Sweden claims breakthrough on EU patent impasse


Business groups hailed a landmark political deal in Brussels on Friday (4 December), as EU industry ministers agreed a package of measures which could pave the way for a European Community patent. However, there are concerns that the thorny issue of translation costs has merely been set aside and will be dealt with separately.

Sweden, which holds the EU’s six-month rotating presidency, pulled off a major political coup by securing unanimous backing for its plan to establish a single EU patent and a European patent court. 

Patent reform has been on the Brussels agenda for several years but attempts to streamline a complex system have failed repeatedly. 

The deal should help slash the cost of protecting new innovations in Europe, something small businesses have been particularly vexed by in recent years. 

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. The plans for a single patent court will make litigation cheaper and more predictable, diplomatic sources said. 

The court will include local and central chambers under a common European appeal court. In the initial stages, companies will be able to continue to use national courts, allowing confidence in the new system to build up gradually. 

A common understanding has also been reached on renewal fees and the cooperation between patent offices.

Jury still out on translation costs 

Another perennial bugbear for innovative businesses has been the high cost of translating patents into all European languages. This has been a major factor in making it more expensive to protect new technologies in Europe. 

The new agreement stopped short of resolving this issue, deciding instead that a proposed new patent regulation should be accompanied by a separate regulation on translation arrangements. 

Business lobbies have highlighted the burden of translation costs which, they say, is a major deterrent to small businesses considering filing for patent protection. Patents typically cost three times as much in Europe as in the US. 

The new reforms should cut the costs of protecting intellectual property in the EU at a time when the incoming European Commission is preparing a new innovation act, which is likely to stress the importance of SMEs for the knowledge economy. 

Eurochambres Secretary General Arnaldo Abruzzini welcomed the agreement, hailing it as a "victory for businesses striving to develop innovation and maintain competitiveness". 

However, he said an additional push will be needed to solve the outstanding language issues. "We have won an important battle, but not yet the war. Translating into all EU languages currently impacts enormously on the overall cost of patenting invention in Europe. It is not sustainable that a company cannot protect an invention on the whole EU territory for less than €70,000 while this costs around €20,000 in the US and even less in Japan," he said. 

Vice-President Günter Verheugen, the EU's commissioner for Enterprise and Industry, welcomed the breakthrough, which he said would make the patent system more efficient and cost-effective. "Today's agreement cannot be overestimated. It comes at a moment when it is most needed," he said. 

Internal Market and Services Commissioner Charlie McCreevy also welcomed what he called a "very strong signal from the Council that the EU is committed to achieving a true single market for patents". 

He said the EU executive will work closely with governments and MEPs to work out a final package that will meet the trust and confidence of users. 

UK Minister for Higher Education and Intellectual Property David Lammy said the agreement was "a significant step towards a single EU-wide patent," which will spell good news for business. 

"If Europe is serious about our knowledge economy being key to economic recovery, then patent reform is the essential underpinning. This business-friendly deal will make patenting and innovating easier and more affordable for British companies. In particularly, innovative SMEs will have more flexibility when choosing how to patent across Europe," he said. 

Lammy said he would push hard for "business-friendly solutions to the language arrangements" next year. 

Political moves to develop a Community patent for the EU began in March 2003, but progress has been hampered by repeated technical and legal difficulties. The issue was resurrected under the French EU Presidency last year, and it had originally been hoped that patent issues might form part of the Small Business Act (SBA). 

However, differences over sensitive translation arrangements have proven insurmountable, and a French proposal fell foul of "political obstacles", despite broad agreement that reform is urgently required (EURACTIV 02/12/08). 

Earlier this year, the Czech EU Presidency said it would seek to advance the issue, and Sweden also made the creation of a single patent a priority issue for its six-month term at the EU's helm (EURACTIV 6/3/09). 

The European Commission has also said it would seek powers from EU member states to conclude an agreement on a unified patent litigation system, which would establish a court with jurisdiction over existing European patents and the future Community patent system (EURACTIV 25/03/09). 

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