Ahead of the meeting of the EU Competitiveness Council, 30 November and 1 December 2017 in Brussels, a group of European companies and associations have sent a letter to EU member states urging them to ratify the Unified Patent Court Agreement and join the Protocol on Provisional Application (PPA) as soon as possible, if they haven’t done so yet.
According to the letter, the Unitary Patent system will ‘encourage investment, spur growth and create new jobs across Europe. The patent reform will substantially contribute to increased European competitiveness.
European industry has invested considerable time and effort to prepare for the patent reform, the launch of which is long overdue. (…) In signing up to the Protocol on Provisional Application, any given Member State will not only contribute to the collective realization of this crucial reform, but also provide positive signals to investors and enable itself to participate in early decision-making on Court matters. (…)
Since the advantages of the reform increase with the number of participating Member States, the broadest possible territorial coverage is desirable. Thus we also have a preference for long-term UK participation’, according to the letter (update: complete text below this blogpost).
Kluwer IP Law was in contact with Fredrik Egrelius, director of the Patent Unit in the UK of Ericsson and one of the people behind the initiative. Egrelius hopes the Unitary Patent package will start as soon as possible. ‘By sending the letters to responsible ministers before their Competitive Council meeting, we want to signal again that the package is important for European industry and must not be forgotten by the participating member states.’
He doesn’t see any reason for other countries to wait with their ratifications until there is more clarity about the situation in Germany, where a constitutional complaint has been filed against ratification of the UPCA which can lead to considerable delays – possibly up to 2020; and about Britain. In the UK the ratification procedure is well on its way, but there is uncertainty about its role in the UP system post-Brexit. Without ratification of the UPCA in both the UK and Germany, the system cannot enter into force (Article 89 UPCA).
Egrelius: ‘What we in practice want to achieve is for all participating member states to see to that they ratify the UPCA and confirm that they are bound by the Protocol on Provisional application as soon as possible. Because if other countries would wait for UK and Germany before they finalize their own national legislative process, then we would have further delays.
Even if many of the companies which have put their logo on the letters have stated essentially the same thing before, for example in the spring this year, we shall not forget that we have had recent elections in a number of EU countries this year, so we also have a number of new ministers who see the joining companies view for the first time.’
According to Egrelius, the letter is not directed at the president and/or Federal Constitutional Court in Germany, where the court asked the president not to ratify the UPCA pending its decision on the constitutional complaint: ‘I firmly want to stress that we did not at all have such an intention. On the contrary, we wanted to make clear that we respect and definitely do not want to disturb the handling of the complaint by the Constitutional Court.’
As to UK participation in the Unitary Patent system post-Brexit, Fredrik Egrelius has no doubts: ‘Of course it is feasible. If there is a will, there is a way. At Ericsson, we are working hard for UK participation. However, we still believe that the Unitary Patent system would be worthwhile without the UK, but that is clearly plan B for us.’
The letter to the EU ministers (with the exception of the ministers of Croatia, Poland and Spain, which don’t participate in the UP system) is signed by ABB, Air Liquide, Alfa Laval, BASF, Bayer, Bracco, Electrolux, Ericsson, Michelin, Novo Nordisk, Philips, Pirelli, SAP, Scania, Stora Enso, Syngenta, Technicolor, ThyssenKrupp, UCB, Unilever, Volvo Group Trucks Technology and the associations CEFIC (European chemical industry), Essenscia (Belgian Federation for Chemistry and Life Sciences industries), LIF (Swedish Association of the Pharmaceutical Industry), VCI (German chemical industry) and VDMA (German mechanical and plant engineering).
The EU presidency published a document earlier this week, which makes clear that so far 14 member states have completed the ratification procedure by depositing their ratification instrument with the secretariat of the EU Council: AT, BE, BG, DK, EE, FI, FR, IT, LT, LU, MT, NL, PT, SE. Another four member states have received parliamentary approval to ratify: DE, LV, SI, UK.
Out of the 18 member states which have ratified or received parliamentary approval to ratify the UPCA, 10 member states have expressed consent to be bound by the PPA (by signature, ratification or declaration): BE, DK, EE, FI, FR, IT, LU, NL, SE, UK.
Other than Germany (DE), two more member states which have ratified the UPCA or received parliamentary approval to ratify the UPCA must express consent to be bound by the PPA before the provisional application can start (Article 3 PPA). During the PPA, preparations for the start of the court, including for instance the appointment of judges, can be completed.
