Special meeting may break deadlock over EU patents

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The Belgian Presidency has proposed a new compromise text – seen by EURACTIV – to break a long-standing deadlock over EU patents which could lead to an historic deal at an extraordinary Competitiveness Council next Wednesday (10 November).

The new proposal, which has been circulating among EU diplomats since 3 November, contains important steps forward compared to the previous compromise text tabled in October, which proved ineffective.

This triggered the convening of a special Competitiveness Council next Wednesday, which follows an official and an informal Council that have already been held during the Belgian Presidency and precedes another two meetings scheduled for November and December. On average only two Competitiveness Councils are held per semester.

If no solution is found at the upcoming meeting, ministers in charge of competitiveness matters will meet again on the patent issue on 26 November and 10 December.

An open-ended transitional period

The most relevant element seems to be the provision of no clear deadline for the end of a transitional period preceding the entry into force of a permanent regime, upon which English, French and German will become the three fully-fledged official languages for the EU patent.

During the transitional period, translations of EU patents should be available only in English and not in the other two official languages. This would reduce costs and make it easier for firms of other EU countries to benefit from the new system.

"As long as high quality machine translations are not available for EU patents, which are not granted in English, a translation into this language has to be provided by the applicant," reads the Belgian proposal.

The vagueness of the transitional period's duration, which some diplomatic sources estimate could be up to 15 years, is designed to please the countries which most strongly opposed the three-language system, namely Spain and Italy, and to a lesser extent Poland and Portugal.

In addition, the proposal on the table also looks at a so-called "review clause," which should launch a new debate to assess the situation at the end of the transitional period. This would increase the negotiating power of countries that oppose the trilingual system.

Convergent diplomatic sources confirm that Poland and Italy support the idea of a review clause. Only Spain is maintaining a tough stance. A Commission official told EURACTIV that "a review clause could possibly be part of a final compromise".

Increased legal protection in case of dispute

If this proposal were to become part of the final agreement, Germany and France would temporarily lose the privilege of having patents translated into their own languages.

They will, however, maintain the much more relevant privilege of keeping German and French as official legally binding languages for the new EU patent.

This means that a patent filed in German or French, even during the transitional period, will be legally binding, despite being translated into English. A patent filed into Italian, Portuguese or Greek would on the contrary not be legally binding.

This has important legal and financial implications, especially for small and medium-sized enterprises (SMEs) operating in languages other than the official ones. They risk inadvertently finding themselves in breach of patent rules and then being held liable for damages.

The compromise text therefore proposes that in case of disputes, "the alleged infringer, before having been provided with a translation in his own language, may have acted in good faith and may have had no reason to know that he was infringing the patent".

Special treatment in courts should also be envisaged for SMEs which lack the financial resources of multinational companies, suggests the text.

Concession required in the UK

The United Kingdom is also requested to make a small concession by the new compromise text put forward by the Belgians.

During the transitional period, when a patent is filed in English, it must be translated into another EU official language chosen by the applicants and paid for by the system. "The translation would be for information purposes only," underlines the Belgian compromise text.

This temporary arrangement is considered "extremely useful to improve the quality of machine translations," since it could be used "to train the translation engines," reads the text.

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 fragmented and inconsistent decisions handed down by European courts. 

Companies often have to fight legal action 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 over linguistic disputes. The EU commissioner in charge of the dossier, Michel Barnier, proposed to maintain English, French and German as official languages for an EU patent but to allow paid-for translations of patents filed in other EU languages. However, this is opposed by other member states, including 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. A number of compromise proposals have been circulated and five competitiveness Councils have been scheduled during the six-month presidency, which ends in December. 

  • 10 Nov. 2010: Extraordinary Competitiveness Council dedicated to translation arrangements of EU patent.
  • 26 Nov. 2010: Competitiveness Council.
  • 10 Dec. 2010: Competitiveness Council.
  • 31 Dec. 2010: End of Belgian EU Presidency.

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