The extraordinary Competitiveness Council, meeting in Luxembourg on 27 June, put together the broad outlines of the future EU unitary patent. The 27 ministers agreed a general approach on the two draft regulations submitted by the European Commission implementing enhanced cooperation in this area by 25 member states (Italy and Spain are not participating given their opposition to the translation rules). The proposals concern: 1. the characteristics of and arrangements for issuing the future patent that confers identical protection in the participating member states; and 2. translation provisions.

The Hungarian EU Presidency was applauded for this compromise, which satisfies all the participating states and thus closes the first chapter of the legislative procedure. “The objective of common protection in the participating states is now achievable,” commented Internal Market Commissioner Michel Barnier. He hopes, together with the European Parliament, to consolidate this achievement so that the EU patent will become a reality within two years.

The patent will be issued by the intergovernmental organisation with 38 member countries that currently manages the European patent, namely the European Patent Office (EPO). Member states taking part in the enhanced cooperation will be represented in this body by a select committee charged with supervising the administrative tasks related to the future patent. Applications may be submitted in any EU language but must be accompanied by a full translation into one of the EPO’s three official languages (English, French and German). A summary must also be submitted in the other two languages. Patents will be issued in one of these three official languages. Applications submitted in a language other than these three will receive compensation for translation costs.

A transitional period (12 years at most) is foreseen pending the availability of a quality automatic translation system. During this period, patents issued in French or German will have to be translated into English. Those issued in English will have to be translated into another EU official language.

FINANCING

The system will be financed out of registration fees to be paid by the patent applicant at the start of the process and by annual patent renewal taxes, half of which will go to the EPO and the other half to the member states based on different distribution criteria, a list of which was drawn up under the Swedish EU Presidency, in December 2009. The Commission’s proposal added a criterion on population size that was rejected by the small member states, which voiced fears about not being able to cover their costs. They succeeded in having this reference deleted and the 2009 criteria put back in the text. These provide for evaluation of “market size,” which could be GDP, GDP per capita or the number of patent registrations, and a fixed share for this distribution.

The procedure for use of this distribution also sparks debate: this competence could be conferred on the select committee, an EU base could be maintained by designating the Council through ‘implementing acts’ (treaty Article 291), or this implementing competence could be delegated to the Commission through ‘delegated acts’ (Article 290). The member states, which prefer to keep this aspect under their control, are opposed to the latter solution and recommend the extra-EU solution involving the select committee. The Commission is reserving its position until Parliament has given its view, counting on it as an ally.

Italy and Spain did not vote on the text. The two states reiterated their opposition to this cooperation, which discriminates against them, and their certainty that the Court of Justice, to which they have submitted a case, will “tear down this unconstitutional edifice,” said the Spanish delegation.

The ball is now in Parliament’s court. It will be reviewing the text in November. The upcoming Polish EU Presidency has made this issue a priority and hopes to conclude an agreement between the Council and MEPs at the December Competitiveness Council.