While the Commission's initial proposal for a regulation on the unitary patent [2] gives a major role to the European Patent Office (EPO) in the granting and administration of this unitary patent, the governance of EPO has been highly criticized, included by academics, EPO staff, governmental studies, the European Parliament, or the Commission itself. This page collects evidences that EU should take advantage of the regulation on the unitary patent to address the problem of governance of the European patent system.
European Parliament resolution on the decision by the European Patent Office with regard to patent No EP 695 351 granted on 8 December 1999 (P5_TA(2000)0136), March 30th 2000
Source [3]
I. whereas the public must be fully informed and the Union must play a leading role in promoting public debate; whereas the EPO is a body acting as both judge and jury whose powers and procedures must be reviewed,
9. Demands a review of the operations of the EPO to ensure that it becomes publicly accountable in the exercise of its functions, and to amend its operating rules to provide for it revoking a patent on its own initiative;
Position of the European Parliament adopted at first reading on 24 September 2003 with a view to the adoption of Directive 2003/…./EC of the European Parliament and of the Council on the patentability of computer-implemented inventions (P5_TC1-COD(2002)0047à, September 24th 2003
Source [4]
(9) In its Resolution of 30 March 2000 on the decision by the European Patent Office with regard to patent No EP 695 351 granted on 8 December 1999 [OJ C 378, 29.12.2000, p. 95], the European Parliament once again called for a review of the Office's operating rules to ensure that it was publicly accountable in the exercise of its functions. In this connection it would be particularly desirable to reconsider the practice whereby the Office sees fit to obtain payment for the patents that it grants, as this practice harms the public nature of the institution.
“Economy of Immaterial - Tommorrow Growth”, report by Maurice Lévy and Jean-Pierre Jouyet for French Minister of Economy, Finance and Industry, March 16th 2006
Source [5], our translation
Therefore, no political authority is involved in the EPO Administrative Council. This results in a lack of political legitimacy in order to adress strategic issues: what shoud be the patentability policy? Should patentability be opened to new fields? Should some requirements be softened or conversely hardened? Instead, discussions focus on daily management of EPO, which is of course part of Administrative Council's powers, but should not be the exclusive topic for discussion by an entity responsible to ensure the oversight of the patent granting policy. RECOMMANDATION N°41: The committee considers that France should launch a political reorganization of the EPO: first, by strengthen EPO's political legitimacy by the involvement of representative of Member States political authorities in its Administrative Council.
European Parliament resolution on future patent policy in Europe (P6_TA(2006)0416), October 12th 2006
Source [6]
C. whereas there have been growing concerns about undesirable patents in various fields and about a lack of democratic control over the processes by which such patents are granted, validated and enforced,
2. Reminds the Commission that all legislative proposals should be accompanied by an in-depth impact analysis related to patent quality, governance of the patent system, judicial independence and litigation costs;
Presentation by Ingrid Schneider, Senior researcher and lecturer at the Research Centre on Biotechnology, Society and Environment at the University of Hamburg, in a workshop organised by STOA (Science and Technology Options Assessment for the European Parliament) on Policy options for the European patent systems, November 9th 2006
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Granting [of patents] + decisions of Boards of Appeal = interpretation of the EPC = implicit policy-making masked as mere technical and legal administrative execution of law.
Borrás, Susana (2006): “The Governance of the European Patent System: Effective and Legitimate?” in Economy and Society, Volume 35, no. 4, pp. 594-610.
Source [8]
The analysis of the current European patent system shows an incomplete picture regarding the success of network governance. The system has relatively few formal and weakly linked forms of “checks and balances”, which seem to be insufficient to guarantee the quality of patents and of judicial developments, in the current context of increased numeric pressure (applications and patents granted).
The weaknesses of the links in the formal “checks and balances” could be improved, with the explicit political intention of creating a much more diversified set of formal mechanisms for securing the quality of granted patents and the quality of enforcement/litigation process that ensure fair use. Some of these mechanisms could for example be, allowing the EPO itself to initiate an opposition procedure about a patent that for one reason or another escaped the internal quality control filters in the application process; to reinforce the links between national judicial decisions about patent validity and the application process of similar patents; or to improve and formalize the links between the EU and EPO.
