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Patent law – The reform aimed at creating patents valid throughout the EU is close to completion

Up to now, patents have had to be separately registered in each individual EU country even though there is a European Patent Office. It was not competent to grant a patent that would be valid throughout the EU. In the Agreement on a Unified Patent Court (UPC) it was decided to establish an EU Patent Court at the EU level as well as an EU-wide patent. The formal transposition of this in Germany is still being delayed by a Federal Constitutional Court ruling, although there are no material objections.

Starting Situation

In Germany, the system of legal protection for industrial property is extensive. Numerous industrial property rights afford protection to business owners for their developments (e.g. patents, utility models and registered designs).

Researching and developing new products is time consuming and expensive. That is why it is necessary to have extensive protection for these inventions in order to be able to accomplish the amortisation of the costs.

The most far-reaching industrial property right in Germany is the patent. This grants the patent owner the right to prohibit others from using the invention for 20 years or allows them to use it with permission by way of a licence. The scope of a patent registered in Germany is restricted to the territory of Germany. To take effect throughout the EU it is necessary to validate the patent in each member state. In some cases, there are different applicable processes to achieve recognition in the individual EU member states. For businesses that operate internationally this could entail considerable administrative effort and costs.

A European patent and the EU patent

There has indeed been a “European patent” based on the European Patent Convention of 1973 for several decades already. However, this is not a patent that is valid throughout the EU. Only the application and the process for granting the patent happen centrally at the European Patent Office. The current European Patent can take effect (like a national patent) only in those states where the respective national conditions have been satisfied. The Agreement on a Unified Patent Court that was concluded is a prerequisite for the creation of “EU patents” that will automatically be valid for the entire EU.

Advantages and aims of the European Patent Court

The establishment of a European patent court is intended to open up a comprehensive uniform and thus cost effective system of patent protection in Europe. The efficacy of the protection will be enhanced by the ability to enforce a ruling with effect for all member states. Patent owners will thus no longer have to initiate legal action in each individual signatory state and spend time and money engaging in several legal proceedings.

Procedural objections in the constitutional complaint

The obstacle to transposition in Germany is a Federal Constitutional Court (Bundesverfassungsgericht, BVerfG) ruling from 13.2.2020 (case reference: 2 BvR 739/17) according to which the approval law for the Agreement on a Unified Patent Court was declared to be formally unconstitutional. The reason provided for this was that the Bundestag (lower house of German parliament) had not passed the approval law by the required two-thirds majority of its members.

In this respect, the Agreement can only come into force after the legislative process has again been properly conducted. By contrast, the BVerfG rejected the claim that there had been material violations of EU law.

Conclusion: The constitutional complaint has delayed the transposition of the Agreement on a Unified Patent Court by three years. The German government should now ensure that the Agreement is swiftly transposed.

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