Category Archives: Intellectual Property

A uniform system of protection of intellectual property rights, ranging from industrial property to copyright and related rights, constitutes the foundation for creativeness and innovation within the European Union. Respect of the basic principles of the internal market (the free movement of goods and services and free competition) is based on standardisation of intellectual property at European level. Protection of intellectual property is covered by many international conventions, most of which are implemented by the World Intellectual Property Organisation (WIPO) and the World Trade Organisation (WTO). The European Union possesses two important bodies to carry out its mission: the Office for Harmonisation in the Internal Market (OHIM), which is responsible for the registration of Community trade marks and designs, and the European Patent Office (EPO). The Commission is currently campaigning for the effective introduction of a Community patent system, which would be less costly and more legally effective, as a guarantee of competitiveness for European industry. Finally, the protection of these rights also entails protecting them against piracy, illegal trade and counterfeiting.

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See also

Living and working in the internal market.
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Further information: the Internal Market and Services Directorate-General of the European Commission.

Agreement on intellectual property rights relating to trade and pharmaceutical patents

Agreement on intellectual property rights relating to trade and pharmaceutical patents

Outline of the Community (European Union) legislation about Agreement on intellectual property rights relating to trade and pharmaceutical patents

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Internal market > Pharmaceutical and cosmetic products

Agreement on intellectual property rights relating to trade and pharmaceutical patents

Document or Iniciative

Council Decision 94/800/EC of 22 December 1994 concerning the conclusion on behalf of the European Community, as regards matters within its competence, of the agreements reached in the Uruguay Round multilateral negotiations (1986-1994).

Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS).

Summary

GENERAL PROVISIONS AND BASIC PRINCIPLES

The principles are those of national treatment and most-favoured-nation treatment. Thus, members of the World Trade Organisation (WTO) must accord the nationals of other members’ treatment no less favourable than that they accord to their own nationals. Moreover, any advantage granted by a member to nationals of another member must be accorded immediately and unconditionally to the nationals of all other members even if this treatment is more favourable than that accorded to its own nationals.

The Agreement aims to ensure that adequate rules on the protection of intellectual property are applied in all member countries, on the basis of the basic obligations laid down by the WIPO (World Intellectual Property Organisation) in the various conventions on intellectual property rights, particularly the Paris Convention for the Protection of Industrial Property. Numerous new rules or stricter rules are introduced in fields not covered by the existing conventions or where the existing conventions are inadequate.

The agreement covers a vast range of topics, from copyright and trademarks to layout-designs of integrated circuits and trade secrets. Patents protecting pharmaceutical products and other products are just one part of this agreement.

INTELLECTUAL PROPERTY RIGHTS FOR PHARMACEUTICAL PATENTS

Patents provide the patent owner with the legal means to prevent others from making, using, or selling the new invention for a limited period of time, subject to a number of exceptions. Patents do not constitute marketing authorisations.

The TRIPS Agreement stipulates that it must be possible for all inventions to be protected by a patent for 20 years, whether for a product (such as a medicine) or a process (a method of producing an ingredient for a medicine). To qualify for a patent, an invention has to be “new”, it must be an “inventive step” and it must have “industrial applicability”. In addition, patented inventions have to be disclosed; enabling others to study the invention even while it is patent protected.

Governments can refuse to grant patents for the three reasons set out below:

  • for inventions whose commercial exploitation needs to be prevented to protect human, animal or plant life or health;
  • for diagnostic, therapeutic and surgical methods for treating humans or animals;
  • for certain plant and animal inventions.

Governments also play a supervisory role and can act to prevent patent owners from abusing these rights (anti-competitive practices) or hampering the transfer of technology.

The TRIPS Agreement makes provision for limited exceptions to patent rights. These exceptions must not “unreasonably” conflict with the “normal” exploitation of the patent. These exceptions are used in very different instances and in particular:

  • to advance science and facilitate the transfer of technology, by allowing researchers to use a patented invention for research (research exception);
  • to speed up the process of marketing a generic drug. Some countries allow manufacturers of generic drugs to use the patented invention to obtain marketing approval without the patent owner’s permission and before the patent protection expires. The generic producers can then market their versions as soon as the patent expires, since the (generally very lengthy) procedure involved in obtaining marketing authorisation has already been completed. This provision is called the “Bolar provision”.

Flexibility in the application of patent law: compulsory licensing and parallel imports

In addition to the two exceptions to patent law mentioned above (Bolar provision and research exceptions), the TRIPS agreement make provision for two other forms of flexibility: compulsory licensing and parallel imports. These two systems should make it possible to strike a balance between promoting access to existing drugs and promoting research and development into new drugs.

Compulsory licensing

Governments can issue compulsory licences when they allow someone else to produce the patented product or use the patented process without the consent of the patent owner. The granting of compulsory licences without the authorisation of the patent owner can only be done under certain conditions aimed at protecting the legitimate interests of the patent holder. In particular, the party applying for a licence must have first attempted, unsuccessfully, to obtain a voluntary licence from the right holder on reasonable commercial terms and within a reasonable period of time. In addition, these compulsory licences should be granted mainly to supply the domestic market.

There is, however, no need to apply for a voluntary licence in advance in the following cases:

  • national emergencies;
  • other circumstances of extreme urgency;
  • public non-commercial use;
  • anti-competitive practices.

Parallel imports

The term parallel imports is used when products manufactured and marketed by the patent holder in one country are imported by another company. The legal principle here is “exhaustion”, the idea that once a pharmaceutical company has sold its product its patent rights are exhausted and it no longer has any rights over what happens to the product. This therefore allows any other company to buy the product in a country where the selling price is lower and import it in order to profit financially from the difference in prices. The TRIPS agreement points out that disputes relating to these parallel imports cannot be handled by the WTO. This means in effect, as stated in the Doha Declaration, that each member of the WTO remains free to establish its own regime for exhaustion.

IMPLMENTATION OF THE AGREEMENT

Enforcement of intellectual property rights

The laws of the member countries of the WTO must include procedures to ensure that intellectual property rights are respected both by foreign right holders and by their own nationals. These procedures must permit effective action against any act of infringement of these rights. They must be fair and equitable, they must not be unnecessarily complicated or costly, and they must not entail unreasonable time limits. Final administrative decisions may be reviewed by a judicial authority.

The Agreement provides details concerning evidence, injunctions, damages, provisional measures and other remedies.

Transition period

With regard to the application of the Agreement, developed countries have a period of one year to bring their legislation and practices into line with the Agreement. This period is extended to five years (i.e. to 2000) for developing countries and countries in the process of transformation from a centrally-planned economy to a market economy, and to eleven years (i.e. to 2006) for the least-developed countries (LDC), with the possibility for the latter to obtain an extension. On 29 November 2005, the Council for TRIPS decided to extend the transitional period for LDCs until 1 July 2013.

In the case of pharmaceutical products, developing countries that did not provide product patent protection on 1 January 1995 (when the TRIPS Agreement came into force) have up to 10 years to introduce this protection. In the meantime they have to comply with two obligations:

  • they must allow inventors to file patent applications from 1 January 1995, even though the decision on whether or not to grant any patent itself need not be taken until the end of this transition period (the “mailbox” provision);
  • if the government allows a pharmaceutical product to be marketed during the transition period, the country in question must grant the patent applicant an exclusive marketing right for the product for five years.

Institutional framework

The Agreement created a Council for Trade-Related Aspects of Intellectual Property Rights (the Council for TRIPS). It is responsible for monitoring the operation of the Agreement, ensuring that members comply with their obligations and affording opportunities for consultations between members.

The settlement of disputes over intellectual property is governed by the dispute settlement procedures adopted following the Uruguay Round negotiations.

