Ministers still deadlocked on EU patent

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A final deal on the EU patent was still being held hostage by divergent national interests yesterday (11 October) at a Competitiveness Council held in Luxembourg. 

EU ministers remain split between a group of countries led by France and Germany which support a trilingual system for the EU patent as proposed by the European Commission, and another group of states that oppose this solution and alternatively back a monolingual or multilingual regime.

The language used to file, contend and spread information about a patent is a crucial detail for countries' competitiveness. Researchers and small and medium-sized enterprises (SMEs) capable of using their mother tongue for patents will have an advantage over competitors that speak different languages.

On the other hand, the current system, which protects all EU languages, has produced legal uncertainty and soaring costs, making patents more difficult and expensive to file in Europe than in other industrialised regions of the world.

At yesterday's Competitiveness Council, Belgium, which currently holds the rotating presidency of the EU, pointed out that under the existing system, a company willing to commercialise the same patent in all 27 countries must pay something like 25,000 EUR in legal and administrative costs.

Some critics argue that this is in fact rather unlikely since most companies only register their patents in specific markets. Only a few multinationals are interested in taking on all the cost of operating their patents in every EU member state. SMEs, on the other hand, tend to use their patents only in bigger EU markets.

The negative consequences of this situation are two-fold, analysts have found. Firstly, the concept of the internal market is undermined at its roots as fragmentation between national markets remains the rule. Secondly, countries where a patent is not registered often become hubs for counterfeit goods, which are then exported to all of Europe.

As an example, if a company decides to register a patent in Germany, France, the UK and Italy, the biggest national markets, the same patent would be left without legal protection in all other member states. In this scenario, if a cargo of counterfeit products were to arrive at the port of Antwerp in Belgium or Madrid airport in Spain, the owners of the patent would not be able to claim their rights against fraudulent activities.

National interests at stake

All member states are aware of the need to quickly reach a compromise on the EU patent. It is in the interests of everybody, but the proposed paths to an agreement differs widely with regard to the language of patent applications.

France and Germany want to maintain the privileged status reserved for their respective languages in the current system, which is run by the European Patent Office (EPO), a pan-European body which is not part of the EU.

The language which is "customary in the field of international technological research and publications" is English, but using French and German too increases costs and lays the ground for potential legal uncertainty.

Italy is the most vocal country against a trilingual regime. The minister in charge of the dossier, Andrea Ronchi, continued to threaten yesterday at the EU Council that Rome would not hesitate to use its veto power on the issue.

Spain is also very critical and has proposed a system based on English and a second language, to be chosen at will by applicants.

Poland is said to have voiced criticism at the last Council. Warsaw is clearly against the idea that a possible solution could involve a five-language regime, where Italian and Spanish would join English, French and German as official languages for EU patents, leaving out Polish.

Slovakia, the Czech Republic and Cyprus are also sceptical about the three-language proposal made by the Commission last July.

The commissioner in charge of the dossier at the EU executive, Frenchman Michel Barnier, faced accusations that he was pursuing his national interest in proposing a trilingual system during a press conference after the Council had ended yesterday.

Two red lines

The compromise proposed by the Belgian Presidency, whose content had been anticipated by EURACTIV, was not considered sufficient to remove the deadlock.

"Our aim is to find an acceptable compromise before the end of our mandate," said the Belgian minister in charge of the dossier, Vincent Van Quickenborne, confirming that the next Competitiveness Council in November would focus on finding a compromise on the EU patent.

Van Quickenborne and Barnier both underlined that a compromise is still possible but with "two red lines". The deal would have to guarantee better legal certainty and lower costs.

EU Internal Market Commissioner Michel Barnier reminded that the current patent regime "does not protect sufficiently and it is too expensive".

Italian European Affairs Commissioner Andrea Ronchi described as "absolutely incompatible" the trilingual regime proposed by the Commission and de facto backed by the Belgian Presidency. "It hampers the internal market. It discriminates against languages and does not reduce costs sufficiently," he said at the end of the Council.

The EU commissioner for industry, Italian Antonio Tajani, said he supported a solution based on multilingualism, with five languages rather than three. "However, instead of a monolingual regime, I would go for a trilingual system," he added after the Council.

Moves to develop a single patenting system for the EU began in 2003 but progress has been hampered by linguistic, technical and legal difficulties.

The cost of filing and protecting patents in Europe is substantially higher than in the US and Japan, and business organisations have consistently complained about the fragmented and inconsistent decisions handed down by European courts. 

Companies often have to fight legal actions in several European countries at once, and national courts regularly come to conflicting conclusions on identical cases. A single patent court would make litigation cheaper and more predictable.

The Commission presented in July a proposal to end the deadlock on linguistic disputes. The EU commissioner in charge of the dossier, Michel Barnier, proposed to maintain English, French and German as official languages for filing an EU patent (EURACTIV 02/07/10). But this is opposed by other member states, namely Spain and Italy.

The Belgian Presidency has said overcoming legal and linguistic problems will be a top priority during its six months at the helm of the European Council (EURACTIV 24/06/10).

  • 26 Nov. 2010: EU Competitiveness Council.
  • 10 Dec. 2010: EU Competitiveness Council.

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