Harmonization of Intellectual Property Rights on the European Level

Index of contents

II. List of Abbreviations

1. Introduction - Intellectual property rights on the European level

2. Historical overview of the development of IPRs

3. IPR legal framework in the European Union

4. Industrial Property Rights
a. Patents and related rights
b. Design Patents
c. Trademark and related rights

5. Copyrights and related rights

6. Conclusion: Is there a Common European IP-law?

List of Abbreviations

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1. Introduction - Intellectual property rights on the European level

Intellectual property rights (IPR) stimulate the creation of innovation in every business segment and keep up the competitive ability of a state’s economy. IPRs are natural territorial, national and exclusive. And national legal systems are territorial in their scope. The EU consists of states with different IP-laws. These different laws can function as barriers to the free movement of goods. Therefore a unitary intellectual property law is considered as the crucial point in the success of the European single market. The Commission stepped forward to harmonise many national rules by means of regulations and directives to gain a high-level protection. But the field of IPR protection is widespread and very complex. The term “intellectual property” comprises¹:

- Industrial Property Rights such as patent, utility patent, design patent, trademarks, geographical indications. These rights have to be registered in every single EU-state.
- Copyrights include literary and artistically work as well as music, television broadcast, software, database, advertising ideas, and multimedia products. These rights are automatically protected and do not necessarily need to be registered.
- Business Strategy for example company secret, duty to observe secrecy or fast production.

Having these rights enable the inventors to prohibit unauthorized using or distribution of their creations and vice versa to demand compensation for an authorized using.²

Moreover, over the last years the competitive ability is more and more disturbed by a rising phenomenon of piracy and counterfeiting. Trading plagiarism is estimated with five to seven per cent of the total world trading. It causes a loss of 200-300 billion euro and 200.000 jobs every year.³ The European Union itself loses about 200-400 million Euros yearly within the internal market and two billion Euros in foreign countries.⁴ However, it does not only cause damage to the economy but also threatens the consumers’ safety and health. As these figures show counterfeiting and piracy became one of the major problems. The OECD estimates that 79 million articles were seized at the EU borders in 2007 in over 43.000 customs actions.5 It was also measured a raise in seizure in the last year, for example for cosmetics and personal care products (+265%).6

This descriptive assignment will give a comprehensive overview of IP-law in Europe. It will mainly focus on the question in how far the EU reached a harmonisation of national IP-law in the main fields of industrial property rights as well as copyrights. In the beginning a short introduction of the historical development of IPRs and the legal framework in the EU will be given. The conclusion will revise the critical points.

2. Historical overview of the development of IPRs

Already in the 19th century, the fragmentation of intellectual property law in every state led to a first attempt of standardisation of IPRs through international agreements.⁵ In 1883, the “Paris Convention for the Protection of Industrial Property” was signed by many - mostly European - countries.⁶ The most significant achievement was the equal grant of protection to foreigners as a contracting state grants for its own nationals. The Berne Convention in 1886 was mainly introduced to protect rights in literature and in art. There are a lot of more agreements such as Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) for which later on, institutionalised through the establishment of the world organisation for property rights (WIPO) as umbrella organisation in 1967.⁷

International IP-law consists of a variety of bilateral as well as multilateral agreements what makes the structure complicated and hard to overview. Within this complex international structure the European Union plays a particular role caused by its supranational body structure. This allows the EU to participate on the general assembly of the WIPO to better coordinate for its members. And it tries to influence the further progress of IPRs to reach EU’s aim improving the global standards for international protection and enforcement.⁸ The EU was one of the key supporters of the Agreement on Trade-related Aspects of International Property Rights (TRIPS).⁹ The EU was also involved in the establishment of a new Anti-Counterfeiting Trade Agreement (ACTA) that began its work in 2007 (not in force).¹⁰ The EU itself set up a broad framework of rules protecting IPRs within its community.

3. Legal framework in the European Union

The term “IPR” was first mentioned in the primary law in the Amsterdam treaty in Article 133 (V) within the context of the common trade policy. And of course today IPR is embetted in the
economic context of the free movement of goods. The basic rule for the free movement of goods is made in Art. 28 EC-Treaty:

“quantitive restrictions on imports and all measures having equivalent effect shall be prohibited between member states. That means that all enterprises shall have a barrier free access to the single market unless there is a valid and crucial reason for denying to a part of the market. The free movement of goods is one of the four fundamental freedoms guaranteed by the treaty."

