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T S Vishwanath: Last hurdle for EU patent

A single EU patent regime may trip at its final stage if the Members of European Parliament are not satisfied

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In the midst of the economic crisis in the euro zone, some good news emerged last week when the European Union (EU) leaders agreed at a summit to have a unified patent across the EU. This is a significant development for Europe since negotiations for a single patent across the union have been in the works for nearly four decades.

The deal means that a single patent will be valid across all EU nations, and reduced translation costs and a simplified enforcement regime will help cut costs for business while promoting innovation and intellectual property rights (IPR).

The launch of a single patent will now have to pass muster with Members of (MEPs), who are supportive of the issue but have reportedly sought some clarifications. Voting on the issue in the European Parliament, which was to be held this week, has been postponed after a few felt that the compromise arrived by the leaders on the final agreement had made the legislation weak. They have now sought clarifications and reports from Brussels; and, therefore, the legal affairs committee along with legal experts from Parliament, European Commission and member states will discuss the matter.

Despite this setback, most analysts in Europe are confident that the single patent would now be a reality soon. They are of the view that after making such progress it would be unwise to let the opportunity slip away. Any delay now may mean that a decision on this issue may be postponed by a few years.

The negotiations, which have been proceeding since the 1975, had hit a roadblock when the UK, Germany and France tussled over which country would house the Unified Patent Court. Eventually, the three struck a deal to split the honours and house the Unified Patent Court in Paris but also have chambers specialised in certain areas in London and Munich.

According to the compromise, Paris will also host the central division of the Court of First Instance, the president’s office and registry. Administration, research, engineering and research efficiency patent cases will go to Munich. Pharmaceutical, life sciences and “human necessity” cases will go to London. This, according to reports, means that about 30 per cent of the cases would go to London and Munich.

Business has been very keen on having a single patent since this is expected to boost competitiveness for industry in EU. What exactly would a single patent across EU mean for business?

Two critical issues would be that it will cut down the time taken — which now could be anything starting from 30 months. And, second, it will, according to Brussels, cut down the cost by about 80 per cent from the current price of around €30,000 per patent. A majority of these costs today are primarily towards translation. According to an accord reached in 2011, English, French and German would be the official languages for filing a single patent in EU.

Moreover, according to the current proposal that has to be passed by the MEPs, the European Court of Justice would not have any jurisdiction over cases involving intellectual property. This has been welcomed by industry since it feels that the European Court of Justice does not have the adequate competence to handle issues. However, some analysts do not agree with this view and feel that this provision may dilute the jurisdiction of the European Court of Justice.

Though a single patent regime in EU will make business in Europe happier, it is also expected to have a favourable impact on industry in other countries that are keen to apply for a European patent. Given the fact that the cost of filing patents will come down in EU, many countries may even look at joint research that may lead to some filings in EU.

A single is now at its last hurdle before it can become a reality. However, there is a possibility that it may trip at its final stage if the MEPs are not satisfied. Since a single patent has been heralded as an instrument that will boost European competitiveness it will be important to watch how the MEPs react given the current economic situation in EU.

The author Principal Adviser with APJ-SLG Law Offices

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