Patent litigation reform to cut costs for SMEs

This article is part of our special report European Business Summit.

The European Commission is seeking powers from EU member states to conclude an agreement on a Unified Patent Litigation System (UPLS), which would establish a court with jurisdiction for existing European patents and the future Community patent system.

The move has been presented as a boost for SMEs and private inventors, for whom the current system can be complex and costly. 

According to the Commission, the UPLS will increase legal certainty, reduce costs and improve access to patent litigation for businesses. 

“European businesses find the current patent litigation system complex, slow and costly. Once agreed, a unified system with a dedicated unified patent court would make patent litigation more predictable, faster and less expensive, helping to stimulate innovation, competitiveness, growth and job creation in Europe,” said Internal Market and Services Commissioner Charlie McCreevy. 

In a statement, the Commission added that the proposed court system would support growth and innovation by allowing prompt settlement of disputes over intellectual property. 

At present, patent holders seeking to protect their inventions throughout Europe may have to pursue parallel litigation in all countries where their patent is valid. This has led to considerable legal uncertainty in cases where courts in different member states issue contradictory judgements. 

Under the UPLS, the ECJ would rule on preliminary questions raised by patent courts regarding the interpretation of EC law and regarding the validity and interpretation of acts from the Community institutions. The Commission will have to ensure that the rules of any draft agreement are consistent with the creation of a Community patent

A cost-benefit analysis by Dietmar Harhoff, of Munich’s Ludwig Maximilian University, predicted that avoiding duplication of patent infringement and revocation actions would result in savings of between €148 million and €289 million per annum. 

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