A Unified European Patent System - The Historical Perspec...

The idea of creating a single patent court for Europe in order to improve legal certainty as well as to reduce costs is inextricably intertwined with the idea of creating a unitary trans-national patent which has the same legal effect all over Europe and which goes well beyond the European bundle patent of our days. Without such new substantive patent law, any attempt to bundle the procedural aspects of litigation and nullity matters will surely be futile. When assessing the chances for a unification of patent courts in Europe we will have to look at the history and prospects of both ideas. If there is no unitary substantial patent law in Europe there will also be no European patent court.

As early as in 1949 the French senator Longchambon put before the Consultative Assembly of the Council of Europe a plan for a European Patent Office, which, however, was at that time rejected by the Committee of Patent Experts. Later, in 1950, the Scandinavian countries began harmonising their patent laws, aiming at a system whereby a Scandinavian patent application could lead to a bundle of national patents granted by a national patent office. Also this approach never matured into reality. And, in 1959, at the invitation of the Commission of the European Economic Community (EEC), the Member States thereof started drafting a patent law for the Common Market which would override territorial limitations. However, in a political dispute over a potential contribution of the United Kingdom which had failed to acquire EEC membership, these efforts came to a halt in 1965.

In January 1969, France placed before the Council of Ministers of the European Communities a proposal for resuming negotiations on European patent law, taking a view to draft two separate conventions. The first was to set up a European patent grant procedure with a European Patent Office granting a bundle of patents, and was to embrace as many European countries as possible. The second convention was to create a European patent for the Common Market and was to be confined to the Member States of the European Communities. A first conference was held from May 1969 to June 1972 in Luxembourg, delivering a draft Convention establishing a European System for the Grant of patents, which formed the basis for the Munich Diplomatic Conference, concluding on October 05, 1973, with the signing of the EPC including the Implementing Regulations, four Protocols, two decisions, one Resolution and one Declaration.

In 1975, only two years after the success of the Munich Diplomatic Conference, another spectacular breakthrough was achieved in Luxembourg: The signing of a Convention concerning the European Patent for the Common Market on December 15, 1975. This Convention provided for a unitary Community Patent as well as for Nullity Boards to be created within the EPO. Decisions of such Nullity Board were open to be challenged by lodging appeal to the European Court of Justice (ECJ). Substantive law concerning the legal effects of a Community Patent was defined by the Convention; however, with regard to procedural law, national courts were responsible for hearing infringement actions. The Luxembourg Community patent approach had aimed at utilising a Community Convention. This Convention would have transformed the national stages in the granting of European patents into a single stage common to the Member States.

However, all was in vain. It was not possible to make all signatory states ratify the Convention. In 1985, a second Diplomatic Conference on the Community Patent was held, and even a third one in 1989. The Convention was amended by an Agreement concluded in Luxembourg on 15 December 1989 concerning Community patents and including, amongst other things, the Protocol on the Settlement of Litigation concerning the Infringement and Validity of Community Patents. At the end of this final Diplomatic Conference it looked as if a decisive breakthrough had been reached but nevertheless the Convention on the Community Patent never entered into force because the quorum of ratifications was not met. The failure of the Luxembourg Convention has generally been attributed to the costs of the Community patent, chiefly that of translation, and to the judicial system. Under the Convention, a patent had to be translated into every Community language. Interested parties felt that this requirement was excessive. Under the highly complex judicial system proposed by the Convention, national judges would have been able to declare a Community patent invalid with effect for the entire territory of the Community. This aspect aroused the distrust of stakeholders who considered it to be a source of legal uncertainty.

In the wake of the Lisbon European Council, the EU Commission issued a proposal for a Council Regulation on the Community patent on August 01, 2000. Unlike the failed approach of a Convention on a Community Patent, the legal basis of this proposal for a Regulation under secondary EU legislation was Article 308 of the EC Treaty. Using this legal base had before been successfully demonstrated in relation to the Community trade mark and Community designs, leading to the creation of the Office for the Harmonisation in the Internal Market (OHIM). However, unlike OHIM, the European Patent Office is not a Community body. In order to make a EU Community Patent working on the basis of a EU Regulation, a link needs to be established between the European Patent Organisation (EPOrg) running the EPO, on the one hand, and the EU, on the other hand. It is foreseen that the grant of Community patents will be carried out by the European Patent Office. For this purpose the European Community, the legal personality of the EU, needs to accede to the European Patent Convention, thereby charging the European Patent Office with the task of granting Community patents. Thus the European Patent Office will grant European and Community patents according to the same standards of the European Patent Convention ensuring uniformity and legal security of patent law in Europe. At the same time the European Patent Office’s high expertise as an examining patent office can be put to use for the Community patent.

