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Tuesday, 23 August 2011

Spain follows Italy in legal challenge to enhanced patent cooperation

Enhanced cooperation leading towards patent unity:
will Italy and Spain derail the runaway train?
The UK Intellectual Property Office's alerting service has informed the IPKat of the case brought by Spain before the Court of Justice: Case C-274/11 Kingdom of Spain v Council of the European Union. Like the earlier action in Case C-295/11 Italy v Council of the European Union (noted here by the IPKat), it concerns an application for annulment of the Council Decision of 10 March 2011 [in full: Council Decision 2011/167/EU of 10 March 2011 authorising enhanced cooperation in the area of the creation of unitary patent protection (OJ 2011 L 76, p. 53), which you can read in here]. What is this case all about, in legal terms? The Curia helpfully tells us:
"Pleas in law and main arguments 
1. Misuse of powers since recourse was had to enhanced cooperation although the purpose is not to achieve integration of all the Member States - the mechanism having been used instead to avoid negotiating with a Member State, imposing upon it an opt-out solution - and although the objectives pursued in this instance could have been achieved by means of a special agreement as provided for in Article 142 of the European Patent Convention [This point is not listed in the Italian case (on which, see below). This Kat wonders whether it is relevant that the objectives could have been achieved via Article 142 on the EPC, if they could be achieved under the powers which were invoked for that purpose]
2. Failure to respect the judicial system of the EU in that no dispute resolution system is provided for in relation to certain legal rights subject to EU law. [This point isn't raised in the Italian case either. Merpel wonders whether it has any validity, if there exist means of resolving disputes even if none is specified. she also wonders how much respect was given to the judicial system of the EU in deeming a motley bunch of national courts of varying quality and experience to be "Community trade mark courts" and "Community design courts", but that's a subject for another post ...]
3. In the alternative, should the Court find that it is appropriate in this instance to have recourse to enhanced cooperation and that it is possible to establish substantive rules for legal rights subject to EU law without making provision for a dispute resolution system in relation to those rights, the Kingdom of Spain submits that the necessary conditions for enhanced cooperation are not met for the following reasons: 
3.1 infringement of Article 20(1) TEU, since in this instance enhanced cooperation is not a last resort and does not fulfil the objectives provided for in the TEU and since areas are referred to which are not within the scope of enhanced cooperation as they are exclusive competence of the EU [see comment on final Italian plea, below]. 
3.2 infringement of Article 326 TFEU, since enhanced cooperation in this instance infringes the principle of non-discrimination and undermines the internal market and economic, social and territorial cohesion, constituting discrimination in trade between Member States and distorting competition between them [see comment on final Italian plea, below].  
3.3 infringement of Article 327 TFEU, since the enhanced cooperation does not respect the rights of the Kingdom of Spain, which is not participating in it [Italy did not raise this point]".
It's interesting to contrast this action with Case C-295/11. To refresh memories, Curia tells us what it turns on:
"Pleas in law and main arguments 
In support of its action, the Italian Republic raises four pleas in law. 
First, it submits that the enhanced cooperation procedure was authorised by the Council outside the limits provided for in the first subparagraph of Article 20(1) TEU, according to which such a procedure is to be allowed only within the framework of the European Union's non-exclusive competences. The European Union has an exclusive competence to create 'European rules' which have Article 118 TFEU as their legal basis [cf Spain, which makes no reference to Art.118]
Second, it submits that the authorisation of enhanced cooperation in the present case is contrary to - or, in any event, not compatible with - the objectives in view of which such cooperation is provided for by the Treaties. In so far as that authorisation is contrary to, if not the letter, at least the spirit of Article 118 TFEU, it infringes Article 326(1) TFEU, in that the latter requires enhanced cooperation to comply with the Treaties and with EU law. 
Third, the Italian Republic submits that the authorisation decision was adopted without an appropriate inquiry with regard to the last resort requirement and without an adequate statement of reasons on that point. [lack of "appropriate inquiry" is not alleged in the Spanish case] 
Lastly, according to the Italian Republic, the authorisation decision infringes Article 326 TFEU in that it adversely affects the internal market, introducing a barrier to trade between Member States and discrimination between undertakings, causing distortion of competition [This is the same as 3.2 in the Spanish case]. Furthermore, it does not help to reinforce the EU's integration process, and is thus contrary to the second subparagraph of Article 20(1) TEU [This appears to overlap with 3.1 in the Spanish case, though the latter does not specifically allude to the challenged Decision not helping to reinforce the EU integration process]".
If you want to persuade the UK government to make any submissions in the Spanish case, you must email the UK IPO here before 29 August 2011.

Says the IPKat, what is interesting is the way in which the Italian and Spanish governments have played their challenge. Rather than combine their forces, conveniently allowing the Court of Justice to consider their cases together, they have opted for separate and non-identical actions which, one might imagine, they will not be happy for the Court to roll into Joint Cases.  This can create a nuisance factor, buy time and give the two countries a little more leverage in their attempt to derail the great freight train of the unitary patent system as it speeds its way -- in the same general direction as the rails if not actually on them -- to its politically desired destination.

2 comments:

patently said...

This Kat wonders whether it is relevant that the objectives could have been achieved via Article 142 on the EPC, if they could be achieved under the powers which were invoked for that purpose

A relevant query. If Spain's logic is correct, and the ability to achieve the objective via Art 142 means that it is in principle wrong to invoke the powers that were in fact used, then surely the same applies in reverse?

On that basis, the existence of two alternative legal bases for doing something would mean that each precludes the other. More would, indeed, be less.

Anonymous said...

I am not sure the reversibility requirement holds.

There is evidently no provision in the EPC saying you can only set up an Art 142 special agreement if another route is not available.

The Spanish govt's line appears to be (albeit it seems via rather contrived logic) that there is such a provision inmplict in the TEU.

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