EN    EN   
 EUROPEAN COMMISSION   
Brussels, 13.4.2011   
SEC(2011) 483 final   
  
COMMISSION STAFF WORKING PAPE R
 SUMMARY OF THE IMPACT ASSESSMEN T 
  
Accompan ying document to th e
 Proposal for a 
 REGULATION OF THE EUROPE AN PARLIAMENT AND THE COUNCIL implementing enhanced coop  eration in the area of the creation of unitar y patent
protection 
and the  
Proposal for a  
COUNCIL REGULATION 
implementin g enhanced cooperation in the area of the creation of unitar y patent 
protection with regard to the applicable translation arrangements   
{COM(2011) 215 final}  
{COM(2011) 216 final}  
{SEC(2011) 482 final}  
 
EN 1   EN 1. INTRODUCTION  
Patents are an important enabler for econom ic growth through innovation. Investment in 
research (R&D) accounts for 1.9% of GDP in the EU1 and a functioning patent system is 
essential to translate that inve stment into economic growth.  
Today, however, patent protection in Europe  is fragmented. Th e Europe 2020 Strategy2 and 
the Single Market Act3 identified the creation of an  economy based on knowledge and 
innovation as a priority. Both initiatives are s eeking to improve the framework conditions for 
business to innovate by creating unitary patent protection in the EU Member States (MS).  
In spite of broad recognition of  the competitive disadvantage European business faces in the 
absence of unitary patent protection, in December 2010 the Competitiveness Council could 
only confirm4 that there were insurmountable difficulties that made the establishment of such 
protection in the entire EU impossible to attain within a reasonable period. This statement was 
followed by a request from 12 MS to establish enhanced cooperation in the area of unitary 
patent protection. The Commission subsequently submitted a proposal5 to the Council for 
authorising enhanced cooperation that was follo wed by the request of another 13 MS to join 
the cooperation. The European Parliament gave its consent to the launch of enhanced cooperation on 15 February
6 and the Competitiveness C ouncil adopted the authorising 
decision on 10 March7. As a consequence, the impact assessment report (IA) has to take into 
account the conditions set by the Council's aut horising decision. Finally, this IA does not 
address the unified patent litigation system that  follows a parallel work stream and will be 
subject to different legal instrument. The Impact Assessment Quality Board issued a 
favourable opinion on 25 February 2011. 
2. CONTEXT – THE EXISTING PATENT SYSTEMS IN EUROPE  
In the EU, patent protection can be obtained ei ther through the national patent offices of the 
MS that grant national patents or thr ough the European Patent Office (EPO). 
If the applicant chooses to apply for a "European patent", th e application is dealt with by the 
EPO under the procedures laid down in the European Patent Convention (EPC)8. The EPC 
established centralised procedures for the sear ch, examination and grant of European patents 
in English, French or German. But a patent that  is granted and published, does not take effect 
automatically. It must first be validated in the States in which the patentee seeks protection, i.e. the European patent has to be "converted" to national patents. 
                                                
