COMMISSION STAFF WORKING DOCUMENT IMPACT ASSESSMENT REPORT Accompanying the document Proposal for a Regulation of the European Parliament and of the Council on compulsory licensing for crisis management and amending Regulation (EC) 816/2006
Date: 2023-04-27
Institutions: Directorate-General for Internal Market, Industry, Entrepreneurship and SMEs, European Commission
Subjects: coronavirus disease, crisis management, epidemic, export monitoring, health aid, intellectual property, pharmaceutical product, rule under emergency powers, security of supply

EN 

  EN 

   EUROPEAN COMMISSION  Brussels, 27.4.2023  SWD(2023) 121 final  COMMISSION STAFF WORKING DOCUMENT  IMPACT ASSESSMENT REPORT  Accompanying the document Proposal for a Regulation of the European Parliament and of the Council on compulsory licensing for crisis management and amending Regulation (EC) 816/2006     {COM(2023) 224 final} - {SEC(2023) 173 final} - {SWD(2023) 120 final} - {SWD(2023) 122 final}  
 
 
 
 
 
Table of contents 

1 

INTRODUCTION: POLITICAL AND LEGAL CONTEXT ............................................................... 4 

1.1 
1.2 
1.3 

The political context .................................................................................................................. 4 
The legal context ....................................................................................................................... 6 
Compulsory licence as an incentive or replacement of voluntary agreements .......................... 7 

2 

PROBLEM DEFINITION .................................................................................................................... 8 

2.1  What is the problem? ................................................................................................................. 8 
Drivers of the problem ............................................................................................................ 11 
2.2 
Divergent national schemes on compulsory licensing ........................................................ 12 
2.2.1 

2.2.2 

Inadequate territorial reach of compulsory licensing .......................................................... 16 

2.2.3 
No dedicated forums to deal with compulsory licensing that could bolster EU resilience in 
times of crisis ...................................................................................................................................... 18 

2.3 
2.4 

Consequences of the problem .................................................................................................. 19 
How likely is the problem to persist? ...................................................................................... 20 

3  WHY SHOULD THE EU ACT? ........................................................................................................ 21 

3.1 
3.2 
3.3 

Legal basis ............................................................................................................................... 21 
Subsidiarity: Necessity of EU action ....................................................................................... 21 
Subsidiarity: Added value of EU action .................................................................................. 21 

4 

OBJECTIVES: WHAT IS TO BE ACHIEVED? ............................................................................... 22 

4.1 
4.2 

General objectives ................................................................................................................... 22 
Specific objectives ................................................................................................................... 22 

5  WHAT ARE THE AVAILABLE POLICY OPTIONS? .................................................................... 23 

5.1  What is the baseline from which options are assessed? .......................................................... 23 
Description of the policy options ............................................................................................ 24 
5.2 
Option 1: Recommendation on compulsory licensing for crisis management.................... 27 
5.2.1 

5.2.2 

Option 2: Harmonisation of national laws on compulsory licensing for crisis management
28 

5.2.3 
Option  3:  Harmonisation  plus  a  binding  EU-level  measure  on  compulsory  licensing for 
crisis management ............................................................................................................................... 29 

5.2.4 

Option 4: EU-level compulsory licensing to complement existing EU crisis instruments . 31 

5.3 

Discarded options .................................................................................................................... 33 

6  WHAT ARE THE IMPACTS OF THE POLICY OPTIONS? ........................................................... 34 

6.1 
6.1.1 
6.1.2 

6.1.3 
6.1.4 

6.2 

6.2.1 

6.2.2 

Option 1 – Recommendation on compulsory licensing for crisis management ...................... 34 
Improve the key features of compulsory licensing ............................................................. 34 
Territorial reach of compulsory licensing ........................................................................... 34 

Support to EU resilience ..................................................................................................... 34 
Impacts per stakeholder group ............................................................................................ 35 

Option  2  –  Harmonisation  of  national  laws  on  compulsory  licensing  for  crisis 
management ............................................................................................................................ 36 
Improve the key features of compulsory licensing ............................................................. 36 

Territorial reach of compulsory licensing ........................................................................... 36 

1 

 
 
 
6.2.3 
6.2.4 

6.3 
6.3.1 
6.3.2 

6.3.3 
6.3.4 

6.4 

6.4.1 

6.4.2 
6.4.3 

6.4.4 

6.5 
6.5.1 

6.5.2 
6.5.3 

6.5.4 

Support to EU resilience ..................................................................................................... 36 
Impacts per stakeholder group ............................................................................................ 37 

Option 3 – Harmonisation plus a binding EU-level measure on compulsory licensing .......... 38 
Improve the key features of compulsory licensing ............................................................. 38 
Territorial reach of compulsory licensing ........................................................................... 38 

Support to EU resilience ..................................................................................................... 38 
Impacts per stakeholder group ............................................................................................ 39 

Option  4  –  EU-level  compulsory  licensing  to  complement  existing  EU  crisis 
instruments .............................................................................................................................. 40 
Improve the key features of compulsory licensing ............................................................. 40 

Territorial reach of compulsory licensing ........................................................................... 40 
Support to EU resilience ..................................................................................................... 41 

Impacts per stakeholder group ............................................................................................ 41 

Common impacts ..................................................................................................................... 42 
Impacts on fundamental rights ........................................................................................... 42 

Social and environmental impacts ...................................................................................... 43 
Economic and competitiveness impacts ............................................................................. 44 

Summary of cost and benefits specific to the compulsory licensing procedures ................ 45 

7 

HOW DO THE OPTIONS COMPARE? ............................................................................................ 47 

7.1 
7.2 
7.3 

Comparison of options against the effectiveness and efficiency criteria ................................. 47 
Comparison of impacts of options on stakeholders ................................................................. 49 
Coherence with other EU policies and proportionality ........................................................... 50 

8 

9 

PREFERRED OPTION ...................................................................................................................... 51 

8.1 

REFIT and the application of the ‘one in, one out’ approach.................................................. 53 

HOW WILL ACTUAL IMPACTS BE MONITORED AND EVALUATED? .................................. 53 

ANNEX 1: PROCEDURAL INFORMATION ............................................................................................ 55 

ANNEX 2: STAKEHOLDER CONSULTATION (SYNOPSIS REPORT) ................................................ 57 

ANNEX 3: WHO IS AFFECTED AND HOW? .......................................................................................... 68 

ANNEX 4: ANALYTICAL METHODS ..................................................................................................... 72 

ANNEX 5: LEGAL BACKGROUND AND THE KEY LEGAL PROVISIONS ....................................... 78 

ANNEX 6: SUPPLEMENTARY EVIDENCE ............................................................................................ 87 

ANNEX 7: SUPPLEMENTARY LEGAL ANALYSIS: THE PRINCIPLE OF EXHAUSTION IN 

THE SINGLE MARKET .................................................................................................................. 135 

ANNEX 8: SME TEST .............................................................................................................................. 138 

2 

 
 
 
 
 
Glossary 

Term or acronym 

Meaning or definition 

Charter 

CJEU 

CL 

EU Charter of fundamental rights 

Court of Justice of the European Union. 

Compulsory licence 

Doha Declaration 

WTO  Declaration  on  the  TRIPS  agreement  and  public  health 
adopted on 14 November 2001 

EC 

EPO 

The European Commission 

European Patent Office 

EU cross-border crisis 

Crisis affecting more than one EU country 

HERA 

IP 

NGO 

OPC 

RDP 

SCBTH 

Health Emergency Preparedness and Response  

Intellectual property 

Non-governmental organisation 

Open public consultation 

Regulatory data protection 

Serious cross-border threats to health 

Single Market 

The EU single market covering EU 27 Member States 

SME 

SMEI 

SPC 

TFEU 

Small or medium-sized enterprise(s) 

Single Market Emergency Instrument 

Supplementary protection certificates 

Treaty on the Functioning of the European Union 

TRIPS Agreement 

Agreement  of  the  World  Trade  Organization  (WTO)  on  Trade-
Related Aspects of Intellectual Property Rights 

WHO 

WIPO 

WTO 

World Health Organization 

World Intellectual Property Organization 

World Trade Organization 

Country codes used in the text:  

AT - Austria  
BE - Belgium 
BG - Bulgaria  
DE - Germany  
DK - Denmark 
CY - Cyprus  
CZ - Czechia 
EE – Estonia 
FI - Finland 
FR- France  
EL - Greece  
HR - Croatia  

SI – Slovenia 
ES - Spain 
SE - Sweden  

HU - Hungary  
IE - Ireland  
IT - Italy 
LV - Latvia  
LT - Lithuania  
LU - Luxembourg  
MT - Malta 
NL – Netherlands, the  
PL - Poland  
PT - Portugal  
RO - Romania  
SK - Slovakia  

3 

 
 
 
 
1 

INTRODUCTION: POLITICAL AND LEGAL CONTEXT 

1.1  The political context 

Intellectual property (‘IP’) rights, and in particular patents, are powerful tools in support 
of EU innovation and the EU economic transition objectives. Patents are exclusive rights 
protecting  inventions.  They  are  an  important  asset  for  inventors  as  they  can  ensure 
investments and access to finance1.  

The  balance  between  IP  rights  and  other  rights  and  interests  has  continuously  been 
discussed and reassessed amid societal changes, technological developments, and crises. 
It is therefore not surprising that the COVID-19 crisis brought this issue once more into 
the spotlight. On that occasion, the conflicting interests were on the one hand, access to 
health products, and on  the other hand  preserving innovation incentives that are key to 
the development of new health products, such as vaccines and therapeutics. However, the 
pandemics  also  added  another  element  to  the  discussion,  notably  on  the  role  IP  rights 
could and should play in a crisis. In other words, the question was how we can preserve 
the balance and incentives for innovation while ensuring swift access to critical products2 
and technologies in crises. Replies differed among countries in the world. 

In  October  2020,  several  World  Trade  Organisation  (‘WTO’)  members  submitted  a 
proposal  to  waive  WTO  members’  obligation  to  protect  and  enforce  some  IP  rights  in 
relation  to  the  prevention,  containment  or  treatment  of  COVID-19.  Waiving  IP  rights 
differs  from  compulsory  licensing.  A  compulsory  licence  (‘CL’)  is  an  authorisation 
granted by a government to a party other than the patent holder to use a patented 
invention without the consent of the patent holder. The Agreement on Trade-Related 
Aspects  of  Intellectual  Property  Rights  (‘TRIPS  Agreement’)  explicitly  allows 
compulsory licensing, provided that some conditions, such as a limited duration and the 
payment  of  an  adequate  remuneration,  are  met.  There  is  no  mechanism  in  the  TRIPS 
Agreement  or  in  domestic  systems  of  the  WTO  members  to  waive  IP  rights3.  The  EU, 
among other WTO members, did not support waiving TRIPS obligations that could result 
in the suspension of IP rights in relation to COVID-19 products. There was no evidence 
that  IP  was  a  barrier  in  the  production  and  distribution  of  these  products.  The  EU  also 
considered  that,  should  voluntary  agreements  fail,  the  TRIPS  Agreement  already 
provides  for  solutions  through  the  existing  flexibilities  and,  in  particular,  compulsory 
licensing4. 

1  Patent  applications  must  be  published  and  indicate  the  technical  details  of  the  invention  they  aim  at 
protecting. The granting of a monopoly – limited in time – is done in exchange of sharing the technicalities 
underlying  the  invention,  based  on  which  new  research  and  invention  can  develop.  This  is  part  of  the 
inherent  equilibrium  of  patent  law;  allowing  at  the  same  time  incentive  to  innovate  and  access  to 
innovation. 
2 In this impact assessment the notion of critical good(s)/ products(s) refers to good(s)/ product(s) that are 
critical to tackle a crisis, notwithstanding the type of crisis that is being discussed. 
3 Waiving IP rights  would potentially consist of depriving the  patent owner of its rights  from the outset, 
including of the right to adequate remuneration. 
4  Discussions  at  WTO  level  led  to  a  Ministerial  Decision  in  June  2022,  which  provided  clarifications  of 
existing flexibilities and waived one of the conditions for the production of COVID-19 vaccines, namely 
the  requirement  that  a  CL  is  granted  “predominantly  for  the  domestic  market”.  It  also  waived  the 
application of Article 31bis of the TRIPS Agreement which provides for a specific procedure applicable to 
export. This  means that COVID-19 vaccines  manufactured under a  CL issued under the Decision can be 

4 

 
                                                 
 
In that context, the Commission IP Action Plan5 of 2020 underlined ‘the need to ensure 
that  effective  systems  for  issuing  compulsory  licences  are  in  place’.  The  Commission 
undertook to ‘explore with  Member States the possibility of creating an emergency co-
ordination  mechanism,  to  be  triggered  at  short  notice  when  Member  States  consider 
issuing  a  compulsory  licence’.  Finally,  the  2023  Commission  Work  Programme6 
provides that the Commission will establish clear rules for the compulsory  licensing of 
patents. 