Act Entry into force Deadline for transposition in the Member States Official Journal
Decision 94/800/EC Effective date: 22.10.1994
Date of entry into force: 01.01.1995
Official Journal L 336 of 23.12.1994

Related Acts

of the European Parliament and of the Council of 17 May 2006 on compulsory licensing of patents relating to the manufacture of pharmaceutical products for export to countries with public health problems

The purpose of this Regulation is to harmonise within the European Union (EU) the conditions for granting compulsory export licences to companies intending to manufacture generic medicinal products for export to developing countries which do not have sufficient production capacity of their own. The Regulation aims to prevent distortion of competition among operators in the single market and to apply uniform rules in order to avoid the reimport into the EU of pharmaceutical products manufactured under the compulsory licences.

Ministerial Declaration on the TRIPS agreement and public health adopted on 14 November 2001 (Doha Declaration)
This Declaration on the TRIPS agreement and public health seeks to address the concerns expressed by developing countries regarding the possible implications of the TRIPS agreement on access to medicines.
The Declaration interprets some of the key provisions of the TRIPS agreement. The Ministers reaffirm the right of the member countries to use the flexibilities that are built into the TRIPS Agreement, in particular compulsory licensing and parallel importing.
The WTO members also agreed to extend exemptions on pharmaceutical patent protection for least-developed countries at least until 2016.
Finally, the ministers assigned the TRIPS Council the additional task of sorting out how to provide extra flexibility, so that countries unable to produce pharmaceuticals domestically can import patented drugs made under compulsory licensing.

Decision adopted by the WTO General Council on 30 August 2003

The decision adopted by the WTO General Council on 30 August 2003 allows countries that can make drugs to export drugs made under compulsory licence to countries that cannot manufacture them. This authorisation constitutes a derogation from the TRIPS agreement since products made under compulsory license must normally be predominantly for the domestic market. This will therefore make it easier for poorer countries to import cheaper generics made under compulsory licensing if they are unable to manufacture these themselves. For a long time, the stumbling block for negotiations within the WTO was determining which diseases were covered by the decision. In the end, the decision refers to the Doha Declaration that covers “the public health problems afflicting many developing and least-developed countries, especially those resulting from HIV/AIDS, tuberculosis, malaria and other epidemics.” It is now widely accepted that this coverage is fairly flexible.
The August 2003 decision also introduces safeguards in order to prevent rich countries profiting from the system by diverting trade through smuggling. A statement accompanies the decision from the Chairperson of the WTO General Council that is intended to reassure countries who feared that the decision might be abused. It points out that the system of derogations introduced will be used “in good faith to protect public health and not as an instrument to pursue industrial or commercial policy objectives”.
Finally, the decision of August 2003 lays down that the decisions taken in it should be put into practice by an amendment to the TRIPS agreement by mid-2004. On 6 December 2005, the WTO General Council adopted the decision, changing the provisional agreement of August 2003 into an amendment to the TRIPS agreement. WTO members have until 1 December 2007 to accept the amendment.

 


Another Normative about Agreement on intellectual property rights relating to trade and pharmaceutical patents

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic

Internal market > Businesses in the internal market > Intellectual property

Agreement on intellectual property rights relating to trade and pharmaceutical patents

Document or Iniciative

Council Decision 94/800/EC of 22 December 1994 concerning the conclusion on behalf of the European Community, as regards matters within its competence, of the agreements reached in the Uruguay Round multilateral negotiations (1986-1994).

Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS).

Summary

GENERAL PROVISIONS AND BASIC PRINCIPLES

The principles are those of national treatment and most-favoured-nation treatment. Thus, members of the World Trade Organisation (WTO) must accord the nationals of other members’ treatment no less favourable than that they accord to their own nationals. Moreover, any advantage granted by a member to nationals of another member must be accorded immediately and unconditionally to the nationals of all other members even if this treatment is more favourable than that accorded to its own nationals.

The Agreement aims to ensure that adequate rules on the protection of intellectual property are applied in all member countries, on the basis of the basic obligations laid down by the WIPO (World Intellectual Property Organisation) in the various conventions on intellectual property rights, particularly the Paris Convention for the Protection of Industrial Property. Numerous new rules or stricter rules are introduced in fields not covered by the existing conventions or where the existing conventions are inadequate.

The agreement covers a vast range of topics, from copyright and trademarks to layout-designs of integrated circuits and trade secrets. Patents protecting pharmaceutical products and other products are just one part of this agreement.

INTELLECTUAL PROPERTY RIGHTS FOR PHARMACEUTICAL PATENTS

Patents provide the patent owner with the legal means to prevent others from making, using, or selling the new invention for a limited period of time, subject to a number of exceptions. Patents do not constitute marketing authorisations.

The TRIPS Agreement stipulates that it must be possible for all inventions to be protected by a patent for 20 years, whether for a product (such as a medicine) or a process (a method of producing an ingredient for a medicine). To qualify for a patent, an invention has to be “new”, it must be an “inventive step” and it must have “industrial applicability”. In addition, patented inventions have to be disclosed; enabling others to study the invention even while it is patent protected.

Governments can refuse to grant patents for the three reasons set out below:

  • for inventions whose commercial exploitation needs to be prevented to protect human, animal or plant life or health;
  • for diagnostic, therapeutic and surgical methods for treating humans or animals;
  • for certain plant and animal inventions.

Governments also play a supervisory role and can act to prevent patent owners from abusing these rights (anti-competitive practices) or hampering the transfer of technology.

The TRIPS Agreement makes provision for limited exceptions to patent rights. These exceptions must not “unreasonably” conflict with the “normal” exploitation of the patent. These exceptions are used in very different instances and in particular:

  • to advance science and facilitate the transfer of technology, by allowing researchers to use a patented invention for research (research exception);
  • to speed up the process of marketing a generic drug. Some countries allow manufacturers of generic drugs to use the patented invention to obtain marketing approval without the patent owner’s permission and before the patent protection expires. The generic producers can then market their versions as soon as the patent expires, since the (generally very lengthy) procedure involved in obtaining marketing authorisation has already been completed. This provision is called the “Bolar provision”.

Flexibility in the application of patent law: compulsory licensing and parallel imports

In addition to the two exceptions to patent law mentioned above (Bolar provision and research exceptions), the TRIPS agreement make provision for two other forms of flexibility: compulsory licensing and parallel imports. These two systems should make it possible to strike a balance between promoting access to existing drugs and promoting research and development into new drugs.

Compulsory licensing

Governments can issue compulsory licences when they allow someone else to produce the patented product or use the patented process without the consent of the patent owner. The granting of compulsory licences without the authorisation of the patent owner can only be done under certain conditions aimed at protecting the legitimate interests of the patent holder. In particular, the party applying for a licence must have first attempted, unsuccessfully, to obtain a voluntary licence from the right holder on reasonable commercial terms and within a reasonable period of time. In addition, these compulsory licences should be granted mainly to supply the domestic market.

There is, however, no need to apply for a voluntary licence in advance in the following cases:

  • national emergencies;
  • other circumstances of extreme urgency;
  • public non-commercial use;
  • anti-competitive practices.

Parallel imports

The term parallel imports is used when products manufactured and marketed by the patent holder in one country are imported by another company. The legal principle here is “exhaustion”, the idea that once a pharmaceutical company has sold its product its patent rights are exhausted and it no longer has any rights over what happens to the product. This therefore allows any other company to buy the product in a country where the selling price is lower and import it in order to profit financially from the difference in prices. The TRIPS agreement points out that disputes relating to these parallel imports cannot be handled by the WTO. This means in effect, as stated in the Doha Declaration, that each member of the WTO remains free to establish its own regime for exhaustion.

IMPLMENTATION OF THE AGREEMENT

Enforcement of intellectual property rights

The laws of the member countries of the WTO must include procedures to ensure that intellectual property rights are respected both by foreign right holders and by their own nationals. These procedures must permit effective action against any act of infringement of these rights. They must be fair and equitable, they must not be unnecessarily complicated or costly, and they must not entail unreasonable time limits. Final administrative decisions may be reviewed by a judicial authority.

The Agreement provides details concerning evidence, injunctions, damages, provisional measures and other remedies.

