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European Unitary Patent System

One Step Closer to a European Unitary Patent System

July 6, 2012

Currently, patents granted by the European Patents Office (EPO) must be validated in the individual countries where protection is sought. This is a costly and time consuming process typically involving full translation of the patent concerned. However, agreement as to the location of the seat of the Central Division of the Court of First Instance of the Unified Patent Court was reached on Friday.  

Some readers may wonder what the fuss is about, given that the European Patent Office has been granting patents since the late 1970s – this was the last obstacle to finalising the introduction of a unitary patent which may be introduced as early as 2014. The new unitary patent will be effective throughout Europe (though see note below on the position taken by Spain and Italy) in the official language in which it is filed.

A ‘Historic Decision’

The President of the European Patent Office, Benoit Battistelli, praising the agreement as a historic decision, commented:

‘Thanks to this long awaited step forwards for the completion of the European patent system, Europe has demonstrated its conviction that boosting innovation and strengthening the competitiveness of its industry is the best way of countering the current economic uncertainties. The simplification of the existing patent system will bring particular benefits to small and medium-sized enterprises and to innovators and research centres’

Positives and Negatives

Some estimate that EU citizens can currently face costs upwards of €30,000 for a patent, compared to €1,850 in the US, a state of affairs which is surely detrimental to small companies, who contribute significantly to innovation. A welcome result for SMEs then? Perhaps, but the unitary patent is not without its critics. On the one hand, a centralised system may mean a cheaper, and simpler mechanism for applicants applying for patent protection, while on the other there are concerns that high renewal fees will actually be problematic for small businesses who might opt for much narrower protection under the current regime.

There also remains the question of enforcement. Earlier in the year one inventor burnt a patent in protest at the costs of standing up to infringement by larger businesses, and others have said of the patent system: “It is expensive, distracting and time consuming to get them in the first place and then you need 10 times the money to defend them”.

An Effective Solution?

Despite the clear progress which has been made, questions remain as to how effective a solution the system will be. Spain and Italy have so far refused to join the scheme, as their national languages have not been adopted, so it is uncertain whether the unitary patent will in fact do what it says on the tin.

While Paris is the agreed seat of the Central Division of the Court, specialised ‘thematic clusters’ will also be established in London (dealing with, for example, pharmaceuticals) and Munich (covering mechanical engineering). According to a report by Science|Business, there are concerns that this fragmentation will fail to address the practice of ‘forum shopping’ whereby litigants choose a court where they are likely to be treated favourably, and some note the risk of inconsistent decisions.

The S|B report cites Chris Mercer, President of the Chartered Institute of Patent Attorneys as commenting that: ‘in order to avoid forum shopping and to assure that there are consistent decisions, there should be a single, central court’. The same article also questions whether the new institutions will ‘cost so much to administer that the promised economic benefits will prove illusory.’

We have a long wait before the unitary patent sees the light of day, and such a sweeping change in an area as important as this is bound to lead to continuing debate and controversy, but this nonetheless seems like a significant step in the right direction.