In  its  resolution  of  November  20217,  the  European  Parliament  called  on  the 
Commission  ‘to  analyse  and  explore  possible  options  for  ensuring  effectiveness  and 
better coordination of compulsory licensing in the EU. The Council8 confirmed that the 
EU  stood  ready  to  discuss  the  flexibilities  of  compulsory  licensing  for  the  domestic 
market  and export purposes to  third  (non-EU) countries9.  It  also  confirmed the need to 
explore  possible  IP  tools  and  options  to  better  coordinate  the  management  of  cross-
border  crises.  At  the  same  time,  the  Commission  announced  its  willingness  to  table 
proposals to ensure the EU’s resilience to crises and new mechanisms to guarantee well-
functioning supply chains in the Single Market and abroad. In that respect, reference can 
be made to two key EU proposals:  

  Proposal  for  a  regulation  establishing  a  Single  Market  emergency  instrument10 

(‘SMEI’); 

 

In the context of the setting-up of HERA, the regulation on serious cross-border 
threats to health11 (‘SCBTH’) and the regulation on a framework of measures for 
ensuring the supply of crisis-relevant medical countermeasures in the event of a 
public health emergency at Union level (‘HERA’)12. 

These  proposals  qualify  as  crisis  instruments,  setting-up  emergency  mechanisms  to 
ensure  the  supply  of  and  access  to  critical  goods  notably  in  the  Single  Market.  Other 
instruments,  such  as  the  Chips  Act13,  also  include  crisis  measures.  None  of  the  above 
instruments  explicitly  includes  the  use  of  compulsory  licensing  to  address  a  crisis.  The 
rationale  was  that  IP  rights  apply  across  sectors  in  a  uniform  way.  Yet,  EU  crisis 
instruments  rarely  apply  to  all  sectors.  For  instance,  despite  a  large  material  scope,  the 
SMEI proposal does not apply to the health sector. Embedding compulsory licensing in 
(sector-specific)  EU  crisis  instruments  would  run  the  risk  of  creating  different  rules  on 

exported to other eligible countries in a much faster and simplified manner. Discussions are still ongoing as 
regards possible extension of the Decision to COVID-19 therapeutics and diagnostics (see Annex 5C). 
5 IP action plan, COM(2020) 760 final, 25.11.2020. 
6 Commission Work programme of 2023, available here.  
7  The  resolution  on  the  intellectual  property  action  plan  to  support  the  EU’s  recovery  and  resilience 
(2021/2007(INI)). 
8 Council conclusions8 of 18 June 2021, available here.  
9 Where reference is made hereinafter to exports to third countries or non-EU countries, this refers to third 
countries covered by Regulation (EC) No 816/2006.  
10  Proposal  for  a  regulation  of  the  European  Parliament  and  of  the  Council  establishing  a  Single  Market 
emergency instrument and repealing Council Regulation No (EC) 2679/98. 
11 Regulation (EU) 2022/2371 of 23 November 2022 on serious cross-border threats to health and repealing 
Decision No 1082/2013/EU. 
12 Council Regulation (EU) 2022/2372 of 24 October 2022 on a framework of measures for ensuring the 
supply of crisis-relevant medical countermeasures in the event of a public health emergency at Union level. 
13  Proposal  for  a  regulation  establishing  a  framework  of  measures  for  strengthening  Europe's 
semiconductor ecosystem (Chips Act).  

5 

 
                                                                                                                                                 
compulsory  licensing  across  domains.  Nevertheless,  this  initiative  would  be  closely 
linked to crisis instruments as to ensure they are fully coherent and complementary. 

Finally, this initiative complements the launch of the Unitary Patent system (expected 
in June 2023). The Unitary Patent is a major step towards the completion of the  Single 
Market  for  patents  and  an  EU-level  compulsory  licence  is  part  of  this  harmonisation 
coordinated  effort.  Against  this  backdrop  of  the  increasing  completion  of  the  Single 
Market  for  patents,  the  envisaged  initiative  on  compulsory  licensing  is  therefore  at  the 
crossroads between the different  EU crisis instruments and the international obligations 
and discussions on IP rights and compulsory licensing. 

1.2  The legal context 

A compulsory licence14 refers to the possibility for a government to allow a third party to 
use  a  patent  without  the  authorisation  of  the  right  holder,  subject  to  certain  conditions 
aiming at preserving the legitimate interests of the patent holders. The TRIPS Agreement 
sets  the international  legal  obligations  as regards compulsory licensing.  It provides  two 
types of compulsory licensing schemes: (i) compulsory licensing for the domestic market 
(article 31), which applies to all types of products and (ii) compulsory licensing for the 
export, which only applies to pharmaceutical products (article 31bis).  

Article 31 allows the granting of a compulsory licence, for  any type of product. In this 
context, the compulsory licence must be predominantly for the supply of the domestic 
market  of  the  WTO  Member  authorising  the  use.  The  TRIPS  Agreement  does  not  list 
the  grounds  on  which  a  compulsory  licence  can  be  granted  but  provides  several 
conditions under which a compulsory licence can be authorised (see Annex 5D). As for 
the EU legal context, there is no harmonisation of compulsory licensing for the domestic 
market, including as regards European patents with a unitary effect15. EU countries have 
all implemented compulsory licensing schemes  but  for different  grounds and following 
different procedures, in accordance with the flexibilities left at international level. 

Under Article 31bis of the TRIPS Agreement, a country can grant a compulsory licence 
to  the  extent  necessary  for  the  purposes  of  production  and  the  export  of  a 
pharmaceutical  product.  The  EU  implemented  this  new  disposition  in  its  legal  order 
through  the  adoption  of  regulation  (EC)  No  816/200616.  The  EU  may  only  act  as  an 
exporter  to  the  countries  with  no  or  limited  manufacturing  capacity.  The  mechanism 
under Article 31bis of the TRIPS Agreement was only used once, in the Canada-Rwanda 
case  (see  Annex  5F).  In  the  context  of  Regulation  (EC)  No  816/2006,  EU  countries 
remain the main points of contacts for granting the compulsory licence, checking whether 
the  conditions  are  respected  and  when  it  is  terminated.  The  role  of  the  Commission 
remains limited to the case where the export of the product under a compulsory licence 
would be directed to an importing country which is not a WTO member. In such case, the 

14 The term “compulsory licence” is found in national patent laws but not in the TRIPS Agreement where 
article 31 refers to the “use [of patents] without authorization of the right holder”.  
15 Recital 10 of Regulation EU No 1257/2012 of 17 December 2012 implementing enhanced cooperation in 
the  area  of  the  creation  of  unitary  patent  protection  provides  that:  “compulsory  licences  for  European 
patents with unitary effect should be governed by the laws of the participating Member States as regards 
their respective territories.” 
16  Regulation  (EC)  No  816/2006  of  the  European  Parliament  and  of  the  Council  of  17  May  2006  on 
compulsory  licensing  of  patents  relating  to  the  manufacture  of  pharmaceutical  products  for  export  to 
countries with public health problems. 

6 

 
                                                 
importing  country  must  make  a  notification  to  the  Commission  instead  of  the  WTO. 
Regulation (EC) No 816/2006 was never used nor evaluated. 

Two  other  EU  legislations  provide  for  a  compulsory  licensing  scheme.  First,  the 
Regulation  on  Community  plant  variety  rights17  provides  for  the  possibility  for  the 
Community  Plant  Variety  Office  to  grant  a  compulsory  licence  on  a  community  plant 
variety  right,  on  application  by  a  Member  State,  by  the  Commission  or  by  an 
organisation  set  up  EU  level18.  Second,  the  Biotech  Directive19  provides  for  the 
possibility, where a plant breeder cannot use a plant variety without infringing a patent, 
to apply for a compulsory licence. 

1.3  Compulsory licence as an incentive or replacement of voluntary agreements 

Compulsory  licensing  is  often  presented  as  a  ‘last  resort  mechanism’20.  In  the  vast 
majority  of  cases,  voluntary  agreements  are  the  most  efficient  solution  to  ensure  the 
manufacturing  and  supply  of  critical  products.  Stakeholders  generally  highlight  the 
importance of voluntary agreements to scale-up the manufacturing of critical products. A 
large majority of respondents to the public consultation (74%, N=55) also considered that 
compulsory  licensing  is  a  last-resort  mechanism  that  should  be  available  only  where 
voluntary  arrangements  have  failed  or  are  unavailable21.  However,  when  voluntary 
agreements are not available, be it because such agreements do not offer a viable solution 
to  address  a  crisis  in  a  timely22  or  adequate23  manner  or  because  the  IP  owner  is  not 
willing to voluntarily license its rights, compulsory licence can have an: 

 

incentive  role:  The  threat  of  a  compulsory  licence  can  incentivise  the  IP  owner  to 
grant  a  voluntary  agreement,  in  particular  when  the  IP  owner  has  refused  the 
licensing or the proposed conditions; 

  enabling  role:  Should  voluntary  agreements  still  not  be  available  or  adequate  to 
address  the  crisis  and  should  another  manufacturer  be  able  to  produce  and  deliver 

17 Plant variety rights cover varieties of all botanical genera and species that are distinct, uniform, stable, 
and new. In addition, the variety must be designated by a denomination in accordance with the provisions 
of Article 63 of Regulation No 2100/94 of 27 July 1994 on Community plant variety right. Regulation No 
2100/94 of 27 July 1994 on Community plant variety right. 
18 Article 29 of Regulation No 2100/94. A compulsory exploitation of rights shall be granted on grounds of 
public interest. Three grounds in particular can constitute a public interest: a) the protection of life or health 
of humans, animals and plants; b) the need to supply the market with material offering specific features; c) 
the need to  maintain the incentive for continued breeding  of improved varieties (see  Article 41(2) of the 
Commission Regulation (EC) No 874/2009). An application for a compulsory licence was submitted to the 
Community Plant Variety Office in March 2017 but ultimately denies as the ground of public interest was 
not proven (see Decision of the Community Plant Variety Office of 28 March 2018, no. NCL001). 
19 Article 12 of Directive 98/44/EC of 6 July 1998 on the legal protection of biotechnological inventions. 
20 Article 31 of the TRIPS Agreement requires that efforts must be made to obtain authorisation from the 
right holder on reasonable terms and conditions and that such efforts proved unsuccessful. However,  there 
are no specific rules on what those terms and conditions are or what type and length of efforts are required. 
Also,  this  requirement  can  be  waived  in  “the  case  of  a  national  emergency  or  other  circumstances  of 
extreme urgency or in cases of public non-commercial use”. 
21 However, views on this issue are contrasted among stakeholders: although all (4) public authorities and 
almost all companies and business association (85%, N=34) agreed with the last resort approach, 4 out of 6 
NGOs having replied to the public consultation disagreed. 
22 E.g. when the voluntary agreement would not ensure the manufacturing and delivery of the critical goods 
in a timely manner (e.g. several months or years depending on the nature of the crisis). 
23 E.g. when the voluntary agreements would not ensure a sufficient production of critical goods to tackle 
the crisis.  

7 

 
                                                 
the  goods  to  tackle  the  crisis,  the  public  authority  could  decide  to  grant  to  this 
manufacturer a compulsory licence allowing/ ramping up production capacity. 

These  roles  can  only  be  fulfilled  where  there  is  an  efficient,  credible,  and  flexible 
compulsory licensing scheme in place. 

2  PROBLEM DEFINITION 

2.1  What is the problem? 

When a crisis strikes and the solution lies in using a certain product or technology, this 
product or technology may be protected by IP rights, for example by patents24. As more 
than 100 000 new patents are granted by the European Patent Office (‘EPO’) alone every 
year25,  there  are  high  chances  that  an  innovative  technology  needed  in  crisis  could  be 
patent  protected.  Public  authorities  willing  to  rely  on  such  product  and/or  technology 
need to secure the IP rights by seeking an agreement with the patent holder26 (e.g. in case 
of  the  European  Patents  (‘EP’)  among  roughly  103 000  companies27).  Yet,  voluntary 
solutions  may  not  always  be  available  nor  adequate,  in  particular  in  the  context  of  a 
crisis, when patent-protected products should be accessible under tight time constraints.  

The  need  to  resort  to  a  compulsory  licence  in  a  crisis  is  supported  (82%,  N=61)  by 
stakeholders  who  participated  in  the  open  public  consultation  (‘OPC’)  run  within  the 
context of this initiative (see Figure 1)28.  

Figure  1:  Do  you  consider  it  important  that  public  authorities  are  entitled  to  allow  production  of  certain  products 
and/or use of certain technologies necessary to tackle a crisis through a compulsory licence? 

Source: OPC, N=74 

However,  the  current  settings  of  the  compulsory  licensing  system  in  the  EU  make  this 
legal instrument unfit to address cross-border crisis29, in a timely manner. This is because 

24 Vaccines and therapeutics provide a good example of the importance of patented inventions as a solution 
to address a crisis, as illustrated by the COVID-19 crisis. 
25 Patent Index 2021 – Statistics at glance, EPO 2022, status: 1.2.2022, page 8. 
26  Or  entering  into  a  manufacturing  and  purchase  agreement  with  the  patent  owner,  or  ensuring  the 
conclusion  of  a  licensing  agreement,  allowing  a  licensee  to  manufacture  the  critical  goods  or  using  the 
critical technology. 
27  Based  on  PatentSight®  query  of  all  patents  active  in  EPO  (“active  in”  understood  as  the  authority  in 
which at least one member of the patent family is active; this includes both pending applications that are 
still under prosecution and granted patents that are still in force) that resulted in 103 052 unique owners. 
The analysis was based on 525 329 patent families active at 12/08/2022. 
28 This is true for all groups of stakeholders. For instance, 72.5% (N=29) of the companies and business 
associations, all NGOs, all citizens and three out of four public authorities agree. 