Transition period

With regard to the application of the Agreement, developed countries have a period of one year to bring their legislation and practices into line with the Agreement. This period is extended to five years (i.e. to 2000) for developing countries and countries in the process of transformation from a centrally-planned economy to a market economy, and to eleven years (i.e. to 2006) for the least-developed countries (LDC), with the possibility for the latter to obtain an extension. On 29 November 2005, the Council for TRIPS decided to extend the transitional period for LDCs until 1 July 2013.

In the case of pharmaceutical products, developing countries that did not provide product patent protection on 1 January 1995 (when the TRIPS Agreement came into force) have up to 10 years to introduce this protection. In the meantime they have to comply with two obligations:

  • they must allow inventors to file patent applications from 1 January 1995, even though the decision on whether or not to grant any patent itself need not be taken until the end of this transition period (the “mailbox” provision);
  • if the government allows a pharmaceutical product to be marketed during the transition period, the country in question must grant the patent applicant an exclusive marketing right for the product for five years.

Institutional framework

The Agreement created a Council for Trade-Related Aspects of Intellectual Property Rights (the Council for TRIPS). It is responsible for monitoring the operation of the Agreement, ensuring that members comply with their obligations and affording opportunities for consultations between members.

The settlement of disputes over intellectual property is governed by the dispute settlement procedures adopted following the Uruguay Round negotiations.

Act Entry into force Deadline for transposition in the Member States Official Journal
Decision 94/800/EC Effective date: 22.10.1994
Date of entry into force: 01.01.1995
Official Journal L 336 of 23.12.1994

Related Acts


Regulation (EC) No 816/2006

of the European Parliament and of the Council of 17 May 2006 on compulsory licensing of patents relating to the manufacture of pharmaceutical products for export to countries with public health problems

The purpose of this Regulation is to harmonise within the European Union (EU) the conditions for granting compulsory export licences to companies intending to manufacture generic medicinal products for export to developing countries which do not have sufficient production capacity of their own. The Regulation aims to prevent distortion of competition among operators in the single market and to apply uniform rules in order to avoid the reimport into the EU of pharmaceutical products manufactured under the compulsory licences.

Ministerial Declaration on the TRIPS agreement and public health adopted on 14 November 2001 (Doha Declaration)
This Declaration on the TRIPS agreement and public health seeks to address the concerns expressed by developing countries regarding the possible implications of the TRIPS agreement on access to medicines.
The Declaration interprets some of the key provisions of the TRIPS agreement. The Ministers reaffirm the right of the member countries to use the flexibilities that are built into the TRIPS Agreement, in particular compulsory licensing and parallel importing.
The WTO members also agreed to extend exemptions on pharmaceutical patent protection for least-developed countries at least until 2016.
Finally, the ministers assigned the TRIPS Council the additional task of sorting out how to provide extra flexibility, so that countries unable to produce pharmaceuticals domestically can import patented drugs made under compulsory licensing.

Decision adopted by the WTO General Council on 30 August 2003

The decision adopted by the WTO General Council on 30 August 2003 allows countries that can make drugs to export drugs made under compulsory licence to countries that cannot manufacture them. This authorisation constitutes a derogation from the TRIPS agreement since products made under compulsory license must normally be predominantly for the domestic market. This will therefore make it easier for poorer countries to import cheaper generics made under compulsory licensing if they are unable to manufacture these themselves. For a long time, the stumbling block for negotiations within the WTO was determining which diseases were covered by the decision. In the end, the decision refers to the Doha Declaration that covers “the public health problems afflicting many developing and least-developed countries, especially those resulting from HIV/AIDS, tuberculosis, malaria and other epidemics.” It is now widely accepted that this coverage is fairly flexible.
The August 2003 decision also introduces safeguards in order to prevent rich countries profiting from the system by diverting trade through smuggling. A statement accompanies the decision from the Chairperson of the WTO General Council that is intended to reassure countries who feared that the decision might be abused. It points out that the system of derogations introduced will be used “in good faith to protect public health and not as an instrument to pursue industrial or commercial policy objectives”.
Finally, the decision of August 2003 lays down that the decisions taken in it should be put into practice by an amendment to the TRIPS agreement by mid-2004. On 6 December 2005, the WTO General Council adopted the decision, changing the provisional agreement of August 2003 into an amendment to the TRIPS agreement. WTO members have until 1 December 2007 to accept the amendment.

 

Management of copyright and related rights in the internal market

Management of copyright and related rights in the internal market

Outline of the Community (European Union) legislation about Management of copyright and related rights in the internal market

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Internal market > Businesses in the internal market > Intellectual property

Management of copyright and related rights in the internal market

Document or Iniciative

Commission Communication of April 16, 2004 on the management of copyright and related rights in the internal market [COM (2004) 261 – Not published in the Official Journal].

Summary

This communication deals with the management of copyright and related rights, i.e. how they are administered (granted through licences, assigned or financed). It concludes a consultation process started in 1995.

The Commission considers whether current management methods, which are mainly governed by national legislations, hamper the good functioning of the internal market. The exchange of goods and services based on copyright or related rights increasingly often takes place at Community level. Accordingly, the legislative framework governing the protection of these rights has to cater for this.

The Commission considers whether it is convenient to let the market stimulate Community licensing or whether it is preferable to enact Community legislation. The Commission puts forward a number of options:

  • ensure that any licence on the rights to communicate with or make available to the public, allows – by definition – usage throughout the Community;
  • adopt the same model as the one chosen for satellite broadcasting under Directive 93/83/EEC. The relevant act of communication to the public occurs solely in the Member State where the programme-carrying signals are introduced into an uninterrupted chain of communication up to the satellite and down towards the earth. The Commission expresses reservations, underlining that this approach does not necessarily yield the desired result of multi-territorial licensing;
  • bring the exclusive rights of communication to the public and of ‘making available’ under one remuneration right subject to obligatory collective management;
  • leave users the freedom to choose the collecting society within the European Economic Area which will issue the required operating licence;
  • empower collecting societies to offer Community licences;
  • focus exclusively on forms of collective management by specialised societies.

Another fundamental issue is the management of digital rights. Digital Rights Management systems (DRM systems) enable the distribution to be restricted to copies of digital content by obtaining and managing copyrights. To complete the internal market in this area, it is necessary to establish a global and interoperable technical infrastructure based on consensus among the interested parties, including consumers.

The management of copyrights and related rights can be done either individually or collectively. The Commission has examined these two ways of managing rights.

Individual Rights Management

It is the marketing of rights by individual rightholders to commercial users through exclusive or non-exclusive contractual licences.

The Commission has noted that the degree of common ground across Member States regarding the rules appears to be sufficient in this area. It is therefore not necessary to undertake action at Community level in the near future.

Collective Rights Management

This term refers to the system under which a collecting society, as trustee, jointly administers rights and monitors, collects and distributes the payment of royalties on behalf of several rightholders.

In this area, the Commission underlines the need to have a common legal framework based on the principles of copyright and the needs of the internal market. It would deal with issues linked to the establishment and status of collecting societies. This legislation would foster the emergence of Community licences for exploiting rights and would finalise the internal market.

It has initiated a new consultation process which has led to the adoption of a recommendation on cross-border collective management of copyright and relative rights in the field of legal on-line music services. It also intends to put forward legislation on certain features of collective management and good governance of collecting societies in order to ensure a higher degree of efficiency, legal certainty and transparency.

Enhancing the patent system in Europe

Enhancing the patent system in Europe

Outline of the Community (European Union) legislation about Enhancing the patent system in Europe

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Internal market > Businesses in the internal market > Intellectual property

Enhancing the patent system in Europe

Document or Iniciative

Communication from the Commission to the European Parliament and the Council of 3 April 2007 – Enhancing the patent system in Europe [COM(2007) 165 final – Not published in the Official Journal].

Summary

The communication points out that the current European patent system is considerably more expensive than the US and Japanese systems. A Community system would be much more attractive than the present system of European patents, which is simply a bundle of national patents. A European patent designating 13 countries is 11 times more expensive than a US patent and 13 times more expensive then a Japanese patent. The existing system for resolving disputes in the EU, with the risk of multiple litigation in a number of Member States on the same patent issue, involves the parties concerned in unnecessary costs and creates a lack of legal certainty.