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The complete text of the letter:
17 November 2017
To: Ms Heléne Fritzon
Minister for Migration, Vice Minister for Justice
cc: Ms Åsa Webber
Ambassador, Deputy Permanent Representative (Coreper 1)
Joint Industry call on Member States to join the Unified Patent Court
Dear Minister for Migration, Vice Minister for Justice,
The introduction of the Unitary Patent and the Unified Patent Court, “the Patent Package”, is a patent reform that significantly will reduce costs and simplify procedures for obtaining, maintaining and enforcing patent protection in Europe.
These improvements will encourage investment, spur growth and create new jobs across Europe. The patent reform will substantially contribute to increased European competitiveness.
European industry has invested considerable time and effort to prepare for the patent reform, the launch of which is long overdue.
Indeed, many Member States have signed up to the Unified Patent Court. However, in order to give life to the Patent Package, a few more Member States need to join the Protocol on Provisional Application.
In signing up to the Protocol on Provisional Application, any given Member State will not only contribute to the collective realization of this crucial reform, but also provide positive signals to investors and enable itself to participate in early decision-making on Court matters.
Thus, we the undersigned companies and associations have come together to urge outstanding Member States to join the Protocol on Provisional Application as soon as possible.
Since the advantages of the reform increase with the number of participating Member States, the broadest possible territorial coverage is desirable.
Thus we also have a preference for long-term UK participation. Consequently, we also call upon outstanding Member States to ratify the Agreement on the Unified Patent Court as soon as possible.
________________________
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I read with interest Fredrik Egrelius’ view that, with regard to UK participation in the UP system post-Brexit: “Of course it is feasible. If there is a will, there is a way”.
Frankly, this is wishful thinking. Whilst it may be true that a way can be found for the UK to participate in some form of “unitary” system, the die is already cast for the current UPC (Agreement). This is because, in my view, there are only two options under the current system: either the UK cannot participate or the whole system is incompatible with EU law.
As keeps being said in relation to Brexit, you can’t have your cake and eat it…
Of course, if anyone out there has a sound reason to believe that I am mistaken, then I would be delighted to hear their reasoning. In particular, I would love to finally get an answer to the question that I posed 3 weeks ago: is the UPC an EU (Member State) court or an international court? (Based upon the radio silence to date, I won’t hold my breath here!)
Where are in this list the SMEs for which the UPC is so wonderful according to the present tenant of 10th floor at the EPO headquarters?
This plea shows in an unmisstakable manner who wants to become the winners of the UPC:
big European companies, which could not give a damn about the much heralded SMEs.
As another commenter said recently, it brings you to puke.
It is not that harmonisation within the EU and even further than the EU is not to be pursued. On the contrary, but not withe present way it is forced down our throats.
It becomes more and more unpalatable, and this kind of pro-domo plea should stop.
This sounds as a desperate attempt to avoid the inevitable. The EU has just taken away the EMA and the EBA from London. Why should they now accept that a section of the central division of the Court of First Instance be established there?
Such section would have to employ citizens from various EU states, but does anybody believe that the EU can accept that its citizens be sent to a country where EU fundamental rights no longer apply?
Be it only for this reason, the UPC in its present form is dead.
I’d be really grateful if someone could provide a link to the letter itself.
Cheers!
Many thanks for updating the article
“where EU fundamental rights no longer apply”
Plus if it is an international agreement and an international court, there are no guarantees that fundamental rights will be respected there neither.
Question: what would happen if the UPC were to issue judgements that are arguably contrary to the UPCA, EU law and/or the European Convention on Human Rights?
Which court(s) (or bodies) could “force” them to change their decisions? Would those decisions still stand (and be enforceable) despite doubts as to their compatibility with other laws by which the Member States are bound?
As far as the links with EU law it is worth reminding what is said in the UPC and its RP.
The liability of the Court itself is governed by Art 5UPCA, which refers to two EU regulations, Rome I and II. The liability of contracting states for damages caused by infringements of Union law is governed by Art 22UPCA. Responsibility of the Contracting Member States is governed by Art 23, which refers itself to Art 258-260TFEU. Supremacy of Union law is enshrined in Art 20UPCA. Last but not least, referral to the CJEU for preliminary rulings is governed by Art 21UPCA.
Enforcement is governed by Art 82UPCA, and service of decisions and orders in contracting states is detailed in
R 270 referring to EU regulation No 1393/2007. The latter applies first to service in non-contracting states.