8 

 
 
                                                 
EU  compulsory  licensing  schemes  have  territorial  limitations  and  are  based  on  a 
patchwork  of  national  laws  that  makes  a  coordinated  and  timely  implementation  of 
compulsory licences practically impossible.  

This  can  be  illustrated  by  a  crisis  striking  several  Member  States,  but  where 
manufacturing  capacities  for  the  critical  product  are  in  other  Member  States.  In  such 
case,  each  step  of  the  manufacturing  process  where  IP  rights  are  involved,  should  be 
authorised by the patent owner, usually through a licensing agreement, or - in the absence 
of  voluntary  agreements  –  a  compulsory  license.  However,  such  compulsory  licence  is 
needed  for  each  Member  State  and  for  each  IP  relevant  step  (be  it  manufacturing, 
exporting  or  importing).  In  case  of  an  EU  cross-border  crisis,  the  issuance  of  multiple 
national  compulsory  licences  with  e.g.  different  scope  (e.g.  covering  different  patents 
and/or different products), procedures and conditions30 would be necessary. In addition, 
great uncertainties would remain as to whether it can be exported from one Member State 
to  another  Member  State  and  in  what  quantities.  Finally,  depending  on  the  national 
procedures and conditions, these compulsory licences could be granted and implemented 
at different times (see section 2.2.1 below). 

In a hypothetical example under the current rules, if two Member States needed a product 
manufactured in another two Member States, four compulsory licences might be need to 
secure  access  to  such  product  (i.e.  two  compulsory  licences  to  export  and  two 
compulsory  licences  to  import).  As  shown  in  Figure  2,  the  number  of  compulsory 
licences needed for five countries in crisis with manufacturing capacities spread over five 
other countries, could reach ten31.  

Figure  2:  Hypothetical  number  of  compulsory  licences  needed  for  a  patented  product,  depending  on  the  number  of 
manufacturing and importing Member States (up to 5 and 5 Member States only, respectively) 

Source: own elaborations 

The  above  example  might  seem  excessive  (up  to  ten  compulsory  licences  needed  for  a 
single  product),  yet  it  is  likely  to  occur  in  practice.  The  average  number  of  Member 
States in which European Patents for COVID-related products32 were active equals 5.18, 
whereas for all patents the intra-EU geographic spread was 4.35 (Member States)33. This 

29 The terms „a cross-border crisis” or „a crisis affecting the Single Market” will be used interchangeably. 
30 Additional explanation and illustrative examples are provided in Figure 15 and Figure 16 in Annex 6. 
31 The scenario assumes a CL per country. In practice, the numbers may be lower if some of the importing 
countries  were  able  to  manufacture  the  necessary  components,  or  higher  if  some  additional  CLs  were 
necessary between the manufacturing countries, for example for other items necessary in production. 
32 Based on WIPO PatentScope COVID-19 Index (https://patentscope.wipo.int/search/en/covid19.jsf) 
33 The results of the analysis by selected IPC groups and subgroups are presented in Table 18 (Annex 6). 
For further details on the methodology, please see Annex 4.  

9 

 
 
                                                                                                                                                 
means that licensing of patent rights for a given product in the EU might require a 
coordinated action among four to five Member States.  

The  number  of  patents  active  in  several  countries  are  not  the  only  element  to  be 
considered.  Additionally,  multi-step  value  chains  are  predominant  nowadays  across 
nearly all industries. The Single Market in particular is based on complex cross-border 
supply  chains,  as  products  are  increasingly  manufactured  across  several  Member 
States34.  For  example,  in  2021,  the  share  of  intra-EU  exports  for  most  Member  States 
was between 50 % and 75 % - it exceeded 75 % in HU (78 %), SK, CZ (both 80 %) and 
LU  (81  %).  Only  in  CY  (27  %),  IE  (38  %)  and  MT  (49  %)  was  the  share  of  intra-EU 
exports  lower  than  50  %35.  In  absolute  terms,  the  value  of  exported  goods  by  Member 
State to partners within the EU in 2021 ranged from EUR 751 billion for DE to EUR 0.9 
billion for CY (Figure 17, Annex 6)36. In view of the multi-dimensional links governing 
the existing value chains, it is highly probable that national compulsory licences would 
be needed not only for the final patented product, but also for any patented component37 
of  the  final  product  that  may  need  to  be  sourced  from  other  country.  For  example,  the 
share of parts and components accounts for 50% of global trade in electrical machinery 
and transport equipment and 46% of trade in machinery and electronics. Over time, it is 
also worth noting that the importance of the Single Market has increased as a source of 
value  added  (supply  and  demand)  in  the  area  of  goods.  On  the  supply  side  (Figure  3, 
left), the contribution of domestic flows (i.e. within a single Member State) as source of 
value  added  in  EU  production  has  been  constantly  decreasing,  whereas  the  relative 
importance of cross-border trade flows of industrial goods within the Single Market has 
slightly  increased.  Today,  Single  Market  flows  account  for  more  than  25%  of  the  total 
value added of EU production. A similar picture can be seen on the demand side (Figure 
3, right). The relative contribution of domestic flows in terms of final demand to absorb 
and  pay  for  the  total  value  added  produced  in  the  EU  has  been  decreasing,  while  the 
importance of the Single Market has increased. 

Figure 3: Relative shares of the Single Market as a Source of Value Added (left) and of Final Demand (right) (goods, 
1995-2018) 

34  For  pharmaceutical  products,  see:  Pharma  supply  chains  of  the  future,  EY  2022,  Figure  1,  p.  2  that 
depicts complex multi-country value chain of a medicinal product based on the following stages: 1. Active 
pharmaceutical ingredient manufacturing, 2. Formulation, 3. Primary packaging, 4. Secondary packaging.  
35 Meaning that extra-EU exports were higher than intra-EU exports. 
36 https://ec.europa.eu/eurostat/statistics-explained/index.php?title=Intra-EU_trade_in_goods_-
_main_features  
37 The electronics sector is one of the most internationally fragmented sectors, see Figure 18 in Annex 6, 
Source: Gaulier, G., Sztulman A., Ünal D., Are Global Value Chains Receding? The Jury Is Still Out. Key 
Findings  from  the  Analysis  of  Deflated  World  Trade  in  Parts  and  Components,  CEPII  Working  Paper 
2019-01, Paris. 

10 

 
 
                                                 
Source:  Chief  Economist  Team  (DG  Internal  Market,  Industry,  Entrepreneurship  and  SMEs)  based  on  OECD  TiVA 
data. Note: data available only until 2018 

Consequently,  the  already  significant  level  of  complexity  in  the  compulsory  licensing 
system  due  to  its  fragmentation  increases  even  further  in  view  of  cross-border  value 
chains  should  manufacturing  capacities  of  patented  components  be  also  located  across 
different Member States. The above problem concerns compulsory licensing that would 
be issued for domestic (the EU market or several Member States), as well as for export; 
although the latter to a more limited extent. As regards compulsory licensing for export 
of pharmaceutical products to non-EU countries facing a health crisis, the system put in 
place by Regulation (EC) No 816/2006 was never used and stakeholders’ views diverge 
on  the  reason  therefore38.  Since  no  report  was  made  on  its  application,  it is  difficult  to 
draw  definitive  conclusions  on  its  effectiveness.  Similarly,  to  what  exists  for  the 
domestic market, the cross-border value chains of manufacturing capacities could affect 
compulsory licensing for export purposes to non-EU countries. 

To conclude, EU compulsory licences rules are characterised by inadequate territorial 
architecture,  uncoordinated  national  procedures  and  decision-making,  which  is 
especially problematic in view of cross-border value chains increasingly predominant in 
the EU. This altogether results in a system which is ill-suited to address a cross-border 
crisis in a timely manner. 

2.2  Drivers of the problem 

The  identified  problem,  its  drivers,  as  well  as  consequences  are  presented  in  Figure 
Figure 4. 

Figure 4: Problem tree 

38  Two  thirds  of  respondents  to  the  OPC  consider  that  the  Regulation  816/2206  allows  for  speedy  and 
efficient procedures for granting compulsory licences to export pharmaceutical products to third countries. 
Views greatly diverge depending on the group of respondents (all NGOs disagree with this view). When 
asked  about  what  elements  of  the  regulation  could  be  streamlined,  around  a  third  of  respondents  having 
expressed an opinion mention the accelerated and simplified procedure (37%) and the conditions to submit 
an  application  (30.5%).  Slightly  more  respondents  (40%)  consider  that  the  procedure  set  by  Regulation 
(EC) No 816/2006 should be made more flexible to adapt to the needs of the importing countries. 

11 

 
 
                                                 
2.2.1  Divergent national schemes on compulsory licensing 

There  is  no  harmonisation  of  compulsory  licensing  for  the  EU  domestic  market.  The 
international framework includes some requirements that are mainly procedural. Outside 
these  requirements,  WTO  members  (including  EU  countries)  retain  a  large  margin  of 
manoeuvre when deciding on their national compulsory licensing scheme. In the EU this 
results  in  a  fragmented  landscape  when  it  comes  to  compulsory  licensing  for  crisis 
management, especially concerning the trigger, the scope, the procedure and conditions 
of national rules (see Table 21, Annex 6). On compulsory licensing for export purposes, 
Article  31bis  of  the  TRIPS  Agreement  has  a  more  limited  scope  covering  only 
pharmaceutical  products  and  provides  for  more  stringent  requirements.  EU  Regulation 
(EC)  No  816/2006  harmonises  national  laws  in  the  field  and  the  margin  of  manoeuvre 
left to Member States is limited. However, its application can still slightly differ across 
Member States, and in particular when it comes to national practices and conditions. 

Trigger 

The international framework on compulsory licensing does not prescribe the reasons for 
which  a  compulsory  licence  can  be  granted  for  the  domestic  market39.  Member  States 
usually allow compulsory licence when the patent is not used on their territory, in case of 
dependency of patents40 or for public interest reasons41. This latter category is relevant as 
regards compulsory licensing for crisis management. Most Member States have general 
provisions  allowing  compulsory 
interest”  or  “national 
emergency”42. With few examples of use across Member States, it is however difficult to 
assess how these national provisions are used in practice and how they apply to crises. In 
contrast to these general clauses, some Member States only allow compulsory licensing 
for specific crises, typically health crises (i.e. BE, HU and IT)43. IE is the only Member 
State  not  providing  for  the  possibility  to  grant  a  compulsory  licence  for  crisis 
management. In conclusion, not all Member States provide for compulsory licensing for 
crisis  management,  some  do  only  for  certain  types  of  crises  (i.e.  health)  while  other 
provide  for  general  basis,  differently  worded,  for  which  uncertainty  remains  as  to  their 
concrete application to crisis (see Table 19 in Annex 6).  

for  “public 

licensing 

Concretely,  if  there  is  an  environmental  crisis  (e.g.  flood,  river  pollution)  affecting  several 
Member States and the manufacturing capacities of the critical product are spread across BE, ES 
and  FR.  Issuance  of  compulsory  licences  would  not  provide  a  solution,  as  BE  does  not  allow 
compulsory licensing for crises other than health crises. 

Scope 

The scope of a compulsory licence refers here to the type of IP rights it covers. This has 
an impact on the efficiency of the compulsory licence. For instance, ‘simple IP products’ 

39 Although an explicit reference is made to compulsory licensing to tackle crises. Article 31 of the TRIPS 
Agreement  provides  indeed  that  in  the  case  of  a  national  emergency  or  other  circumstances  of  extreme 
urgency, the best-efforts requirement to obtain an authorisation from right holder can be waived. 
40 When a patented invention cannot be exploited without infringing an invention patented beforehand. 
41 This notion is generally not defined nor exemplified. Most of the time a case-by-case approach prevails, 
as  this  is  for  instance  the  case  in  DE,  see  EPO  (2018),  p  30.  Compulsory  licence  for  Community  plant 
varieties can also be issued on a public interest ground. 
42  See  Table  19  (Annex  6)  listing  the  different  provisions  applicable  in  the  EU  countries  and  based  on 
which a compulsory licence could be granted to tackle a crisis. 
43 To be noted that FR also restricts the grounds on which a compulsory licence can be granted to public 
health, national defence, and national economy. 

12 

 
                                                 
such  as  water  purification  pills,  valves  for  a  respiratory  device  or  masks  can  easily  be 
replicated  based  on  the  patent.  For  complex  products  such  as  vaccines,  access  to  trade 
secrets  or  secret  know-how  would  be  needed  on  top  of  patents.  Finally,  some  crisis-
relevant  products  are  developed  in  such  a  short  time  span  that  the  patent  has  not  been 
granted  yet.  Only  the  patent  application  is  available  in  such  cases.  Member  States  take 
a different approach as regards the scope of compulsory licences: 

  Patents: All Member States’ compulsory licences law apply to patents, be it national 
or  European  patents.  However,  the  same  is  not  true  for  patent  applications.  A 
minority  of  Member  States  expressly  include  patent  applications44.  The  Dutch 
national patent law expressly excludes it45. For the remaining Member States, their 
laws  do  not  explicitly  include  nor  exclude  patent  applications,  leading  to  legal 
uncertainty. Yet, cutting-edge technologies to tackle a crisis are often new and still 
subject  to  a  patent  application.  The  procedure  to  grant  a  patent  is  also  lengthy 
(between  3  to  5  years  for  the  grant  of  a  European  patent).  Excluding  patent 
applications can therefore severely affect the effectiveness of a compulsory licence.  

