Opinion on the proposal for a European Parliament and Council Regulation (EC) concerning the creation of a supplementary protection certificate for plant protection products ()

(95/C 155/05)

On 10 February 1995 the Council decided to consult the Economic and Social Committee, under Article 100A of the Treaty establishing the European Community on the abovementioned proposal.

The Section for Industry, Commerce, Crafts and Services, which was responsible for preparing the Committee's work on the subject, adopted its Opinion on 5 April 1995. The Rapporteur was Mr Gardner.

At its 325th Plenary Session (meeting of 27 April 1995), the Economic and Social Committee adopted the following Opinion by a majority vote with five abstentions.

1. Introduction

1.1. Development of plant protection products requires extensive and expensive research. They need to be effective, safe and environmentally friendly. These requirements have to be met before authorization is given under Directive 91/414/EEC. Authorization can be withdrawn under that Directive if for any reason these requirements are no longer met. The Committee emphasizes that safety and respect for the environment are absolutely essential.

1.2. In many ways those products are similar to pharmaceuticals. Unlike the latter the market for plant protection products is very price sensitive. Farmers will only buy them if they give enough benefit in terms of yield or quality, or reduction of weeds, pests or diseases. Profits from which research is financed have gone down both due to the increased testing requirements and lower sales resulting from lower farming incomes.

1.3. The products of this research are generally very easy to copy. Therefore patent protection is very necessary. In the EU, patent protection (20 years) starts from the time that a patent application is filed. Effective protection (i.e. the period between authorization to market the product and patent expiry) has been subject to gradual 'erosion' owing to time taken to comply with the (justified) increase in safety and environmental requirements. In the EU it is currently about nine years.

1.4. In the USA, the most important competitor, patent protection starts from the date of grant of the patent rather than its date of filing. As a result US patents generally expire after the expiry of the corresponding EU patent. In the '70s the EU matched the USA's ability to originate the most important new products but in the '80s this majority originated in the USA.

1.5. This proposal will help to restore the competitive position vis-à-vis the USA and Japan, and encourage highly skilled employment in the EU.

1.6. This proposal is for a supplementary protection of up to five years which may (but need not) be granted from the time that the basic patent of a product has expired. The result is to give a total effective period of protection (patent + SPC) of up to 15 years. The proposed procedure, which is totally transparent, has been closely modelled on the analogous one for medicinal products (Regulation 1768/92) ().

1.7. The proposal also seeks to align differences between Member States, measure necessary for the efficient working of the single market.

1.8. There is also a transitional provision for current products for which the patent has not yet expired. However, this only applies to products where first authorization in the EU took more than five years from the date of patent application. The transitional provision does not apply to patent expired products (over 50% of the market), but to a small but significant proportion of those that are still patent protected.

2. General Comments

2.1. The Committee endorses the Commission proposal for a supplementary protection certificate for plant protection products subject to the comments below:

2.2. After the Regulation has been in force for five years the Commission should draw up an evaluation report for the European Parliament and the Economic and Social Committee on the following points:

2.2.1. Whether the proposed changes really have brought effective EU patent protection in line with that in the USA and Japan?

2.2.2.

The interests of producers of generics including the effect of the transitional provisions

2.2.2.1. Generics are products with the same chemically active principles marketed after patent protection has expired. Generics producers do not engage in research but need a steady supply of new or improved products to become available. The generics industry therefore cannot exist without a strong innovative and productive research based industry.

2.2.2.2. There are currently 700 active ingredients on the EU market, more than 50% of which are patent expired and thus available to generics manufacturers. The Commission has estimated that of the remaining active ingredients that are patent protected this proposal will affect only 37 over the next 10 years (i.e. it will affect on average 3.7 out of 700 active ingredients per year). This illustrates the effect on generics producers.

2.2.3.

The long term interests of farmers

2.2.3.1. Farmers need a continuing supply of improved plant protection products but for them this proposal could produce some increase in costs (estimated by the Commission as an increase in cost of plant protection products from 6.2% to 6.2204% of total outgoings). In the shorter term this increase will continue to be more than compensated by increased competition due to the single market.

2.2.4.

Increased development of safer, more environmentally friendly products

2.2.4.1. The restoration of effective protection provided by this proposal should contribute to the already established trend to develop safer, more environmentally friendly products.

Done at Brussels, 27 April 1995.

The President

of the Economic and Social Committee

Carlos FERRER

() OJ No L 182, 2. 7. 1992.

() OJ No. C 390, 31 12. 1994, p. 21.