BRUSSELS – The European Commissioner for Internal Market and Services, Charlie McCreevy, this week said he will pay “particular attention” to intellectual property rights during the coming year, including one last drive to create a European Community patent.

“I will go for one big last push for the Community patent,” he told a 12 July public hearing in Brussels on the future patent policy in Europe. The daylong hearing included presentations from a wide range of stakeholders (more on the hearing in an upcoming IP-Watch story).

The day before, in an 11 July speech in Finland, McCreevy said, “Over the coming year, I will intensify my efforts to improve the industrial property environment in Europe.”

The push for a Community patent will happen some time during his term, he said, which ends in late 2009. But exactly when this push will take place is yet to be decided. “I need the time to be ripe,” he told a group of journalists at the event.

The commissioner said in Finland that the Community patent “remains a central plank” in the work of filling the gaps in terms of the legal framework for intellectual property. “Without question, this is the best way to go,” he said.

Meanwhile, McCreevy is ready to move forward now with the proposed European Patent Litigation Agreement (EPLA), which also was on the agenda at the hearing. This could mean the setting up a European patent court with jurisdiction to deal with infringement and revocation actions concerning European patents, according to the European Patent Organisation Working Party on Litigation. The group adopted a declaration on the issue in 2003.

McCreevy has called the EPLA a “promising route,” and he has asked his IP unit “to move forward with this project,” according to Florian Müller of the Software Developers Community.

McCreevy said there is support for a Community patent but not a 3 March 2003 EU compromise. He said the issues of which language(s) should be required for such a patent as well as the status of regional courts were among the key sticking points.

But whatever the decision would be, the idea of reducing costs should not come at the expense of patent quality, McCreevy stressed.

No New Software Patent Directive

Referring to the proposed EU software patent directive that the European Parliament dramatically voted down last summer, McCreevy said there would be no new legislation in this area during his time at the Commission as the time is not right.

“But that wouldn’t prevent him from taking other measures, such as the EPLA, that have to do with software patents as well,” Müller said, adding that the European Parliament plans to vote on a patent policy resolution in late September. Müller recently published a book about the massive lobbying effort on the software patent directive last year.

McCreevy said that the Community is getting involved in the EPLA but he did not specifically mention if the European Court of Justice would be consulted regarding whether this is a requirement. Some countries argue that it is not, and say that the EPLA can be set up only with the support of a few countries.

McCreevy said patent policy decided in different fora “does European business no good,” and Europe must retain its competition vis-à-vis growing economies such as those in Asia.

McCreevy will focus on intellectual property and patents in particular, such as industrial patents, he said. For example, there is a “significant potential” in so-called “sleeping patents,” which are those not being used by companies, he said. Small companies use 80 percent of their patents, while large companies only use only 60 percent while they hold three quarters of all patents, he said.

McCreevy’s IP Past

Müller said that although commissioners do not have any legislative power, they can influence the agenda as they are “like the project managers.”

He said intellectual property is clearly on McCreevy’s agenda as it was in his political past as politician in Ireland. He was one of the main drivers behind a law in Ireland that exempts companies from paying taxes on patent revenues, leading Microsoft to move some of its operations from the United States to Ireland, Müller said.

The Foundation for a Free Information Infrastructure said that, “In particular, transfer of IP rights was made tax-free” in Ireland. “While the tax exemption policies were labelled as measures designed to foster R&D investment in Ireland, it is clear from the figures that Ireland is mainly being used as a hub for international transfers.”

McCreevy became the European Commissioner from Ireland in 2004 (succeeding David Byrne, commissioner for health and consumer protection). Commissioners serve for five year terms. Müller said McCreevy was a supporter of the proposed software directive when that was being discussed. McCreevy was most recently minister of finance in Ireland (1997 to 2004).

IP Focus Staked out in Finland

McCreevy also highlighted his IP focus in the speech he gave at the 10-11 July informal ministerial meeting on competitiveness in Jyväskylä, Finland, of which Intellectual Property Watch has obtained a copy. He referred to himself as “the commissioner responsible for intellectual property.”

Finland, which assumed the six-month rotating EU presidency on 1 July, has highlighted innovation as a top priority.

McCreevy said there are three main priorities for fostering innovation: Light-touch regulation and fewer bureaucratic hurdles; a “modern, world-class intellectual property law that stimulates innovation and gives the right rewards” – to which he added that, “This will be a priority for me during your [the Finnish] presidency” -; and public authorities helping to foster demand as important customers.

He emphasised that there may be more efficient means of making competition work better than regulations, and he is not prepared to “put forward any new legislative initiatives unless there is a clear and compelling case.”

In his speech, McCreevy said that a modern intellectual property right system must be balanced. “It must reward innovation, but it must also remain open enough to encourage the transfer of knowledge and to stimulate new innovation,” he said.

“What we want is a virtuous circle – businesses that innovate, reap the rewards, help others to move forward, and have returns to invest in further innovation.”

He noted that IP has a “capacity to generate enormous political heat,” referring to the software directive discussions, but said debate is good.

McCreevy said he had issued the consultation earlier this year on the Commission’s way forward on patents. He said the stakeholders want “access to simple and inexpensive procedures for obtaining protection; and predictable, cost effective and accessible resolution of disputes.”

Copyright Initiative Also Seen

He also called for copyright rules, which he said he was reviewing comprehensively. He said that modern copyright rules for online music services are needed, as at the moment, it is “a nineteenth century horse pulling a twenty-first century car.”

Further to this, he said that, “It should be possible for online service providers to get an EU-wide license.” He said he was looking closer at copyright levies as this seems to be an area that is out of touch with the technological reality.

“I hope to bring forward an initiative later this year,” he said.