified Patent Court (but not the Unitary Patent!) if the Central Division is awarded to Milan will not make things easier (see here). It now is a mere fight for prestige and money (“Billions at stake”) but not so much on European interests and perspectives (see here and here).

Of course, national interest always played a prominent role in the turbulent history of the European Union (official version here) and the present issue is another striking proof for the deficiencies of the EU policy-making process, since complicated substantive arguments as to the merits have been dismissed at a certain point and a purely political question became decisive for the whole project

There is no doubt that winning the seat would be a tremendous victory for the respective government and an enormous economical boost for the respective country (see estimate as to the financial benefits for the hosting city/country) so that the seat issue is a perfect pledge and leverage for even more important negotiations such as the measures to take for stemming the European sovereign-dept crisis. It can easily be imagined that Paris or Berlin is awarded with the seat in order to soothe François Hollande's left-winged post-election reform impetus or Angela Merkel’s strict saving agenda, respectively.

The epic and painful process of drafting and implementing a unified European patent infrastructure discloses frightening mechanisms and structural deficiencies of the European policy-making process that may endanger stability and acceptance of and confidence in the European Union as a whole, particularly before the background of the severe financial and depths crisis that shakes the Union like nothing else before. 

According to my understanding, four major problems can be identified (see details here) that prevent EU politicians from finding a reasonable solution satisfying the needs of the European innovative economy:
  • Ignorance as to users and experts and their mostly well-founded observations; 
  • A striking lack of transparency preventing public involvement; 
  • An information policy that disguises more than it discloses; and 
  • National egoisms, inappropriate horse-trading and power games. 
These disturbing shortcomings of the EU legislative process were also summarized in a somewhat desperate e-mail that prominent IP litigator and former legal expert consultant to the EU Commission Jochen Pagenberg sent to EU Council President Herman Van Rompuy (see also this article). In the e-mail, the following issues were addressed:
  • Abandonment of the original goals (patent litigation system working in practice and attractive to its users) occurred behind closed doors in an unprecedented process of legislation, as the papers of the “patent package” had never seen the light of a public discussion; 
  • Matter has been handled by the instances in Brussels over the last six months in such an undemocratic behavior that few people in Europe would have imagined; 
  • Council hides legislative texts from public discussion because they fear that otherwise users and members of national parliaments would learn about negative impacts of the project and therefore would oppose and refuse ratification; 
  • Many additional flaws have found their way into the texts as a result of political compromises which again have never been discussed with users. 
Perhaps the most striking issue is the EU’s tendency to lock away documents offering substantial content that may, however, provoke discussions and objections among stakeholders (see e.g. intransparent wheeling and dealing, EU locks away documents, something to hide), which is not what one may expect of democratic institutions like the EU Council and its Presidency.

But there is still hope as driven by the financial crisis, some politicians in charge realize that the solution might be to dare more European integration, not less, as German Chancellor Angela Merkel sketched at this year’s World Economic Forum 2012 in Davos:
Europe must be a political union, where the European Commission looks more like a government, the European Parliament is stronger and the Council is a kind of its second chamber, and the EU Court of Justice is the supreme court with powers to supervise the implementation of public budgets in individual countries.
Singing the same tune, the President of the European Economic Social Committee (EESC), Mr. Staffan Nilson, added that
  • we need deeper European integration, in which responsibilities are shared, risks mutualised and resources jointly leveraged to create debt instruments and a growth model which is credible, coherent and sustainable. 
  • we need a Europe of true solidarity and respect for all citizens. 
  • we need a Europe of democracy, both representative and participatory. 
No doubt, this would surely be the right approach to both rescue the European project and establish an efficient and accepted unified patent infrastructure. The question only is whether such insight does not come far too late to save anything, as the confidence of markets in the European currency and of potential uses in a European unified patent infrastructure will not be endless.


(Photo 2010 by Katuslampan via Flickr under a CC license)

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