  Supplementary protection certificates (SPCs)46: Most national compulsory licensing 
laws do not explicitly refer to SPCs47. This leads to legal uncertainty and diverging 
interpretation  of  similarly  worded  provisions48.  Where  SPCs  are  not  covered,  a 
consequence  is  that  a  patented  product  which  was  the  subject  of  a  compulsory 
licence  during the patent term  may  cease  to be  ‘exempted’ after the patent  expiry, 
during the SPC  term  (if any).  In contrast,  Regulation (EC) No 816/2006 explicitly 
covers SPCs49. Where SPCs are not covered (neither explicitly nor implicitly) by the 
national  compulsory licensing  provisions in  a certain Member State,  its  authorities 
are  prevented  from  ‘lifting’  SPC  protection.  Consequently,  despite  an  existing 
compulsory licence on the patent, the  manufacturing of the SPC-protected product 
would still require an authorisation from the SPC holder.  

  Regulatory data protection (RDP): Regulatory data protection are rules enshrined in 
the EU pharmaceutical legislation. Today, generic manufacturers cannot refer to the 
results of pre-clinical tests and clinical trials of the originator until eight years have 
elapsed from the date of authorisation of the medicinal product. This period of data 
exclusivity granted to innovative companies is complemented by an overlapping 10-

44  Such  as  FR,  IE,  and  MT,  see  “Compulsory  licensing  of  intellectual  property  rights”,  Center  for 
International  Intellectual  Property  Studies  (CEIPI),  Université  de  Strasbourg  (UNISTRA),  Impact 
Licensing Initiative (ILI), Ecorys Nederland BV (Ecorys), Brussels 2023, p. 41 and Table 21 in Annex 6. 
45  As  reported  by  CEIPI(2023).  Based  on  that,  the  patent  court  of  The  Hague  has  refused  to  grant  a 
compulsory licence for a European Patent application on the ground that the final scope of the application 
was uncertain and could only be determined after the grant of the patent. 
46 An SPC is an IP right that serve as an extension to a patent right, applicable, under specific conditions, to 
medicinal and plant protection products that have been authorised by regulatory authorities.  
47 SPCs are covered by compulsory licensing laws in HR, CZ, EE, EL, HU, LT, RO and SK. In other EU 
countries,  in  the  absence  of  any  explicit  reference  or  authoritative  official  documents  of  interpretative 
value, legal uncertainty persists, see CEIPI(2023), page 38. 
48A  questionnaire  was  sent  to  national  experts  to  identify  the  scope  of  national  compulsory  licensing 
schemes.  Responses  of  the  national  experts  show  that  the  lack  of  explicit  reference  to  SPC  gives  rise  to 
legal uncertainty and different interpretation of similarly worded provisions, see CEIPI(2023), page 40. 
49 Article 1 of Regulation (EC) No 816/2006 provides that “This Regulation establishes a procedure for the 
grant of compulsory licences in relation to patents and supplementary protection certificates concerning the 
manufacture and sale  of pharmaceutical products,  when such products are intended for export to eligible 
importing countries in need of such products in order to address public health problems.” 

13 

 
                                                 
year  market  exclusivity  which  prevents  a  generic  drug  to  be  placed  on  the  market 
during  this  ten-year  period.  RDP  rules  are  based  on  harmonised  EU  legislation50 
with no margin of manoeuvre left to Member States. Where they apply, RDP rules 
slow  down  or  may  even  block  the  availability  of  products  manufactured  under  a 
compulsory  licence  as  it  would  delay  the  granting  of  marketing  authorisation  for 
medicinal products. In other words, a compulsory licence granted on a patent may 
be defeated by RDP still in force, preventing a generic product from being placed on 
the market. This can constitute a solid obstacle to the effective use of a compulsory 
licence51.  

  Other  IP  rights,  trade  secrets  and  know-how:  compulsory  licensing  is  already 
regulated at EU level as regards plant varieties (see supra,  section 1.2). As regards 
other IP rights, from the available information it appears that Member States do not 
provide  for  a  compulsory  licence  outside  patent  rights.  Likewise,  national  laws 
generally do not address the issue of trade secrets and know-how (which might be 
needed  for  the  manufacturing  of  complex  products).  The  Spanish  law  is  an 
exception  as  it  imposes  an  obligation  to  act  in  good  faith  in  the  context  of  a 
compulsory  licence,  as  well  as  a  transfer  of  know-how  to  the  beneficiary  of  a 
compulsory licence.52  

In  conclusion,  the  scope  of  a  compulsory  licence  has  a  direct  influence  on  its 
effectiveness to tackle crises. Many divergences exist across the EU in this respect.  

Concretely, in the context of a cross-border crisis a  FR company has developed a new  product 
still  subject  to  a  patent  application.  FR  has  the  manufacturing  capacities  and  the  possibility  to 
grant a compulsory licence on a patent application. FR would therefore be able to help NL, also 
experiencing  the  crisis.  However,  since  the  NL  law  does  not  authorise  compulsory  licences  on 
patent applications, it cannot issue a compulsory licence to import the FR products. 

Procedure 

Member  States  also  take  different  approaches  as  regards  the  granting  authority  and  the 
granting  procedure.  The  granting  authority  can  be  a  court,  an  executive  body 
(government or ministry), an IP office or even a competition authority53. Regulation (EC) 
No 816/2006 also maintains some margin of manoeuvre for Member States as regards the 
competent  authority  to  grant  a  compulsory  licence  for  export  purposes  to  non-EU 
countries.  

Often,  when  it  comes  to  compulsory  licences  for  crisis  management,  a  dedicated 
authority  (typically  an  executive  body)  is  competent  and  expedited  procedures  are  in 
place.  Advisory  committees  are  also  sometimes  involved  in  the  decision-making 

50  See  the  protection  periods  set  out  in  Article  14(11)  of  Regulation  (EC)  No  726/2004  and  in  Articles 
10(1) and 10(5) of Directive 2001/83/EC. 
51  In  2016,  the  Romanian  government  contemplated  issuing  a  compulsory  licence  for  the  medicine 
sofosbuvir.  However,  data  exclusivity  was  only  to  expire  in  2022.  In  such  circumstances,  issuing  a 
compulsory  licence  would  have  been  useless  as  data  exclusivity  would  still  prevent  the  registration  of  a 
generic  version  of  sofosbuvir.  See  E.  ‘t  Hoen,  P.  Boulet  and  B.  Baker,  Data  exclusivity  exceptions  and 
compulsory  licensing  to  promote  generic  medicines  in  the  European  Union:  A  proposal  for  greater 
coherence in European pharmaceutical legislation, Journal of Pharmaceutical Policy and Practice (2017).  
52 CEIPI(2023) p. 50 and Table 21 in Annex 6. 
53 See Annex 6, Table 20. 

14 

 
                                                 
process54. Patent owners can be part of the procedure. This is the case for some national 
procedures55  but  also  in  the  context  of  Regulation  (EC)  No  816/2006  where  the  patent 
holder is  being notified of an  application for a compulsory licence and can comment56. 
Member States also diverge regarding the availability of an expedited procedures for the 
issuance  of  a  compulsory  licence  (e.g.  by  way  of  a  preliminary  relief57).  While  some 
Member  States  provide  for  such  procedures,  others  do  not,  or  it  is  at  least  uncertain 
whether a compulsory licence based on a preliminary relief is possible because national 
law is silent on this matter and there are no precedents in national case law58. Therefore, 
procedures  (covering  e.g.  the  assessment,  granting  or  refusal  of  the  applications)  and 
granting  authorities  vary  across  Member  States,  including  as  regards  compulsory 
licensing  for  export  purposes  to  non-EU  countries  even  if  to  a  lesser  extent59.  Review 
(appeal)  procedures  are  provided  in  all  Member  States  but  with  again  different 
procedures  and  delays.  In  conclusion,  differences  between  national  granting  authorities 
and procedures result in different delays applicable to grant a compulsory licence and to 
review the granting decision.  

Concretely, in the context of  a crisis requiring fast actions, in DE a compulsory licence can be 
granted based on a preliminary relief. In contrast, in PL it is not possible to obtain a compulsory 
licence  by  way  of  a  preliminary  relief.  This  could  lead  to  delays  in  cross-border  supply,  for 
instance when the crisis relevant products are already being produced in DE under a preliminary 
compulsory licence (also ready for the supply of PL), but PL cannot react in timely manner with 
a corresponding compulsory licence for the importation due to the lack of expedited procedure.  

Conditions 

Member  States  apply  different  conditions  as  regards  the  conditions  under  which  a 
compulsory  licence  can  be  granted.  These  conditions  can  impact  the  effectiveness  of  a 
compulsory licence: 

 

Identification  of  the  patent(s)  and/  or  product:  Most  Member  States’  laws  provide 
for  a  compulsory  licence  for  a  “patent”,  leaving  room  for  interpretation  as  to 
whether  this  can  refer  to  all  patents  covering  a  product  or  only  to  a  single  patent 
(meaning  that  for  complex  products  covered  by  multiple  patents,  multiple 
compulsory licences would need to be issued). This is source of legal uncertainty60. 

54 For instance, in the context of a compulsory licence for public health purposes in BE the application is 
submitted to the Minister of Economy and forwarded to the Bioethics Advisory Committee. 
55 For instance, in BE the patent holder has one month to file her observations on the grant of a compulsory 
licence and the level of remuneration. 
56 See article 7 of Regulation (EC) No 816/2006. 
57  Preliminary  relief  proceedings  are  short  proceedings  seeking  an  immediate  provisional  judgment  in  a 
civil dispute. 
58  “European  Patent  Office,  Compulsory  licensing  in  Europe  -  A  country-by-country  overview”: 
Unavailable in: BE, EL, PL, Uncertain: IE, FR, FI, ES, DK, SE. 
59  The  competence  to  assess,  grant  or  refuse  an  application  remains  with  national  competent  authorities 
who retain a margin of manoeuvre in that respect. 
60  National  experts  were  asked  how  provision  only  referring  to  ‘patent’  in  singular  form  should  be 
interpreted. Views greatly varied between national experts. Some (e.g. experts from AT, BG, DK, FR and 
LU) considered that a compulsory licence could only be granted per single patent. Others (e.g. EE, FI, EL, 
LT, LU, PL, RO and ES) considered that the law does not prohibit that a compulsory licence covers more 
than one patent, see CEIPI(2023) p. 37, 

15 

 
                                                 
A  compulsory  licence  can  currently  be  based  on  a  product  under  Regulation  (EC) 
No 816/200661.  

  Embargos:  Some  Member  States’  law  provide  for  an  ‘embargo’  during  which  a 
compulsory  licence  cannot  be  requested  before  a  certain  period  after  the  patent 
application and/ or grant which can prove particularly problematic for a compulsory 
licence to tackle a crisis since such an embargo effectively blocks ‘access’ to recent 
technologies62. 

  Calculation  of  the  remuneration:  The  calculation  of  the  adequate  remuneration  is 
determined following different criteria63 and by different authorities across Member 
States64. The patent owner is sometimes invited to file observations on the level of 
remuneration65.  

In conclusion, Member States’ law considerably vary when it comes to conditions under 
which  a  compulsory  licence  can  be  granted.  These  divergences  can  lead  to  distorting 
consequences  and  further  fragmentation,  e.g.  different  procedures  in  the  granting  of  a 
compulsory  license,  including  the  impossibility  in  the  case  of  the  embargos,  to  issue  a 
compulsory  licence  before  several  years,  different  remunerations  granted,  etc.  Those 
differences can significantly affect efforts across the EU to provide a uniform reply. 

Concretely, in the context of a crisis where manufacturing capacities are located in  AT but the 
patent  was  recently  granted,  AT  could  not  issue  a  compulsory  licence  because  its  national  law 
provides for an embargo on compulsory licences for patents registered for less than three years. 

2.2.2 

Inadequate territorial reach of compulsory licensing 

Cross-border  supply  of  goods  manufactured  under  a  compulsory  licence  is  complex 
under  the  current  EU  legal  framework.  Member  States  face  obstacles  when  willing  to 
both export and import within the EU goods manufactured under a compulsory licence. 
Consequently, there is simply no Single Market when it comes to compulsory licensing 
in  the EU.  Article 31 of the TRIPS Agreement  provides  for that a national  compulsory 
licence must be used predominantly for the supply of the domestic market. The domestic 
market  usually  amounts  to  the  national  territory  of  the  country  having  granted  the 
compulsory licence. However, this is not necessarily always the case. Under the TRIPS 

61  Article  6(3)  of  Regulation  (EC)  No  816/2006  provides  that  “The  application  pursuant  to  paragraph  1 
shall set out the following: (…) the non-proprietary name of the pharmaceutical product or products which 
the applicant intends to manufacture and sell for export under the compulsory licence”. However national 
divergences can remain as Member States may prescribe requirements on the identification of the patent(s) 
and/ or supplementary protection certificate(s). 
62 See for instance AT (a CL can only be requested four years after the application date or three years after 
the  grant  date);  NL  (a  CL  can  only  be  requested  after  three  years  of  lack  of  use);  IT  (a  CL  can  only  be 
requested four years after the application and three years after the grant). 
63 For instance, in AT the appropriate remuneration is determined by the Austrian Patent office taking into 
account  the  economic  value  of  the  licence.  In  DK,  the  remuneration  is  decided  in  accordance  with  the 
general principles of damages. 
64 For instance, in AT the appropriate remuneration is determined by the Austrian Patent office taking into 
account  the  economic  value  of  the  licence.  Likewise  in  ES  the  Spanish  Patent  and  Trade  mark  office  is 
competent to decide on the remuneration, based on the economic importance of the invention. In DK, the 
remuneration  is  decided  the  granting  court  in  accordance  with  the  general  principles  of  damages.  Court 
also has the discretion to determine the amount of remuneration in DE.  
65 This is for instance the case in BE. 

