Single Patent System OK’d for Europe

(CN) - The European Union's highest court upheld legislation creating a single patent system, which has been held up for years by objections from Spain and Italy.

The idea for a unified European patent system came about in 2000, when the European Commission sent draft legislation to the EU Council.

A decade later - after commissioners sent proposals for translating the EU's patchwork patent system into unitary EU-wide protection - lawmakers said that lack of unanimity among member states made a single patent system impossible at the time.

But in 2010, 12 of the 27 EU member states told the commission they would seek an enhanced cooperation agreement among themselves effort to save the single-patent plan. By the time the EU Council signed off on the plan, 25 member states had agreed to participate - but not Spain and Italy.

Those two countries sued the Council, claiming that the lack of unanimity among member states prevented lawmakers from signing off on the enhanced cooperation agreement. Both countries claimed the Council's actions infringed on member states' rights to self-governance, as established by the EU's founding treaties.

In its ruling Tuesday, the Court of Justice of the European Union found that nothing in EU law prevents member states from forming partnerships among themselves, and that the EU Council is not bound by rules of unanimity in authorizing such agreements.

"The Council's decision to authorize enhanced cooperation, having found that the unitary patent and its language arrangements could not be established by the Union as a whole within a reasonable period, by no means constitutes circumvention of the requirement of unanimity laid down in [the EU's founding treaties] or exclusion of those member states that did not join in making requests for enhanced cooperation," the Luxembourg-based high court wrote. "The contested decision, provided that it is compatible with [EU law] does not amount to misuse of powers, but rather, having regard to its being impossible to reach common arrangements for the whole Union within a reasonable period, contributes to the process of integration.

"'Any group of contracting states, which has provided by a special agreement that a European patent granted for those states has a unitary character throughout their territories, may provide that a European patent may only be granted jointly in respect of all those states,'" the court continued, citing a provision from the European Patent Convention (EPC). "Given that every member state of the EU is a contracting state of the EPC, the introduction of a European patent with unitary effect between the member states of the EU as envisaged by the contested decision may, as the Kingdom of Spain maintains, be effected by 'a special agreement' within the meaning of [the EPC]. Nevertheless, contrary to what is claimed by that member state, it does not follow from that circumstance that the power provided for in [EU law] is used for ends other than those for which it was conferred when member states of the union establish such a patent by a measure adopted under enhanced cooperation instead of concluding an international agreement."

While EU law allows lawmakers to circumvent unanimity rules as a last resort, Spain and Italy complained that the 6 months between commission proposal and EU Council action did not qualify as last resort.

The court rejected those arguments, finding that plans for a single patent had been in the works since at least 2000, derailed by a series of fruitless negotiations.

"The applicants have adduced no specific evidence that could disprove the Council's assertion that when the requests for enhanced cooperation were made, and when the proposal for authorization was sent by the commission to the Council, and at the date on which the contested decision was adopted, there was still insufficient support for any of the language arrangements proposed or possible to contemplate," the court wrote. "Having regard to the applicants' participation in the negotiations and to the detailed description of the fruitless stages before the contested decision set out in the proposal that was to lead to that decision, it cannot be concluded that that decision was vitiated by any failure to state reasons capable of resulting in its annulment."

Finally, the court rejected arguments by Spain and Italy that a single patent system among the 25 member states would undermine the internal market, leading to trade imbalances and distorting competition.

The door is open for Spain and Italy to participate in the agreement.

"Nothing in the contested decision prejudices any competence, right or obligation of those two member states," the court wrote. "In particular, the prospect of the introduction of the language arrangements objected to by the Kingdom of Spain and the Italian Republic may not be described as prejudicial to the competences, rights or obligations of those latter states. While it is, admittedly, essential for enhanced cooperation not to lead to the adoption of measures that might prevent the non-participating member states from exercising their competences and rights or shouldering their obligations, it is, in contrast, permissible for those taking part in this cooperation to prescribe rules with which those non-participating states would not agree if they did take part in it.

"Indeed, the prescription of such rules does not render ineffective the opportunity for non-participating member states of joining in the enhanced cooperation," the court concluded.

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