The European Commission has just unveiled a proposal for three new regulations of significant importance in the field of patent law. The proposal was drafted following an extensive consultation process with stakeholders, which was launched after the Commission published its Action Plan on Intellectual Property in November 2020 to support businesses, particularly small and medium-sized enterprises (SMEs).
According to the European Commission, the new regulations will complement the new unitary patent system, which will take effect on June 1, 2023, and are intended to make the patent system more effective within the European Union. The proposed regulations address the following aspects:
Essential Patents and FRAND Licenses
So-called standard-essential patents (SEPs) protect inventions that are part of a technical standard approved by an independent standards-setting organization. They are of great importance in key areas of technological development such as 5G and the Internet of Things.
Through its proposed Regulation, the Commission aims to promote greater transparency regarding portfolios of standard-essential patents and the granting of licenses for them on fair, reasonable, and non-discriminatory terms (FRAND licenses). Among the key new measures included in the proposal are the creation of a registry and database of SEPs, the implementation of a system for assessing their essentiality, and the establishment of a conciliation procedure for determining the amount of FRAND license fees, which would avoid the current lengthy and costly court proceedings. All of this would be overseen by a new “Competence Center” integrated into the European Union Intellectual Property Office (EUIPO), headquartered in Alicante.
Mandatory Licenses
Compulsory licenses are a legal mechanism that allows governments to authorize third parties to use patented inventions in cases of necessity, when patent holders refuse to grant voluntary licenses.
The new Regulation aims to harmonize the national compulsory licensing systems currently in force to complement other crisis management tools available to the institutions of the European Union.
Supplementary Protection Certificates
Through what are known as Supplementary Protection Certificates, it is possible to obtain an additional five-year term of validity for patents on pharmaceutical and plant protection products, in addition to the 20-year term applicable to all patents.
Supplementary Protection Certificates are granted by national patent offices, and the proposed new regulation seeks to centralize the examination procedure, which would be implemented by the EUIPO in collaboration with those offices. In addition, the proposal calls for the creation of a unitary Supplementary Protection Certificate that would complement unitary patents.
The new regulations proposed by the Commission must now be debated and approved by the European Parliament and the Council of the European Union. The debate is expected to be intense given the significant interests at stake, particularly with regard to essential patents and compulsory licenses. We will need to closely monitor the outcome of this process.
Carlos Morán, Partner at ELZABURU