16 

 
                                                 
Agreement,  the  Single  Market  can  be  considered  a  domestic  market  as  the  EU  is  a 
Member of the WTO and of the TRIPS Agreement in its own rights.  

In contrast, all Member States’ laws are territorially limited, in the sense that the effects 
of a national compulsory licence are limited only to the national territory of the granting 
Member State66. Current national compulsory licensing schemes are indeed designed to 
meet  the  national  needs  of  their  own  population  and  satisfy  the  public  interest  of  the 
issuing  Member  State67.  They  do  not  reflect  the  EU  as  being  one  domestic  market,  as 
allowed under the TRIPS Agreement. Furthermore, uncertainty exists as regards import 
of  goods  manufactured  under  a  compulsory  licence  from  other  Member  States.  The 
uncertainty  results  from  the  exhaustion  principle  (see  Annex  7).  Patents,  like  other  IP 
rights,  exhaust  within the  Single Market  once the  patented  goods  have been put  on the 
EU  market  in  one  Member  State  by  the  patent  owner  or  with  consent  of  the  patent 
owner68.  

The  question  therefore  was  raised  as  to  whether  the  putting  onto  the  market  of  a  good 
manufactured  under  a  compulsory  licence  can  be  considered  done  with  the  patent 
owner’s  consent69.  In 1985, the ECJ replied in the negative to this question70. It indeed 
decided that where a compulsory licence is granted to a third party which allows to carry 
out manufacturing operations, the patent owner cannot be deemed to have consented to 
the operation of that third party. This means that the patent owner is allowed to stop the 
import of goods into a Member State in case the goods have been manufactured under a 
national compulsory licence in another Member State due to the exceptional lack of EU-
wide  exhaustion  of  the  patent.  A  (voluntary  or  compulsory)  licence  is  therefore  also 
needed  in  the  importing  country  to  avoid  the  importation  being  stopped  by  the  patent 
holder. 

As  regards  compulsory  licensing  for  export  to  non-EU  countries,  Article  31bis  of  the 
TRIPS  Agreement  explicitly  allows  for  the  export  of  the  products  to  a  third  country71. 
There is no limitation as to the part that can be exported from an EU country to  certain 
countries  outside  the  EU,  under  Article  31bis  of  the  TRIPS  Agreement  and  Regulation 
(EC) No 816/2006. On the contrary, the compulsory licence granted under the Regulation 
covers  the  manufacturing  of  the  product  for  export  and  distribution  in  the  countrie(s) 
cited  in  the  application72.  There  is  therefore  no  problem  as  regards  the  possibility  to 

66 They are based on the understanding that: (i) a compulsory licence as a governmental act is necessarily 
limited to the governed territory and (ii) the compulsory licence (as the limiting factor of the patent) shares 
the territorial scope of the limited right (national patent). 
67  For  instance  HR:  “situations  of  extreme  urgency  on  a  national  level”;  EE:  “national  defence, 
environmental protection, public health or other significant national interests of the Republic of Estonia”; 
DE: “epidemic situation of national importance”; HU:  “in  the  interest of  meeting domestic demand”; IT: 
“national health emergency”; PL: “to prevent or eliminate the state of national emergency” and “to prevent 
or remove a threat to important state interests”; RO: “in national emergency”.  
68 In other words, once a product is put on the EU market by the IP owner or with  the consent of the IP 
owner,  this  good  can  be  freely  resold,  rented,  lent  throughout  the  Union.  The  rights  of  the  IP  owner  are 
exhausted;  the  patent  owner  cannot  further  invoke  patent  rights  to  oppose  the  resale,  rental,  lending  or 
other forms of commercial exploitation of the good by third parties when done in another Member State. 
69 If the reply is in the negative, the patent rights are not exhausted. In other words, the patent owner can 
oppose any further distribution of the goods. 
70 CJEU, Judgement of 9 July 1985, C-19/84 (Pharmon), ECLI:EU:C:1985:304. 
71  It  should  however  be  reminded  that  since  EU  countries  have  opted  out  from  the  possibility  to  be 
importers under Article 31bis of the TRIPS Agreement, they cannot benefit from the system 
72 See article 10(4) of Regulation (EC) No 816/2006. 

17 

 
                                                 
export  pharmaceutical  goods  to  non-EU  countries.  However,  a  non-EU  country  could 
also  face  a  situation  within  the  EU  where  the  supply  and  manufacturing  chain  of  a 
product  requires  multiple  compulsory  licences  in  different  Member  States.  In  addition, 
the importing non-EU countries would have to issue a compulsory licence to import the 
products73, unless the products are not protected by a patent in the importing country.  

In  conclusion,  despite  the  flexibility  that  exists  at  international  level,  compulsory 
licensing in the EU is designed to exclusively supply national territories. In other words, 
there  is  currently  no  Single  Market  for  products  and  no  free  movement  of  goods 
produced under a compulsory licence.  

2.2.3  No  dedicated  forums  to  deal  with  compulsory  licensing  that  could  bolster  EU 

resilience in times of crisis 

The EU has faced numerous crises throughout its history and has gradually implemented 
policy  and  institutional  changes  to  enhance  its  resilience  to  crises  (see  Annex  6,  Table 
22).  This  is  still  true  today  with  the  Union  currently  working  on  different  instruments 
aiming  at  tackling  crises  (e.g.  the  SMEI  proposal  and  the  setting-up  of  HERA)  or 
including crisis-specific provisions (e.g. the Chips Act). The COVID-19 crisis has indeed 
confirmed that action at EU level allows a better, faster, and more efficient response to 
crises. Yet, compulsory licensing schemes remain fragmented and purely territorial.  

There  is  currently  no  or  very  limited  interplay  between  compulsory  licensing  schemes 
and existing and envisaged EU crisis instruments: 

  EU  crisis  instruments  may  include  a  coordination  mechanism  providing  for 
exchange  of 
information,  coordination  and  monitoring  of  national  crisis 
countermeasures.  The  objective  being  to  enable  coordinated  decision  making  in 
support  of  an  EU  response.  Currently,  it  is  uncertain  whether  and  how  these 
coordination mechanisms would apply to compulsory licensing.   

  EU crisis instruments usually allow the declaration or activation of a crisis mode, 
in the context of which emergency measures can be taken. Currently, there is no link 
between the EU possibility to activate a crisis mode and the trigger at national level 
to grant a compulsory licence. 

  EU  crisis  instruments  usually  allow  decision-making  at  EU  level,  as  a  means  to 
more efficiently tackling EU crises. Yet, decision-making remains at national level 
as regards compulsory licensing, which can undermine efforts to build an EU-level 
crisis response mechanism. 

  Regulation (EC) No 816/2006 harmonises the conditions and procedure for Member 
States  to  grant  a  compulsory  licence  for  export  purposes  to  non-EU  countries. 
However,  the  Regulation  does  not  provide  for  any  coordination  nor  cooperation 
limited  role.  This 
between  Member  States.  The  Commission  also  has  a 
uncoordinated and purely national process can hamper the use of the mechanism put 
in place by Regulation (EC) No 816/2006. 

In  conclusion,  the  current  compulsory  licensing  system  that  could  complement  and 
support the EU’s ability to tackle crises appears disconnected from EU crisis instruments. 

73 As explicitly required by the TRIPS Agreement. Importation in other countries or into the Single Market 
is prohibited (see Article 13 of Regulation (EC) No 816/2006). 

18 

 
                                                 
In  addition,  there is  no  coordination at  EU level  should  several  Member States wish to 
coordinate their national actions as regards compulsory licensing. This is also not in line 
with  the  increased  harmonisation  of  EU  patent  law,  and  in  particular  the  upcoming 
launch of the unitary patent system74, which will make unitary patent protection much 
easier than before in a large portion of the EU75. In contrast, purely national compulsory 
licensing  systems  and  their  resulting  divergences  would  conflict  with  the  increasing 
European integration of patent law.  

2.3  Consequences of the problem 

A coherent compulsory licensing system for crisis management does not currently exist 
in  the  EU.  Instead,  a  patchwork  of  national  laws  with  different  triggers,  scope, 
conditions, and procedures on compulsory licensing makes it difficult for a Member State 
with  manufacturing  capacities  in  critical  goods  to  help  another  Member  State  (without 
such  manufacturing  capacities).  Likewise,  in  case  of  a  manufacturing  process  spanning 
across several EU countries (e.g. components sourced from other countries), the current 
licensing scheme in the EU is unfit to match its complex cross-border nature. The above 
fragmented  architecture  leaves  the  EU  more  fragile  in  terms  of  resilience,  as  Member 
States  cannot  effectively  cooperate  in  cross-border  crises.  Furthermore,  Member  States 
are  not  able  to  leverage  their  bargaining  position  based  on  an  optimal  compulsory 
licensing  scheme.  As  a  result,  they  may  have  no  choice  but  to  rely  on  voluntary 
agreements  only.  The  fragmented  system  also  results  in  administrative  costs  for  public 
authorities granting the  compulsory licence, potential licensees, and patent owners, in a 
sense that multiple procedures might be initiated across several jurisdictions.  

The  next  link  in  the  chain  of  consequences  affects  the  citizens  and/or  firms  that  might 
have no access to critical goods in crisis, as products cannot be manufactured or supplied 
from  another  country.  This  consequence  could  aversively  impact  citizens’  well-being 
and/or firms’ economic standing, especially if a particular crisis is larger and lasts longer 
than  what  would  have  been  otherwise  (i.e.  with  a  more  efficient  compulsory  licensing 
scheme).  In  other  words,  today’s  rulebook  on  compulsory  licensing  can  lead  to  a 
situation  when  access  to  certain  goods  in  crisis  is  not  secured  on  time,  which  may 
generate broad negative socio-economic consequences. 

Finally,  non-EU  countries  also  face  a  fragmented  and  complex  legal  landscape,  which 
can be an important obstacle when seeking a CL for critical pharmaceutical goods. The 
compulsory licensing scheme for export to non-EU countries is also not suited to address 
cross-border  supply  chain  in  the  EU  and  in  that  respect,  third  countries  face  similar 
problem as EU countries.  

74 Currently 17 Member States, and up to 25 EU Member States (participating in the enhanced cooperation 
on  unitary  patent  protection).  The  unitary  patent  system  will  stimulate  research,  development  and 
investment in innovation, and contribute in that respect to the Union’s resilience. The unitary patent system 
does not provide for specific rules for compulsory licensing. It only foresees that compulsory licences for 
unitary patents (‘European patents with unitary effect’) should be governed by the laws of the participating 
Member States as regards their respective territories (Recital 10 of Regulation (EU) No  1257/2012). For 
the  participating  Member  States,  this  means  maintaining  the  status  quo,  as  their  existing  national 
compulsory licensing systems, limited to their respective territories, will apply. A CL granted in respect of 
a unitary patent  will not share its unitary  nature, and may for instance affect a single Member State, or a 
few of them – not necessarily all 17 Member States covered by unitary patents (initially). 
75 The 17 Member States in which the unitary patent system will initially apply represent about 75 % of the 
Union’s GDP. 

19 

 
                                                 
To  conclude,  the  current  system  does  not  provide  for  an  EU-wide  compulsory 
licensing  mechanism,  as  the national  legislations are  heterogeneous and  would not 
allow  a  flexible  use  of  production  capacities  across  the  EU.  When  it  comes  to 
compulsory licences there is simply no Single Market. And thus unlike EU main trading 
partners  with  unitary  regime  of  compulsory  licences76,  the  EU  would  not  be  able  to 
respond  in  a  timely  and  coherent  manner  to  cross-border  crises  requiring  such  a 
compulsory licence (be it within the EU or outside the EU). Finally, the discussion on the 
scale  of  the  identified  problem  and  the  likelihood  that  a  more  streamlined  compulsory 
licencing  rules  could  be  needed  in  the  event  of  a  cross-border  crisis  are  based  on  the 
assumption  that  there  is  a  non-zero  chance  that  such  situation  could  materialise  in  the 
future in the EU (e.g. of a similar scale to COVID-19 pandemics). Irrespective of what 
the  future  threats  might  look  like  (infectious,  environmental,  affecting  IT  or  energy 
networks, etc.), in can be assumed that any attempt to strengthen crisis-preparedness and 
ultimately  speed  up  the  response  time  should  be  encouraged  or  at  least  further 
investigated.  

