Patrick Oliver

New report: Europe faces a growing problem of firms abusing the patent system for financial gain

new report published today gives unique insight into how some non-practising entities (NPEs), also known as patent asserting entities (PAEs) or patent trolls, game Europe’s patent system. The report also provides further evidence that the problem of patent trolls is migrating to Europe from the US, and it proposes several policy responses to address the problem.

The report is largely based on two original case studies, which demonstrate a serious lack of transparency in patent and corporate ownership in Europe. Dormant companies with opaque ownership and almost no assets, commonly established in the UK, are used to acquire among others, European patents. The case studies show how patent trolls exploit those patents in courts in the European Union – especially in Germany.

“This report further supports our view that imbalances in the patent system in Europe are increasingly exploited by non-innovative companies,” said Kevin Prey, Chairman of IP2Innovate and a director of IP at the German software group SAP.

“Lack of transparency lies at the heart of the problem,” said the principle author of the report, Valerio Sterzi, Associate Professor of Economics, University of Bordeaux & GREThA, CNRS.

His report makes a number of policy recommendations to address the transparency issue, including the introduction of corrective measures to deter abuse.

“This report shines a spotlight on flaws in Europe’s patent system that until now have remained obscure. It’s clear now that the proportionality principle enshrined in Europe’s IP Enforcement directive is not being respected,” said Patrick Oliver, executive director at IP2Innovate.

“We urge policymakers in Europe to address this. If left unchecked then Europe’s intellectual property regime can’t be considered fit for the digital age, as European Commission President Ursula von der Leyen called for when she took office last year,” Mr Oliver said.

The study entitled Non-practising entities and transparency in patent ownership in Europe, was written by Valerio Sterzi (Associate Professor of Economics, University of Bordeaux & GREThA, 5113 CNRS), Jean-Paul Rameshkoumar (Researcher, VIA Inno, GREThA, 5113 CNRS, University of Bordeaux), and Johannes Van Der Pol (Researcher, VIA Inno, GREThA, 5113 CNRS, University of Bordeaux).

Professor Sterzi’s report was discussed during an online conference this afternoon. Guest speakers included Amaryllis Verhoeven, Head of Unit in charge of IP at the European Commission, Jean-Francois Cases, Director of IP at Amadeus, the travel IT firm, Edmund Mangold, Principle Expert in IP at the carmaker BMW, Maurits Dolmans, a Partner at law firm Cleary Gottlieb Steen & Hamilton, and Patrick Meinhardt, Vice President of European Entrepreneurs CEA-PME, a trade group representing SMEs.

Today’s event was supported by Marion Walsmann, MEP and Vice-Chair of the European Parliament’s Legal Affairs Committee.

Notes to editors:

  1. The study entitled Non-practising entities and transparency in patent ownership in Europe can be found here:

  2. IP2Innovate (IP2I) is a coalition of small and large companies that create innovative products and services in Europe and collectively hold thousands of European patents, as well as European industry groups that collectively represent 65 companies. Our members include: Adidas, Amadeus, Atos / Bull, BMW, Daimler, Dell, Deutsche Telekom, Freebox, Google, Intel, Microsoft, Nvidia, Proximus, SAP, Spotify & Wiko.

  3. GREThA (the Research Group on Theoretical and Applied Economics of the University of Bordeaux) is a joint research institute (Unité Mixte de Recherche), associating the University of Bordeaux and the French National Centre for Scientific Research (CNRS). GREThA develops research programmes into theoretical and applied economics.

    GREThA’s Non-Practicing Entities and Innovation in Europe (NPEIE) project is funded by the French National Research Agency (ANR). Its principal objective is to constitute the first systematic and extensive research programme aiming at qualifying and quantifying the phenomenon of Non-Practicing Entities (NPEs) entering and affecting the market for technologies and innovation in Europe. For more information, please visit:

For further information, please contact:

Patrick Oliver
Executive Director

Mobile: +32-477-597065


Other press releases


SEP regulation: a step in the right direction

BRUSSELS, 28 April 2023 – IP2Innovate welcomes the European Commission’s proposal to reform the licensing of standard essential patents. “This initiative should at least help level the playing field when standard essential patents licensing is involved,” said Patrick Oliver, executive director of IP2Innovate. “The proposal isn’t as bold as it was a week ago, but it still has certain important reforms in place. Opponents of this reform have lobbied intensely for the Commission to abandon it. I hope that in an effort to compromise, the Commission hasn’t opened up loopholes that would undermine its effectiveness,” he added. IP2Innovate welcomes the Commission’s effort to inject much needed transparency into SEP licensing, limiting the instances where patent owners could abuse the system. In his press conference on 27 April, Commissioner Thierry Breton referred to how the current SEP system enables patent owners to extract excessive royalties. “He is right. This happens not only with SEPs but also in the broader patent system too,” said Mr Oliver, adding: "We hope he is also right when he says this practise will become impossible in the areas of SEPs, and that he then turns his attention to fixing related problems that plague the broader patents system in Europe.” IP2Innovate members collectively have thousands of European patents, including SEPs. They believe that patents play a vital role in the innovation process. But when the system is abused patents become an obstacle to innovation. And it’s not only happening with SEPs. Many patent assertion entities (PAEs) are in business to exploit the weaknesses in the system. IP2Innovate was established in 2016 to combat patent abuse by these PAEs, often referred to as patent trolls. It has been pushing for courts to move away from granting automatic injunctions in patent disputes, and instead apply remedies that are proportionate, especially when highly complex products are involved.
Patrick Oliver

Statement welcoming EP report on AI and IPR

IP2Innovate welcomes an own initiative report by the European Parliament adopted today which urges policymakers to safeguard the European patents system from abuse.
Patrick Oliver

Wide cross-section of industry urges the European Commission to take action to stop PAEs from gaming the patent system in Europe

Thirty-five companies and four industry groups representing over 150 companies from different industry sectors, have written to European Internal Market Commissioner Thierry Breton, urging him to take action to clamp down on Patent Assertion Entities (PAEs) – otherwise known as “patent trolls”. “The experience of our member companies indicates that Europe’s patent system is not working properly and is undermining Europe’s ability to compete globally in the next frontier of technologies,” said Patrick Oliver, Executive Director of IP2Innovate, one of the industry groups that signed the letter. “The European Commission needs to take steps to stop PAEs from gaming the patent system. We are urging Commissioner Breton to draft a set of guidelines that address imbalances in the patent system – in particular guidelines that support the application of a proportionality requirement in patent enforcement by judges around Europe, as required by EU law,” Mr Oliver added. Many European courts issue automatic injunctions upon a finding of a patent infringement, without considering a remedy that could be more proportionate. So for example, an unintentional infringement of just one patent among many others could result in a popular product being withdrawn from the market. PAEs don’t invent, build or sell anything. They just buy up patents to assert them against innovative companies, including SMEs, and extract high settlement fees not based on the value of the underlying invention but rather based on the damage that would result from the removal of the entire product from the market. “As litigation by PAEs has slowed in the US we have witnessed its rise in Europe,” Mr Oliver said, adding: “It’s not just big firms that are targeted – SMEs are also picked on by PAEs. Unjustified product withdrawals can sink a company. They also deprive the public of consumer choice and the benefits of innovation.” Clear enforcement guidelines would help ensure Member States apply EU law properly. They would also bring more balance to the patent system and help avoid disproportionate outcomes and abusive litigation practices, Mr Oliver said. “We stand ready to work with the Commissioner and his team on specific solutions to prevent PAEs from further exploiting the legal system to the detriment of Europe’s digital economy,” he said. Notes to editors: 1. The letter to Commissioner Breton and full list of signatories can be found here. 2. IP2Innovate (IP2I) is a coalition of small and large companies that create innovative products and services in Europe and collectively hold thousands of European patents, as well as European industry groups that collectively represent 65 companies. Our members include: Adidas, Amadeus, Atos / Bull, Daimler, Dell, Freebox, Google, Intel, Microsoft, Nvidia, Proximus, SAP, Spotify & Wiko. IP2I is concerned about a number of imbalances in Europe’s patent legal system that are being exploited to the detriment of innovation and growth in Europe. The exploitation of these imbalances is in particular shown by the rise of litigation related activity by Patent Assertion Entities (PAEs) in Europe. 3. European Commission’s IP Package of 29 November 2017: In its IP Package of 29 November 2017, the Commission acknowledged that there are differences in the way Member States apply certain provisions of the EU Directive on IPR enforcement (IPRED) (such as those on injunctions) across the Single Market, thereby limiting the effectiveness of the Directive. The Commission therefore undertook to “work with Member States' national experts and judges on further, more targeted guidelines, to give more detailed and practical guidance on specific IPRED issues, based on best practices experience” (here, p. 29) with a view to improving the system of judicial enforcement in the EU. Two years after the publication of the IP Package, the thirty-four companies and four associations signatories to the letter to Commissioner Breton call on the European Commission to expand its work with Member States, judges and stakeholders to publish targeted guidelines to support the homogenous and effective application of the proportionality principle to patents. 4. For further information, please contact: Patrick Oliver Executive Director, IP2Innovate Email: Mobile: +32-477-597065
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