I have never heard from any supporter of the post-Brexit stay of UK any answer as how those points could be respected by UK once it is out of the EU.
The purpose of the Administrative committee provided under Art 82 is primarily to bring it into line with any international treaty relating to patents or Union law, cf. Art 82(2). In Art 82(1) it is only the functioning, efficiency and cost-effectiveness of the Court and the trust and confidence of users of the patent system in the quality of the Court’s decisions which has to be examined. To sum it up, the Administrative Committee has not be created in order to fiddle with the UPCA so that a contracting state of the UPCA leaving the EU can be maintained in it, and worse, to bring other non-EU states into it.
It is thus high time to consider all those kind of statements as either the expression of wishful thinking or supreme naivety, which is hard to believe. The pulling wool over the eyes of third parties should however stop. The UPCA has never been conceived for the benefit of SMEs.
With Brexit, the UPCA has received a first deadly knell, with the complaint before the German Constitutional Court it might receive the final deadly knell.
In view of the many shortcomings of the UPCA and the way its RP have been devised, it might be better.
It is an irony that the EU contracting state from which the litigation procedure has been taken over to a large extent, has afterwards decided to leave the EU. But this is not a reason to keep it in.
Techrights: fingers off!!!
Thanks for sharing your views. It appears to me that they key compliance mechanisms in the UPCA are Article 20, 21 and 24(1)(a). Whilst these seem perfectly reasonable on the face of it, I cannot help but worry what would happen if the UPC decided not to honour either the wording or the spirit of those provisions.
This worry cannot simply be brushed aside. For example, recent experience has shown that the EPC is honoured more in the breach than in the observation. Particular issues that have arisen in that context include the imposition of systems or rules that are clearly at odds with the wording (or the spirit) of the EPC and/or EU law … but where the situation has been allowed to stand because the AC either endorsed the development or simply ignored it.
Under the current UPCA, the only possible way in which these kinds of problems might be avoided is if litigants are provided with a mechanism to seek a ruling from a superior (and independent) court that can FORCE the Contracting Member States to bring the UPC Agreement, the Rules of Procedure and/or the practical implementation of either into line with EU law.
The UPCA clearly envisages the CJEU as being the court to adopt this role. However, this raises the following question: by which mechanism can the Court of Justice FORCE the Contracting Member States to amend the UPC Agreement and/or the Rules of Procedure?
Unlike the EUIPO, the UPC is created under an international agreement. This means that the CJEU will be unable to invalidate the UPCA or its Rules of Procedure. It will not even be able to order the Contracting Member States to make suitable amendments to the Agreement or the Rules. In fact, the best that the CJEU could do is to find the Agreement and/or the Rules to be in breach of EU law.
Whilst this parallels the role of the CJEU vis-à-vis the national laws of the EU Member States, there is a crucial difference. That is, the law in question in this instance is one to which multiple EU Member States are signed up. This alone makes it significantly less likely that procedures intended to ensure compliance (that is, Articles 258 and 259 TFEU) will be initiated.
Thus, even putting the issue of Brexit aside, the set-up of the UPCA leads to a heightened risk that breaches of EU law connected with the UPC will somehow brushed under the carpet.
And then there is Brexit. For the life of me, I cannot figure out how anyone would expect the (already questionable) enforcement mechanisms described above to operate in a post-Brexit world. This is perhaps best illustrated by considering how an action for damages (resulting from an infringement of Union law by the Court of Appeal) under Article 22 UPCA could possibly be initiated at a UK court post-Brexit. This is because such actions are highly likely to require the national court designated under Article 22(2) UPCA to refer questions (regarding compliance with EU law) to the CJEU. But this will of course be impossible if the UK does not wish to be bound by post-Brexit rulings of the CJEU (or by post-Brexit EU legislation upon which the CJEU’s ruling may be based).
As final, tangential note, I see that UPCA Article 41(2) indicates that “The prior opinion of the European Commission on the compatibility of the Rules of Procedure with Union law shall be requested”. Has that been done yet? If not, why not?
The new “JUVE Patent” (http://bit.ly/2i9urHf, p. 35) is setting up an equation on how to reconcile Brexit and UK UPCA membership:
“…shortly following
the vote, the founding fathers of the new court came
up with a solution that has both stoked confidence
and calmed fears (The Flamingo Trick).”,
said “trick” going as follows:
“Flamingos can stand on one leg. In a similar vein, the UK
should also be able to participate in the European Patent
Court (UPC), even if the island is no longer part of the
European Union (EU).