2.4  How likely is the problem to persist? 

The  problem  described  under  2.1  is  most  likely  to  persist.  Some  Member  States  could 
decide to streamline their national compulsory licensing laws, as some already did in the 
aftermath of the COVID-19 crisis but the lack of coherence between national compulsory 
licences  in  the  EU,  the  limited  territorial  effect  of  these  licences,  the  burdensome  and 
lengthy administrative procedures, and the lack of Single Market for products subject to 
compulsory licensing would remain. Furthermore, recently tabled EU crisis instruments, 
such as SMEI, SCBTH or HERA, do not provide for compulsory licensing within their 
framework. As a consequence, a gap concerning compulsory licencing as a crisis remedy 
tool is likely to remain. Even the forthcoming introduction of the unitary patent system 
enabling  the  possibility  to  obtain  such  protection  in  a  large  portion  of  the  EU  will  not 
change  the persistence of the problem.  Within the legal  framework creating  the unitary 
effect  it  is  foreseen  that  compulsory  licences  for  European  patents  with  unitary  effect 
should  be  governed  by  the  laws  of  the  participating  Member  States  as  regards  their 
respective  territories  (Recital  10  of  Regulation  (EU)  No  1257/201277).  This  prevents  - 
even  in  a  cross-border  crisis  situations  -  that  the  recognition  of  an  event  triggering  a 
compulsory  licence  in  one  participating  Member  State  (for  instance  a  specific  public 
interest)  can  lead  to  the  granting  of  a  compulsory  licence  for  the  territory  of  all 
participating Member States. Consequently, it would mean that in the future, also under 
the  new  unitary  patent  system,  the  fragmented  national  regimes  and  practices  for 
compulsory licensing would remain. 

76 For example where the US successfully relied on CL to conclude a voluntary agreement on reasonable 
terms stems from 2001: when facing anthrax attacks, the US government threatened to grant a CL for the 
relevant antibiotic drug should Bayer not lower the price thereof. Eventually Bayer lowered the price of its 
antibiotic  drug.  Likewise,  the  US  government  appeared  in  a  better  position  than  the  EU  to  conclude 
voluntary agreements during the COVID-19 crisis, which can at least partly be attributed to its possibility 
to  rely  on  compulsory  licensing.  By  contrast,  the  EU  was  not  able  to  rely  on  an  EU-level  compulsory 
licensing as a bargaining chip in the context of negotiations on vaccines. 
77  Regulation  (EU)  No  1257/2012  of  the  European  Parliament  and  of  the  Council  of  17  December  2012 
implementing enhanced cooperation in the area of the creation of unitary patent protection. 

20 

 
                                                 
3  WHY SHOULD THE EU ACT? 

3.1  Legal basis 

The  proposed  initiative  will  be  based  on  Articles  114  and  207  of  the  Treaty  on  the 
Functioning  of  the  EU  (‘TFEU’).  Article  114  TFEU  confers  on  the  EU  the  power  to 
adopt  measures,  which  have  as  their  object  the  establishment  and  functioning  of  the 
internal  market  and has  provided legal  basis for a wide range of EU instruments  in  the 
area  of  IP  rights.  Since  the  envisaged  initiative  aims  at  ensuring  that  compulsory 
licensing is fit for purposes as regards the Single Market, this initiative should be based 
on Article 114 TFEU. Article 207 TFEU confers on the EU competence in the field of 
common  commercial  policy,  including  as  regards  IP  rights.  Regulation  (EC)  No 
816/2006, relating to the compulsory licensing of medicines for export purposes to non-
EU countries, is based on Articles 95 and 133 of the TEC (i.e. Article 114 and 207 of the 
TFEU).  Since  the  envisaged  initiative  would  have  an  impact  on  Regulation  (EC)  No 
816/2006, and on the possibility to  export goods manufactured in the EU,  the initiative 
should  also  take  article  207  TFEU  as  a  basis.  Insofar  as  derogations  from  regulatory 
pharmaceutical  protections  are  concerned,  the  latter  are  mainly  regulated  by  Directive 
2001/83, based on Article 95 TEC (i.e. Article 114 TFEU). Internationally, any new EU 
initiative should take place against the backdrop  of, and in  compliance with  the TRIPS 
Agreement, and in particular its Articles 30, 31 and 31 bis. 

3.2  Subsidiarity: Necessity of EU action 

Action at EU level is justified to ensure the smooth functioning of the Single Market in 
crises.  Currently,  Member  States  can  only  act  nationally  meaning  that  they  can  grant  a 
compulsory  licence  for  their  own  territory.  This  can  be  sufficient  for  purely  national 
crises,  where  both  the  crisis  and  the  manufacturing  capacities  are  in  the  same  Member 
State. However, this will not be sufficient when a crisis has a cross-border dimension – 
the  latter  is  highly  probable  due  to  prevalence  of  cross-border  supply  chains.  The 
incapacity of Member States to properly  address  a crisis with a cross-border dimension 
finds  its  origin  in  the  territoriality  of  national  compulsory  licensing  schemes  and  the 
divergent,  sometimes  sub-optimal,  compulsory  licensing  schemes  in  place  to  tackle  a 
crisis. The proposed EU action will act on these specific points by creating an EU-level 
compulsory licence with  a streamlined procedure. Without  action at  EU level,  Member 
States  would  remain  vulnerable  to  crises  with  a  cross-border  dimension.  In  contrast, 
introducing  an  EU  compulsory  licensing  scheme  will  contribute  to  building  a  more 
resilient  EU  by  providing  an  additional  collective  tool  in  support  of  other  crisis 
instruments such as SMEI or HERA. 

3.3  Subsidiarity: Added value of EU action 

The objective of the initiative is to build an EU-level compulsory licensing scheme able 
to  tackle  crises  with  a  cross-border  dimension,  in  addition  to  the  existing  compulsory 
licensing  national  schemes  for  grounds  other  than  crises.  Any  instrument  that  is  to  be 
considered  in  this  impact  assessment  would  be  limited  to  what  is  necessary  to  tackle 
crisis  with  a  cross-border  dimension,  only  when  such  action  cannot  be  implemented  at 
national  level  or  when  such  implementation  would  be  inefficient.  Ultimately,  the 
proposed instrument would be also complementary to the other crisis instruments aimed 
at strengthening the resilience of the Single Market. 

21 

 
4  OBJECTIVES: WHAT IS TO BE ACHIEVED? 

To  address  problems  discussed  in  section  2,  the  proposed  initiative  aims  to  create  a 
compulsory  licensing  system  that  would  be  less  fragmented  and  better-suited  for  EU-
wide crises. Since compulsory licensing may have a significant impact on IP holders, this 
should  remain  an  exceptional  measure,  applicable  in  case  of  unavailability  or 
unsuitability  of  voluntary  agreements.  Working  within  the  bounds  of  the  TRIPS 
Agreement, the initiative should not lead to higher aggregate burdens or risks for patent 
holders  relative  to  national  regimes,  but  rather  a  more  convergent,  predictable,  and 
workable regime in the exceptional cases where recourse to compulsory licensing at EU 
scale is necessary. Details of objectives to be achieved are presented below: 

Figure 5: Objectives 

4.1  General objectives 

Our  general  objective  is  to  enable  the  EU  to  respond  to  crisis  situations  in  a  timely 
manner  using  the  full  potential  of  the  Single  Market  and  ensure  that  in  time  of  crisis, 
critical  products  and  components  can  be  made  available  across  EU  countries  and 
supplied without delays to EU citizens and firms or non-EU countries. 

4.2  Specific objectives 

With  a  view  of  creating  a  convergent,  predictable  and  workable  compulsory  licensing 
system  in  the  EU  for  crisis  management,  both  for  the  domestic  market  and  for  export 
purposes to non-EU countries, the specific objectives (‘SO’) would aim at: 

  SO1:  Improve the  key  features of  compulsory licensing, such as  the trigger, scope 
and  conditions  of  compulsory  licensing,  as  well  as  improve  the  coherence  of 
compulsory  licensing  in  the  EU  to  improve  its  effectiveness  and  efficiency  in  a 
crisis. This objective would in other words aim at reducing the fragmentation. This 
would  mainly  concern  the  domestic  market  as  Regulation  (EC)  816/2006  already 
provides for harmonisation of compulsory licensing for export purposes to non-EU 
countries;  

  SO2: Ensure that the territorial reach of a compulsory licence, including for export 
purposes, can accommodate the reality of cross-border value chains operating in the 
Single  Market.  This  objective  does  not  aim  at  making  compulsory  licensing  more 
frequent  but  rather  ensuring  that  the  territorial  reach  of  a  compulsory  licence, 
including  for  export  purposes  to  non-EU  countries,  is  adequate  to  the  reality  of 
cross-border value chains operating in the Single Market;  

  SO3:  Support  EU  resilience  by  improving  the  coordination,  streamlining  the 
decision making and allowing compulsory licences to better complement EU action 

22 

 
 
in crises, including for export purposes to  non-EU countries. This objective would 
also  aim  at  ensuring  adequate  coherence  between  (national)  compulsory  licensing 
schemes and EU crisis instruments.  

5  WHAT ARE THE AVAILABLE POLICY OPTIONS? 

5.1  What is the baseline from which options are assessed? 

Under  the  baseline  scenario  (status  quo)  the  compulsory  licensing  system  in  the  EU 
would continue to operate based on the existing national rules and  Regulation (EC) No 
816/2006.  As  a  result,  compulsory  licensing  schemes  for  crisis  management  would 
remain  purely  national,  also  for  cross-border  or  EU-wide  crises.  There  would  be  no 
coordination  between  Member  States  and  compulsory  licensing  would  remain  mainly 
applicable to national territories (and subject to possible restrictions such as embargos). 
This  would  result  in  maintaining  an  inefficient  tool  for  addressing  crises  in  the  Single 
Market, unfit for the cross-border nature of EU supply chains. This option may lead to a 
situation  that  voluntary  agreement  is  the  only  viable  option  or  where  Member  States 
could  only  rely  on  the  goodwill  of  private  economic  operators  and  their  willingness  to 
enter  into  voluntary  agreements,  as  public  authorities  will  not  be  able  to  leverage  their 
bargaining  position  based  on  an  optimal  compulsory  licensing  scheme.  This  option 
would  neither  support  the  EU’s  efforts  in  building  tools  to  foster  its  resilience  when 
facing  crises  nor  ensure  a  link  between  EU  emergency  instruments  and  compulsory 
licensing.  Furthermore,  the  following  factors  would  continue  to  affect  stakeholders 
involved in a compulsory licensing procedure under the status quo (Table 1). 

Table 1: Key factors affecting stakeholders involved in compulsory licensing procedure (relevant in a crisis situation) - 
the baseline  

Patent owners 

Key factors affecting stakeholders 
  Cost to participate in licensing negotiations in each jurisdiction, where the 

compulsory licensing may be pending; 

  Lack of legal certainty (e.g. on the scope of compulsory licensing, amount of 

remuneration) due to fragmentation.  

  Loss of control over patent rights in a EU country concerned. 
  Cost to participate in licensing negotiations in each jurisdiction, where the 

compulsory licensing may be pending. 

  Cost of adapting the manufacturing facilities to the production of CL-covered item. 
  Cost of launching and implementing the compulsory licensing procedure (incl. 

negotiations with the patent holders and manufacturers). 

Manufacturers – 
potential 
licensees 
EU countries 

  Crisis tackled individually, less leverage. 
  Risk of unavailability or delays in supply of critical products during crisis. 
  Cost and legal uncertainty when initiating the compulsory licensing procedure in 

EU citizens  
Non-EU 
countries78  
As  compulsory  licensing  is  very  rare79,  data  on  the  actual  costs  of  such  procedures  is 
scarce  and  accessing  its  economic  impacts  proves  challenging.  Nonetheless,  the 
following  characteristics  can  be  attributed  to  selected  entries  indicated  in  the  above 
Table:  

the EU.  

  Currently,  compulsory  licensing  procedure  is  complex  and,  based  on  the  available 
examples,  it  may  take  a  year  or  longer  to  complete,  even  if  carried  out  only  at 

78 Understood as countries covered by Regulation (EC) No 816/2006. 
79 E.g. in the context of the COVID-19 crisis, only one compulsory licence was granted in the EU (HU). 

23 

 
 
                                                 
national level (see Table 25, Annex 6 – the duration lasting from at least ca. 1 year 
and 10 months80, to ca. 2 years and 2 months including the negotiation phase81, or 
ca.  2  years  and  8  months82).  The  only  example  where  a  compulsory  licence  for 
export was successfully issued (the Canada-Rwanda case) took roughly three years83 
to  complete.  For  both,  domestic  and  export  markets,  the  length  and  complexity  of 
procedure  has  direct  influence  on  cost  for  all  parties  involved.  The  cross-country 
differences  between  compulsory  licensing  procedures  are  also  source  of  legal 
uncertainty. 

  Costs  are  borne  separately  in  each  jurisdiction  –  as  indicated  in  the  problem 
statement (section 2.1), the average number of Member States in which patents for 
COVID-related  products  were  active  was  around  4  to  5.  Using  this  as  a proxy  for 
products  that  can  be  subject  to  a  CL  during  a  crisis,  it  can  be  assumed  that  in  the 
event  of  a  cross-border  crisis  compulsory  licensing  procedures  might  need  to  be 
repeated at least four times for the same product (i.e. separately in each jurisdiction 
where the relevant patent should be lifted).  

