European Parliament blames EU Council's "horse trading" as they delay unitary patent proposals until September

What the AmeriKat wished she could have
been doing on her couch on Tuesday...and
indeed as she types (zzzzz)

Yesterday afternoon the AmeriKat was nestled in her couch (the joys of working from home) with papers, bundles and pens strewn everywhere. During her lunch break she logged on to the European Parliament's website and watched the debate on the unitary patent (to lead as an exciting life as the AmeriKat, click here to watch the video). Readers will recall that following the EU Council's agreement on 29 June 2012 on the location of the Central Division of the Unified Patent Court (Paris, with specialist branches in London and Munich) and suggested deletion of Articles 6 to 8 of the Proposed Regulation, the European Parliament cancelled the final reading and vote on the unitary patent package. German rapporteurs, Bernard Rapkay and Klaus-Heiner Lehne called the Council's agreement and suggested deletion of Articles 6 to 8, a "scandalous breach of procedure" and that the deletion would "emasculate the proposals". The European Parliament referred the issues back to the Legal Affairs Committee of the European Parliament ( aka JURI) for discussion and debate yesterday under the new Cypriot Presidency (for press release from Tuesday's session click here).

Chair of JURI - MEP Lehne

Some initial comments were provided at the beginning of the debate by the Chair of the Legal Affairs Committee, Mr. Lehne, who stated that he did not really care whether the controversial Articles 6 to 8 in the Proposed Regulation - which would make the interpretation of what constitutes patent infringement and defences subject to the preliminary ruling jurisdiction of the Court of Justice of the European Union (CJEU) - were included. The basis for Mr. Lehne's ambivalence was because they were already included in the Draft Agreement. However, giving an insight into the repetitive argument that was to come later, he stated that excluding Articles 6 to 8 in the Proposed Regulation would risk negating the legal basis of the treaties and Article 118 TFEU.

However, the main debate occurred 90 minutes later (fast forward to the 11:37 minute mark). Mr. Rapkay in a fiery, if rambling, speech expressed his dismay at the EU Council's previous Friday agreement. He stated

"I think there are some very questionable issues looking at what's happened and I think it goes far beyond the patent issue. So the first point is the subject mater. I think that the Secretariat sent all the members the first opinion from our Legal Service, so you are all aware of that. In the conclusion its quite clear that in 22(c)…. deleting the three articles is not compatible with EU law because it means that its not compatible with Article 118….If we delete the three articles we no longer have the right legal basis, because the legal basis states that we must have a patent with harmonized protection...It is quite interesting, in fact its not interesting at all, that the decision of the Heads of State of Government was not factual at all it was just horse trading. . . [and] Luckily, there weren't any further member states [vying for a branch of the Central Division] otherwise we would have 8 seats [of the Central Division]."

So, yes IPKat readers, we finally have seen the Parliament's Legal Services Opinion (but due problems wiht Google Docs and a currently unavailable European Parliament website you will have to wait until tomorrow to find it, unless you e-mail the AmeriKat).  We are now awaiting the Commission's and Council's Legal Opinions.

Mr. Rapkay continued stating that the need for the inclusion of Articles 6 to 8 in the Proposed Regulation in order to be compliant with Article 118 TFEU was not controversial.

"If you remember, the discussions we had...before, [this] wasn't controversial between Council and Parliament. So its not a factual position its just horse trading [undertaken by the Council on 28 to 29 June 2012]."

Obviously feeling violated by the EU Council's agreement, Mr. Rapkay continued his submissions about the interference by the Council in the legislative process of Parliament and again referred to the Parliament's Legal Services Opinion on Articles 6 to 8. He stated:

MEP Rapkay

"The task of the European Parliament is not to violate European law and constitutions and treaties, but to protect them. At the end of the day this is the job of the Court of Justice but the legislature must do this as well…This is a very remarkable political proceeding. I have a question on number 9 [of the Parliament's Legal Services Legal Opinion]. I fully realize that a text is valid when its decided upon by the right body. That occurs in the plenary session and by Council in whatever form. We have an agreement - the text of a Regulation. We voted on this. As at 2 December 2011, COREPER on behalf of the Council wrote to the Legal Affairs Committee saying that "if the EP decides on the Annex word for word, then the Council commits also to this word for word" so the question arises: "Is this paper worth anything?" . . .If this is the case, then we can suspend any number of informal trilogues because they would be pointless. I would also like to add another point. As rapporteur I had to prepare all of this, so perhaps I am sensitive. COREPER on behalf of the Council gave reassurances and we trusted that, we voted then, and we voted literally word for word on what we had to agree upon…I had my own proposals as a rapporteur that I withdrew. Colleagues made proposals that should have been supported, but we have a recommendation and they fuddled this. As rapporteur I said we can't vote on this as it would affect the compromise. So we took a decision in the Committee on false pretences." [So, asks the AmeriKat, is Mr. Rapkay stating that Parliament was also not completely happy with the proposals but just let them pass for the sake of agreement? She definitely didn't get that impression when watching the debates last December in JURI - the proposals seem to go through pretty unchallenged save for Ms. Wikstrom's comments.]