Even if the free movement of goods has first priority, the Article says that restrictions can be made if there are crucial reasons for it. Therefore Article 30 EC-Treaty enumerates the exceptions of the free movement of goods that can be made:

“The provisions of Art. 28 and 29 shall not preclude prohibitions or restrictions on imports, exports or goods in transit justified on grounds of public morality, public policy or public security; the protection of health and life of humans, animals or plants; the protection of national treasures possessing artistic, historical or archaeological value, or the protection of industrial and commercial property. Such prohibitions or restrictions shall not, however, constitute a means of arbitrary discrimination or a disguised restriction on trade between member states. ’’

The article contains a closed list of exceptions. One of these is the protection of the intellectual property rights. Any discrimination made by the member states must be justified and needs a proportional requirement.

Furthermore the Art. 295 EC-Treaty states the national autonomy regarding property rights:

“This Treaty shall in no way prejudice the rules in member states governing the system of property rights"

In case of absence of Community harmonisation measures, this article offers the member states a considerable discretion over IPRs. And the European Court of Justice decided that national legislature is required to determine the conditions of the protection of IPR. This is why the states even possess their own national offices for IPR-law (in Germany “the German patent and trademark office”) which also represent the state’s interest in the committee of the European Patent Organisation (EPO), in the administrative board of the Office for Harmonisation in the Internal Market (OHIM)¹¹ and at the international level in numerous committees of the World International Property Organisation (WIPO).¹² Beneath these offices, there exist particular courts specialised in IPR-law in some countries (in Germany e.g. “German Bundespatentgericht”).

In the secondary law, property rights were mentioned very seldom in the beginning. First at the end of the 1980’s, the Commission noticed the necessity of a uniform IP-law.¹³ Since then the Commission enforced numerous directives, letters of recommendation, as well as several regulations.

4. Industrial Property Rights 4.1 Patents

A patent is a granted right for a technological invention. Granting a patent has a monopoly effect, because only the patentee is allowed to use and to sell its invention for a particular period of time.¹⁴ A patent is a very strong right that shall act as an incentive covering the costs spent for research and development of the product.

The first patent law in Europe is the England’s Statue of Monopolies from 1624.¹⁵ Granting patents was a national privilege to maintain the economic activity.¹⁶ Each state had its own principles of patent granting system. Since the founding of the European Community (EC) in 1957, it was considered to set up a European Economic Community Patent. But these considerations were suspended with the failing of Britain’s membership. France however continued to promote this plan what finally led to the European Patent Convention (EPC) which was signed in Munich in 1973. It was first not intended to advance the freedom of trade but to promote a complete European system of examination.¹⁷

The European Patent organisation (EPO) is an intergovernmental institution that was established the 7th October 1977 based on the EPC from 1973 and possesses legal entity. Beneath the members of the EU, the follow states signed this agreement as well: Iceland, Croatia, Macedonia, Monaco, Liechtenstein, Norway, San Marino, Switzerland, and Turkey.¹⁸. Five years after erecting, the first applications were received. And since then, the patent office granted 830.000 patents out of two millions applications. Most applications are received from Germany. But even the United States and Japan possess a huge share of the total number.¹⁹ The organisation has its domicile in Munich (Art. 6 EPA) and agencies in Den Haag, Berlin and Vienna. This organisation has two organs; the EPO and the Administrative Council that supervises the work of the Patent Office. The legislative organ is the Administrative Council. The Administrative Council is composed of the delegates of the contracting member states. It holds regular meetings fourth a year. The EPO’s workforce is 6.700 workers and covers a geographical area of 540 million people. With this it is one the biggest institutions in Europe.²⁰

Even if EPO is not an institution body of the EU, the EU is the key promoter for this project and has a great influence of its further progress. In 2000, the contracting states of the EPC agreed on the revision of the EPC aiming the modernisation on the Convention that came into force in 2007.²¹ At that time, it was the major objective to strengthen the EU’s economic competitiveness.²² In addition, the EPC had to be made conform to the TRIPS-agreement.