In view of the difficulties being experienced in the area of patents and, in particular, in creating a Community patent, in 2006 the Commission launched a broad consultation, involving all those concerned, on the future of patent policy in Europe. The results of the consultation leave no doubt as to the urgent need to create a simple, cost-effective and high quality patent system in Europe.

This communication aims to draw operational conclusions from the consultation and enable the Council to open discussions on the reform of the system of patents and, in particular, on the Community patent and jurisdictional arrangements. It also puts forward a number of supporting measures to improve the patent system, concerning patent quality, knowledge transfer and enforcement issues.

The Community patent

Many stakeholders continue to support the Community patent as the approach that will yield most added value for European industry under the Lisbon Strategy. However they criticise the Council’s Common Political Approach adopted in 2003 on the grounds of the high costs of translation and the excessive centralisation of the proposed jurisdictional system.

The Commission believes that a truly competitive and attractive Community patent can be achieved provided there is political will to do so. Concerns about over-centralisation should be taken into account in the creation of the EU-wide patent jurisdiction system. On translation costs, the Commission will explore with the Member States ways of improving the language regime with a view to reducing costs while increasing legal certainty.

Jurisdictional system

Currently, any disputes arising from a European patent granted by the European Patent Office (EPO) can be brought before the national courts. This is because each European patent is a bundle of national patents, which are subject to the national rules of the EPO Contracting States designated in the application. In the absence of a single jurisdiction, disputes are dealt with in accordance with national laws and procedures.

This situation creates difficulties that damage legal certainty and impede business decisions on patented products:

  • multiple litigation: the same issue can be brought before the courts in several countries, creating a difficult situation for competitors;
  • high costs: the parties concerned have to pay court fees and hire lawyers and experts in all the countries in which action is brought;
  • inconsistencies: courts deal with cases in accordance with national law, which can produce different and sometimes contradictory results;
  • choice of forum: given the possibility of choosing which jurisdiction is to apply, parties tend to choose the one most likely to deal with the matter in a way that favours their interests.

The major advantage of a single jurisdiction for patents are the savings made by the parties involved in a dispute. The costs of disputes are currently excessive and vary considerably according to a number of factors, including the complexity of the case, technical aspects and the sums involved. These costs weigh most heavily on individual inventors and small businesses, which can be discouraged from taking out patents and, more generally, from investing in research and development.

Discussion of the new jurisdictional system

The Member States agree on the need for a Europe-wide patent court system that would guarantee cost-effectiveness, legal certainty and proximity to users. However, discussions have revealed differences about how to proceed.

Recent discussions with the Member States have brought to light different views on the jurisdictional system: some Member States support the draft European Patent Litigation Agreement (EPLA) in the context of the European Patent Convention, which aims to create a single jurisdiction for disputes concerning European patents, while others favour the creation of a specific Community jurisdiction based on the Treaty for litigation on European and Community patents.

Under these circumstances, the Commission believes that consensus could be built on the basis of an integrated approach that combines features of both EPLA and a Community jurisdiction. This could involve one single court system with competence for litigation on European patents and future Community patents. Such a judicial system could be based on the EPLA model and allow for harmonious integration into the Community jurisdiction. Initially, efforts should be concentrated on building consensus among Member States around these principles.

The jurisdiction would have competence for infringement and validity actions as well as for related claims such as damages. It should ensure an appropriate degree of proximity to the parties concerned and comprise a limited number of first instance chambers as well as a fully centralised appeal court that would ensure uniformity of interpretation. These chambers, which could make use of existing national structures, should form an integral part of the single jurisdictional system.

The first instance chambers and the appeal court should work under common rules of procedure based on best practices in the Member States.

The patent jurisdiction should have legally and technically qualified judges with full judicial independence.

Finally, the patent jurisdiction must respect the European Court of Justice as the final arbiter in matters of EU law, including questions relating to Community legislation and to the validity of future Community patents.

Supporting measures to improve the patent system

With a view to promoting a reliable patent system, the Commission proposes the following supporting measures:

  • guaranteeing patent quality: rigorous patentability criteria must be applied to maintain the high quality of European patents. Cooperation between patent offices will reduce costs and delivery times;
  • supporting small businesses: small businesses must be given all necessary advice on patents. The Commission is providing backing for support projects under the PRO INNO Europe initiative and the Competitiveness and Innovation Framework Programme;
  • improving technology and knowledge transfer: between European businesses on the one hand and between research centres and businesses on the other;
  • enforcing patent rights: the legal framework for patents must be strengthened, taking account of the different ways of resolving disputes, including alternative dispute resolution systems, patent litigation insurance and international standards.

Background

The promotion of intellectual property rights (IPRs) and, in particular, patents is part of the Lisbon Strategy for Growth and Jobs, in that it stresses the role of patents as a driving force for European development.

A separate, detailed communication on intellectual property rights is planned for 2008. This will supplement this communication and cover the main non-legislative and horizontal questions relating to all aspects of intellectual property.

Defence-related products: rules on transfer within the EU

Defence-related products: rules on transfer within the EU

Outline of the Community (European Union) legislation about Defence-related products: rules on transfer within the EU

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Internal market > Businesses in the internal market > Intellectual property

Defence-related products: rules on transfer within the EU

Document or Iniciative

Directive 2009/43/EC of the European Parliament and of the Council of 6 May 2009 simplifying terms and conditions of transfers of defence-related products within the Community (Text with EEA relevance) [See amending act(s)].

Summary

The aim of this Directive is to facilitate the transfer of defence-related products within the European Union (EU) and to improve the competitiveness of the defence sector in Europe and industrial cooperation between the Member States.

This Directive establishes a European authorisation system based on issuing transfer licences to suppliers. This system increases the transparency and security of transfers in the EU. It also facilitates the purchasing, maintenance and repair of European defence products.

This Directive applies to the defence-related products stated on a list annexed to the Directive. The Commission updates the list regularly so that it strictly corresponds to the Common Military List of the European Union.

Transfer licences

The Directive makes the transfer of defence-related products subject to prior authorisation from the Member State from whose territory the defence products are to be transferred.

The Directive states that no other authorisation from other Member States is required for transit through Member States or entry to the territory of the Member State where the recipient of the defence-related products is located, except on grounds of public security or public policy, for example in the area of safety of transport.

There are three types of transfer licences:

  • general licences;
  • global licences;
  • individual licences.

General licences are published by Member States and are addressed to all suppliers established within their territory who comply with the conditions of the general licence. With these licences, suppliers can carry out several transfers of defence-related products to one or several categories of recipients situated in another Member State.

The Directive specifies the cases which must at least have a general licence: transfers to certified companies, transfers to the armed forces of other Member States, transfers for demonstration, evaluation or exhibition purposes and transfers for maintenance and repair purposes.

This type of licence may also cover transfers relating to an intergovernmental cooperation programme.

Global licences are issued to individual suppliers on their request. On the basis of this request from the supplier, Member States determine the scope of the global licence, its duration (three years, renewable) and the authorised recipients.

Individual licences are also issued at the supplier’s request. They are limited to a single transfer of products to a single recipient. They are permitted by the Directive in four cases only:

  • if the request is limited to a single transfer;
  • if it is necessary for the protection of the essential security interests of the Member State or on grounds of public policy;
  • if it is necessary for compliance with international obligations and commitments of Member States;
  • if there is serious reason to believe that the supplier will not be able to comply with all the terms and conditions necessary to grant it a global transfer licence.

Information obligations of suppliers

Member States ensure that suppliers of defence-related products:

  • inform recipients of the terms and conditions relating to the end-use of the transfer licence;
  • inform the competent authorities of the Member State from whose territory they wish to transfer defence-related products of their intention to use a general licence for the first time;
  • keep detailed records of their transfers.

Certification of recipients

The Directive establishes a certification system of recipients. This system aims at establishing the ability of recipients to comply with the safety rules relating to the particular nature of products in the field of defence.

