Intellectual property is an effective means to keep track of a country’s growth and economic development. The more patents generated in a sector, the more is the innovativeness blooming in the sector. All counties focus on establishing and maintaining a standard and unified system for protecting the IP rights of inventors. This would make the patenting procedures easier, lower financial expenses, and grant additional security to the inventor.
The Existing Patent System in EPO
When we file an EPO patent application, it is possible to gain validity for the invention in 38 contracting states of the European Patent Convention (EPC). Though the system looks alluring, and it has its drawbacks. When the EPO grants a patent, the patent becomes subject to the jurisdiction of every single country where it stands valid. In other words, one must validate the patent in every contracting state for the patent rights to become effective.
The validation requirements vary among the contracting states. Some states expect the inventor to translate the whole patent into their official language. While some states need the translation of the claims only, the applicant should also pay an annual maintenance fee in each state to protect the invention. This diverse validation procedure drastically increases the financial costs as well as the workload for the applicant. As a result, an individual needs to spend nine times more than they would spend in the US or Japan to obtain a patent in the EU.
The EPO decided to implement some changes to the patent system to support inventors and drive innovation and invention in all sectors.
The Unitary Patent System
The European patent with the Unitary effect will enable the applicant to obtain a patent in 25 EU member states. The applicant need not validate the patent in each member state individually. It is sufficient if the applicant files a requisition for the unitary effect of the patent in EPO. However, the inventor should ensure to submit the requisition within one month from the grant of patent. Moreover, the patent claims should be identical in all the 25 member states for the patent to gain a unitary effect. Similarly, the transfer, revoking, and lapsing rights of the patent will be in common for all the 25 member states.
Unitary Patent System Benefits
The single patent system works on making the patenting process convenient to all the inventors and enterprises.
Cost-effective
In the usual patent system, the financial expenses for patenting a product in the EPO are expensive. As a result, many small and medium scale enterprises who develop great products suffer to meet the patenting expenses. Moreover, the costs do not stop granting the patent. Besides, the renewal fee for maintaining patent rights contributes to 15% of the total costs.
The Unitary patent system divides the fee between the EPO and the member states. While the EPO acquires 50% of the patent fee to maintain the patents register, the member states will share the remaining patent fee. Furthermore, the EPO has come up with specific revisions in the renewal fee. It has thoughtfully assigned a relatively lower renewal fee until the product reaches the market and during the first five years. It is mainly to support the inventor as the product will not generate much revenue during the initial stages. However, the EPO will gradually increase the renewal fee when the product is successful.
Easy Procedures
In the Unitary patent system, the applicant can file the patent either directly at the EPO or any national office. The processing of the patents occurs at the EPO office. In the previous system, translating patents was time-consuming. Hence, the EPO tries to find common ground to translate the patents. They have recognized French, German, and English as the three languages to file a patent. Though the inventor files the patent in any other official language, they must translate it into French, German, or English within two months from applying. The EPO is also working on ‘Patent Translate’ – a platform to provide free access to automated online translation services.
Rapid legal proceedings
Businesses need to solve patent disputes as soon as possible to proceed with their functions. Hence, the EPO plans to establish a Unified Patent Court to resolve the disputes efficiently and rapidly. This Court aims to avoid all irregularities in the national Patent law and thereby, giving little chance for the infringers to find any loopholes.
The structure of the Unified Patent Court is as follows:
– The Court of First Instance,
– The Court of Appeals, and
– Various committees (e.g., Budget Committee, Governing Board).
The Court of First Instance will have:
+ A central division,
+ Local divisions (for each state party), and
+ Regional divisions (two or more state parties, only if they prefer to establish a common division)
The Central division deals with patent enforcement, and the local division deals with patent infringement cases. This clear-cut split up of duties of the Court will enable it to function more efficiently and resolve disputes faster.
Drawbacks of the Unitary Patent System
Patent experts state that there is a risk of unethical business dealings in the Unitary patent system. Patent holders with weak patents can use it to threaten companies that sell products all over Europe.
A unitary patent system for all the member states will drastically increase the number of patents in the EPO. There are chances of approving low-quality patents, thereby risking their authenticity.
As a result of the increase in low-quality patents, instances with patent trolls also increases. Patent trolls are those who own only the patents and do not have any intention of developing it on a large scale. The patent owners are mostly attorneys who purchase the patents at a low cost. Usually, they wait until some company designs the product, and the product hits the market. Then, they reveal their patent and put forth unreasonable demands and high reimbursements forcing the company to comply with it.
We can expect this new Unitary patent system by the end of 2020. There are both benefits and some discomforts that may arise when EPO implements this system entirely. However, one cannot deny that it is a remarkable initiative from EPO to standardize and regulate its patent system more effectively.
