Structural weakness in Europe’s patent system should also be a Presidency priority

The Portuguese Presidency of the EU is hosting a high-level conference tomorrow focused on intellectual property in the digital world, and the importance of an innovation-oriented ecosystem to improve the quality of life for citizens and companies, and drive economic recovery. This is an admirable goal that we share unreservedly.

Sadly, absent from the conference agenda is fixing the structural weaknesses in Europe’s patent system that permit financial vehicles – often dubbed patent trolls – to prey on European firms both small and big and divert resources away from providing essential products and services. But with the establishment of the Unified Patent Court as a top priority for the EU, and its potential for EU-wide injunctions, neglecting this topic is a mistake.

Two important events later this year in Berlin and in Luxembourg could catapult the patent injunction issue to the front of policymakers’ minds. Both events could conclude during Portugal’s six months at the helm of the EU.

First, Germany is in the process of reforming its patent laws. As it is Europe’s busiest jurisdiction for patent litigation, what happens in Germany will have a bearing on patent enforcement across the Continent.

The legislative process is expected to conclude in the first half of 2021. According to the latest iterations of the reform, the reforms have the potential to bring some balance to the excessive and unfair use of injunctions so that products and services are not threatened by unnecessary removal from the market.

Meanwhile in Luxembourg, the Court of Justice of the European Union (CJEU) is set to rule in a copyright case that could have important implications for patents too. The case involves a copyright troll that is using EU law (the 2004 IP Rights Enforcement Directive, or IPRED) to profit from copyrighted material it acquired solely for the purpose of suing users of the content- in this case it involves pornographic material.

The CJEU’s decision in this case could be similarly applied in cases where patent trolls – which do not provide any products or services to European consumers – acquire patents for the sole purpose of targeting operating companies.     

Both the patent reform legislation in Germany, and the upcoming decision from the CJEU, demonstrate the importance and timeliness of calls to introduce balance into Europe’s patent system and ensure that it is fit for purpose in the digital age. The establishment of the Unified Patent Court – one sole jurisdiction with a single, Unitary Patent, applicable across the whole block – amplifies the need for such improvements.

Failure to address them will leave Europe’s ambitious plans for a single patent jurisdiction susceptible to the same abusive practices that are already being experienced, but with EU-wide economic impact.