The policy options proposed in this impact assessment will be evaluated compared to the 
above factors, as identified for the baseline. The general economic and competitiveness 
impacts of compulsory licencing that are valid irrespective of a crisis incident occurrence 
are discussed in section 6.5.3.  

5.2  Description of the policy options  

Each option will consider the ensuing elements, in line with the specific objectives: 

  Improve the key features of compulsory licensing (addressing SO1): Features of 
a  compulsory  licensing  scheme  play  an  important  role  to  ensure  the  effectiveness 
and efficiency of a CL for crisis management purposes. As illustrated in the problem 
definition, shortcomings currently exist in the national systems. These shortcomings 
concern: 

-  The  trigger  (i.e.  possibility  to  grant  a  compulsory  licence  for  crisis 
management or only limited to certain types of crises): clarifying this aspect is 
broadly  in  line  with  stakeholders  opinions  as  only  few  of  them  (5%)  are 
against  the  use  of  compulsory  licence  for  crisis  management84.  In  addition, 
those  having  expressed  an  opinion  are  in  favour  of  a  compulsory  licensing 
scheme covering a large range of crises. For this reason, the different options 
provide  for  the  granting  of  a  compulsory  licence  for  crisis  management, 
covering all types of crises. 

80 Italy, 2005 – SPC on medicine imipenem-cilastatin (for further details see Table 25 in Annex 6). 
81 Germany, 2016 - Medicine raltegravir (for further details see Table 25 in Annex 6). 
82 Austria, 1972 - Medicine inderal propranolol hydrochloride (for further details see Table 25 in Annex 6). 
83 A submission from Canadian pharmaceutical company Apotex Inc. to manufacture Apo-TriAvir (an HIV 
antiretroviral drug) was received by Health Canada in December 2005. The medicine was sent to Rwanda 
in two shipments in September 2008 and 2009.  
84 Only 5% (N= 4) respondents to the public consultation consider that compulsory licensing should never 
be  used  in  crises.  Among  the  respondents  having  given  their  opinion  on  the  types  of  specific  crises  that 
should  be  covered  by  a  compulsory  licence,  a  majority  favours  a  large  approach  (i.e.  crises  related  to 
health,  war  and  large-scale  attack,  energy,  and  natural  disasters).  Furthermore,  27  respondents  replied  to 
the sub-question on which types of specific crises should be covered. Out of these 27 replies, 25 mentioned 
health-related crises, 21 war and large-scale attack, 19 energy and 19 natural disasters. 

24 

 
                                                 
-  The  scope  (i.e.  covering  or  not  patent  applications,  SPCs,  RDP  and  know-
how):  as  illustrated  in  the  problem  definition,  a  limited  scope  can  seriously 
limit  the  efficiency  and  effectiveness  of  a  compulsory  licence.  Not  covering 
patent  applications  could  prevent  the  use  of  critical  new  products  or 
technologies  to  tackle  a  crisis.  Not  covering  SPC  and  RDP  could  maintain 
protection  other  than  IP,  making  the  compulsory  licence  useless.  This  is 
acknowledged by many categories of stakeholders, as far as patents85, SPC86, 
RDP87 are concerned. In contrast only a third of stakeholders are in favour of 
including  know-how88  in  the  scope  of  compulsory  licensing.  However,  good 
collaboration from the patent owner, including  in some circumstances access 
to  know-how,  may  be  necessary  to  ensure  the  success  of  a  compulsory 
licence89. In that context, all the options include a good cooperation obligation 
for patent owners. For this reason, all options include a scope covering patents 
(unitary and national patents), patent applications, (unitary) SPCs and RDP90 
as  well  as  a  good  collaboration  obligation.  Other  IP  rights  would  not  be 
covered (see discarded options). 

-  The procedure (i.e. absence of an accelerated procedure): as illustrated in the 
problem  definition,  the  absence  of  an  accelerated  procedure  can  delay  the 
granting of a compulsory licence. Yet, a large majority of respondents (74%, 
N= 55) consider the speed of ensuring access to the required products and/ or 
technologies  as  a  high  priority  for  compulsory  licensing  in  crisis91.  For  this 
reason, all options include an accelerated procedure. 

85  Half  of  the  respondents  (N=  37)  to  the  public  consultation  are  in  favour  of  a  scope  covering  patent 
applications,  with few disparities between the  main categories of stakeholders, except for companies and 
business associations who remain mainly against (for more details see Annex 2 and Table 25 in Annex 6). 
86 65% of the respondents (N= 48) to the public consultation are in favour of a scope covering SPCs, with 
few disparities between stakeholders (for more details see Annex 2 and Table 27 in Annex 6). 
87  Stakeholders  generally  agree  that  RDP  should  not  be  an  obstacle  to  the  effective  implementation  of  a 
compulsory licence, see CEIPI(2023) p. 46. As for the OPC, although in absolute terms only 32% of the 
respondents  (N=  37)  to  the  public  consultation  are  in  favour  of  a  scope  covering  RDP,  this  low  score  is 
explained by the many companies and business associations being against it, which is understandable due 
to their legitimate commercial interests. NGOs, public authorities, and academic/ research institution were 
predominantly in favour (for more details see Annex 2 and Table 28 in Annex 6).  
88  36%  of  respondents  (N=27)  welcome  if  compulsory  licences  also  included  the  know-how.  However, 
views are extremely contrasted on this point with only 5% of companies and business associations being in 
favour. In contrast, academia, NGOs and public authorities, all but one  are  in favour of including know-
how in the scope of a compulsory licence (for more details see Annex 2 and Table 29 in Annex 6). 
89 There may be situations in which allowing the use of a patent the invention through a compulsory license 
is not sufficient to enable the licensee to effectively produce the crisis-relevant goods. This can particularly 
be  the  case  for  complex  products  that  require,  in  addition  to  the  permission  to  use  the  invention,  the 
transfer of know-how including skills, abilities and knowledge. To this end, both parties involved, rights-
holder and licensee, should act together in good faith to enable the transfer of the knowledge (know-how) 
associated with the patented invention, considering the interests of both parties.  
90  As  regards  RDP,  the  pharmaceutical  review  would  include  the  lifting  of  RDP  in  case  of  compulsory 
licensing granted to tackle a crisis. 
91 Additionally, 43% of the respondents to the public consultation would welcome an alignment of the type 
of procedure (administrative or judicial procedure). When it comes to NGOs and academia, 8 out of the 11 
respondents are in favour of such alignment. On recourse procedure, a bit more than a third of respondents 
to  the  public  consultation  agree  with  an  alignment  of  the  time  limit  within  which  the  application  of  an 
appeal  is  admissible  (42%,  N=  31)  and  an  accelerated  appeal  procedure  (38%,  N=  28). 35%  (N=  26) of 
respondents are in favour of the suspensive effect of an appeal. 

25 

 
                                                 
-  The  conditions  (i.e.  burdensome  identification  requirements,  embargos  and 
rules on remuneration): as illustrated in the problem definition,  identification 
of  a  patent  or  imposing  an  embargo  can  undermine  the  efficiency  of 
compulsory 
rules  on 
remuneration  can  to  the  contrary  support  a  swift  granting  of  a  compulsory 
licence92.  For  this  reason,  all  options  include  as  conditions  streamlined 
identification  of  patents/  product  the  prohibition  of  embargos  and  rules  on 
remuneration. 

for  crisis  management.  Pre-defined 

licensing 

Consequently, the legislative options allow for the granting of a compulsory licence 
to  tackle  all  types  of  crises,  providing  a  large  scope  (covering  SPCs  and  RDP), 
subject to a streamlined procedure and with optimal conditions. The options differ 
as  they  propose  different  ways  to  implement  these  features.  Each  option  therefore 
details how trigger, scope, conditions and procedure are clarified. Additionally, each 
option  specifies  who  decides  to  issue  a  compulsory  licence  and  the  applicable 
procedure.  

  Territorial  reach  of  compulsory  licensing  (addressing  SO2):  Each  option 
indicates  the  territorial  coverage  and  the  need  –  or  absence  thereof  –  to  issue 
multiple compulsory licences,  and therefore how  it fits  the inherently  cross-border 
nature of supply chains in the Single Market. In this context it is worth noting that 
almost half of the respondents to the public consultation consider that a compulsory 
licence  should  enable  the  manufacturing  of  products  across  several  EU  countries 
(46%, N=34) or to be exported in another Member State than the one in which the 
product is manufactured (45%, N=33 replies)93.  

  Support to EU resilience (addressing SO3): Each option specifies the role it plays 
in supporting the EU efforts to foster resilience to crises and the coherence with the 
different  EU  crisis  instruments  as  well  as  the  streamlining,  transparency  and 
coordination  efforts  on  decision  making.  Because  of  the  horizontal  nature  of  IP 
rights,  the  envisaged  initiative  on  compulsory  licensing  will  build  on  these  crisis 
instruments,  by  relying  on  the  concepts  and  mechanisms  already  in  place  and 
complement  them.  Finally,  all  options  envisage  certain  reporting  obligations94 
imposed on Member States if a compulsory licence is considered to tackle a cross-
border  crisis.  The  scope  of  such  obligation  differs  according  to  options,  as  it  may 
range  from  exchanges  of  information  during  compulsory  licensing  negotiations,  to 
post-factum reporting on the implementation of the CL. The reporting requirements 
would not necessitate any additional  ICT infrastructure nor data collection, as they 
would refer to basic information included in the licence agreements.  

The  results  of  the  public  consultation  show  that  a  large  majority  (82%,  N=61)  of 
respondents  consider  that  public  authorities  should  be  entitled  to  allow  production  of 
critical goods through a CL. Respondents are usually less in favour of a decision-making 
role of European institutions (28%, N= 21) than a coordinating role (36%, N=27). This 
can be explained by the  fact that businesses and  industry representatives  expressed low 

92 Pre-defined rules on remuneration are deemed useful to speed-up the granting of a compulsory licence 
by 42% of the respondents to the public consultation. 
93  Interestingly,  respondents  identifying  themselves  as  likely  to  be  the  subject  of  a  compulsory  licence 
generally (75%) agree with the cross-border use of a compulsory licence. Stark contrast exists among the 
different categories of stakeholders, as illustrated in Annex 6. 
94 Or recommendation to do so in Option 1. 

26 

 
                                                 
support  in  this  respect,  whereas  they  were  the  dominant  group  of  respondents95  to  the 
OPC. That being said, the option of granting a CL at EU level is generally deemed more 
positive by stakeholders as regards the EU’s ability to tackle crises (35%, N=26) than the 
granting of a CL at national level (respectively, 11%, N=8). Stark contrast exists among 
stakeholders  with  again  low  support  from  industry  representatives:  a  majority  (around 
50%)  of  companies  and  business  associations  considering  that  the  impact  would  be 
negative.  In  contrast,  no  respondent  in  other  categories  considers  the  impact  to  be 
negative. A large majority (65%, N=22) considers it positive (4% considers the impact to 
be neutral and the rest did not reply). 

5.2.1  Option 1: Recommendation on compulsory licensing for crisis management 

Under this non-legislative option, the Commission would propose a recommendation on 
compulsory  licensing  for  crisis  management  with  the  objective  of  increasing  the 
efficiency  and  effectiveness  of  national  compulsory  licensing  schemes,  including  for 
export  purposes  to  non-EU  countries  (i.e.  cases  covered  by  Regulation  (EC)  No 
816/2006). In this recommendation, the Commission would clarify the international legal 
framework,  both  in  terms  of  obligations  and  flexibilities.  Based  on  that,  the 
recommendation would identify good national practices as regards compulsory licensing 
for crisis management and good coordination practices with a view to foster their uptake 
in Member States.  

 

Improve  the  key  features  of  compulsory  licensing:  In  addition  to  identifying  and 
listing national provisions for issuing a compulsory licence for crisis management, 
the recommendation would clarify, in collaboration with Member States, the optimal 
features of compulsory licensing for crisis management (including the trigger, scope 
and the conditions), as well as clarify the procedures to apply for and grant such CL. 
The recommendation would list remedies available to patent owners, including the 
competent judicial authorities, and provide concrete guidance on how patent owners 
can file an appeal against the granting decision. On compulsory licensing for export 
to  non-EU  countries,  the  recommendation  would  identify  good  practices  among 
Member States as regards national formal or administrative requirements. 

  Territorial  reach  of  compulsory  licensing:  The  recommendation  would  clarify  the 
territorial scope of compulsory licensing granted at national level, and in particular 
the  possibility  to  distribute  part  of  the  goods  manufactured  under  a  compulsory 
licence to another Member State.  

  Support  to  EU  resilience:  The  recommendation  would  identify  relevant  EU  crisis 
instruments  and  related  transparency  and  coordination  requirements.  Against  that 
background,  the  recommendation  would  clarify  how  to  align  national  compulsory 
licensing  schemes  with  EU  crisis  instruments.  It  would  also  outline  and  promote 
good  practices  in  terms  of  cooperation,  transparency  and  information  sharing 
between  Member  States,  including  compulsory  licences  for  export  to  non-EU 
countries.  Finally,  PO1  would  propose  good  practices  in  information  exchange 
concerning granted compulsory licenses and encourage Member States to share such 
info with the EC. 