Documents sent by the European Commission to some SMEs during a consultation on 2006 on the patent system in Europe
Source [9]
Whilst being basically a patent granting office the EPO has ambitions to steer patent policy at European and international levels. It has a business culture of its own with very little understanding for what happens in Brussels in a more global context. Initiatives from Brussels implying changes to the existing multilateral European patent system are considered as an attack on the holy writ. The EPO has close ties with national patent offices and far less with the ministerial level in Member States. Recently the EPO has become subject to growing criticism by MEPs and various EU Member States for a lack of political accountability.
“Which intellectual property system for France in 2020?”, report of the prospective group on Intellectual Property for the Strategist State (PIETA), 2006
Source [10], our translation
While EPO should be expected to work for the benefit of society as a whole, it seems actually inclined to view itself as too exclusively serving only applicants. This bias in favor of granting patents is due to many reasons, including financial reasons and easiness. It also refers to a logic of clientelism, since it also stems from the fallacy that the applicant is a client. This is reflected for example by the fact that the approach of the EPO in terms of quality is based primarily on satisfaction surveys only sent to applicants.
This situation is not unrelated to the fact that EPO Administrative Council is now mainly made up of representatives not only of users but also – and almost exclusively – of the national offices. But the representatives of national offices, that is to say generally the directors of these offices, are inherently in a bad position to challenge the interests of their own house. […] Nevertheless, across the EPO Administrative Council, representatives of member countries currently tend to get the most possible revenue for their own offices, given the substantial windfall represented by collected feess.
Interview with Dr. Ingrid SCHNEIDER, Senior researcher and lecturer at the Research Centre on Biotechnology, Society and Environment at the University of Hamburg, for EPO “Scenarios for the future”, 2006
Source [11]
Judgments about the patentability of new technological developments and new subject-matter are inherent and unavoidable. Therefore, up to a certain point, EPO must certainly have discretion to decide. On the other hand, decisions about patent eligibility are genuine political acts which should be reserved to the legislator. Therefore the interface between the EPO and the European and national legislators should be strengthened, and feedback loops be established. As a voluntary self-obligation, the EPO should provide annual qualitative reports on its practice of granting and on (pending) decisions of its boards of appeal. This would allow the European legislator to intervene concerning patent policy, either by legislative regulation or by filing opposition to patents recently granted. The EPO should also acknowledge the limits of its own competences as an executive body. In sensitive cases or concerning decisions about patent eligibility and scope of patents in new technological fields, it should request advisory support from the national and EU legislators, or the European Court of Justice. Specific legislation, detailing exceptions to patent eligibility or at least its outer limits, would provide greater guidance to the EPO and the courts in making patentability determinations. Furthermore, the EPO should support the European legislator by scanning applications for sensitive issues, and thus use patent information as an early warning system. This would enable regulatory activities outside of patent law to be addressed by EU regulatory mechanisms such as research funding, health, environmental or anti-trust regulation. As a result, checks and balances between both the EU and the EPO should be established. Although the EPO is not an institution of the European Union, both are elements within a broader European governance framework. Patent policy must be a result of adequate communication and policy co‐ordination between the multiple national and supranational levels, and between legislative, judicial and executive bodies.
Interview with Thierry Stoll, Deputy DG for the Internal Market and Services, European Commission, and Jacqueline Minor, Director in charge of Knowledge-based Economy, European Commission, for EPO “Scenarios for the future”, 2006
Source [12]
The immediate consequence of this technological evolution is that one of the issues that is becoming acute is the current lack of political governance in the field of patents. This is directly relevant to the EPO: it cannot continue to look at patents as a purely technical issue, where patents are granted and then used purely as a technical and economic exercise – the big question is whether the political world exercises sufficient influence.
[…] without doubt intellectual property governance will be a major issue for the future. In both the United States and Japan it is linked to the political processes, but Europe has a dichotomy: little real political influence in the decision-making process on patents in Europe and a patent granting organisation that is also acting as a spokesman for patents in Europe. The Trilateral (USPTO, JPO and EPO) appears to be developing into a proto-governing body for patents globally, and while two of the parties are subject to a certain degree of political accountability, the third is not. The gap between political influence and the administrative side of patents will have to close, and if this does not happen voluntarily, then it will be narrowed by debate, sometimes irrational debate, in the European Parliament.