Member States designate authorities to carry out the certification of recipients established within their respective territories. The certification is drawn up according to the following criteria:

  • proven experience and reputation in defence activities;
  • relevant industrial activity in defence-related products within the EU;
  • appointment by the company of a senior person responsible for transfers and exports;
  • written commitment of the company to observe and enforce the conditions related to end-use and export of received components or products;
  • written commitment of the company to provide the authorities with the information requested concerning the end-users or end-use of products exported, transferred or received under a transfer licence from another Member State by the company;
  • a signed description of the internal compliance programme or the export management system implemented in the company.

Valid for a maximum period of five years, the certificate mentions the name of the issuing authority, the name and address of the recipient, its date of issue and period of validity and a statement that the recipient complies with the requirements. The Directive requires Member States to recognise certificates issued in accordance with the Directive by other Member States.

Member States publish und update regularly the list of certified undertakings and forwards the information to the other Member States and the Commission, which then makes it publicly available on its website.

If a Member State considers that there is a serious risk that any certified recipient in another Member State will not respect any condition attached to a general transfer licence, it informs the Member State which issued the certificate and requests evaluation of the situation. If doubts remain, it can suspend the transfer licence, informing the other Member States and the Commission.

Moreover, Commission Recommendation 2011/24/EU on the certification of defence undertakings gives practical advice to Member States for implementing this system of certification.

Background

The transfer of defence-related products within the EU was subject to 27 national licensing systems which differed greatly in terms of procedures, scope and time taken to obtain licences. This diversity adversely affected both the competitiveness of European defence undertakings and the establishment of a genuine European market in defence products. Moreover, the constraints associated with the obtaining of licences in the EU appeared excessive compared with the real control needs in so far as thousands of requests for licences are lodged every year while none is refused.

References

Act Entry into force Deadline for transposition in the Member States Official Journal

Directive 2009/43/EC

30.6.2009

30.6.2011

OJ L146, 10.6.2009

Amending act(s) Entry into force Deadline for transposition in the Member States Official Journal

Directive 2010/80/EU

14.12.2010

30.6.2011

OJ L308, 24.11.2011

Fees Payable to the Office for Harmonisation in the Internal Market

Fees Payable to the Office for Harmonisation in the Internal Market

Outline of the Community (European Union) legislation about Fees Payable to the Office for Harmonisation in the Internal Market

Topics

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Internal market > Businesses in the internal market > Intellectual property

Fees Payable to the Office for Harmonisation in the Internal Market (OHIM)

Document or Iniciative

Commission Regulation (EC) No 2869/95 of 13 December 1995 on the fees payable to the Office for Harmonisation in the Internal Market (Trade Marks and Designs) [See amending acts].

Summary

The fees governed by the Regulation include an application fee for a Community trade mark, a fee for opposition to a Community trade mark, registration and renewal fees, a fee for an application for revocation or for a declaration of invalidity, an appeal fee and a fee for the cancellation of the registration of a licence or other right.

Payment of fees

Fees and charges due to the Office must be paid:

  • by payment or transfer to a bank account held by the Office;
  • by delivery or remittance of cheques made payable to the Office; or
  • in cash.

Currency of payment

All fees and all costs relating to a Community trade mark application must be paid in euros.

Payment details

For all payments, the name of the person making the payment must be indicated and the following information must be provided:

  • when paying the application fee, the purpose of the payment, i.e. “application fee”;
  • when paying the registration fee, the file number of the application being registered and the purpose of the payment, i.e. “registration fee”;
  • when paying the opposition fee, the file number of the application, the name of the applicant for a Community trade mark whose application is being opposed and the purpose of the payment, i.e. “opposition fee”;
  • when paying the revocation or invalidity fee, the registration number, the name of the holder of the Community trade mark against which the application is directed and the purpose of the payment, i.e. “revocation fee” or “invalidity fee”.

Deemed date of payment

The date on which a payment is considered to have been made to the Office is as follows:

  • for a deposit or transfer: the date on which the amount of the payment or transfer is actually entered in a bank account held by the Office;
  • for delivery or remittance of cheques: the date on which the cheque is received by the Office, provided that it is honoured;
  • for a cash payment: the date on which the cash payment is received.

Insufficient payment

In principle, a payment deadline is deemed to have been met only if the full amount of the fee has been paid in due time. If the fee is not paid in full, the amount paid will be refunded after the payment deadline has passed.

Refund of insignificant amounts

Where an excessive sum is paid to cover a fee, the excess will not be refunded if the amount is insignificant and the party concerned has not expressly requested a refund. (It is for the President to determine what constitutes an insignificant amount.)

Refund of fees following refusal of protection

If protection is refused the fee to be refunded is shown in the table in Article 2. In the case of an individual mark the fee to be refunded is €1100, plus €200 for each class of goods and services. In the case of a collective mark the fee to be refunded is €2200 plus €400.

If the refusal concerns part of the goods and services, the fee to be refunded is equal to 50% of the difference between the fees per class paid and the fees per class which would have been payable.

Reduction in the fees payable to the OHIM from 2005 and 2009

The Commission decided to reduce the fees payable to the OHIM by adopting Regulation (EC) No 1687/2005 of 14 October 2005, which is designed to reduce the cost of protecting intellectual property for businesses operating in the EU’s single market. This reduction in fees is the result of productivity gains at the OHIM, which therefore wanted to pass the savings on to business as a whole.

Regulation (EC) No 355/2009 of March 2009 reduces the fees charged by the OHIM and simplifies the fee structure by fixing the amount of the registration fee for a Community trade mark at zero. Only the application fee need be paid. The registration fee is also fixed at zero in relation to international registrations. These reductions in fees are carried out in order to ensure that the OHIM budget is balanced while fostering access to the Community trade mark system for users.

The consequences of the reductions made in 2009 include the following:

  • entreprises will only have to pay an application fee of €1050 instead of the €1750 that it previously cost to apply for and register a Community trade mark;
  • applications made by Internet will be charged at an even lower rate, which will be €900 instead of the €1600 payable in total at present.

References

Act Entry into force – Date of expiry Deadline for transposition in the Member States Official Journal

Regulation (EC) No 2869/95

22.12.1995

_

OJ L 303, 15.12.1995

Amending act(s) Entry into force Deadline for transposition in the Member States Official Journal

Regulation (EC) No 781/2004

1.10.2004

OJ L 123 of 27.4.2004

Regulation (EC) No 1042/2005

25.7.2005

OJ L 172 of 5.7.2005

Regulation (EC) No 1687/2005

22.10.2005

OJ L 271 of 15.10.2005

Regulation (EC) No 355/2009

1.5.2009

OJ L 109 of 30.4.2009

Related Acts

Communication of 22 December 2006 from the Commission to the European Parliament and the Council – The financial perspectives of the Office for Harmonisation in the Internal Market (Trade Marks and Designs) [COM(2006) 865 final – Not published in the Official Journal].
This Communication deals with the long-term management of the financing of the OHIM. The OHIM provides EU-wide protection for trade marks and designs for companies from all over the world. It is funded by the businesses that use its services. The OHIM is generating substantial cash reserves, particularly as a result of the ever increasing number of applications for trade marks and designs. Despite fee reductions in 2005, cash reserves are expected to increase still further in the next few years. However, the annual surplus cannot be allowed to continue to exceed the financial resources needed by the Office to operate. The Commission has therefore proposed a periodic review of the fees payable for Community trade marks in order to ensure that the OHIM has a more balanced budget.

Council Regulation (EC) No 207/2009 of 26 February 2009 on the Community trade mark [Official Journal L 78/1 of 24.3.2009].

Industrial property rights strategy

Industrial property rights strategy

Outline of the Community (European Union) legislation about Industrial property rights strategy

Topics

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Internal market > Businesses in the internal market > Intellectual property

Industrial property rights strategy

Document or Iniciative

Communication from the Commission to the European Parliament, the Council and the European Economic and Social Committee of 16 July 2008 “An Industrial Property Rights Strategy for Europe” [COM(2008) 465 final – Not published in the Official Journal].

