On February 19th 2013, 24 European Union (EU) states reached an agreement on a Uniform Patent Court (UPC), which is considered as a big step forward towards the final goal of reaching a European patent package which the parties have been negotiating over the past 50 years. The package, which is comprised of European patent with unitary effect and a UPC, cannot go into force until thirteen EU member states (including the UK, France and Germany) have ratified the treaty, and in any event no earlier than January1st 2014.
Currently, there are two ways of obtaining patent protection in Europe: firstly by applying for a national patent in an individual EU country; secondly by applying for a European patent at the European Patent Office (EPO) under the European Patent Convention (EPC). However, the package will provide the third approach for protection, which will bring big changes to European patent protection and enforcement once it goes into effect.
Professor Manuel Desantes (Desantes), former Vice-President of the EPO, has been involved in the long process of reaching the unitary patent package for many years. Given the EPO’s central role in promoting the European patent package and Mr. Desantes’ role and professional reputation within the EPO, China IP interviewed Professor Desantes, invited him to give readers a comprehensive and authoritative interpretation of the package as well as some practical suggestions to Chinese enterprises in coping with the new changes.
China IP: Professor Desantes, how can you summarize in some lines for our readers the relevance of the “European patent package?”
Professor Desantes: This agreement is a landmark in the history of the European construction. After more than 50 years of negotiations, most of the member states of the EU have agreed to two main things. The first is to attribute unitary effects if the holder of the patent so wishes. The second is to create a new Court, the UPC, and to empower it with exclusive jurisdiction for all actions regarding the validity and the infringement of all European patents, regardless of whether they are European patents with unitary effect or classic European patents validated in some or in all the member states.
China IP: Could you explain the meaning of a “European patent with unitary effect?”
Professor Desantes: Yes, of course. As you probably know, presently there is no European patent with unitary effect (UE patent or Unitary patent). When the EPO grants a European patent, it has to be validated in each EPO member state. But currently the legal protections of the same European patent differ in each member state, as determined by national law. After more than 50 years of discussion, most EU member states concluded that it was not possible to reach a unanimous agreement on a linguistic regime for the UE patent. In November 2010, all members except Spain and Italy asked the Council for authorisation to establish a Unitary patent through the “Enhanced cooperation procedure,” a very special procedure introduced in the Treaties twenty years ago and which had been used only once since that time. The language regime proposed was the same as the one established in 1973 in the EPC for the granting of European patents: English, German and French. The Council authorised the Enhanced Cooperation in March 2011, and in December 2012 adopted Regulation 1257/2012 and Regulation 1260/2012. The first one established that in the territory of the Member States participating in the Enhanced Cooperation the European patents would have unitary effect, that is to say, the same effects attributed by the same national law, at the request of the holder of the patent. This means that the holder of the patent can always decide to continue using the present system and validating the European patents as usual. The second Regulation established the linguistic regime for the European patents with unitary effect.
China IP: Why do you advise us to talk about the “European patent with unitary effect” and not about the “Unitary Patent?”
Professor Desantes: Because a Unitary patent is an EU title which can only be created with the participation of all the Member States of the EU. This was the case, for instance, with the Community trademark or the Community Design, which are granted by the Office for the Harmonisation of the Internal Market (OHIM) in Alicante (Spain). But in the case of the Unitary patent not all the Member States agreed, so instead of creating a Unitary patent they attributed unitary effects to a classic European patent granted by the EPO, which is, as you can imagine, completely different as creating a single title.
China IP: What are the main advantages and disadvantages of the new system?
Professor Desantes: It is easy to perceive that the advantages are many. First, it is not necessary to validate in each of the different Member States, but just to ask the EPO for the registration of the unitary effect of the European patent. In just one shot patent protection is assured in 25 EU Member States. Second, the rights and limitations attributed to the European patent are the same in all these territories. Third, it is not necessary to renew the patent every year in each Member State, but just with the EPO. Fourth, most of the translations are avoided. Finally, this means that it will not be necessary to have representatives in each Member State but only one before the EPO. Of course, there are also possible disadvantages. For instance, there is no way to abandon the patent in one territory and keep it for the rest, as it is all or nothing. The same applies to limitations, possible declaration of nullity, etc. And it is also true that actual costs are not known yet, as registration and renewal fees have to be fixed by the participating Member States.
China IP: You stated that together with the “unitary effect” of the European patents the EU Member States have created a UPC. What are the main characteristics of this Court?
Professor Desantes: This new UPC is a very unique experience in International Law. The Court is both international and national. It is international because it has been created by an international agreement. It is composed of judges appointed by an international body, having an international status, applying Rules of Procedure which have been internationally agreed upon and many times court will be held in a place other than the territory of their nationality. But, at the same time, the Court belongs to the different national jurisdictions. Consequently, for instance, a judgment rendered in German language by the Central Division of the UPC sitting in London where the Court is composed by a Slovakian and a Swedish lawyer and a Portuguese engineer, and where the parties are Chinese and US companies will be considered in each nation as effective as if it were, for example, a French, Danish, Greek or any other EU member judgment.
