Italy, Spain take patent fight to court

European Court of Justice President Vassilios Skouris. [ECJ]

Italy and Spain yesterday (30 May) lodged a complaint with the European Court of Justice against attempts by other member states to introduce an EU patent without them.

The EU patent scheme (see 'Background') is backed by 25 members but viewed as discriminatory by Rome and Madrid.

In a statement, the Italian Foreign Ministry said it had lodged the complaint with the court to defend the values of the union against abuse.

The statement said the use of enhanced co-operation procedure was "never intended to be stretched to nullify the original aims of the European treaties".

Against the spirit of the single market

It added: "The use of enhanced co-operation within the patent sector is contrary to the spirit of the single market, because it tends to create division and distortion within the market, and will thus prejudice Italian businesses."

Supporters of a single EU patent say it is time for the Union to replace the current system, which forces firms to patent their designs in every one of the bloc's 27 member states and in 23 official languages, at huge expense.

It is the second time that the courts have waded in to the patent row. Before the enhanced co-operation procedure had been agreed by member states in March, the Luxembourg court ruled that the creation of a Community Patent Court would not be compatible with the provisions of EU law.

Ministers to discuss the move in June

Hungarian Deputy Economy Minister Zoltán Cséfalvay said competitiveness ministers would discuss the issue at a special meeting on 27 June in Luxembourg.

In respone, Internal Market Commissioner Michel Barnier said: "I am confident that the enhanced co-operation procedure presented by the Commission is not discriminatory. We are assured that Italian and Spanish business will suffer no discrimination."

Legal difficulties

Patent titles are currently granted by the European Patent Office (EPO), which was set up in 1977 and now covers 38 countries, including all EU member states.

However, the so-called 'European patent' offered by the EPO is in reality nothing more than a bundle of national patents, with each country having its own set of different rules.

The current situation results in significant costs and legal difficulties for companies that want to protect their inventions across all European countries.

On 15 February, the European Parliament gave its approval for member states to make use of the enhanced cooperation procedure for setting up a common patent system.

The agreement among 25 member states concerns the creation of the European patent – which in legal jargon is known as a "unitary patent title" – as well as the use of English, French and German as the three main working languages.

However, another potentially more difficult issue is not covered by the ministers' agreement. This concerns the idea of setting up a common jurisdiction system, including a tribunal to resolve legal disputes, for example concerning the scope of individual patents.

Before the agreement on enhanced co-operation had even been reached, on 8 March, the European Court of Justice ruled that the creation of a Community Patent Court would not be compatible with the provisions of EU law, thereby casting a shadow of doubt over plans to establish a Europe-wide patent system.

The Hungarian Presidency estimates that the direct consequence of a fragmented patent system add up to around €750 million of extra costs on European businesses every year.

Jeremy Fleming

Positions

"Italy has today filed an appeal with the Court of Justice in Luxembourg against the decision of the Council of 10 March 2011 which authorised the introduction of European patent by enhanced co-operation of the 25 member states," said a statement from the Italian Ministry of Foreign Affairs.

"By this means, Italy intends to defend the values and objectives of the European Union against attempts to create a clique of power and values in contravention of the principle of the equal right to dignity and the respect for the languages and culture of each member states."

"Italy also contests the creation of a negative precedent within the process of European integration: enhanced cooperation was never intended to be used as a divisive instrument, effectively stretched in order to nullify the norms of the European Treaties which call for humanity, but as methods for groups of states to develop means of integration in which other states are not interested," it added.

The statement concluded: "The use of enhanced co-operation within the patent sector is contrary to the spirit of the single market, because it tends to create division and distortion within the market, nd will thus prejudice Italian businesses."

"We cannot understand why Spanish and other languages cannot have the same status of French, English and German," Spain's EU affairs minister Diego Lopez Garrido said.

"[The Spanish government] insists that the reinforced cooperation mechanism was used to impose a solution which excludes Spain with a mechanism which, paradoxically, was thought up to facilitate the integration of the Member States,” Lopez Garrido added, concluding: “Spain believes a future European patent cannot be based on linguistic discrimination. Spanish is a great European language and Spanish companies, Spanish innovators and patentors cannot be discriminated against for reasons of language."

In response, Internal Market Commissioner Michel Barnier said: "It is for the Italians and Spanish to make their own decisions. But I am confident that the enhanced cooperation procedure presented by the Commission is not discriminatory. We are assured that Italian and Spanish business will suffer no discrimination."

"I hope that in time Italy and Spain will join in the enhanced co-operation: that would be in the general European interest," Barnier added. 

Background

On March 11 2011, ministers from 25 member states decided to go ahead with plans to introduce a common system for registering patents that would save European businesses millions of euros each year. Italy and Spain refused to join in, and claimed at the time that difficult legal issues remain unresolved.

The two countries chose to exclude themselves from the process, because they refused to accept the proposed rules regarding the choice of official languages.

Most of the ministers were able to accept the principle that all patent applications should be submitted using one of the three working languages of the European Patent Office (EPO), which since 1977 have been English, French and German.

However, the Italians and Spanish are afraid that such an approach would give an unfair advantage to companies based in France, Germany and the United Kingdom, which would all be able to make Europe-wide patent applications in their native languages.

The two Southern European countries argued that their languages should be included as well, otherwise there should be just one reference language. But the French government was not willing to accept the idea that all patent applications should be submitted in English.

After many months of unsuccessful negotiations it finally became apparent, at the end of last year, that it would not be possible to achieve an agreement between all 27 countries on the sensitive issue of which languages could be used for patent applications.

Some of the member states then started to think about going ahead with a common patent system between themselves, making use of the so-called 'enhanced cooperation' procedure that has been part of the EU treaty since 1999.

Enhanced cooperation allows a group of countries to adopt new common rules among themselves, in areas where an EU-wide agreement cannot be reached.

The procedure was first put into practice last summer (July 2010), when 14 countries launched an agreement on how to manage divorces involving couples with connections (of nationality and/or residence) to more than one member state.

Timeline

  • 27 June: Ministers to discuss dispute in special meeting on patents in Luxembourg.
  • Next half year: Court will consider complaint by Italy and Spain.

Further Reading

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