All this points to the need for greater cooperation in the future. Ideally, if we had a Community patent, we could have a Community agency, and an agreed procedure negotiated according to a complex set of rules negotiated in the Commission. While this scenario might be ideal for the future, it is not realistic, as there is currently no Community patent.
The European Commission sits on the Administrative Council in consultative capacity, and ideally, if the Community patent comes into force, the Commission could then speak on behalf of its 25 members. In the present situation, a clear advantage of the EPO is that it is an existing structure that works, and if the European Union can bring a political umbrella, we will have a win-win situation.
This again lends support to the view that there should be more political involvement in the functioning of the board of the EPO, to ensure political acceptability of decisions to grant patent and to avoid an accretion of decisions such as appears to be taking place at present: moving slowly but more certainly to a lowering in the level of patents.
The patent world is a small world, and with regard to governance, the influence of patent agents, lawyers and judges on decision-making at European level is often self-serving. The failure of the Community patent was due to vested interests.
Interview with Professor Joseph Straus, Director, Max Planck Institute for Intellectual Property, Competition and Tax Law, Munich, for EPO “Scenarios for the future”, 2006
Source [13]
A weakness of the patent system in Europe is that the EPO does not have a political mandate to take care of the patent system and of innovation policy for Europe. The EPO is only mandated to administer and further develop the Convention and to grant patents and also to offer help to developing countries. In order to fulfil its mission – to work for the benefit of the citizens of Europe – the EPO should form part of the European Union‘s legal framework, but with a special status.
Interview with Thierry Sueur, VP, Intellectual Property Department, Air Liquide and Member of UNICE, and Jacques Combeau, Intellectual Property Department, Air Liquide, for EPO “Scenarios for the future”, 2006
Source [14]
Within the political sphere, there are several problems to be solved: in the biotech field, in the software field, the Community patent. However, I am convinced that the way the EPO is managed today (by the Administrative Council) is such that it will mean either the death of the EPO or its transformation into a cash machine. The issue of management is becoming increasingly important as the organisation grows.
[The Question would be:] What needs to be done to ensure that patent policy becomes part of the political agenda of the European Union? The political drive of the system is a key to the future, and hopefully the Community patent might lead to that.
“Governance of the EPO: a Staff Perspective”, document CA/93/07 submitted by the staff representatives via the President of the European Patent Office to the EPO Administrative Council, June 4th 2007
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It is a matter of fact that a majority (at present about two-thirds) of the heads of delegations hold a function in a national patent office. This document argues below that this leads to a conflict of interest which is clearly perceived as such by the EPO staff.
There is a strong belief amongst staff that the financial benefits to the Member States arising from the renewal fees motivate the Administrative Council, and consequently the EPO administration, to focus on the quantity rather than the quality of the granted patents.
“Policy options for the improvement of the European patent system”, STOA (Science and Technology Options Assessment for the European Parliament), September 2007
Source [16]
Yet as a result of its historical development, the European patent system has sometimes been perceived as rather insulated from the rest of the EU, in policy terms and in respect of the wider society. This is critical as issues relating to patents are now more integrated into thinking behind innovation policies at an EU level than ever before. Patents, as with other IPRs, are no longer seen as separate specialized areas outside the scope of broad social and economic concerns. Accordingly, the European patent system is a very important part of the current functioning and future development at the Community level and this relationship must be considered.
Letter to IAM blog from Staff Union of the European Patent Office (SUEPO) on December 15th 2008
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The heads of the national delegations in the Administrative Council are almost without exception heads of their respective national patent offices. For many of the national offices their 50% share of the renewal fees constitutes a very substantial proportion of their annual budget (in several cases well over 50%). In their function as heads of national offices these heads of delegation thus have an interest in having many patents granted, and having them granted quickly.