China IP: Do you think that the system will be cheaper and more reliable than the present one?
Professor Desantes: We have to understand that patent litigation in Europe is still a nightmare today. Once a European patent is granted, it can be subject to opposition and appeal at the EPO. Courts of the Member States of the European Patent Organisation where the European patent has been validated can also judge upon the validity of the patent, but limited to its territory. Again, it is very difficult to fight against infringements if not going State by State. All this will disappear with the new system. Infringements or nullity of the patent will be declared by a single Court for the whole territory of the Contracting Member States. What is to be seen is whether this new system will be cheaper and reliable. We will have to follow the development of the UPC very attentively.
China IP: When is this UPC going to open its doors?
Professor Desantes: The UPC Agreement was signed on February 19th, 2013 by all EU Member States except Spain and Poland. It will enter into force as soon as it is ratified by thirteen Member States of the EU, with Germany, France and the United Kingdom being mandatory signatories. At the same time, the two abovementioned Regulations will be applicable. It is expected that this will happen sometime in 2014.
China IP: Is there any transitional period envisaged for the UPC?
Professor Desantes: Yes, and it is a very relevant one. During the first seven years after the entry into force of the new system, the UPC will not have exclusive competence, as the ordinary national courts will continue dealing with cases related to infringement and validity of European patents. Plaintiffs will therefore be able to introduce their requests either with the UPC or with the national courts. These seven years can be supplemented with another seven if Member States conclude that the experience of the UPC is not sufficient after the first transitional period.
China IP: And why it is the “opt out” offered to patent holders so important for Chinese enterprises?
Professor Desantes: The “opt out” clause is key in the short run. It will force all Chinese enterprises having a European patent to decide, right after the entry into force of the Agreement, whether they want or not to be bound by the UPC. If they do not exercise the “opt out” right during the transitional period and the patent is questioned before the UPC, they will not be able to opt out at a later stage. The advantage of the “opt out” is double: first, it will cover the patent during its whole life, even after the transitional period; second, it is always possible to reverse it through a subsequent “opt in” if we are interested in the application of the new system.
China IP: Do you have any advice for Chinese enterprises and Chinese IP firms?
Professor Desantes: Definitely. They should be very attentive to what is happening in Europe these upcoming months. Europe is a very relevant market for Chinese enterprises and IP assets are more and more important when designing short and long-term strategies. Chinese IP firms should try to be very aware of the particularities of the new European system in order to be able to properly advise their clients. In this regard, European IP firms established in China could be of great support.
China IP: During the last 15 years you have played and are still playing a key role in developing friendship and cooperation not only between SIPO and the EPO but also between China and Europe, and we greatly appreciate your contribution to the development of IP system in China. Could you summarize this process and let us know what China means for you?
Professor Desantes: I had the immense fortune to be directly involved in the change of paradigm, which moved EPO-SIPO relations from an assistance framework to an equal cooperation one. For many years, EPO supported the development of SIPO. But around 10 years ago we realized that the child had become an adult, and was going to be much bigger than the old brother. Then we decided that our relations had to be much more mature, much more win-win and on a completely equal basis. The contributions of my friends Mr. Tian Lipu and Dr. Li Yuguang were decisive to move in this direction. SIPO’s and EPO’s joint attitude was also key to convince the other three big offices, USPTO, JPO and KIPO, to create the IP5 and to strengthen cooperation between patent offices as one of the main leading tools for the improvement of the patent system all over the world. This pioneer process gave me the opportunity not only to visit China many times but to learn how to understand your culture much better, and, over all, your people. I feel completely at home in China and do hope life will give me many more opportunities to continue learning from this relationship in the years to come.
China IP: Professor Desantes, we all know that you hold several different positions and are very familiar to all those interested in the IP field. You are the Founder and Director of the IP Program at the University of Alicante (Spain) (1994-1998); were responsible for IP matters at the Legal Service of the European Commission (1998- 2000); served as the Vice-President of the EPO (2001-2008); and in 2010 you joined the ELZABURU IP firm. How did you feel during the change of so many roles?
Professor Desantes: I felt very excited. I have had the opportunity to approach IP from 4 different perspectives. I am a professor in IP who can approach IP from the academic perspective. I worked for the legal service with the European Commission where I was a drafter and then a legislator. I worked on legislation and worked with European Court of Justice, which is another way to approach IP. Finally, I had the honor of serving EPO for 8 years. I have seen the every piece of machinery in the robot IP at work, both in practice and from the administration perspective. I neither drafted the law nor criticized the law from an academic perspective. I had to remain very impartial since I was part of the big administration. Now I am a practical user of IP and can help guide enterprises. I feel very fortunate to have had the opportunity to see IP from all of these perspectives.