New Stirrings On EU Patent Front In The Name Of Small Business

By David Cronin for Intellectual Property Watch
BRUSSELS – The ‘fragmented’ nature of Europe’s patent application system is harming small firms, a Brussels event has been told amid new efforts to harmonise it.

Ever since the early 1970s, the European Community – now Union – has been discussing the possibility of introducing a single patent scheme for all its member states. Almost forty years later, no accord has yet been reached on how such a system would operate.

The absence of common rules in this area has meant that a firm that wishes to file a patent that will be valid across the EU’s 27 countries has to submit individual applications in each of them. With twenty-two different working languages in the Union, small firms say translation costs will be exorbitant.

Margot Fröhlinger, a director in the Single Market directorate of the European Commission, said large multinational companies benefit from the absence of common rules as they have the resources to protect patents in different territories. By contrast, small and medium-sized enterprises (SMEs) encounter obstacles in seeking to have their inventions protected, she suggested.

“The whole debate about the patent system is very much driven by the interests of big companies,” she said. “In some sectors, big companies are working against the unification of the system. They thrive on the fragmentation of the system.”

Fröhlinger, who was speaking at the EU SME Day, an annual conference on entrepreneurship, added: “All politicians talk a lot about SMEs. They should stop just talking and start doing something. Improving the patent system would be a big step.”

France, which will assume the EU’s rotating presidency in July, has promised to intensify discussions on the single patent dossier during its six-month stint at the Union’s helm. Still, Brussels officials say it is unlikely that a final deal that would allow an EU patent to become a reality can be brokered this year.

Diplomats representing EU governments have discussed a number of documents relating to the proposal over the past few days.

One of these papers recommends that applications for EU patents could be filed in English, French or German or in the official tongue of the country in which a firm is based.

The question of what languages patents could be filed in has proven to be contentious. While many firms have argued that an English-only system should be allowed, given that English is increasingly the lingua franca of international business, the Paris government is adamant that French should be facilitated, too. Spain has indicated it wants Spanish to be given at least as favourable treatment as French.

Jonathan Zuck from the Association for Competitive Technology, which favours EU patents, said that the arguments about linguistic diversity can perhaps be protected better in “film and literature than in the patent system”.

He also argued that a related proposal of having an EU litigation system to resolve disputes over patents should have a core objective of keeping court battles over intellectual property rights to a minimum. As a general rule, mediation or arbitration should be favoured over litigation, he said. “With mediation, the advantage is that, at the end of it, companies can still be friends and can cooperate in ways that can be very difficult with litigation,” he added.

Despite the views expressed by representatives of small firms, some companies in the computer market are perturbed that a common EU patent system could lead to patents being introduced on software.

In 2005, the European Parliament rejected a proposed EU law on patenting software.

Benjamin Henrion from the Foundation for a Free Information Infrastructure, a group of technology specialists who campaigned against software patents, said he is perturbed by plans to have a specialised patent unit in the European Court of Justice (ECJ).

One particular concern, said Henrion, is that patent attorneys may have a large role in the proposed structure. Some of the judges dealing with technical issues at the ECJ could be patent attorneys. He suggested that because of their training and ethos, such attorneys could be biased in favour of introducing patents on software.

“The impartiality of judges should be crystal clear,” he said. “I don’t think a technical judge could be a patent attorney and be impartial.”

Other Efforts Stumble

In November last year, EU governments agreed on the main components of a litigation system. This would involve tasking a specialised unit of the European Court of Justice with assessing cases relating to whether a patent should be valid or not.

But this proposal has suffered a setback over the past few months. In April, lawyers working for the Council of Ministers – the body which binds together EU governments – argued that it would be preferable to have a new international treaty dealing with intellectual property.

That opinion follows suggestions made by the European Patent Office in Munich in 2006. It had urged the creation of a court system that would extend to all of the EPO’s members – which currently number 38 countries. As a result, it would be outside the EU’s jurisdiction.

David Cronin may be reached at info@ip-watch.ch.