Contractually speaking, the UPC stands on two legs. One
constitutes EU law, the other the European Patent
Convention (EPC). The latter may be enough to ensure
the UK’s participation if the other Member States agree
on an additional accord to extend the collective validity
of the EU patent to include the UK, since one of the
foundations of the patent is article 142 of the EPC
concerning the European Patent and European Patent
Office (EPA). Neither are EU institutions –
the UPC is not an EU body, it was founded as a court in
the context of “closer integration” in accordance with the
Lisbon Treaty. In formal terms, it is a multilateral project
between 25 EU states. However, not only is the UK
supposed to ratify the UPC before it can even open its
doors at all, but the UK also needs to continue to
recognise all rights and obligations, including European
law and the jurisdiction of the European Court of Justice.
For this, the UPC Administrative Council needs to
introduce an amendment to the agreement – which
should not pose a problem – along with a corresponding
clause in the EU exit agreement between the EU and
the UK.”
Don’t tell me that you don’t find this convincing. 😉
Well, I can’t decide how best to describe “The Flamingo Trick”. Phrases that spring immediately to mind include “wishful thinking”, “wilful ignorance” and “blatant self-delusion”. Perhaps it would be more aptly named “The Ostrich Trick”… though that might not be fair on ostriches, who (unlike the ardent proponents of the UPC) don’t actually bury their heads in the sand.
However, if anyone would care to explain to me how “The Flamingo Trick” would comply with EU law (especially in the light of Opinion 1/09), then I would be delighted to hear. I should remind anyone who might attempt this task that I am very familiar with the Gordon and Pascoe opinion and am frankly unconvinced. This is primarily on the grounds that, in the light of provisions of EU law such as Article 267 TFEU, it is impossible for the UPC to comply with EU law unless it is genuinely “a court common to the (EU) Member States”.
In this respect, and sticking with the bird-related theme, perhaps the constitutional complaint in Germany will cause the UPC to do a “Dodo Trick” and become extinct. Signs are that it is already an endangered species… but perhaps not one worth saving in its current form.
Don’t forget those referred to as “the founding fathers of the new court” that “came up” with this “solution”. So the gentlemen Mooney, Tilmann and Hoyng are the UPC founding fathers? Interesting aspect to take home.
New (English language) piece on the UPC by Juve Patent magazine:
https://webreader.mediacologne.de/juve#/reader/88332/
“Düsseldorf Torpedo: Bad news for the UPC. The German Constitutional Court will take all the time it needs.”
I fail to see wherefrom the „founding fathers” (whoever they are) of the UPC take the assurance that the Flamingo trick has “both stoked confidence and calmed fears”.
1) Art 142 EPC
Art 142EPC simply allows member states of the EPC to enter an agreement on a unitary patent. In which respect this allows the UK to stay in the enhanced cooperation governed by EU regulations, remains a mystery.
EPLA was also a special agreement under Art 142EPC. We all know what happened to it after Opinion 1/09.
Art 142-149 were already present in EPC 1973. EPC 2000 contains an Art 149a which led to the London Agreement on translations.
Interesting notes:
It was even foreseen in Art 149a(2,a) that the AC of the EPO could decide that “members of the Boards of Appeal or the Enlarged Board of Appeal may serve on a European patent court or a common entity and take part in proceedings before that court or entity in accordance with any such agreement”. Nothing like this in the UPCA….
In Art 149a(2,b) it was even foreseen that “the European Patent Office shall provide a common entity with such support staff, premises and equipment as may be necessary for the performance of its duties, and the expenses incurred by that entity shall be borne fully or in part by the Organisation”. The EPO will only administer the Unitary Patent, nothing more.
2) The UPC Administrative Council
The purpose of the UPC Administrative Council provided under Art 82 is primarily to bring it into line with any international treaty relating to patents or Union law, cf. Art 82(2). In Art 82(1) it is only the functioning, efficiency and cost-effectiveness of the Court and the trust and confidence of users of the patent system in the quality of the Court’s decisions which has to be examined.
In other words, the UPC Administrative Committee has not be created in order to fiddle with the UPCA so that a contracting state of the UPCA leaving the EU can be maintained in it, and worse, to bring other non-EU states into it. By no means can the UPC Administrative Council change the UPCA in such a radical manner. If the UPC needs to be changed to the effect of maintaining a post Brexit UK in it, and even accept non-EU member states, then a new round of ratifications would be needed. And then we would arrive at another form of EPLA. See above….