 
1 Eurostat, 2008 data. 
2 COM(2010) 2020. 
3 COM(2010) 608 final/2. 
4 Press release 17668/10. 
5 COM(2010) 790. 
6 P7_TA(2011)0054. 
7 Council Decision 2011/167/EU of 10 March 2011 authorising enhanced cooperation in the area of the 
creation of unitary patent protection (OJ. L 76, 22.3.2011, p. 53). 
8 http://www.epo.org/patents/law/legal- texts/html/epc/1973/e/ma1.html  
EN 2   EN 3. PROBLEM DEFINITION  
The procedure for searching, examining and gr anting European patents is well-functioning 
and widely accepted by applicants from Europe  and third countries. This standardised 
procedure, however, is complemented by mandato ry post-grant procedures  that are complex, 
divergent and result in unnecessary cost for business. This IA looks into the problems and 
possible solutions with respect to the post-grant stage of patent protection. 
3.1. Problem 1: High costs related to the translation and publication of patents 
After the grant of European patents the app licable national validation requirements include 
translation, publication fees and various formal  filing requirements. Wh ere the patent holder 
fails to observe any of the above, the Eu ropean patent is deemed to be void ab initio  in that 
State. The fees charged by patent agents add to these costs. 
Even if the London Agreement9 reduced the costs of validation requirements in some MS, the 
overall cost of validation in 3 MS (DE, FR , UK) equal € 680; it reaches € 12 500 in 13 MS 
and over € 32 000 if a patent is validated in the whole EU. It is estimated  the actual validation 
costs are around € 193 milli on per year in the EU. 
3.2. Problem 2: Differences in the maintena nce of patents in the Member States 
Renewal fees have to be paid by the patentee each year in each country where the patent is 
validated. If he/she does not pay the fees, the patent lapses and becomes part of the public 
domain. Renewal fees show great diversity in  the MS. Moreover, there are many auxiliary 
provisions in the national law that make the maintenance of patents in several MS 
unnecessarily difficult. The deadlines for the pa yment of the fees differ, payment by bank 
transfer is still not possible everywhere, some  countries make the appointment of a patent 
attorney mandatory and communication with the national patent offices is often only possible 
in the local language. It is estimated that the accumulated cost of the technical assistance for 
payment can reach € 61-81.2 million over a 10-year period. 
3.3. Problem 3: Administrative complexity of  registering transfers, licences and 
other rights 
Patents can facilitate transacti ons in the markets for technolo gy: they can be bought and sold 
as property titles or, more fre quently, be subject to licensing agreements. Transfers and rights 
are registered in the national pa tent registers of the countries where the patent is validated. 
Such registration requires appoin ting a professional representative in more than half of the 
MS. Registering the transfer of a patent vali d in 5 countries can co st € 2000-2500 in addition 
to the different procedural fees charged in the MS. Moreover, there are divergent 
requirements as regards the types of documents to be submitted to the patent register, certificates, etc. 
                                                
 
9 Agreement on the application of Article 65 EP C (London Agreement) adopted in October 2000  (OJ 
EPO 2001, 550). 
EN 3   EN 3.4. Consequence: EU-wide patent protection is expensive 
As a consequence, access to comprehensive pate nt protection in Europe is so costly and 
complex that it is inaccessible to many inventor s and companies. In particular, SMEs often 
prefer an informal protection of their innovations (i.e. secrecy).  
But even when European patents are solicited an d granted, they are usually validated only in a 
few countries selected by the patentee. Currentl y, a European patent is , on average, validated 
in 5 MS10. The number of validations has even  decreased over the last 15 years11. Moreover, 
the administrative burden and complexity of ma intaining patents and registering rights and 
licences generate unnecessary costs for inventor s and businesses, including the ones seeking 
patent information. 
The fragmentation of patent protection also re nders the enforcement of patent rights more 
difficult. When goods enter the EU through a MS where a patent is not in force, the patent holder may not rely on the EU Customs Code
 to withhold the goods suspected to be in breach 
of a patent12.  
The situation described above has major undesira ble effects on the functi oning of the internal 
market. In addition to maintaining the fragment ation of the market, it also has a negative 
impact on innovation, growth and the competitiveness of European business.  
4. SUBSIDIARITY  
The creation of European intellectual propert y rights to provide unifo rm protection throughout 
the EU and associated language arrangement s is provided for by Article 118 TFEU. The 
problems outlined above can only be addressed at EU level by a solution that drastically 
reduces translation and administrative require ments compared to the current regime. EU 
action is necessary, as without an  EU legal instrument MS woul d not sufficiently be able to 
establish legal effects attached to patents th at are uniform in several MS. Proportionality was 
taken into account in the analysis of the options. 
5. OBJECTIVES  
Following from the problem definition, the general objectives of this pro posal are to enhance 
the functioning of the Single Market and foster growth and innovation. Th ese objectives could 
be achieved by increasing SMEs' access to patent  protection, increasing the scope of patent 
validations and knowledge dissemi nation (specific objectives). 
The above objectives can only be reached by loweri ng the overall costs of patent protection in 
Europe, in particular by reducing the tran slation and publication costs, simplifying the 
maintenance of patents (renewal) and simplif ying the registration of  transfers, licensing 
agreements and other rights.  
                                                 