Mr. Rapkay closed his initial speech by commenting, as the AmeriKat suggested in her post last week, that more work and analysis must be done on Articles 6 to 8.

"Like others, like our Chairman, I have received a number of letters over the past few days but nothing has changed. Some people feel, falsely, that the CJEU is not competent. Other people say its reasonable to take this out. But all those who have familiarity with European law say this is not feasible, that we would be adopting a regulation that would be legally invalid. I can only recommend and call on the Committee that we shouldn’t make a political decision. Once we have a legal position then we can take a political decision. It would be a good idea to if we allow the Legal Service to continue its work so that we can have a fuller opinion after the holidays and we can think about how we proceed from there."

Cecila Wickström  took the floor. Readers may recall that in December she was initially vocal on her support for the removal of Articles 6 - 8 and a call for the disclosure of the Legal Opinion on the why the inclusion was necessary. She eloquently stated:

MEP Cecilia Wickström

"I fully understand the irritation of colleagues in this case, especially you Mr. Rapkay as rapporteur, to find the first reading deal broken by the European Council especially in the way it was done after a session of the worst sort of closed door horse trading between capitals where national prestige overruled common good of Europe and EU citizens - this is a shame. It has been a complicated dossier and we are handling it in ways that are a bit different than other dossiers….The proposal has been very controversial for decades and its extremely important for European competitiveness. When we concluded a deal with the Council on the unitary patent Regulation last December I was happy that we had come finally to an agreement. I was of course not pleased with all aspects of it…I had proposed elements that were eventually not taken aboard in agreement with the Council.  Nevertheless I and the Liberal group of the house continued to support the creation of the unitary patent. Part of the midnight deal I personally support on substance - that is the deletion of Articles 6 to 8. . . No member of this Parliament should be happy with this deal in the European Council independently of what we may have thought of the substance of the matter. The European Council should know better than to meddle with the first reading of Parliament and Council. What is otherwise an agreement worth ?"

Ms. Wickström emphasised that throughout the process she had argued for the exclusion of Articles 6 to 8 but that she did not want to go into too much detail on the proposition for and against the deletion of the controversial articles as it deserved a much more indepth discussion. She, however, stated that it was more important that the various bodies adopt a flexible approach and work creatively towards a common solution and quickly because

"The goal of reaching an agreement with Council - however immature and stubborn the direction may be - must come now. I understand that there is a lot of irritation at the behaviour [of Council], but that [the European Parliament should not} take out frustration on the citizens, SMEs and entrepreneurs. We simply cannot afford a failure at this point. We are in the middle of a crisis in Europe and we are elected to provide concrete solutions to problems. Let us use the summer for reflection and we will come back in September with more energy and creativity to sort this out."

MEP de Grandes Pascual

Spanish MEP Luis de Grandes Pascual took the floor next explaining that he was sure that everyone knew the position of the Spanish delegation in that Spain was opposed to the unitary patent proposals. He stated it was not just because the proposals created a unitary patent court but

"irregularities and inconsistencies in the whole procedure which we have denounced and want to take to the Court of Justice. Other languages are being left aside, such as Spanish which represent millions of people so we are not going to shed crocodile tears at this point."

MEP Raffaele Baldassarre, the rapporteur for the language portion of the unitary patent package, commented that he agreed that the Council had no competence or right to interfere with the legislature, especially given that an agreement had been reached on the unitary patent proposals under the Polish Presidency.

"So quite frankly the intervention we have seen in the last few days has no legal basis. Neverthless we have to find a solution. The main concern is that European law should be respected and that there should be a clear and transparent procedure which is in the hands of Parliament and the Council of Ministers.. . Companies and industry at large would very much like to see a unitary patent to see the light of day, moving away from all the personal interests at stake. A lot of amendments were lost during the amendment stage but we did find an agreement and its our duty to find a point of agreement following the intervention which challenges the three articles. . . I don’t think this is a time to discuss the language. If 90% of Italian companies are presenting applications in English then the language issue is not a problem…"

Mr. Lehne addressing Mr. Christian Pennera, the representative from the Parliament's Legal Service, explained that he had spoken with British experts who told him that the inclusion of Article 3 of the Proposed Regulation as enough to satisfy Article 118. Mr. Pennera stated that

" ….Well we can always be more and more minimalist. The absolute minimum is to say nothing at all. This is a 25-26 page act. Stop at 3? Well, I don’t really thing that’s the point. Maybe someone else could say we can stop at 4, or stop at 9 or 10. If you withdraw [Articles] 6 to 8, then you withdraw all legal control of this issue and you take away the unitary value of the patent."