On the basis of this approach to link the EU to the EPOrg the EU Commission announced ambitious plans for safeguarding legal certainty by installing a new court system related to patents. The solution adopted in this proposal provides for the creation of a centralised judicial system specialising in patent matters, particularly for the examination of questions concerning validity and infringement of the Community patent. To this end, a Community Intellectual Property Court was envisaged by the EU Commission. This court would have comprised chambers of first instance and appeal. These two instances, whose jurisdiction was intended to cover the entire Community territory, may deal with questions relating to the actual facts of a case as well as to points of law. They were designed to apply their own rules of procedure, grant provisional measures, determine penalties and award damages. On December 23, 2003, the EU Commission presented a Proposal for a Council Decision conferring jurisdiction on the Court of Justice in disputes relating to the Community patent as well as another Proposal for a Council decision establishing the Community Patent Court and concerning appeals before the Court of First Instance. The legal basis to be used for the establishment of a Community patent jurisdiction was introduced into the EC Treaty by Article 2 of the Treaty of Nice amending the Treaty on European Union, the Treaties establishing the European Communities and certain related acts which entered into force on February 01, 2003, inserting Article 229a and Article 225a into the EC Treaty. The EU Commission proposed the Community patent jurisdiction to be established by two Council decisions based on those Articles. The Court of Justice was intended to have jurisdiction in disputes relating to the infringement and the validity of the Community patent. Concerning the validity of a Community patent, the draft regulation provided for an invalidity action as well as a counter-claim for invalidity.

Despite all efforts, also this fresh approach on the basis of the EU Treaties did not succeed. On May 18, 2004, the EU Council failed to adopt the proposal.

Nevertheless, many stakeholders continued to support the Community Patent as the approach. However, they criticised the Council's Common Political Approach adopted in 2003 on the grounds of high costs of translation arrangements as well as the excessive centralisation of the proposed jurisdictional system.

Hopes grew that a European patent litigation could be created outside of the framework of the EU which appeared to have failed to resolve that problem. At an Intergovernmental Conference already held in Paris in 1999, the EPC Contracting States had set up a Working Party on Litigation which was mandated to present a draft text for an optional protocol to the EPC which would commit its signatory states to an integrated judicial system. At a meeting of a Working Party on Litigation in November 2003, the basic legal instruments which are needed to establish the above jurisdictional arrangements were agreed by the Working Party, namely a Draft Agreement on the establishment of a European Patent Litigation Agreement (EPLA), and a Draft Statute of the European Patent Court. The latest draft was submitted to the Working Party on Litigation for information on occasion of its meeting on December 14, 2005. The work of the Working Party on Litigation on the draft Agreement was not continued ever since. On the one hand, stakeholders appreciated the more decentralised structure of the proposed EPLA court system. However, it become clearer that due to legal restrictions coming from the EU Treaties the EU Contracting States are not free to decide on any agreement for a pan-European patent court outside the system of EU secondary legislation. This project must be undertaken under the roof of the EU or it will fail forever.

Whereas the European Patent Convention had politically failed because of its lack of centralisation with regard to litigation matters, the approach for establishing a Community IP Court in 2003 on the basis of secondary EU legislation was doomed to fail due to its over-centralisation of litigation and nullity proceedings. The EPLA approach was widely greeted in view of its balance between locality and centralisation but it turned out to be infeasible due to the sole rule-making competence of the EU in this field of law.

The EU Commission did not give up and launched another attempt, this time by blending the balanced centralisation approach for a court system with the concept of a EU Community Patent like that of 2003. A European Community Patent Court (ECPC) was drafted to have exclusive jurisdiction in respect of civil litigation related to the infringement and validity of Community patents and European patents, comprising a Court of First Instance, a Court of Appeal, and a Registry. The Court of First Instance should comprise a central division as well as local and regional divisions. Direct actions for revocation of patents should be brought before the central division. A counter-claim for revocation can be brought in the case of an action for infringement before a local or regional division. The ECPC was intended to have exclusive jurisdiction in respect of litigation related to the infringement and validity of Community patents and European patents. Under this scheme, the European Court of Justice (ECJ) will have a quite limited role; the ECPC only can refer questions of Community law to ECJ.

Since then continuous work is going on to finalise a Draft package for a European Community Patent plus a matching European court system. In 2009, another twist happened as the EU Council decided to fathom the option to include non-EU States like Turkey into some pan-European court system. To this end, a Draft Agreement on the European and Community Patents Court was drawn up in an attempt to create a Unified Patent Litigation System for Europe (UPLS). This again represents a switch of basic law-making models because of a court system also covering non-EU States cannot be created on the basis of secondary EU legislation alone. Hence, the UPLS-related part is now again drafted in the form of an Agreement under international law. It appears as if even the proponents of this approach are not quite sure if such undertaking is in accord with the existing EU treaties. Hence, the EU Council has referred a set of questions concerning points of law relating the UPLS - which strangely were not published as of today - to the European Court of Justice for consideration.

There are some wild speculations as to when a political agreement on the European community patent plus the UPLS can be reached if it ever will be reached at all. Some expect significant progress very soon. The text of the present drafts appear to be relatively mature. However, building UPLS on the basis of an Agreement outside the EU Lisbon Treaty means that the painstaking process of ensuring ratification by all EU member States plus interested States outside the EU has to start again. And the Danish Government has already indicated that this would require transference of competence which means that according to the Danish Constitution this would require either a national referendum or a 5/6 majority in the Parliament.

The answer to the question posed lies in the history of European unification. The timeline of the quarrels of patent politics as sketched above is a model representing in nuce the timeline of the quarrels of chain of successive EU treaties. As we all know, obtaining certificates of ratification from all EU Member States for the Lisbon Treaty was utterly difficult, and it was a quite narrow escape that prevented the Treaty from failure. Perhaps the Decision of the EU Council on December 04, 2009, can be understood as a sign encouraging optimism. Some years from now we will know as to whether idea of a single patent court for Europe will share the fate of the Lisbon Treaty, i.e. come into reality after incredible political woes, or will have to get buried for a long time.