Summary

This Communication presents actions aimed at introducing a high-quality industrial property rights system, which will allow the European Union (EU) to benefit from its potential, to encourage innovation and the transfer of new technologies and knowledge, and to address the challenges of globalisation.

The quality of industrial property rights

The quality of patents in Europe is generally perceived to be high, but stakeholders are concerned about maintaining and improving this quality. The Commission emphasises that it is vital that patents are awarded only where a true inventive contribution is made, because poor quality patents contribute to economic and legal uncertainty. The Commission will launch a comprehensive study on patent quality to analyse the risks of low quality rights and find ways to avoid their presence in Europe. Furthermore, it will analyse the extent of possible problems caused by unused patents.

The Commission also considers that a strong trade mark protection system, that is effective against improper licensing, non-use or unfair use, or infringements, is required. To this end, the Commission will evaluate the overall functioning of Community and national trade mark systems. This study could form a basis for enhanced cooperation between the Office for Harmonisation in the Internal Market (OHIM) and national offices.

Innovation support for SMEs

Small and medium-sized enterprises (SMEs) frequently decide not to take advantage of industrial property rights, particularly because of the high cost of obtaining them. The Commission intends to take measures in this area. As part of the introduction of the future Community patent, the Commission will explore means of improving access to the system for SMEs.

Improving SME access to patent litigation resolution procedures is also required. There are many possible solutions, in particular the development of litigation insurance and the use of mediation and arbitration. The Commission will explore how mediation and arbitration can be encouraged in the context of ongoing work on an EU-wide patent litigation resolution system.

Moreover, the Commission highlights the importance of helping SMEs to manage their industrial property rights, to enable them to benefit from support ‘tailored’ to their individual needs.

Tackling counterfeiting and piracy

The protection of industrial property rights should be accompanied by measures to tackle counterfeiting and piracy, two phenomena which have negative consequences on growth in the EU and risks for the health and safety of European consumers. The Commission insists on the need to properly apply the Directive on the Enforcement of intellectual property rights (IPRs) and considers that Member States need to put in place criminal law measures.

In addition, the Commission considers that holders of IPRs need to cooperate fully with customs authorities. Such cooperation is one of the pillars of the action plan for an effective customs response to combat counterfeiting and piracy adopted in 2005. A new action plan will be launched soon. Finally, the Commission considers that improving cooperation between the different players concerned is required in order to effectively enforce IPRs. In particular, the Commission will study how collection and documentation of information on illegal activity can be made more effective and how to improve consumer awareness.

International dimension

The Commission will prepare for the accession of the European Community to the

Singapore Treaty on the Law of Trademarks, adopted in 2006 by the World Intellectual Property Organization(WIPO).This Treaty aims to create an international framework for the harmonisation of administrative trade mark registration procedures. Furthermore, patent law harmonisation at international level could make it easier for European companies to patent their inventions outside the EU. Negotiations for a Substantive Patent Law Treaty are currently underway.

The Commission also highlights the need to enforce IPRs in third countries and announces its intention to conduct a survey of IPR activity outside the EU on a regular basis. The Commission will seek to include this issue in the negotiations of bilateral trade agreements. In addition, the Commission will participate in international discussions aimed at helping developing countries to make the most of their intellectual property rights.

Context

This Communication complements the Communication on the patent system in Europe published in April 2007. It forms part of the framework of the 2008-2010 cycle of the Lisbon Strategy, of which one of the priority action areas is knowledge and innovation.

Legal protection: topographies of semiconductor products

Legal protection: topographies of semiconductor products

Outline of the Community (European Union) legislation about Legal protection: topographies of semiconductor products

Topics

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Internal market > Businesses in the internal market > Intellectual property

Legal protection: topographies of semiconductor products

This Directive therefore aims to provide a clear legal framework for the protection of topographies of semiconductor products and to remove the differences between the national laws in force in this field.

Document or Iniciative

Council Directive 87/54/EEC of 16 December 1986 on the legal protection of topographies of semiconductor products.

Summary

Definitions of “semiconductor product” *, “topography” * and “commercial exploitation” *.

There is an obligation on Member States to adopt legislation to protect topographies in so far as they are the result of their creator’s own intellectual effort and are not commonplace in the semiconductor industry.

The right to protection is granted to the person who is the topography’s creator, subject to that person being a natural person who is a national of a Member State or ordinarily resident there. However, Member States may specify to whom the right is granted where a topography is created in the course of the creator’s employment or under a contract other than a contract of employment.

Under certain conditions, protection is also granted to natural persons, companies or other legal persons who first commercially exploit a topography:

– which has not previously been exploited commercially and;

– who have been exclusively authorised to commercially exploit the topography throughout the Community by the person entitled to dispose of it.

The Directive lays down the procedure for extending the right to protection to persons not covered by the Directive.

Member States may refuse or remove protection in respect of the topography of a semiconductor product where an application for registration in due form has not been filed with a public authority within two years of its being commercially exploited for the first time. They may require that material identifying or exemplifying the topography be deposited. However, they must ensure that material deposited is not made available to the public where it is a trade secret.

The rights granted are exclusive rights. They include the right to authorise or prohibit reproduction of a protected topography and the right to authorise or prohibit commercial exploitation or the importation for that purpose of a topography or of a semiconductor product manufactured using the topography. The exclusive right to authorise or prohibit reproduction does not apply to the reproduction for the purpose of analysing, evaluating or teaching the concepts, processes, systems or techniques embodied in the topography or the topography itself.

Where registration of the topography constitutes a condition for the coming into existence of exclusive rights, those rights will take effect on the date on which the application for registration is filed or on the date on which the topography is first commercially exploited anywhere in the world, whichever comes first. If registration is not a condition for protection, the rights will come into existence when the topography is first commercially exploited anywhere in the world or when it is first fixed or encoded.

The exclusive rights come to an end 10 years from the end of the calendar year in which the topography was first commercially exploited. Where registration is required, the 10-year period is calculated from the end of the calendar year in which the application for registration was filed or from the end of the calendar year in which the topography was first commercially exploited, whichever comes first.

The legal protection of topographies of semiconductor products has been extended to natural persons, companies and other legal persons from the United States (Decision 93/16/EEC), Canada (Decision 94/700/EC), a Member of the World Trade Organization (Decision 94/824/EC) and the Isle of Man (Decision 96/644/EC).

Key terms 

  • Semiconductor product: the final or an intermediate form of any product:
    – consisting of a body of material which includes a layer of semiconducting material and
    – having one or more other layers composed of conducting, insulating or semiconducting material, the layers being arranged in accordance with a predetermined three-dimensional pattern and
    – intended to perform, exclusively or together with other functions, an electronic function.
  • Topography of a semiconductor product: a series of related images, however fixed or encoded
    – representing the three-dimensional pattern of the layers of which a semiconductor product is composed;
    – in which series, each image has the pattern or part of the pattern of a surface of the semiconductor product at any stage of its manufacture.
  • Commercial exploitation: the sale, rental, leasing or any other method of commercial distribution, or an offer for these purposes.

References

Act Entry into force Deadline for transposition in the Member States Official Journal
Directive 87/54/EEC 27.01.1987 07.11.1987 OJ L 24 of 27.01.1987

Related Acts

EXTENSION OF THE PROTECTION TO THIRD COUNTRIES

Council Decision 96/644/EC of 11 November 1996 on the extension of the legal protection of topographies of semiconductor products to persons from the Isle of Man [Official Journal L 293 of 16.11.1996]

Council Decision 94/824/EC of 22 December 1994 on the extension of the legal protection of topographies of semiconductor products to persons from a Member of the World Trade Organization [Official Journal L 349 of 31.12.1994]

Council Decision 94/700/EC of 24 October 1994 on the extension of the legal protection of topographies of semiconductor products to persons from Canada [Official Journal L 284 of 01.11.1994]

Council Decision 93/520/EEC of 27 September 1993 amending Decision 93/16/EEC on the extension of the legal protection of topographies of semiconductor products to persons from the United States of America and certain territories [Official Journal L 246 of 02.10.1993]

Council Decision 93/16/EEC of 21 December 1992 on the extension of the legal protection of topographies of semiconductor products to persons from the United States of America and certain territories [Official Journal L 11 of 19.01.1993].

