EU MAKES PROGRESS TOWARDS, AN EU-WIDE PATENT SYSTEM

UNCLAS SECTION 01 OF 02 BRUSSELS 001673 SENSITIVE SIPDIS STATE FOR EUR/ERA KESSLER STATE FOR NSC KVIEN, DBELL STATE FOR EEB/TPP/IPE URBAN USDOC FOR ITA/MAC/EUR/OEU/DEFALCO USDOC FOR ITA/MAS/OCG/JFERMAN USDOC FOR ITA/MAS/OTEC/RBLANKENBAKER STATE PASS TO USTR E.O. 12958: N/A TAGS: KIPR EIND ETRD SENV ECON TPHY TSPL EUR EUN SUBJECT: EU MAKES PROGRESS TOWARDS, AN EU-WIDE PATENT SYSTEM BRUSSELS 00001673 001.2 OF 002 ¶1. SUMMARY: At a Competitiveness Council meeting in Brussels December 4, EU industry ministers reached a political agreement on a process to move toward setting up a single EU patent to replace the multitude of national patents in force across 27 member states. The ministers also reached a deal on the establishment of an EU patent court system that would set up a single European appeals courts for patent infringement disputes. The agreement paves the way for further discussion, under Spanish and later Presidencies, towards a future patent system, but, given institutional and procedural hurdles, such a system is likely still one or more years away. END SUMMARY -------------- BACKGROUND -------------- ¶2. The EU has long had a goal of creating a single EU patent system under which, as in the United States, a patent could be applied for and granted through a single office, valid in all 27 member states. Such a system would, according to Commission proponents, save firms at least 150 million Euros/year. ¶3. The EU has tried and failed to launch a common patent a number of times. The first effort was the Community Patent Convention (CPC) signed in Luxembourg, December, 1975, by the nine EU states at the time, but never ratified. An Agreement Related to Community Patents was signed by the EU 12, in Luxembourg in December, 1989, but also was never ratified by all signatories and thus never entered into force. A political agreement on an approach to an EU patent was achieved in 2003, but foundered in 2004 when the Competitiveness Council failed to agree on details of the regulation. ¶4. Unable to reach agreement on a common patent, European member states agreed to the European Patent Convention, which created the European Patent Office (EPO). This differs from a community-wide patent in that the EPC is a mutual recognition of nationally agreed patents and includes non-EU European states as signatories. The arrangement does not, however, represent a centrally enforceable, European Union-wide patent. -------------- LATEST EFFORTS MAY BE MORE SUCCESSFUL . . . -------------- ¶5. At a December 4 Competitiveness Council meeting, the Swedish presidency was able to use new powers under the Lisbon Treaty to gain get member states to agree to the basic parameters of an approach to an EU common patent and supporting institutions. The Commission will use this result to draw up specific legislative proposals. Political agreement on the key elements of the proposal should facilitate adoption by the Council and European Parliament. ¶6. Article 118 of the Treaty on the Functioning of the European Union (TFEU),which consolidates the Treaty of the European Union with the Treaty of Lisbon, provides for the creation of European intellectual property rights (IPR) and the setting up of centralized, EU-wide arrangements for the authorization, coordination, and supervision of IPR in the EU. It also calls for establishment of language arrangements for translations of European IPR, long an issue in the creation of an EU patent. The entry into force of Lisbon on December 1, then, provided additional clear legal support for the patent. ¶7. The new political agreement on an Enhanced Patent System in Europe calls for the creation of a European and EU Patents Court (EEUPC),an EU patent (along with a separate regulation governing translation arrangements for the EU patent),an enhanced partnership with the EPO, and, as necessary, amendments to the EPC. Under the agreement, the EEUPC would be made up of a Court of First Instance, a Court of Appeals, and a Registry. The EEUPC would be financed by court fees and contributions from the EU member states at least during the transition period (five years after entry into force). The court would be composed of judges with patent litigation experience at the national level. In addition, non-EU BRUSSELS 00001673 002.2 OF 002 contracting members of the EPC could accede to the agreement as well. -------------- . . . BUT NOT A LOCK -------------- ¶8. But hurdles remain. The European Union Court of Justice (EUCJ) is currently considering whether a new European patent court can be set up (presumably out of concern that such a system could be contrary to the EUCJ's role as guardians of the EU Treaties). Member states are not united in their support for an EU-wide patent, with national patent offices set to lose patent renewal fees and some competence under the proposal. And, while the Lisbon Treaty offers legal support for both a centralized approach to IPR and patent systems and translation arrangements, the mechanics of both are unclear. -------------- CONCLUSION -------------- ¶9. While the notion of an EU-wide patent has been around for some time, this agreement should come as welcome news for supporters of a strong internal market and a more robust EU patent regime. With entry into force of a final regulation two or three presidencies away, there is time yet for a roadblock or two, with the EUCJ opinion the largest potential deal maker or breaker. But political will for an agreement, combined with the legal support of Lisbon, make an EU-wide patent regime more likely than not in the near future. MURRAY .