There is no standardized permission for patent rights within the EU. There are some possibilities to validate a patent. A national patent is just valid in the state where it is registered. It is protected through the national laws. This can be obtained by application at the national patent office as well as the EPO. However, an application for a European patent at the EPO offers a national protection in all the members of the EPO.²³ The patent registered at EPO grants a bundle of national patents that was maintained in every national system. The patentee can choose in its application in which countries its patent shall be valid. The more countries this request contains, the more expensive it will be.²⁴ That is to say that registration for one country is cheaper at the national office. But the registration for numerous countries will be cheaper at the EPO.²⁵

EPC only harmonised particular basis rules to secure the effective function of the system. Harmonisation in the national law affected the patentability, validity and the point of grant.²⁶ The EPC determines whether the application is patentable. The patentee must have the same rights as it would be conferred by national patent office. All other matter such as renewal, revocation infringement, and litigation should remain in the respective state law.²⁷ However the patent can only be revoked on grounds listed in the Art. 138 EPC.²⁸ The EPC sets high requirements on the European patent. To obtain a European patent it must be really “new” in terms of inventive and susceptible of industrial application. The period of protection takes 20 years from the date of filling the application.

Moreover, there are differences between the national legal systems. In some countries for example there exist no examination requirements whereas the EPC set this as a pre­condition.²⁹ The EPC allows as well an opposition proceeding that can lead to a revocation of the patent in all chosen states. If the patent is not “strong” enough maybe it can be a smart strategy to register the patent directly in every country individually.³⁰ Another additional difficulty is that³¹ in some countries the term “utility model” or “petty patent” exists.³²

[...]

¹ European Commission: Geistiges Eigentum schützen. (06/09).

² Elster, Rina: WIPO Guide on Managing Intellectual Property for Museums by Pantalony (08/2007).

³ European Press Release: Nachahmung und Piraterie - Kommission legt ehrgeizigen Aktionsplan vor. Brüssel. (11/2000).

⁴ ibid

⁵ European Commission on trade: Intellectual Property. Anti Counterfeiting.

⁶ ibid

⁷ Siegrist, Hannes: Geistiges Eigentum im Spannungsfeld von Individualisierung, Nationalisierung und Internationalisierung. Der Weg zur Berner Übereinkunft von 1886.

⁸ Seville, Catherine: EU intellectual property law and policy. p. 74.

⁹ König, Doris. Der Schutz des geistigen Eigentums im europäischen Recht. S.4.

¹⁰ “European Commission: Urheberrechte und verwandte Schutzrechte.(10/2009)

¹¹ European Commission: Intellectual property rights.

¹² European Commission on trade: Intellectual Property. Anti Counterfeiting.

¹³ Deutsches Patent und Marken Amt: Nationale, europäische und internationale Zusammenarbeit. (19.1.2010).

¹⁴ ibid.

¹⁵ König, Doris Der Schutz des geistigen Eigentums im europäischen Recht, p. 5.

¹⁶ Seville, Catherine: EU intellectual property law and policy, p. 70.

¹⁷ ibid, p. 71.

¹⁸ ibid, p. 72.

¹⁹ ibid, p. 91f

²⁰ European Patent Organisation: Europäische Patentorganisation. Rechtsgrundlage.

²¹ Seville, Catherine: EU intellectual property law and policy. p. 92f.

²² European Patent Organisation: Europäische Patentorganisation. Rechtsgrundlage.

²³ Seville, Catherine: EU intellectual property law and policy. p. 92f.

²⁴ ibid, p. 92f.

²⁵ European Commission: Geistiges Eigentum schützen.

²⁶ Seville, Catherine: EU intellectual property law and policy. p. 72 f.

²⁷ Seville, Catherine: EU intellectual property law and policy. p. 72 f

²⁸ ibid, p. 92f.

²⁹ ibid, p. 91f.

³⁰ ibid, p. 100f.

³¹ Seville, Catherine: EU intellectual property law and policy. p. 72 f.

³² ibid, p. 72 f.