Intellectual property rights: enhancing their enforcement

Intellectual property rights: enhancing their enforcement

Outline of the Community (European Union) legislation about Intellectual property rights: enhancing their enforcement

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Internal market > Businesses in the internal market > Intellectual property

Intellectual property rights: enhancing their enforcement

Document or Iniciative

Communication from the Commission to the Council, the European Parliament and the European Economic and Social Committee of 11 September 2009 – Enhancing the enforcement of intellectual property rights in the internal market [COM(2009) 467 final – Not published in the Official Journal].

Summary

This Communication presents measures aimed at safeguarding intellectual property rights (IPR) and combating counterfeiting and piracy within the internal market.

European Observatory

The European Commission is establishing a European Observatory, the aim of which is to gather, monitor and report information and data related to IPR.

This Observatory requires collaboration between Member States and the private sector.

The main functions of the Observatory are:

  • the collection and use of independent, reliable information and data;
  • the dissemination of best practice amongst public authorities;
  • the dissemination of successful private sector strategies;
  • the assessment and identification of solutions for specific geographical areas.

The Observatory should be based on existing European Commission structures, and the Commission will provide the central administrative resource. It will however be possible, where necessary, to make use of external expertise.

The Commission has asked the Member States to appoint a national representative for the Observatory and has requested the participation of the private sector including a broad range of national and pan-European bodies representing the different economic sectors most involved in the fight against piracy and counterfeiting. European consumers are also represented and invited to play an active role.

Administrative cooperation across Europe

It is necessary to improve cross-border cooperation between different enforcement authorities in view of the international nature of IPR infringements.

Cooperation between the Commission and Member States should also be consolidated in the context of a borderless internal market. In this regard, the creation of a network of contact points across the European Union would be a relevant solution.

As the national centres of IPR expertise, National Intellectual Property Offices also have a role to play. They can contribute to developing strategic approaches and the dissemination of best practices.

National bodies should improve transparency in respect of the activities that they carry out in the field of IPR protection. The Commission, on the basis of information collected from Member States, is responsible for analysing the structures that Member States have put in place and drafting a report to map existing strategies, frameworks and best practices.

Stakeholders in European cooperation in the field of IPR should have access to an electronic network for the exchange of information on infringements that have been committed. This network will need to:

  • support ‘real-time’ exchanges of information on goods and services infringing IPR;
  • put in place an effective system of alerts concerning specific products or potential threats;
  • facilitate communication between the parties involved, particularly to overcome language barriers;
  • raise consumers’ awareness of the growing threat of counterfeiting and piracy and the associated risks.

Voluntary arrangements between stakeholders

The Commission wishes to encourage rights holders and the other parties involved to engage in dialogue and to share their common interests in combating IPR infringements. In this regard, voluntary arrangements seem to be the most appropriate solution, since this type of agreement allows for rapid adaptation to new technologies and may be extended beyond the European Union (EU).

The sale of counterfeit goods over the Internet has developed considerably in recent years. The Commission considers this sector as a priority for action where the method of dialogue and cooperation agreements could be applied effectively.

Brand owners and Internet companies alike have therefore committed themselves to developing a collaborative method. This involves a Memorandum of Understanding dealing with prevention, identification and removal of infringing offers and sellers from Internet platforms.

The Commission envisages legislative solutions if voluntary arrangements cannot be implemented.

Context

IPR infringements, particularly counterfeiting and piracy, cause widespread economic harm and even pose a threat to public health and consumer safety. The Commission therefore considers it necessary to protect IPR in order to foster economic growth, innovation and creativity.

Patent law in the field of biotechnology and genetic engineering: implementation report

Patent law in the field of biotechnology and genetic engineering: implementation report

Outline of the Community (European Union) legislation about Patent law in the field of biotechnology and genetic engineering: implementation report

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Internal market > Pharmaceutical and cosmetic products

Patent law in the field of biotechnology and genetic engineering: implementation report (2002)

Document or Iniciative

Commission Report of 7 October 2002, Development and implications of patent law in the field of biotechnology and genetic engineering COM(2002) 545 final [Not published in the Official Journal].

Summary

Background and general objective

The biotechnology sector was identified by the Stockholm European Council in March 2001 as one of the most promising in terms of economic development and employment. There has, in fact, been a real boom in biotechnological inventions with the discovery of very encouraging new techniques for therapeutical applications and food production. In this context, the European legislator felt it necessary to keep pace with these developments by establishing a secure legal framework allowing European companies to develop and market the new products and processes arising from genetic engineering. This is the context in which to place Directive 98/44/EC on the legal protection of biotechnological inventions, which was adopted after almost ten years of discussions within the Council of Ministers and the European Parliament.

Provision is made for this report in Directive 98/44/EC which stipulates that the Commission should send the European Parliament and the Council an annual report on the development and implications of patent law in the field of biotechnology and genetic engineering. This report also forms part of the follow-up to the Commission Communication of 23 January 2002 entitled “Life sciences and biotechnology – A Strategy for Europe”[PDF ], which aims to promote biotechnology within a flexible regulatory framework and to ensure consistency across the different policies and sectors involved in this field.

The report examines the core provisions of Directive 98/44/EC with the aim of determining whether the patent system is effective in meeting the needs of researchers and businesses.

The current situation in Europe

At the time of drafting this report, only six Member States had transposed Directive 98/44/EC into their national legal systems: Denmark, Finland, Ireland, the United Kingdom, Greece and Spain. This transposal is, however, essential in order to avoid any discrepancies between the different national legislations, especially since if such a situation were to continue, the development of biotechnology in Europe might slow down considerably.

The main provisions of Directive 98/44/EC have been incorporated into the Implementing Regulations to the European Patent Convention by a Decision of the Administrative Council of the European Patent Organisation. This incorporation of Community law by the Organisation is particularly important. The European Patent Convention lays down a single procedure for examining applications for patents, which makes it possible to have a whole range of national patents governed by national and Community law.

In 1998, the Netherlands, with the support of Italy and Norway, brought an action for annulment of Directive 98/44/EC before the Court of Justice of the European Communities. The application by the Netherlands put forward six pleas, relating in particular to the incorrect legal basis chosen for the Directive, the breach of the principles of subsidiarity and legal certainty, and the breach of obligations in international law. In October 2001, the judgment of the Court dismissed the action.

The compatibility of the Directive with relevant international agreements in this field

The Directive is compatible with existing international Treaties in the field of biotechnology. Nonetheless, the work being carried out at international level within WIPO (the World Intellectual Property Organisation) on the draft SPLT (Substantive Patent Law Treaty) is particularly likely to have an impact on Directive 98/44/EC. The new draft treaty is intended to establish, at international level, binding provisions applicable to substantive patent law. At the current stage in the negotiations, the provisions of the Directive that might be affected by this work are those relating to industrial application and those relating to the deposit of a biological material with a recognised institution.

The patentability of inventions relating to plants and animals

The Directive distinguishes between plants and animals which are patentable and plant and animal varieties which are not. The reason for this differentiation lies in the means of achieving the product concerned: a plant or animal variety is generally obtained by essentially biological processes, while transgenic plants and animals are obtained through non-biological processes forming part of genetic engineering.

With regard to plants, the Directive reiterates that, while plants are patentable, plant varieties are not and are protected by plant variety rights. In delivering its judgment of October 2001, the Court of Justice pointed out that, under Article 4 of the Directive, a patent cannot be granted for a plant variety, but may be for an invention if its technical feasibility is not confined to a particular plant variety. The Court also concluded that a genetic modification of a specific plant variety is not patentable but a modification of wider scope, concerning, for example, a species, may be protected by a patent.

