SMEs hail new EU strategy on industrial property rights


Despite the absence of concrete legislative initiatives on issues such as the Community patent, businesses have praised the Commission’s new strategy to better protect patents and trademarks – an area particularly crucial for smaller companies.

The draft communication, presented by the Commission on 16 July, proposes two main courses of action: firstly, helping SMEs to better exploit their property rights, and secondly, better protecting rights by stepping up the fight against counterfeiting and piracy.

The protection of intellectual property is seen as key to stimulating innovation and R&D investment and facilitating the transfer of knowledge “from the laboratory to the market place”. 

According to a 2006 study of European company executives, 35% considered the use of property rights as very important or even critical to their business model, while 53% said it would become an important issue within two years. 

Improvements to the current IPR system are among SMEs’ key demands as in most cases, they do not have sufficient resources or their own legal departments to deal with these issues. 

A key element in the Commission’s new strategy, according to the President of the Association for Competitive Technology Jonathan Zuck, is the suggestion that small businesses would be able to avoid costly legal proceedings in court to resolve patent disputes. Instead, the Commission says it will look into the establishment of “alternative dispute resolution (ADR) mechanisms,” which it acknowledges could “substantially improve” the settlement of disputes. 

Such a mechanism would be “key for smaller players”, allowing all parties to settle disputes more efficiently, said Zuck. 

The Commission’s draft also stresses the need to set up an EU-wide jurisdiction system for patents. But up till now this has been a major stumbling block in the negotiations on a Community patent, and the strategy offers no new solutions as to how to move forward on the issue. 

However, the paper suggests new paths to help SMEs exploit their property rights, such as reducing patent fees or providing tax incentives to promote licensing activities. This is also a key objective of the Small Business Act proposed by the Commission in June (EURACTIV 26/06/08). 

The new strategy also stresses the need to address the rising number of counterfeit products flooding the European market, as these are causing an increasing threat to the health and safety of European citizens (EURACTIV 20/05/08).

The lion’s share of these fake products (60%) stems from China, where the Commission recently set up an IPR helpdesk to provide advice to businesses. The EU executive calls on member states to share more information on fake and pirated goods and says it also intends to finalise a joint customs action plan against counterfeiting and piracy by the end of the year. 

Luc Henricks from the European Association of Craft, Small and Medium-sized Enterprises UEAPME praised the Commission draft as a “landmark” paper, which highlights all points of relevance to SMEs. “Commissioner McCreevy seems to have understood what it is all about,” he told EURACTIV. He refrained from laying the blame before the Commission regarding the lack of progress on the Community patent, saying it was the member states that blocked further progress. 

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