Opinion of the Economic and Social Committee on the 'Proposal for a European Parliament and Council Directive approximating the legal arrangements for the protection of inventions by utility model'
Date: 1998-05-27
Institutions: European Economic and Social Committee
Subjects: approximation of laws, competition law, industrial property, invention, technological change

C 235/26

EN

Official Journal of the European Communities

27.7.98

Opinion of the Economic and Social Committee on the ‘Proposal for a European Parliament
and Council Directive approximating the legal arrangements for the protection of inventions
by utility model’ (1)

(98/C 235/06)

On 13 January 1998 the Council decided to consult the Economic and Social Committee,
under Article 100a of the Treaty establishing the European Community, on the above-mentioned
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 6 May 1998. The rapporteur
was Mr Ataı´de Ferreira.

At its 355th plenary session (meeting of 27 May 1998), the Economic and Social Committee
adopted the following opinion by 102 votes to 2 with 3 abstentions.

1.

Introduction

Treaty Article 3(f) and (h), opening the way for the
approximation of law which is called for in the proposal.

The present opinion concerns the Proposal for a
1.1.
European Parliament and Council directive approxi-
mating the legal arrangements for the protection of
inventions by utility model, submitted by the Com-
mission (2).

1.2.
The proposal follows upon the Green Paper: The
protection of utility models in the single market (3) and
the relevant ESC opinion (4).

1.3.
This is therefore a particularly painstaking legis-
lative process, involving the different competent insti-
tutions and a number of other concerned organizations.

1.4.
From the outset, the Committee would stress the
importance of utility models for technological and
industrial innovation, particularly for SMEs and, in this
light, for EU development.

2. The Commission proposal — general comments

2.3.
For this reason, the Commission has quite rightly
selected Treaty Article 100a as the legal basis for the
proposal.

2.4.
The Commission also refers to the need to take
action ‘to make the free movement of goods resulting
from minor technical inventions in the Community more
transparent and prevent differences between national
laws or the lack of such laws from causing distortions
of competition’ (5), and to ‘improve the legal environ-
ment for Community firms, engaged as they are in an
ongoing process of innovation and adaptation, and thus
enhance their competitiveness in the world market
through the protection of their inventions by utility
model — a device particularly attuned to serving the
needs of SMEs’ (5).

2.5. On the basis of the survey mentioned in point
2.1 above, the Commission concludes that there is ‘a
real need for the protection of inventions by utility
model in the Community ... patent protection being
unsuited to certain types of invention such as minor
technical inventions’ (6).

2.1.
The Commission proposal is based firstly on a
number of general assumptions, and secondly on a
survey of actual utility model protection in several
Member States.

2.6.
The Committee has already had occasion to
comment on Commission studies and surveys on the
subject, and maintains its reservations that they are not
‘as totally reliable as their authors appear to claim’ (7).

2.2.
The first of the general assumptions is connected
with the idea that in this field, ‘the intellectual property
rights conferred by the Member States can ... be used to
hinder the free movement of goods’ (3), and is echoed in

In connection with the underlying assumption of
2.7.
this legislative process — in brief, that rules protecting
intellectual property other than by patent are absolutely
essential — the Committee would repeat the view
expressed in its earlier opinion, to the effect that ‘the
lesson which must perhaps be drawn from the existence

(1) OJ C 36, 3.2.1998, p. 13.
(2) COM(97) 691 final; OJ C 36, 3.2.1998.
(3) COM(95) 370 final.
(4) OJ C 174 of 17.6.1996.

(5) COM(97) 691 final; OJ C 36, 3.2.1998, p. 3, point 3.
(6) COM(97) 691 final; OJ C 36, 3.2.1998, p. 4, point 6.
(7) OJ C 174 of 17.6.1996, p. 8, point 5.5.

27.7.98

EN

Official Journal of the European Communities

C 235/27

of these “short term” national patents is that the priority
need in Europe is to make patent protection more
efficient (more rapid and less costly), rather than
create complementary protection (utility model) at the
Community level’ (1). In this respect, the Committee
would highlight the Commission’s work in analyzing
the patent protection system (2). It should also be
noted that the Commission is currently drawing up a
communication on the Community patent.

which the production cycles and lifespans of inventions
are becoming ever shorter.

