Out-Law News | 16 Apr 2013 | 2:36 pm | 3 min. read
Plans to create a new system that will allow businesses across the EU to obtain patent protection spanning across the trading bloc by making just a single application for that protection received the backing of MEPs and EU Ministers late last year.
Ministers from 24 EU countries, including the UK, subsequently signed an agreement paving the way for the creation of a new unitary patent court system to be established to deal with cases relating to the validity and infringement of the unitary patents that can be awarded under the framework.
However, Spain and Italy challenged the plans, claiming that the legislative process used to establish the unitary patent framework does not allow for the creation of such a regime, that it had been misused and that there had been an infringement of EU law. Now, though, the Court of Justice of the European Union (CJEU) has ruled to reject their complaints.
Spain and Italy had argued that EU laws preclude the UK and other EU member states from taking advantage of a legal mechanism set out in the Lisbon Treaty to establish a new unitary patent framework. The enhanced co-operation mechanism permits nine or more member states to use the EU's processes and structures to make agreements that bind only those countries. The CJEU said that it was legitimate to make use of the enhanced co-operation mechanism in order to form an agreement on the unitary patent plans and that the countries involved had engaged in the process properly.
The CJEU also ruled that it was "unfounded" of Spain and Italy to claim that the creation of a new unitary patent system would likely damage the "uniformity" that currently exists with the system for obtaining European patent protection. EU law requires that the enhanced co-operation mechanism only be used to create a "higher level of integration" between member states, according to the judgment.
Spain and Italy also claimed that the unitary patent agreement formed by the other EU member states would "undermine the internal market" as well as "economic, social and territorial cohesion" and that it would create a barrier to trade and distort competition "to the detriment" of businesses in their countries. They said it was unfair that the predominant languages to be used for documents outlining details of unitary patents would be English, French and German.
However, the CJEU said that it "cannot validly be maintained" that the unitary patent agreement would damage "the internal market or the economic, social and territorial cohesion of the Union". It said, though, that it would not rule on whether the "language arrangements" are compatible with EU law. However, the Court said that the countries that negotiated the unitary patent agreement were not obliged to conform to the language wishes of Spain and Italy.
"Nothing in the contested decision prejudices any competence, right or obligation of those two Member States," the Court ruled. "In particular, the prospect, indicated by that decision, of the introduction of the language arrangements objected to by the Kingdom of Spain and the Italian Republic may not be described as prejudicial to the competences, rights or obligations of those latter States."
"While it is, admittedly, essential for enhanced cooperation not to lead to the adoption of measures that might prevent the non-participating Member States from exercising their competences and rights or shouldering their obligations, it is, in contrast, permissible for those taking part in this cooperation to prescribe rules with which those non-participating States would not agree if they did take part in it," it added.
Patent law expert Adrian Murray of Pinsent Masons, the law firm behind Out-Law.com, said that, despite the CJEU's ruling, the proposed new unitary patent framework was still the subject of legal challenges initiated by Spain.
"The Court’s decision is in line with the opinion of Advocate-General Bot that the claims made by Spain and Italy were either unfounded or inadmissible, and clears what would have been a large hurdle in the establishment of the unitary patent and unified patent court," Murray said. "In view of the current political momentum driving the Community patent project forward, this outcome is not overly surprising."
"It should be appreciated that the current complaint related solely to the use of the enhanced cooperation procedure by the 25 participating Member States, and not the legality of the resulting regulations that establish the unitary patent and the applicable translation arrangements. Thus, this decision would not appear to be the last of Spain’s attempts to derail the Community patent system; two further actions for annulment have been lodged by Spain before the CJEU. However it has been rumoured and it would prove unsurprising if they were challenges to the legality of the regulations that have been formed," he added.