Compulsory licences for all? Latest Community patent plans ...

Does nothing miss the eagle eye of the IPKat's friend and guru Axel H. Horns, the German patent attorney and blogger whose IP::JUR weblog has provided a valuable and welcome education for so many of us? Today Axel has posted a piece here entitled "Yet Another Revised Proposal For A Council Regulation On The Community Patent". This post reveals the existence of Document 13706/09, bearing yesterday's date, which the General Secretariat of the EU Council has prepared for the benefit of the Working Party on Intellectual Property (Patents) when it holds its next session next week. This document is 28 pages in length.

Recital 6 of the proposed Regulation will generate some debate:

"(6) Negative effects of an exclusive right created by a Community patent should be mitigable through a system of compulsory licences. This is without prejudice to the application of Community competition law by the Commission or national authorities. The [European and Community Patents Court] Court (hereafter: Court) should be entrusted with the grant of compulsory licences in situations not falling under Community competition law".

The extent to which this fits in with existing Paris Convention and TRIPs provisions relating to compulsory licensing will no doubt launch a few PhD theses, not to mention a smattering of heart attacks.

Articles 21 and 22 are worth reproducing in full:

"Article 21: Grant of compulsory licences

1. The Court may grant a compulsory licence for lack or insufficiency of exploitation of a Community patent to any person filing an application four years or later after the patent application was filed and three years or later after the patent was granted if the patent proprietor has not exploited the patent in the Community on reasonable terms or has not made effective and serious preparations to do so, unless he/she provides legitimate reasons to justify his/her inaction, and on the condition that the grant of the compulsory licence is required in the public interest. In determining the lack or insufficiency of exploitation of the patent, no distinction shall be made between products originating within the Community and products imported to the Community from a member of the World Trade Organization.

2. On request, the Court may grant a compulsory licence in respect of a Community patent (first patent) to the proprietor of a national or Community patent (second patent) or […] plant variety right who cannot exploit his/her second patent or […] plant variety right without infringing […] the first patent, valid for the territory of the second patent or plant variety right, provided that the invention or new plant variety claimed in the second patent or plant variety right involves an important technical advance of considerable economic significance in relation to the invention claimed in the first patent. […] The owner of the first patent shall be entitled to a cross-licence on reasonable terms to exploit the second patented invention or protected plant variety.

Where on the corresponding conditions as above in this paragraph a proprietor of a
Community patent is granted a compulsory licence in respect of a first national patent or national or Community plant variety right, the owner of the first patent or plant variety right shall be entitled to a cross-licence on reasonable terms to use the patented invention of the dependent Community patent for the territory of the first patent or plant variety right.

3. The Court may grant a compulsory license under the conditions set out in the Regulation (EC) No 816/2006 of the European parliament and of the Council of 17 May 2006 on compulsory licensing of patents relating to the manufacture of pharmaceutical products for export to countries with public health problems.

4. In times of national emergency or in other situations of extreme urgency, including those relating to a public interest of extreme importance, the Court may authorise at the request of a Member State the exploitation of a Community patent.

5 In the case of semi-conductor technology, exploitation shall be possible without the authorisation of the right holder only in the situations set out in paragraph 4.

6 A licence or exploitation set out in paragraphs 1 and 2 may be granted only if the proposed user has made efforts to obtain authorization from the patent holder on reasonable commercial terms and conditions, and if such efforts have not been successful within a reasonable period of time. However, the authority granting the licence may derogate from this condition in the situations set out in paragraph 4. In these situations, the right holder shall be informed as soon as reasonably possible.

7 The detailed rules of application and the procedures to be used for applying the principles set out in this Article shall be laid down in the Agreement on, and the Statute and the Rules of Procedure of the Court.

Article 22: Conditions applicable to compulsory licences

When granting the compulsory licence under Article 21, the Court shall specify the type of use covered and the conditions to be met. The following conditions shall apply:
(a) the scope and duration of the exploitation shall be limited to the purpose for which it was authorized;
(b) the exploitation shall be non-exclusive;
(c) the exploitation shall be non-assignable, except with that part of the enterprise or goodwill which enjoys such use;
(d) the exploitation shall be authorized predominantly for the supply of the internal market of the Community;
(e) the Court may, on reasoned request of the patent holder, the holder of a contractual license or the holder of the compulsory license, change the conditions set by the authorisation or decide to cancel the authorization, subject to adequate protection of the legitimate interests of the persons so authorized, if and when the circumstances which led to it either change or cease to exist and are unlikely to recur;
(f) the licence holder shall pay the right holder adequate remuneration in the circumstances of each individual case, taking into account the economic value of the authorization;
(g) in the case of a compulsory licence in respect of a dependent patent or a plant variety right, the exploitation authorized in respect of the first patent shall be non-assignable except with the assignment of the second patent or plant variety right".

The IPKat looks forward to the chance to read this document carefully and draw some conclusions. He suspects, however, that some of his patent-proficient readers will beat him to the draw. Merpel says, I do hope they make up their mind how to spell licence/license. Tufty's theory is that the variations of spelling are an indication that the drafting has been in the hands of more than one draftsman.