2.11.
The Committee also stresses that any proposals
for harmonization must first ensure harmonization of
timescales and procedures: otherwise, harmonization of
more substantive aspects will prove impracticable.

2.8. Once again, the Committee would point out that
this issue, of the need for arrangements which protect
technical
innovations, supplementary to patents for
inventions, must be integrated into the EU’s RTD policy
strategy.

2.8.1.
It is therefore important to draw the appropri-
ate conclusions from the experience of the EU’s main
competitors, as the EU is lagging behind.

2.8.1.1.
Examination of the US experience, where
utility models are absent, would in fact point to ‘the
need to make the patent system more efficient by
reducing its known drawbacks, such as the length of
time taken to examine applications and grant patents,
and the cost’ (3).

2.8.1.2. On the other hand, as the Committee empha-
sized in its earlier opinion, the Japanese experience
shows that utility models must always possess a three-
dimensional quality and be of a significantly shorter
duration than patents (six years instead of twenty).

2.9.
The Committee warns that moves for legislative
approximation in this field must always be justified on
their own merits and not by virtue of shortcomings or
contradictions in the patent process: these must be
corrected or removed within the framework of that
process, as appears to be the Commission’s aim in its
green paper on the Community patent.

2.10.
Independently valid arguments include the cir-
cumstances surrounding intellectual property protec-
tion, legislative safeguards against counterfeiting and,
indirectly, the promotion of innovation and development
at Community level, particularly given a world scene on

3. The Commission proposal — the legislative option

In its green paper (4), the Commission set out the
3.1.
various possible types of action in this area, and
concluded by selecting four options:

3.1.1.
bringing current national systems into line and
introducing a protection system in countries where it
does not currently exist;

3.1.2. mutual recognition — once alignment has been
achieved — of the national protection offered by
Member States;

3.1.3.
adoption of a regulation establishing a Com-
munity protection system and ranking above national
systems;

3.1.4.
a combination of different possibilities with,
in particular, a directive harmonizing national protection
rights, and a regulation establishing a single protection
system.

3.2.
The Committee notes that the Commission has
restricted the present initiative to the first of these
objectives (see 3.1.1 above), concluding that ‘harmo-
nization will make it possible for equivalent national
systems of utility model protection to coexist’ and that
‘a person applying for a utility model will be assured of
finding an equivalent property right in the other Member
States and will no longer come up against different sets
of rules’ (5). The Committee would, however, highlight
the need for such persons to file separate requests in
each country in which they seek utility model protection
for their invention.

3.3.
The Committee believes that this objective can-
not be met unless a system of mutual recognition of
national protection by the Member States is consolidated
at the same time. In the Committee’s view, it is essential
that the plan to harmonize national legislation should
‘following effective harmonization, provide for a later
stage of mutual recognition of national rights’ (6).

(1) OJ C 174 of 17.6.1996, point 5.3.3.
(2) COM(97) 314 final — Green Paper on the Community
patent and the patent system in Europe, and the relevant
ESC opinion: OJ C 129, 27.4.1998.
(3) OJ C 174, 17.6.1996, p. 4, point 2.8.

(4) COM(95) 370 final, pp. vi et seq.
(5) COM(97) 691 final, OJ C 36, 3.2.1998, p. 6, point 10.
(6) OJ C 174, 17.6.1996, p. 11, point 6.11.

C 235/28

EN

Official Journal of the European Communities

27.7.98

3.4. More generally, the Committee also wishes to
underscore two basic ideas, already expressed in its
earlier opinion on this question.

for technical inventions’ (2), and then lists the names
under which it is known in various Member States.

3.4.1.
Firstly, there is ‘the fact that some of the
national systems, which the green paper lumps together
under the label of “utility model”, are actually none
other than patent systems “without examination” (of
novelty or inventive step), and thus essentially “regis-
tration” (rather than merit assessment) patents, albeit
of shorter duration than normal patents (e.g. in Belgium,
the Netherlands and France)’ (1), while retaining eligi-
bility conditions for inventions which are very close to
those imposed for patent protection.

In this regard, the Committee would repeat
3.4.1.1.
that utility models should be clearly distinguished as a
separate entity under the overall umbrella of industrial
property rights, and must not represent a safety-valve
to make up for any shortcomings (cost, delay) in the
patent system.