The representative from the Commission added nothing of substance, merely to say that the institutions needed to fully cooperate to meet the target of granting the first unitary patent by April 2014 and that the Commission was ready to assist Council and Parliament to deal with all outstanding issues.

Mr. Rapkay fixated on this lacklustre statement and called for more conviction "for their own proposals from the Commission". In what will forever be known as his "We are the Parliament" speech Mr. Rapkay continued:

"We are the Parliament. We are the Parliament. We are the only ones that have been directly elected… The legitimate law makers are the Council, not patent lawyers. It is not up to the patent lawyers to come up with the law. I have received a lot of e-mails from those who want to delete Articles 6 - 8 and e-mails form others who are warning against that. In Article 118 we have to have a unitary patent with uniform protection and that would not happen if we were to delete those articles. Our task as the Parliament is to take a political decision. . . " ["But if I have followed this correctly, only first after a legal position, right…?", asks the AmeriKat]



MEP Sajjad Karim



The AmeriKat's favorite moment of the debate came with MEP Sajjad Karim stated:

"Firstly, in relation to Articles 6- 8, I personally have no difficulty with those provisions being excluded. I certainly don't regard a system of referrals to the CJEU based on sort of delays with current workload being appropriate, especially when we have a specialized system [such as the proposed unitary patent system]. I share the frustration of colleagues that have been expressed to the number of seats available and the whole of language issues. Ultimately Chairman, this is Europe and we are doing what we have always done. We have taken something incredibly sensible and then undo it by one means or another and come up with a system that our citizens will look at and say "What on Earth have we done?". We might as well come forward and have said we will have one seat in Munich where they will speak English, one in Paris where they will speak German, and one seat in London where they will speak French and there will be an underlying language where they are can come forward and speak in Spanish."

In the final moments of the session, the new Cypriot Presidency stated that Europe simply could not lose the opportunity to finalize the unitary patent proposals (a comment the Amerikat agrees with), because once lost the momentum would be very difficult to regain. The Presidency called for everyone to use the Summer months to reflect on the issues and to prepare further legal opinions on Articles 6 to 8 for discussion in September. Following some final threatening comments from Mr. Rapkay that any lack of a unitary patent would be the "Council's fault and no one else's" and that they already had an agreement from December which they should adhere to, Mr. Lehne reiterated the Presidency's comments that everyone should "think about it" these issues over the summer.



No summer sun for the Legal
Services it seems?
(or us in the UK)

 So Summer 2012 will be a summer of reflection for the European Parliament, with the Legal Services of all of the main European institutions seemingly beavering away analyzing the legal basis and necessity of the inclusion of Articles 6 to 8 of the Proposed Regulation. Meanwhile, those who were celebrating the big news of the Heads of States' compromise on 29 June 2012 will need to put down their party hats - the European Parliament is not happy with not only the suggestion (and it was only a suggestion by the EU Council (i.e Heads of State), who unlike the Council of Ministers, have no legislative competence) of the removals of Articles 6 to 8 but also with the multiple locations of the Central Division. The problem is that the European Parliament does have the power to drag out this process and they may do so until they are happy with all issues.

So what will happen in September? Either, the Summer recess could find Parliament in a fiercely good mood and ready to once again push through the proposals with Articles 6 to 8 included, or the Commission could withdraw the proposals arguing that the proposals are sufficiently denatured (unlikely and dubious), or Parliament could just vote against the deal (unlikely, because if anything we know Brussels would like an easy political win given the current climate ) or we could go back to the start and try again with negotiations on the text. If the AmeriKat was a betting Kat, she would bet that the first possibility will occur.


The IPO. . . .

 So, the AmeriKat hopes that everyone, even those in the apparently hallowed halls of the IPO where the IPKat is apparently not allowed to creep, will listen to what she said last week - that the UK and other national governments, industries and professions spend the summer (or at least part of it) analyzing the Parliaments Legal Service opinion and prepare an in-depth analysis and response into the necessity (or lack thereof) of Articles 6 to 8.

In the meantime, the AmeriKat looks forward to seeing you at Friday's unitary patent debate (more details to attendees soon).