Unified Patent Court "unfit for SMEs", say Parliamentarians

Being suspicious of anything that comes from Europe is an English Parliamentary  tradition of long standing ...

The IPKat has long expressed his concern about both the substance of the proposals for the European Union's Unified Patent Court and for the manner in which the European Commission set about flattening all opposition -- particularly from experts in the shape of judges and practitioners -- who knew enough to explain to the Commission why it was that, even if the idea of such a court is good in theory (which most of us are happy to concede that it is), it has got to work in practice too if it's going to bring about the desired benefits [for an idea of some of the IPKat's earlier roaring on this topic, check out this December 2011 list of earlier posts together with more recent posts here, here, here, here, here and here].

At this very minute, the embargo is being lifted on a remarkable and fascinating document, The Unified Patent Court: help or hindrance?, which incorporates the thinking of the British Parliament's House of Commons European Scrutiny Committee -- a cross-party body of elected Members of Parliament which examines European legislative proposals and advises Parliament as how to respond to them. The press release which accompanies it reads as follows:

The draft agreement on the Unified Patent Court (UPC) is likely to hinder, rather than help, the enforcement of patents within the European Union, says the European Scrutiny Committee in its report, published today.

The Committee has held the draft agreement on the UPC under scrutiny since September last year. There has been vehement opposition to the draft agreement from national and European patent professions.

The Committee is particularly concerned about the effect the agreement would have on small and medium sized businesses (SMEs) who are supposedly the main intended beneficiaries. The patent profession was overwhelmingly of the opinion that the current draft of the UPC Agreement would actually increase litigation costs for SMEs and be far more burdensome than the existing system in the UK.

The overall aim of the UPC was to allow SMEs in particular to be able to obtain a single patent covering 25 countries at an affordable cost. However, the Committee heard that very few SMEs actually require protection in all 25 States and so cost savings would not be as great as was expected, and that litigation before the UPC was likely to be convoluted, expensive and protracted.

The Committee says that it is vital that the UK Government adopts a strong position reflecting the concerns of practitioners in the final negotiations of the agreement, as well as calling for the Central Division of the UPC to be in London in order to mitigate the most damaging effects of a unitary EU-wide patent.

Chairman of the European Scrutiny Committee, Bill Cash, says

“Although the theory of a single EU-wide patent - with a single court to administer it - has long been thought desirable, the practice has long been elusive. These latest proposals appear, regrettably, to be a further example of this. They would increase costs for SMEs and hinder the enforcement of patents within the EU, particularly by giving additional jurisdiction to the Court of Justice of the EU and not allowing the invalidity of a patent to be a defence to infringement proceedings. The negotiations have been rushed and effectively excluded the views of European patent professions.

“We found the responses of the Minister, Baroness Wilcox, oddly detached from the evidence we heard on these important points. This appears now to be a damage-limitation exercise but the UK Government must bring the practical concerns we heard to the table as negotiations conclude, and in particular ensure that the Central Division of the UPC sits in London.”

You can read the full report here.  It is 103 pages in length and consists of one of the most detailed and pertinent reviews of the unified patent court system that this blogger has yet seen. It's not just the Unified Patent Court proposals that don't emerge from this with much credit: the Minister, Baroness Wilcox, has fared poorly too.  It must be recorded with great sadness that, for whatever reason, her time as Minister responsible for intellectual property has been a torrid one.  It would be an act of kindness to the Minister, and indeed to all of us, if she were to be given another position of responsibility in which she had a better opportunity to deploy her many undoubted talents than to be left in a role in which she inspires no confidence and earns no admiration among so many members of the IP community.

This member of the IPKat team would like to make special mention of the efforts of his Kat-colleague, patent litigator Annsley Merelle Ward, whose detailed accounts of the various stages of the proposals and what passed for a debate on them have served as an effective briefing document for many of those whose submissions have helped persuade the Scrutiny Committee of its position.