3.4.2.
Secondly, the Committee points out that the
objectives of the present draft directive — to boost the
single market and remove distortions of competition —
cannot be achieved through measures of this kind: they
depend on deeper and, essentially, broader legislative
harmonization.

3.4.3.
The Committee therefore emphasizes that any
future measures in this field must satisfy a variety of
essential conditions:

4.1.1.
The Committee would point out that what is
apparently a single concept in fact covers widely varying
realities. According to the Commission itself, these
should be divided into three distinct groups: this alone
illustrates the need for a full and clear definition of the
applicable rules. The list under Article 1 should therefore
only appear as an annex to help clarify the internal rules
which are to be harmonized, and should not actually
define the utility model itself.

4.1.2.
The Committee also draws attention to the
narrow scope of the definition given, and recommends
that if the present wording of Article 1 is retained, the
concepts of ‘inventive step’ and ‘industrial application’
should appear directly. These are the decisive elements,
as acknowledged by the Commission in Article 3.

4.2. Article 4

The Committee considers the wording of Article 4(d) to
be too broad and therefore believes that, in line with the
rules adopted for the European patent, exclusions should
be limited to computer programs as such.

3.4.3.1.
at the level of the protection conferred: utility
models must be seen as the most appropriate procedural
means of protecting simpler inventions;

4.3. Article 5

3.4.3.2.
at the procedural level: protection by means
of utility model must be secured swiftly and economi-
cally, since the level of legal protection conferred is
incompatible with lengthy and costly procedures;

In connection with the ‘novelty’ requirement, the Com-
mittee acknowledges the Commission’s efforts to attune
this concept to that of ‘state of the art’ (absolute novelty)
and to make it practicable by providing clear and precise
conceptual descriptions.

3.4.3.3.
at the level of legal certainty: the degree of
protection must be clear as regards both counterfeiters
and well-intentioned third parties.

4.4. Article 6

4. The Commission proposal — specific comments

4.1. Article 1

The Commission begins by defining the utility model as
‘the registered right which confers exclusive protection

Concerning the ‘inventive step’ requirement (again in
relation to ‘state of the art’), the Committee notes the
introduction of ‘particular effectiveness’ and ‘practical
or industrial advantage’ as conditions for granting utility
model status. It should be pointed out that the aim here
is to protect inventions designed for major practical
applications, chiefly in the fields of mechanical engineer-
ing, the electrical industry, precision engineering, optics
and car manufacturing. The Commission should work

(1) OJ C 174, 17.6.1996, p. 7, point 5.3.1.

(2) COM(97) 691 final; OJ C 36, 3.2.1998, p. 32, ‘Definitions’.

27.7.98

EN

Official Journal of the European Communities

C 235/29

out a way of formulating this requirement which could
provide the best guarantee of legal certainty both for
the applicant and for the third parties concerned.

4.9. Article 16

4.4.1.
The Committee therefore emphasizes that util-
ity model protection must be subject to verification of
three essential requirements:

4.4.1.1.
absolute novelty, compared with the state of the art;

the novelty requirement,

in the sense of

4.4.1.2.
in its widest sense;

the industrial application requirement, taken

4.4.1.3.
the inventive step requirement, seen from the
standpoint of either particular effectiveness (ease of
application or use), or of practical or industrial advan-
tage.

The Committee believes that although the search report
is offered as an option to utility model applicants, the
circumstances in which it may be requested should be
clarified. The possibility of such reports being used only
by the most economically powerful applicants must be
avoided. Also, for the system to remain viable, it should
be clarified that this option needs to be limited to
exceptional cases.

4.9.1.
At the same time, the Committee would argue
that the Member States should legislate at national level
to make search reports compulsory in the case of legal
proceedings invoking the rights conferred by utility
models, as this would be justified in such cases.

4.5. Article 8

4.10. Articles 17 and 18

In the Committee’s view, the proposed wording does
not properly address the need to regulate the payment
of fees for renewal of utility models as set out in
Article 19.

4.6. Article 10

The Committee believes it essential that, in addition to
indicating how utility model protection is acquired, an
indication of duration should also be compulsory, if it
is granted temporarily.