If the Administrative Committee of the UPC would go as far as to fiddle with the agreement as is foreseen by those uttering such proposals, then it would be acting ultra vires and any decision of it in this respect would be null and void. I also refer to the Vienna Convention on the interpretation of treaties, which would certainly not allow such a misuse of an administrative organ in a treaty, as the tasks of the latter are clearly defined.
Conclusion:
I would not bet on a volatile with such delicate legs. I even doubt that those are proper legs and that those flimsy legs can support the bird in the slightest.
“The purpose of the UPC Administrative Council provided under Art 82 is primarily to bring it into line with any international treaty relating to patents or Union law, cf. Art 82(2)”
The Administrative Council is part of the German complaint:
https://www.limegreenipnews.com/2017/10/upc-and-germany-status-update-constitutional-complaint-ratification-timeline-and-more/
“Violation against the rule of law as regards the issuing of the rules of procedure and the regulation of reimbursement sums: This concerns the issuing of the rules of procedure of the UPC by the Administrative Committee (Article 41 UPCA). Due to the fact that the rules would be legislation in the material sense because they have an external effect on everyone and regulates a judicial process in the field of civil and administrative procedural law, they would have also needed to be part of the law of consent. The power of the Administrative Committee to enact these rules would present itself as an impermissible blanket authorisation and the rules in any case would be required to be transformed into national law as well.
The same argument is put forward as regards the regulation of the maximum reimbursement sums for the costs of representation, which according to the complainant were set in an arbitrary manner.”
It’s been over a month now and still not one UPC supporter has even attempted to answer my question about whether the UPC is an EU (Member State) court or an international court.
This is sad. Perhaps even more depressing, though, are the continued efforts by the pro-UPC lobby to portray the project as still being in good health. As that very same lobby cannot even answer the simplest of questions relating to the nature of the UPC (and, consequently, its viability either pre- or post-Brexit), it is clear that such efforts amount to nothing more than propaganda.
Perhaps the hope of the UPC lobby is that the politicians will come up with a huge “fudge” that will somehow square the post-Brexit circle. However, the strong rejection (by the DUP) of mere “regulatory alignment” with the EU for only a small part of the UK makes it clear that this hope is just a pipe dream.
Even if it wanted to do so, how can the current UK government persuade its own MPs (and those of the DUP) to accept that the WHOLE of the UK will remain bound by ALL provisions of the EU Treaties, Regulations and Directives (and the CJEU’s rulings on the same) that have ANY bearing on disputes relating to patents and SPCs? Remember, this is not just an IP issue. This is because at least the TEU, TFEU and EURATOM contain provisions (eg relating to competition law, the CJEU and methods for calculating periods and deadline) which would be relevant to decisions of the UPC. Can we really see the hard-line Brexiteers agreeing that signing up (in perpetuity) to such provisions is a price worth paying in order to save the UPC?
Dear Concerned Observer,
you seem to be unaware of Mr Tilmann’s new article (GRUR 2017, 1177), in which he provides arguments for some of your concerns. For instance, just in case you did not know yet, we learn that paragraph 89 of CJEU-Opinion 1/09 is in fact not the Court’s position, but only that of the Spanish judge rapporteur which, although part of the opinion, the Court did not follow (!). Therefore no need to ask the CJEU on UPCA compatibility with EU law.
We all just think too complicated, not bearing in mind that the powers that be only need some sort of argumentation to be able to press on with their plans, not necessarily a convincing one.
Would that be the same paragraph 89 that that immediately precedes the CJEU’s final conclusion, that begins with “Consequently, …” and that ends with “… indispensable to the preservation of the very nature of European Union law”?
Whilst I have not read the article, I have to say that it is frankly ludicrous for anyone to attempt to paint paragraph 89 of Opinion 1/09 as not representing a key plank of the CJEU’s conclusion in that Opinion.
Whatever next? Will UPC proponents try to argue that, despite appearances to the contrary, Regulations 1257/2012 and 1260/2012 are not actually “EU law”? Or something more along the lines of “The UPC is not dead, it is just that its total lack of movement is due to it being tired and sh***ed out after a particularly long squawk”?
I suspect that you are correct that this is not about having a convincing argument but instead just an excuse (no matter how flimsy) to keep ventilating the corpse of the UPC. The sad thing is that, even if this tactic succeeds, it is likely to be a monumental waste of time and effort – as it is now inevitable that parties on the wrong end of an action before the UPC will challenge the legality of that court under EU and/or constitutional laws.