With regard to animals, Directive 98/44/EC stipulates that animal varieties cannot be patented. However, inventions relating to animals can be protected by patent if the technical feasibility is not confined to a particular animal variety. Amongst the many patents granted in the field of biotechnology since the adoption of the Directive in July 1998, some of those granted by the European Patent Office have provoked strong reactions from the public. One such case is a patent granted to the Seabright company relating to the creation of a transgenic fish, which gave rise to a written question to the Commission from a Member of the European Parliament. The question related in particular to the compatibility of granting this patent with the exclusion from patentability of animal varieties. In its reply, the Commission pointed out that one of the provisions of the Implementing Regulations to the European Patent Convention – which takes over the substance of the provisions of Directive 98/44/EC – lays down that a patent for an invention relating to an animal may be obtained if the claimed invention involves a technical measure which is not confined to a particular animal variety. This appeared to be the case with the patent granted to the Seabright company.

Finally, the Directive expressly makes provision for the patentability of microbiological processes and products directly obtained from such processes.

The patentability of inventions relating to elements isolated from the human body

Under Directive 98/44/EC, the human body, at the various stages of its formation and development – thus including the embryo -, is not patentable. It follows that neither the discovery of a sequence of a gene, nor the crude data relating to the human genome constitute patentable inventions. Only inventions which combine a natural element with a technical process enabling it to be isolated or produced for an industrial application can be the subject of an application for a patent.

In this field, two patents granted to the company Myriad Genetics gave rise to numerous questions from Members of the European Parliament to the Commission. These are patents which are based on an invention which allows screening for cancer of the breast and ovaries in women. The questions focused principally on the dangers which granting the patents might pose for the freedom of research in the EU, as well as on the high costs to European patients of access to the technology offered by the patents.

In answer to these questions, the Commission stressed that Directive 98/44/EC was not intended to call into question the freedom of research in Europe. It reiterated that, if research results were commercialised and these results used a technique which has already been patented, a sub-licence should be obtained from the holder of the patent. In addition, most national legislation in the Member States had adopted the principle of exempting prior use, which allows anyone who has already used the invention in the European Community, or had made effective preparations for such use before the patent was filed, to continue such use or to use the invention as envisaged in the preparations.

Exclusion from patentability of inventions whose commercial exploitation would be contrary to ordre public and morality

Directive 98/44/EC excludes from patentability inventions whose commercial exploitation would be contrary to ordre public or morality. Contrary to the arguments advanced under the action to annul the directive, the Court of Justice considered that the directive was sufficiently precise on this point and that the danger of wide differences of interpretation was not therefore a valid argument. The Court also considered that the national administrative and court authorities in the Member States were best placed to evaluate the validity of a biotechnological invention with regard to the ethical, sociological or philosophical context of each country.

The Directive specifies four explicit exclusions from patentability, which was not the case in the body of law applicable to patents. These are processes for cloning human beings, processes for modifying the germ line genetic identity of human beings, and the use of human embryos for industrial or commercial purposes. These explicit exclusions are a clear source of legal certainty.

Recent developments in the field of biotechnology and human stem cells show great promise for cures, particularly in the treatment of degenerative diseases. This is the case with parthenogenesis, which is defined as the development of an ovule without there having been any fertilisation by a spermatozoid. The Commission report also emphasizes the controversial status of cell lines obtained from multipotent cells which may themselves be created by “therapeutic cloning”. These cell lines also, however, pave the way for considerable progress, which is the reason why the Commission suggests that discussions should continue on this question and on measures which could be taken to encourage this type of research.

Asked by the President of the Commission to look into the ethical aspects of the patentability of inventions involving human stem cells, the European Group on Ethics issued its opinion in May 2002. In it, the Group insists on the importance of ensuring a fair balance between the interests of the inventor and those of society, and hence of defining the conditions and limits for the patentability of stem cells. The protection conferred by a patent should relate to precisely described industrial applications, and not to a wide range of potential applications.

Conclusion

The Commission report concludes that the European legislator has endeavoured to create a functional system which respects the ethical principles recognised within the European Community. This report identified two key topics:

  • the scope to be conferred to patents on sequences or partial sequences of genes isolated from the human body;
  • the patentability of human stem cells and of cell lines obtained from them.

These two topics will be investigated by a group of independent experts made up of professionals in the field of patents (scientists, lawyers, economists) who are highly qualified in the field of biotechnological inventions and genetic engineering. The group will also assist the Commission in defining the priority topics to be covered in subsequent reports.

Related Acts

SECOND REPORT

Commission report of 14 July 2005, Development and implications of patent law in the field of
biotechnology and genetic engineering [Not published in the Official Journal].
This second annual report presents the latest major developments that have taken place since the first report was published. It highlights the questions concerning the patenting of gene sequences isolated from the human body and the patentability of inventions relating to stem cells. It also reports on the implementation of the Directive.

DIRECTIVE 98/44/EC

Directive 98/44/EC of the European Parliament and of the Council of 6 July 1998 on the legal protection of biotechnological inventions [Official Journal L 213 of 30 July 1998].
The Directive clarifies the distinction between what is patentable and what is not patentable. In particular, it confirms that the human body at the various stages of its formation and development, as well as processes for human cloning and for modifying the germ-line genetic identity of human beings, may not be regarded as patentable inventions.


Another Normative about Patent law in the field of biotechnology and genetic engineering: implementation report

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic

Internal market > Businesses in the internal market > Intellectual property

Patent law in the field of biotechnology and genetic engineering: implementation report (2005)

Document or Iniciative

Report from the Commission of 14 July 2005 – Development and implications of patent law in the field of biotechnology and genetic engineering [COM(2005) 312 – Official Journal C 211 of 30.8.2005].

Summary

The Commission drew up this report on the basis of the work carried out by the group of experts set up following the first report.

It presents an analysis of the two issues which had been raised in 2002:

  • the patenting of sequences of genes which have been isolated from the human body

The aim was to determine the scope of the protection conferred by patents to this type of product: classical protection covering possible future uses of the sequence or protection restricted only to the specific use disclosed in the patent application (“purpose-bound protection”).

The Commission has not taken a position so far regarding the scope of Member States’ protection. It will, nonetheless, monitor the matter closely to determine whether there are any economic consequences of possible divergences between Member States’ legislation.

  • the patentability of human embryonic stem cells and cell lines obtained from them

A distinction should be drawn between totipotent stem cells, which are capable of developing into a human being, and pluripotent embryonic stem cells, which do not have this capability.

The former are clearly excluded from patenting on grounds of human dignity.

For the latter, the group of experts considered that the question of patenting was linked to the definition of what constitutes an embryo, and the scope of research allowed, which is determined by national legislation. Given the divergences which exist between Member States on this matter, the Commission considers that it is premature to give further definition or provide for further harmonisation in this area.

The Commission will monitor developments in this field and has launched a study looking at the ethical and legal aspects of stem cell patenting.

It draws attention to the initiation of legal proceedings in 2003 for failure to transmit transposition measures and the opening of new procedures in December 2004 against Latvia and Lithuania which had not completed the transposition of the Directive. Italy and Luxembourg had also still not applied the Directive in July 2005.

Related Acts

Report from the Commission of 7 October 2002 – Development and implications of patent law in the field of biotechnology and genetic engineering COM(2002) 545 final [Not published in the Official Journal]

This document is the Commission’s first annual report aimed at evaluating the implementation of Directive 98/44/EC on the legal protection of biotechnological inventions. It examines the development of patent law in the field of biotechnology and genetic engineering, and identifies and evaluates problems and sensitive issues which have recently arisen.

European Parliament and Council Directive 98/44/EC of 6 July 1998 on the legal protection of biotechnological inventions [Official Journal L 213 of 30.07.1998]

The purpose of this Directive is to guarantee clear and effective legal protection in the field of biotechnology. It also specifically bans human cloning and any modifications to germ line genetic identity. The ethical aspects are handled by an independent committee which has been given the task of advising the European Commission on these matters.