The Committee considers that since the question of
priority rights and internal priority concerns the effects
of an application rather than the application itself, it
should be dealt with in a separate section and not in
those on applications and the effects of the model.

4.10.1.
This is in fact one of the most important
effects of the draft directive, since it grants the applicant
a priority right to file a utility model application relating
to a single invention in one or several Member States.

4.7. Article 12

4.11. Article 19

The Committee fully endorses the specific safeguards
imposed on applicants regarding disclosure of the
invention, since this description enables the expert
(skilled in the art) to assess the practical applicability of
the invention, where appropriate (see Article 24).

4.8. Article 13

The Committee must point out that the opportunity to
‘restrict the number of claims’ (1) — recognized by
the Commission itself as appropriate — is lost. The
Committee also considers that the Commission should
clarify whether or not the Member States are barred
from restricting the possible number of claims by
applicants, or whether the only way of fleshing out the
vague concept applied in Article 13 — ‘strictly necessary
having regard to the nature of the invention’ — is by
means of third party opposition to ‘excessive claims’.

The proposed duration of protection appears excessive
given the data the Commission provides on the life-cycle
of inventions, particularly when this duration is viewed
independently of the economic exploitation of the
invention. It should however be borne in mind that
harmonization would reduce the duration of protection
in certain Member States.

4.11.1.
This point may give particular grounds for
concern, considering that the applicant may easily obtain
two successive two-year renewals up to a total of
10 years. It might be advisable to oblige the Member
States to increase renewal fees after the six-year period.

4.12. Article 20

(1) COM(95) 370 final, p. 73, fourth paragraph of (g).

The scope of the exclusive rights granted, and the legal
seem appropriate, although
limitations on them,

C 235/30

EN

Official Journal of the European Communities

27.7.98

allowing the Member States to impose further limitations
might, to some extent, run counter to the intended aims
of the draft directive.

4.13. Article 21

The legal precepts concerning Community exhaustion
and international non-exhaustion of rights require no
comment, since they are in accordance with Community
legal precedent in this area.

4.14. Article 22

The Committee believes that the Commission should
make it obligatory for Member States to deem a utility
model ineffective, where a patent has been granted for
the same invention.

4.14.1.
This is the only way to ensure effective
harmonization, since the consequences of this legislative
option extend beyond the question of dual protection
(cf. the rules on priority, for example).

4.14.2.
It would also seem proper to ‘oblige’ appli-
cants to retain patent protection only, since the greater
costs involved would be offset by the specific features
of this type of protection, particularly in terms of legal
certainty.

4.15. Article 23

Further to the previous point and for the reasons already
set out, the Committee considers that the list of causes
of lapse of a utility model should include supersedence
by a patent on the same invention. Moreover, it believes
that non-payment of fees should not be deemed a cause
for lapse, but simply a failure to meet the conditions
for granting a utility model. However, this being
understood, the Committee recommends that renewal
fees be added to the list of fees given in Article 8(2).

Brussels, 27 May 1998.

4.16. Article 24

While endorsing the principles underlying the proposed
text, the Committees urges that the wording be amended,
particularly with regard to the paragraphs identifying
the grounds for requesting revocation of utility models.

4.17. Article 25

Regarding the deadline for transposition of the proposed
directive, the Committee would point out that transpo-
sition must depend upon harmonization of patent rights,
since this clearly lies at the core of the entire question.

5. Conclusions

5.1.
Utility models are an appropriate means of
protecting industrial property and as such, contribute
to EU development insofar as they boost investment in
research and development.

5.2.
The coexistence of different national industrial
property protection systems by using utility models
could prejudice the achievement of free movement of
goods and generate distortions of competition.

5.3.
Utility models are the ideal mechanism to protect
inventions which cannot be patented. As such they
represent a legal instrument particularly well-suited to
SMEs.

5.4.
The Commission’s initiative appears capable of
achieving the aims it proposes, although some technical
improvements might be made, as mentioned in the
present opinion.

5.5.
The present initiative should also be viewed
in conjunction with initiatives to regulate protection
through the patent system, in view of the similarities
existing between the two systems in question.

The President

of the Economic and Social Committee

Tom JENKINS