“The Governance of European Intellectual Property Rights: Toward a Differentiated Community Approach”, Evisa Kica and Nico Groenendijk, Centre for European Studies (CES) and the Department of Legal & Economic Governance Studies (LEGS) University of Twente, in: AIC 2009: Fourth GARNET Annual Conference, Rome, Italy, 11-13 November 2009
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Moreover, it emphasized the need for the EU legislation to intervene in democratizing the governance of patents and to expand the regulatory framework of IP protection from regulating only the “classical” biotechnological matters (e.g. food technology, microbial treatment of sewage water, etc.) to establishing appropriate regulatory frameworks for specific issues within the field (i.e. new plant and animal varieties).
Besides the lack of clarity on standards and requirements for the patentability of new subject matters, the lack of collaboration among the NPOs and the European patent examiners, plus the workloads associated with patent examinations, have contributed significantly to the inability of the system to accommodate the widening diversity in subject matters.
“Current policy issues in the governance of the European patent system”, STOA (Science and Technology Options Assessment for the European Parliament), March 2010
Source [19]
In knowledge-based economies, modes of generation, appropriation, access, diffusion and distribution of knowledge (in science and technology) have become decisive for societal development and important areas of political debate.
The European patent system is characterised by technocratic decision-making. It lacks democratic legitimacy and accountability and has become increasingly inefficient (Schneider, 2006). The EU and the EPO are two worlds apart: they are two fully-independent supranational bodies and the EPO is not subject to EU and EC decisions.
The EPO’s self-governance is mainly based on the interaction between applicants and the EPO itself, and between granting departments and Boards of Appeal (quasi-judiciary bodies).
The EPO is an institution that is self-funded by the fees of patentees. The interests of parties other than the applicants are not represented, and there is the risk of capture by the applicants, who can be seen as customers to be served. Moreover, its limits for patent eligibility are expanding, it covers a broad scope of patents to be granted, and it demands a low threshold for inventive step. All these pose problems of patent quality, but also of power. There are two critical aspects: the inherent expansionist drive and the fact that innovation has to be qualified in terms of efficiency, sustainability and social desirability.
Questions of the separation of powers, accountability, democracy, legitimacy and control are of utmost importance. It may be necessary to re-balance the governance of the patent system, introducing more roles for the European Union, increased democratisation, legislative regulation of substantive patent law in new technological fields and improving the responsiveness of the European Parliament on IPR issues in the following areas:
- Public domain or ‘Open’ science
- Ethical limits
- Public health and cost issues
- Efficiency
- Alternative modes of innovation (e.g. Open Source).
“Patent Office Governance and Patent System Quality”, Pierre Picard and Bruno Van Pottelsberghe de la Potterie, Centre for Economic Policy Research (CEPR) Discussion Paper No. DP8338, April 2011
Source [20]
It is important to shortly discuss the mission and governance of patent offices. In most cases, the patent offices’ mission statements are limited to commitments to appropriate framing of intellectual property rights and to contribute to innovation, competitiveness and growth. The mission usually includes administrative functions such as the search and examination process of patent disposals as well as advisory functions to government ministries about intellectual property right. In this sense, the offices can be seen as setting and justifying their objectives by themselves.
The governance structure has also implications on the formulation of the institutions’objectives. In particular, the EPO is an international organization directed by a board (called European Patent Organization) that gathers representatives of national patent offices (or contracting States). As an intergovernmental organization, the EPO is required to balance its budget because contracting States are obliged (but reluctant) to finance any deficit. The governance structure is prone to conflict of interest on the one hand because some national patent offices are somewhat competitors for patent filing and on the other hand because national patent offices receive the proceeds of renewals of the patents granted by the EPO. The board could therefore be criticized to favor quantity over quality of patents because this strategy is expected to raise national patent offices revenues and maintain their national demand for patents.
Policy Brief 324 of the Centre d'analyse stratégique (Strategic Analysis Centre for the French government), March 2013
Source [21], our translation
software patents allow to get a monopoly on algorithms, including when these algorithms are needed to guarantee security. Article 52 of the Euorpean Patent Convention of 1973 excludes "programs for computers" from the scope of patentable inventions, but the European Patent Office (EPO) grants software patents in practice, due to a broad interpretation of the Convention and a questionable economic and governance model.