Europe's new one-stop patent winning over companies

Sun Jun 1, 2014 7:00pm EDT

* Unitary patent welcomed by 74 pct of firms in survey

* Endorsement follows initial scepticism about system

* EU may be "forum of choice" for patent fights after 2016

By Ben Hirschler

LONDON, June 2 (Reuters) - Europe's new one-stop patent system is winning over companies despite initial criticism from lawyers and some multinationals of the scheme, which is expected to come into effect in 2016, according to a survey on Monday.

The Europe-wide unitary patent system offers a cheaper, simpler solution for businesses seeking to protect their inventions, rather than having to register and enforce patents separately in individual European Union countries.

But there has been scepticism as to whether firms would opt into the new arrangement or stick with a country-by-country approach, given doubts about the efficiency and quality of decision-making from an untested Unified Patent Court (UPC).

A survey of 152 individuals working in the European headquarters of large and medium-sized patent-owning enterprises found that 74 percent thought the new system would benefit their company. Only 15 percent saw it as negative.

Telecoms, media and technology companies were particularly positive, with 91 percent expecting to see benefits.

"We are surprised by the level of support for the new system that the survey shows," said Nicola Dagg, global head of intellectual property litigation at law firm Allen & Overy, which commissioned the study.

A key worry in the past has been that experienced national judges could be replaced by inexperienced ones on the UPC, trained through a new school in Budapest. However, there have been 1,100 applicants to the new court, of whom 130 are deemed to be highly experienced patent judges.

Dagg said the quality of the practitioners coming forward to serve on the UPC had been important in neutralising concerns.

"It seems likely we are going to see a shift towards Europe's Unified Patent Court as a forum of choice for big international patent disputes," she told Reuters.

Traditionally, the world's big patent battles - from the fight between Apple and Samsung Electronics over smartphones to disputes over drugs - have been fought out primarily in the United States, with lesser cases in Europe and Asia.

In future, the centre of gravity in patent disputes could shift more to Europe, especially since companies surveyed said they were likely to protect their most valuable or "crown jewel" patents under the EU unitary system.

The UPC has a complex structure with headquarters in Paris and subsidiary courts and branches distributed across Europe, which critics have also suggested could hamper smooth operations.

But the risks arising from the new system are offset by the far lower cost for litigating in Europe - estimated by Allen & Overy at about fives times less than in the U.S. - and the fact that decisions will affect a much larger consumer market of around 600 million people against 300 million U.S. citizens. (Editing by Pravin Char)

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