The European Union is on the threshold of a single patent for almost all of its Member States, the Unitary Patent, and an international court to enforce both such patents and traditional European patents, the Unified Patent Court (UPC). After many attempts to create a Community Patent failed, an increasing number of Member States joined forces to create the next best thing by way of an enhanced cooperation within the EU, which resulted in the plans for the Unitary Patent. This would be established through a Regulation of the European Parliament and the Council that would apply in the participating Member States, the Unitary Patent Regulation. In the end 24 Member States joined this Regulation, with the exception of Croatia (which will join later), Italy, Poland and Spain.
To accommodate the political issues around the language regime for such a Unitary Patent, an additional Regulation on translation arrangements was enacted, which provides for a certain level of translation of patents into various EU languages for a transitional period of 12 years max.
The enforcement through the Unified Patent Court will be based on a multilateral agreement between 25 Member States, including Italy, the Agreement on a Unified Patent Court (UPC Agreement). The UPC Agreement is not an EU instrument.
Spain disagreed with the whole project. A first attack aimed at the EU Council decision that authorized the work on the enhanced cooperation, which attack was launched in cooperation with Italy, was dismissed by the Court of Justice on 16 April 2013. When the Unitary Patent Regulation and the Regulation on Translation Arrangements were issued, Spain appealed both, this time without the help of Italy. In the meantime the preparation for the introduction of the Unitary Patent and the Unified Patent Court started. Both projects are well-advanced. The UPC Preparatory Committee is aiming for a start of the UPC in early 2016.
Of course, the pending appeals caused some concern, so everyone was looking out for the opinion of the Advocate-General Yves Bot. The protagonists of the new system got more than they were hoping for. Not only does the Advocate-General advise in his opinion of 18 November 2014 to reject Spain’s appeals, he even goes as far as to say that “by refraining from ratifying the Agreement on a Unified Patent Court, the participating Member States would infringe the principle of sincere cooperation in that they would be jeopardising the attainment of the Union’s harmonisation and uniform protection objectives”. This was printed in bold letters in the Curia press release.
In the appeal against the Unitary Patent Regulation, Spain had argued that the procedure to grant a Unitary Patent was excluded from EU judiciary control, which would violate Article 2 of the Treaty on European Union (TEU). Indeed, decisions of the European Patent Office (EPO) on the grant of unitary effect can be appealed to the Unified Patent Court, but not to the Court of Justice.
The Advocate-General starts by remarking that the EU legislator has chosen to accept the way in which European patents are granted. Even the plans for a Community Patent were always based on the system of the European Patent Convention (EPC) and in addition, all Member States are already bound by the EPC. The sole purpose of the contested Regulation is to attribute to European patents, already granted under the European Patent Convention, the additional characteristic of unitary effect. The Regulation therefore brings benefits of uniformity and integration compared with the existing system requiring separate registration and enforcement of European patents in each member state, but it does not affect the grant of European patents in any way; unitary effect is awarded post-grant.
The Advocate-General says that the protection conferred by the unitary effect is not determined by national law on the basis of Article 64 EPC, but by the provisions on the uniform execution of the Regulation, which include the scope of the rights conferred by the patent. He adds to this that Article 5 determines the consequences of unitary effect and the way in which unitary protection is guaranteed in all participating Member States. These are very interesting remarks, since the provisions on infringement were moved from the draft Regulation to the UPC Agreement, inter alia to exclude jurisdiction of the Court of Justice over such issues. However, the Regulation still provides in Article 5(2) that “the scope of that right and its limitations shall be uniform in all participating Member States in which the patent has unitary effect”. Article 5(3) refers to national law for the scope of protection, which has to be understood as a reference to the UPC Agreement, which will be part of national law. Nevertheless, some discussion has remained whether Article 5(2) would allow the Court of Justice to rule on scope of protection issues. It seems that the Advocate-General is hinting in that direction, particularly since these remarks are made in response to Spain’s argument that the Unitary Patent would be excluded from EU judiciary control and that the Regulation would be an “empty shell”.
The Advocate-General adds that there is no violation of Article 118 of the Treaty on the Functioning of the European Union (TFEU), inter alia since a reference to national law is allowed as long as the right involved offers unitary protection within the territory of the participating Member States. But then he links Article 5 to Article 7: the law governing the scope of protection as meant in Article 5 would be the law that applies to the patent as an object of property under Article 7, so the law of that Member State (which would always include, but not be limited to, the UPC Agreement) would determine the scope of protection in all other Member States. This is quite a novel view on the effect of Article 7, which is generally seen as to only cover property-related issues.
The fact that the level of renewal fees will be determined by the participating Member States and not by the EU, is not a violation of Article 291 TFEU, since those powers will be exercised within a framework set by the EU in some detail in the Regulation itself.
Spain had further argued that the UPC Agreement undermines the powers of the EU. In the Advocate General's opinion the Court of Justice of the EU does not have jurisdiction to review the content of the UPC Agreement in an action for annulment of the Regulation and therefore this argument cannot be explored further.