10 Study on the Cost of Patenting by Roland Berger Market Research, August 2004. 
11 Economic cost-benefit analysis of the Community patent by van Pottelsberghe, Danguy, 2009.  
12 Council Regulation (EC) No 1383/2003 (OJ L 196, 2.8.2003, p. 7–14).  
EN 4   EN 6. POLICY OPTIONS AND ANALYSIS  
The policy options were measured against the fo llowing criteria: effectiveness, cost reduction, 
simplification and political feasibility. The MS , however, that request ed the Commission to 
propose enhanced cooperation in the area of unitary  patent protection also indicated the scope 
and the objectives of such cooperation. These preconditions had to be taken into account when considering the options.  
6.1. Option 1 (Base-line scenario) – the Commission takes no action 
Under this scenario, the current patent syst em in Europe would remain intact. The only 
improvement could be the accession of more MS to the London Agreement. Accession is, however, not only optional but lengthy and comple x. This scenario is ineffective as it would 
not address the shortcomings of the current Eur opean patent system. It would not result in 
cost reduction or simplification as the problem s of validation, renewal and registration would 
persist. Finally, this option is also not in line with the political engage ment of the Commission 
and the Council to address the proble ms in the current patent system. 
6.2. Option 2 – the Commission continues to  work with the other institutions 
towards an EU patent covering 27 Member States 
Under this option, the Commission – together with  the Council and the European Parliament – 
would continue to work towards an EU patent which covers al l MS, i.e. would continue the 
discussions on the basis of the Commi ssion's proposals on the Community patent
13 and on the 
translation arrangements14. This option would fully achieve th e objectives of the initiative. It 
would result in a major cost reduction, as translation costs w ould amount to € 680 in the entire 
EU with no additional cost of validation. The overall sa vings could reach € 159 million per 
year. From the elimination of th e cost of technical assistance for the payment of renewal fees, 
a saving of € 49-65.2 million in a 10-year peri od could be foreseen. As the payment and 
management of the renewal, as well as the re gistration of the patents and the related rights 
would be managed centrally, this option would achieve major simplification. However, this 
option is not feasible politica lly as the Council had tried and failed on several occasions to 
reach a unanimous agreement on the indispensable translation arrangements. 
6.3. Option 3 - the Commission presents pr oposals for regulation implementing 
enhanced cooperation 
Under this option, the Co mmission would present the proposals necessary for the 
implementation of enhanced cooperation in the area of unitary patent  protection. Unitary 
patent protection would cover th e 25 MS that wish too cooperate in this framework. They 
represent 79% of the territory of  the EU and over 92% of the app lications are filed from these 
countries. The unitary patent protection would be optional to the users and would co-exist 
exist with the current European and national pate nt systems. The costs and the complexity of 
patent protection would be signi ficantly reduced. All patent hol ders would equally enjoy the 
benefits of this option, no matter whether they ar e residents in countries inside or outside the 
enhanced cooperation. 
                                                 
