Europarätt
| EU
| 4/16/2020
On Friday the 20th of March a well anticipated decision of the Bundesverfassungsgericht, the German Federal Constitutional Court, 2 BvR 739/17 was finally publicised. The constitutional court upholds the complaint against the German Act of Approval of the Unified Patent Court and declares the act as void due to the fact that the German Federal Parliament passed the act unanimously with only 38 members present, not with the required two-thirds majority of the Bundestag.
The German Constitutional Court’s Decision – an Imminent Breakdown for a Unitary Patent in the EU?
By Anna Horn (Doctoral candidate in intellectual property law, Stockholm university)
On Friday the 20th of March a well anticipated decision of the Bundesverfassungsgericht, the German Federal Constitutional Court, 2 BvR 739/17 was finally publicised. The constitutional court upholds the complaint against the German Act of Approval of the Unified Patent Court and declares the act as void due to the fact that the German Federal Parliament passed the act unanimously with only 38 members present, not with the required two-thirds majority of the Bundestag.
The Gesetz zu dem Übereinkommen über ein Einheitliches Patentgericht, German Act of Approval of the Unified Patent Court, was intended to provide the requirements for the ratification of the Agreement on a Unified Patent Court has now proven to do the opposite.
The idea of a unification of patent laws in Europe was firstly expressed by the Council of Europe in 1949. The original work of unification was never realized because the level of harmonisation of substantive patent law required could not be achieved because of the diversity of national patent laws. Further, the establishment of the common market in the EC and the treaty of Rome coming into effect in 1958 worked as an impetus for creating a common European patent system. As a result, EC countries struggled a long way to create a community patent right. In 1992 the work for a community patent failed again due to lack of sufficient number of ratifications by the Member States.
The Union never abounded the idea of a unified patent system and in 2012 EU countries and the European Parliament agreed on an enhanced cooperation on a patent package consisting of an international agreement on a Unified Patent Court and two EU regulations on unitary effect for patents granted by the EPO and translation arrangements for such patent protection.
The Agreement on a Unified Patent Court is purported to constitute a supranational patent court for EU countries. The court shall apply union law in its entirety and shall respect its primacy. Furthermore, the Unified Patent Court has an obligation to request preliminary rulings by the Court of Justice of the European Union (CJEU).
The agreement coming into effect is based on a ratification by thirteen Member States. Additionally, the three states in which the highest number of European patents was in force in the year preceding the year in which the signature of the agreement took place had to be in the group of ratifying countries. As an effect, Germany, France and the UK have to ratify the agreement for it to come into force.
In March 2020 sixteen Member States have ratified the agreement. France ratified the agreement in 2014 followed by the UK which ratified it in 2018 before leaving the EU. The German act for preparing the ratification of the agreement was passed in March 2017 and was later contested in June 2017 in the German Constitutional court due to a complaint stating that the act violates the applicant’s fundamental rights by breaching the German Constitution.
The complaint was primary based on the argument that the act violated right to democratic self-determination for citizens by limiting their opportunity to oppose against a decline in the German federal parliament’s power as well as EU breaching its conferred competence. Importantly, the complaint alleged that citizens have a right to have sovereign powers transferred to the EU or other supranational institutions exclusively in the forms provided by the German Constitution. The applicant inter alia argued that by transferring jurisdiction to the Unified Patent Court, there is a transfer of sovereign rights.
The Federal Constitutional Court upheld the applicant’s argument establishing that the act required a two thirds majority in the Federal Parliament to ensure the special level of legitimation for decisions which transferred sovereign powers to EU or other supranational institutions. As a result, the act for the German ratification of the agreement is void. Three of the eight judges of the court presented a dissenting option by warning that the decision could in the future prejudge the democratic process and significantly delay further integration in the EU.
Prior to the German Constitutional Court’s decision, the UK government has declared that it will not remain in the unitary patent cooperation claiming that the participation in a court which will apply EU law and that is bound by the CJEU is inconsistent with the country’s aim to become independent of the EU.
The Preparatory Committee of the Unified Patent Court has responded by declaring that the preparatory work will continue and that arrangements will be made to deal with the practical implications by the UK’s departure and the German Constitutional Court’s decision. However, no one can claim that future of the unified patent in the EU is guaranteed. Even if the German Parliament succeeds to pass an act for ratification of the agreement with two-thirds majority, the agreement is likely to need to be recast due to the UK leaving the patent cooperation. As in the process of creating the earlier community patent the unitary patent package is now in the risk of falling behind the changing requirements and the construction of the EU.
Nevertheless, the Union’s inventors’ and companies’ need for a harmonisation and unification of the European patent system is consistent. The issue is how the Union can meet this need. Due to the territorial nature of the European patent right this is a complex issue. A way forward could be to, instead of creating a new unitary EU system, change the jurisdiction rules by giving patent holders a greater opportunity to enforce their bundle of European patents collectively.
One of the most evident lesson learned by the failure of the community patent system and the imminent breakdown of the unitary patent system is that if a draft agreement requires ratification by the EU Member States before it can come into effect will be dependent on the degree of the ratifying states’ national parliament’s interests and ability to agree.