Spain had also argued that Member States could decide on the applicability of the Regulation on their territory by not ratifying the UPC Agreement. This argument backfires seriously. In the view of the Advocate-General, the UPC Agreement is essential to guarantee the proper working of the Unitary Patent. The Member States have an obligation under Article 4(3) TEU to take all measures suitable to implement the enhanced cooperation. This includes the ratification of the UPC Agreement, since that is necessary for the execution of the enhanced cooperation. Thus, Member States that do not ratify, would infringe the principle of sincere cooperation under Article 4(3) TEU, as they would endanger the objectives of harmonisation and unification of the Union. Of course, this rule only applies to Member States who participate in the enhanced cooperation. Thus, it would not affect ratification by Italy, which participates in the UPC Agreement, but not in the enhanced cooperation (which is limited to the Regulations). It also does not affect Spain, which has not signed the UPC Agreement and does not participate in the enhanced cooperation. However, it does affect Poland, which has subscribed to the Decision on enhanced cooperation, but has not signed the UPC Agreement and currently therefore has no intention of ratifying it. Arguably that might now be seen as an infringement of the Treaty on European Union!
Spain also applied to annul the Regulation on translation arrangements. Industry might not be unhappy with the upholding of the Unitary Patent Regulation, but the revocation of the Regulation on translation arrangements, because this would eliminate the need for translations that are only required for political reasons, but are actually burdensome for industry. However, that approach may be too opportunistic, certainly for the Court of Justice.
The Advocate General acknowledged that Spanish speakers, or others who do not know one of the three official languages of the European Patent Office (German, French and English), are discriminated by the choice of those languages in the context of the Unitary Patent regime. Nevertheless, the discriminatory effect is legitimate, appropriate and proportionate in light of the legitimate objective of reducing high translation costs, for which all interested parties have called. Taking into account the fact that the Union wants to promote the functioning of the internal market, as well as the innovative, growth and competition potential of European enterprises, it is “essential and necessary” that the legislator acts in the field of patent law.
In contrast to the Community trade mark, patents involve the translation of technical, lengthy and complicated documents. The curtailment of the use of languages is thus aimed at avoiding excessively high translation costs. The choice for the official languages of the EPO is a coherent one, which provides for stability for the parties in the relevant market and for the professionals, who are already used to working in these languages. The Advocate-General also referred to what he called the linguistic realities of the patent sector where most scientific papers are published in the three official languages of the EPO. Therefore, European researchers will be able to understand patents published in those languages (remember: the Advocate-General is French!) and those languages are spoken in the Member States from which most patent applications in the EU originate.
The language choice also complies with the principle of proportionality. First of all, in case of a dispute, the defendant will be entitled to a translation into a language of the Member State where the alleged infringement took place or where the defendant is based. Second, if the case goes to court before the UPC, the defendant will be entitled under Article 4(2) of the Regulation on translation arrangements to a translation of the patent into the language of the proceedings. In this reasoning, the Advocate-General ignores the fact that the claimant has many options for forum shopping among the UPC divisions as well as the fact that almost all local divisions will allow litigation in English. However, this case is about the Regulation, not about the UPC Agreement and the Regulation has at least tried to protect the interests of the defendant who doesn’t understand English (which will be a rare phenomenon among technology driven companies). Third, when awarding damages, the UPC has to take into account whether the defendant acted in good faith before he was provided with a translation of the patent. That is indeed true, but it does not take into account that an infringer who initially acted in good faith will lose the value of his investment once he has been presented with a translation of the patent. Finally, during the transitional period all Unitary Patents will be available in English. Afterwards there will be high quality automatic translation systems and a compensation scheme to reimburse translation costs up to a certain limit for patent applications not filed in one of the official languages.
Spain further argued that the Regulation on translation arrangements violates legal certainty, as it limits the access to information. In addition, the translation provided in case of a dispute would have no legal effect. In response to this argument, the Advocate-General says that the principle of legal certainty is better safeguarded where one language is authentic.
Unfortunately, and somewhat ironically in view of the above comments, the opinion is not available in English although a press release in English has been published. Therefore, this comment is based on the Dutch version. The authors have not dared to rely on a machine translation.
The opinions in both cases do seem to make a lot of sense. They also show that EU law is flexible enough to provide solutions which are dearly needed for, as the Advocate-General says, the functioning of the internal market, as well as the innovative, growth and competition potential of European enterprises. The Court is expected to rule on this in the summer, but we may already see developments before that. Poland will have to consider whether they want to run the risk of an infringement on the Treaty on European Union. Italy may reconsider its position with regard to the Unitary Patent. Croatia always had the intention of joining, but just wanted to take care of the implementation of the massive body of mandatory EU law first. That would leave Spain on its own, and forced to contemplate the effect on the Spanish innovative industry and the potential for growth in Spain.
 Regulation (EU) no 1257/2012 of the European Parliament and of the Council of 17 December 2012 implementing enhanced cooperation in the area of the creation of unitary patent protection, L 361/1.
 Council Regulation (EU) No 1260/2012 of 17 December 2012 implementing enhanced cooperation in the area of the creation of unitary patent protection with regard to the applicable translation arrangements, L 361/89.
Council Regulation (EU) No 1260/2012 of 17 December 2012 implementing enhanced cooperation in the area of the creation of unitary patent protection with regard to the applicable translation arrangements, L 361/89.
 Agreement of 19 February 2013, 2013/C 175/01.
 C-274/11 and C-295/11, aimed against 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).
 Paragraph 59 and 60, C-146/13.
 Paragraph 79, C-146/13.
 This will automatically be the case in most civil law jurisdictions, but may need to be part of the implementation act in common law jurisdictions.
 Paragraph 90, C-146/13.
 Paragraph 93 and 94, C-146/13.
 Paragraphs 172 – 183, C-146/13.
 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).