13 COM(2000) 412. 
14 COM(2010) 350. 
EN 5   EN Although this option would not br ing the full benefits of opti on 2, it would be effective and 
have a positive impact on users of the patent system in Europe. The payment and management 
of the renewal of the patents, as well as the registration of the patents and the related rights 
would be managed centrally by th e EPO with respect to the territory of the participating MS. 
In a 10-year period, the cost sa vings from the fees of technical assistance for payments could 
reach € 5760-7680 per patent if 25 MS participat ed in the enhanced cooperation. In the non-
participating countries patents would still need to be managed one-by-one. 
6.3.1.  Sub-option 3.1 - the Commission proposes translation arrangements applicable in 
the area of unitary patent protection that correspond to its proposal of 30 June 
2010 
Under this sub-option, the Comm ission would propose translation arrangements applicable in 
the area of unitary patent protec tion that are identical to its pr oposal for the translation regime 
for the EU patent. The patentee would supply to the EPO a translation of the claims into the 
two other official languages of the EPO. No add itional translations would be required (except 
in the case of dispute). The average cost of  patents for the area of enhanced cooperation 
would be € 680. The cost of protection for the whole EU could be 15% of the costs today 
(with 25 participating MS). The overall savings could reach € 58.5 million per year. This sub-
option would be cost-effective and result in rele vant simplification but did not find sufficient 
support in Council. The MS requesting the launch of enhanced cooperation wish to include in 
the implementing regulations some of the elemen ts proposed by the Belgian Presidency on the 
translation arrangements. The proposal fo r the draft Council deci sion authorising the 
enhanced cooperation contains already a number of substantive elements in this regard. 
Therefore, this option is politically not feasible. 
6.3.2.  Sub-option 3.2 – the Commission proposes translation arrangements applicable in 
the area of unitary patent protection bas ed on its proposal of 30 June 2010 and 
incorporating elements of a compro mise proposal discussed by the Council 
Under this sub-option, the above translation arrangements would be complemented by certain 
elements of a compromise proposed by the Belg ian Presidency in 2010 , as requested by the 
MS demanding the Commission to provide for a proposal to launch enhanced cooperation. 
The main set of linguistic requirements would the one under the EPC. In addition, 
supplementary translation requirements would be  applicable for a transitional period that 
would result in additional costs for patentees. Th erefore, the total costs of translation during a 
transitional period may vary from approx. € 980 to  € 2380 per patent in the area of enhanced 
cooperation. When high-quality mach ine translations become available, the cost of translation 
would be reduced to € 680. The co st of protection for the whole EU could be 20% of the costs 
today (with 25 participating MS). The overall savings could reach € 50 million per year. This 
sub-option can be expected to get significant political support.  
7. COMPARING THE OPTIONS AND THEIR IMPACTS  
When comparing the options, option 2 has the highest score according to the effectiveness, 
cost reduction and simplification criteria. However option 3 also has major benefits and results in important savings and simplificatio n for the users from Europe and from third 
countries. 
The creation of an EU patent (option 2) would have the most  positive impact on the internal 
market, on the users of patent information and on consumers, as it would integrate the entirety 
EN 6   EN of the internal market in terms of patent pr otection. But option 3 would also increase the level 
of integration not only between the participating MS but also  between participating and non-
participating countries. By implementing e nhanced cooperation, the overall costs and 
complexity of obtaining patent protection th roughout the EU will be significantly reduced, 
thus, more inventors can be expected to seek patent protection also in the MS that do not 
participate in the enhanced cooperation.  
Improved integration will have a positive impact on consumers' access to goods and services. 
A better integrated market will ensure better cr oss-border trade and will facilitate fight against 
counterfeited goods. The centralised registratio n and publication of patents by the EPO would 
facilitate the dissemination of knowledge and have a positive impact on innovation.  
Easier and cheaper access to patents in Europe is likely to result in an increased number of 
innovative SMEs. SMEs have a majo r role in job creation; they ensure 2/3 of private sector 
jobs15. The increase in the number of  new business, therefore, can be expected to have a 
positive impact on job creation. 
While it is clear that in economic terms an EU patent would the most effective, 10 years of 
negotiation have shown that this option is polit ically not feasible. Th e analysis of option 3 
shows that its benefits would still be very import ant. Although the translation regime under 
sub-option 3.1 would be the most cost-effective, sub-option 3.2 is  likely to have the widest 
support among the MS participating in enhanced  cooperation. Therefore, option 3 with sub-
option 3.2 is the preferred option. 
8. MONITORING AND EVALUATION  
Five years after the start of application, th e Commission will review the application of the 
legislation, with particular attention to the transitional translation arrangements. The Commission will also monitor the relevant indexes on the conditions of innovation, the 
number of patents and their cost on an annual basis. 
 
                                                
 
15 http://ec.europa.eu/enterprise/policies/ sme/facts-figures-analysis/index_en.htm