95 Business associations and company/business organisation accounted for 54% of respondents to the OPC 
(see Table 12 in Annex 2) 

27 

 
                                                 
Figure 6: Simplified scheme for Option 1 

5.2.2  Option  2:  Harmonisation  of  national  laws  on  compulsory  licensing  for  crisis 

management 

Under  this  option,  the  Commission  would  propose  a  legislative  initiative  that  would 
harmonise national laws as regards the ground, scope, procedure, and conditions for the 
granting of a compulsory licence for crisis management. The legislative initiative would 
ensure that all Member States have in their national laws a compulsory licensing scheme 
for crisis management. The compulsory licensing would remain in the remit of Member 
States and have predominantly a national effect. PO2 would not harmonise compulsory 
licensing schemes other than for crisis management. In line with the identified objectives, 
it would focus on three building blocks as described below: 

 

Improve the key features of compulsory licensing: PO2 would require all Member 
States  to  include  in  their  national  law  a  compulsory  licensing  scheme  for  crisis 
management.  Although  the  definition  of  a  crisis  would  be  harmonised  (using 
existing definitions at EU level), the granting decision, and the interpretation given 
to  the  notion  of  crisis,  would  be  left  to  Member  States. The  harmonisation  would 
cover the procedure, scope and conditions for granting a compulsory licence, along 
the  lines  of  what  was  described  in  section  5.2.  The  issuance  of  a  CL  for  crisis 
management  would  remain  a  national  decision.  PO2  would  ensure  that  remedies 
available to patent owners, including the competent judicial authorities, are aligned 
in all Member States.  

  Territorial  reach  of  compulsory  licensing:  PO2  would  require  Member  States  to 
allow,  in  cross-border  crises,  the  possibility  to  export  manufactured  under  a 
compulsory  licence  to  another  Member  State.  There  would  be  no  exhaustion  of 
patent  rights  under  this  option  (i.e.  importing  Member  States  would  still  need  to 
issue a licence to import the goods). 

  Support  to  EU  resilience:  This  option  would  clarify  that  national  compulsory 
licences could be issued in the context of an EU decision activating or declaring a 
crisis  mode  or  an  emergency.  The  EC  would  have  a  coordination  role  in  case  of 
cross-border  crises,  as  it  would  provide  support  to  Member  States  and  facilitate 
coordination  of  national  compulsory  licences  (e.g.  ensure  the  same  subject-matter, 
duration,  remuneration,  etc.)  to  ensure  coherence  across  the  EU.  PO2  would  also 
include  transparency  and  information  exchange  obligations  for  Member  States  as 
regards applications for and granting of compulsory licences for crisis management 
and in the context of Regulation (EC) No 816/2006. Member States would have to 
inform the EC when they are considering granting and/or have granted a compulsory 
licence  for  crisis  management  (i.e.  transparency  obligation)  as  well  as  provide 
information  on  the  compulsory  licence  (the  subject  matter  of  the  compulsory 
licence,  companies  involved  such  as  patent  holders  and/or  manufacturers,  the 
conditions agreed, etc.). 

28 

 
 
Figure 7: Simplified scheme for Option 2 

A detailed scheme describing the procedural steps foreseen under Option 2 is provided in 
Figure 19 (Annex 6). 

5.2.3  Option  3:  Harmonisation  plus  a  binding  EU-level  measure  on  compulsory 

licensing for crisis management 

Under  this  option,  the  compulsory  licence  could  be  triggered  in  two  scenarios.  First,  it 
could  be  triggered  by  an  EU-level  decision  activating  a  crisis  mode  or  declaring  an 
emergency  under  an  existing  EU  crisis  instrument96  (e.g.  activation  of  the  emergency 
mode  under  SMEI).  Second,  the  compulsory  licence  could  be  triggered  upon  a  request 
made to the Commission by more than one Member State in the event of a cross-border 
crisis97.  In  such  case,  the  notion  of  crisis  would  be  defined  along  the  line  of  existing 
definitions  in  EU  legislation98.  It  would  cover  all  types  of  crises  (e.g.  not  limited  to 
health-related crisis) but would always require a cross-border aspect99. The Commission 
would adopt an activation measure100 requiring one or several Member States to issue a 
compulsory  licence  for  crisis  management.  The  Commission  would  be  assisted  by  an 
advisory committee composed of Member States representatives that should provide the 
Commission with a non-binding opinion. Its main tasks would include the assistance of 
the Commission in the determination of the necessity to rely on compulsory licensing at 
Union  level,  and  under  which  conditions.  In  case  there  is  an  existing  crisis  instrument, 
the advisory body would be the one foreseen in the context of this crisis instrument (e.g. 
Advisory  Group  under  SMEI).  For  cases  falling  outside  existing  crisis  instruments  or 
where there is no such advisory body, an ad hoc advisory body would be set up101. The 
advisory  committee  would  also  hear  the  patent  owner(s)102.  This  should  enable  the 

96  In  such  case,  the  EU-level  decision  activating  a  crisis  mode  should  fulfil  the  conditions  under  that 
specific crisis instrument (e.g. crisis activation decision under SMEI or SCBTH– see Table 22 in Annex 6).  
97  The  request  would  have  to  be  made  by  the  Member  States  willing  to  be  covered  by  the  EU-level 
compulsory licence (as a manufacturing or receiving country). 
98 In order to ensure as much coherence as possible with existing crisis instruments and other acts at Union 
level, the proposed initiative should draw on existing definitions.  For example, the definition of a ‘crisis-
relevant  product’  could  be  based  on  the  definitions  of  SMEI.  In  similar  vein,  the  determination  of  the 
existence of a crisis or emergency would rely on the Union legal act underlying the crisis mechanism and 
the crisis definition included therein. 
99 I.e. a crisis covering multiple EU countries or with manufacturing capacities in a different country than 
the one experiencing the crisis or with manufacturing capacities spread across several EU countries.  
100 E.g. an implementing act.  
101 When the advisory body is an existing one, its existing rules of procedure should apply. As regards ad 
hoc  advisory  bodies,  they  should  be  composed  of  one  representative  of  each  Member  State  in  order  to 
provide  the  Commission  with  information  and  input  stemming  from  the  national  level  including 
information  on  manufacturing  capacities,  potential  licensees  and,  if  applicable,  proposals  for  voluntary 
solutions. In addition, the advisory body should have the function of collecting and analysing relevant data 
as well as ensuring coherence and cooperation with other crisis relevant bodies at Union and national level.  
102  The  non-binding  opinion  of  the  advisory  body  should  be  considered  in  the  decision-making  process. 
The  advisory  body  would  have  to  consider  the  comments  made  by  the  patent  owner(s).  Persons,  in 
particular  the  licensee  and  the  rights-holder,  whose  interests  may  be  affected  by  the  compulsory  licence 
should be given the opportunity to submit their observations beforehand.  

29 

 
 
                                                 
Commission  to  make  an  assessment  and  consider  the  individual  merits  of  the  situation 
and  determine  on  this  basis  the  adequate  conditions  of  the  compulsory  licence,  in 
particular the adequate remuneration103 for the rights-holder. It would lead to the issuance 
of several national compulsory licences, each being applicable to the territory of several 
EU countries or the whole EU. An appeal against the decision would be available104. PO3 
would not harmonise national compulsory licensing schemes other than for cross-border 
crisis management. In line with the identified objectives, it would focus on the following 
building blocks:  

 

Improve the key features of compulsory licensing: PO3 would require all Member 
States  to  include  in  their  national  law  a  compulsory  licensing  scheme  for  cross-
border crisis management (i.e. triggered by an EU-level decision activating a crisis 
mode or declaring an emergency  or upon request  of Member State(s)). The option 
would require Member States to provide for an accelerated granting procedure (e.g. 
an executive order). Although the granting decision will be a national decision, its 
basis will be a Commission act defining the conditions strictly linked to  the crisis, 
namely the purpose (e.g. production of this product protected by this(es) patent(s)), 
the duration, and the territorial scope of the compulsory licence. This option would 
provide harmonisation on other features105 such as the scope and the conditions, but 
still leaving some margin of manoeuvre for Member States106. The licensee(s) could 
be  identified  by  the  Commission,  Member  States  and/  or  directly  apply  to  benefit 
from a compulsory licence.  

  Territorial reach of compulsory licensing: Under this option, the compulsory license 
could  have  an  EU-wide  effect.  However,  the  activation  measure  and  the  national 
decision would specify the exact territorial scope, considering the crisis. The scope 
could  be  modified  depending  on  the  circumstances  (e.g.  crisis  expanding  to  other 
countries, need for further manufacturing capacities).  

  Support  to  EU  resilience:  This  option  would  provide  the  possibility  for  the 
Commission, being assisted by the relevant  advisory body107, to order the granting 
of  national  compulsory  licences  for  cross-border  crises  management.  The  option 
would also include transparency and information exchange obligations for Member 

103 Further details on the possible remuneration criteria are provided in Annex 6. 
104 The procedure would however depend on the type of act through which the binding opinion would be 
granted. It would however always include a judicial procedure, as per requested by the TRIPS Agreement. 
As regards national decision (and under PO3 aspects such as the remuneration), appeal would be done at 
national level. 
105 E.g. the harmonisation would include some criteria to determine the remuneration at national level. 
106 The margin of manoeuvre would concern aspects that are not strictly linked to the crisis. For instance, as 
regards remuneration, Member States would be able to decide on the amount of remuneration to be paid to 
the  patent  owners  but  should  take  into  account  some  criteria,  such  as  the  economic  value  of  the  use 
authorised under the licence or the non-commercial circumstances relating to the issue of the licence. This 
option  would  also  provide  for  coordination  on  the  adequate  remuneration  with  other  concerned  Member 
States. On remedies, this option would require Member States to set up a judicial procedure to appeal the 
national granting decision,  in particular as regards remuneration aspects and respect of the conditions set 
up by the Commission activation measure. 
107 Either the advisory body attached to the crisis instrument in the context of which the compulsory licence 
is granted or, in the absence of such body, the ad hoc advisory body – see footnote 101.  

30 

 
                                                 
States108  as  regards  applications  for  and  granting  of  compulsory  licences  based  on 
the  Commission  activation  measure  and  in  the  context  of  Regulation  (EC)  No 
816/2006. Yet, to the extent Member States are to be involved in the implementation 
of the compulsory licence, they would be also bound to report on the outcomes of 
the  process  to  the  Commission.  Finally,  under  this  option  a  single  contact  point109 
would be set-up so that non-EU countries110 could submit a request for coordination 
to the Commission in case of cross-border supply and manufacturing, which would 
require the granting of several national compulsory licences. In order to process the 
request, the Commission would be assisted by an advisory committee composed of 
Member  States  representatives.  This  committee  would,  along  the  lines  of  what 
would exist for the EU domestic market under this option, ensure coordination and 
cooperation among Member States and the  EC, with the aim to provide  support to 
non-EU countries so that they can better plan their activities of manufacture and sale 
for export under Regulation (EC) No 816/2006. 

Figure 8: Simplified scheme for Option 3 

A detailed scheme describing the procedural steps foreseen under Option 3 is provided in 
Figure 20 and Figure 21 (Annex 6). 

5.2.4  Option  4:  EU-level  compulsory  licensing  to  complement  existing  EU  crisis 

instruments  

Under  this  option,  the  triggers  would  be  the  same  as  under  PO3  (i.e.  two  possible 
triggers,  namely  either  an  EU  level  decision  in  the  context  of  an  existing  EU  crisis 
instrument111,  or  a  request  made  to  the  EC  by  more  than  one  Member  State112).  The 
Commission would adopt an activation measure granting a compulsory licence for cross-
border crisis management. The Commission would be assisted by an advisory committee 
composed of Member States representatives113. This  option would lead to  the issuance, 
by the Commission, of one compulsory licence, applicable to the territory of several EU 
countries or the whole EU, with its own procedure114 and conditions. PO4 would leave 
unchanged national  legislations on compulsory licensing115.  The patent owner(s)  would 
be able to share their views and provide information in the context of the discussions of 

108  Member  States  would  have  to  provide  the  EC  with  key  information  on  the  compulsory  licence  (the 
subject  matter  of  a  CL,  companies  involved  such  as  patent  holders  and/or  manufacturers,  the  conditions 
agreed, etc.). 
109 The  single contact point should be established at the Commission and act as a focal and coordination 
point  in  case  third  countries  face  a  situation  when  planning  its  activities  under  Regulation  (EC)  No 
816/2006 that requires compulsory licences in more than one Member State. 
110 Or applicants as identified by Article 6 of Regulation (EC) No 816/2006. 
111 Along the lines of what is provided under PO3. 
112 In case of a crisis with a cross-border aspect, along the lines of what is provided under PO3.  
113 See footnote 101. 
114  Including  the  appeal  procedure,  which  will  depend  on  the  nature  of  the  act  (e.g.  implementing  act  or 
Commission  decision)  granting  the  compulsory  licence.  In  contrast  to  PO3,  there  will  be  no  national 
granting decision and therefore no national appeal procedure. 
115 Member States would retain full competence to grant national compulsory licences. This option would 
just add an additional layer to the existing national schemes on compulsory licensing. 

31 

 
 
                                                 
the  advisory  body116.  The  Member  States  could  initiate  the  procedure117  and  would 
participate in the advisory body118. An appeal procedure would be set-up119. In addition, 
the Commission would have the possibility to review, upon motivated request,  whether 
the licence conditions are respected120. In line with the identified objectives, PO4 would 
focus on three building blocks as described below: 

 

Improve  the  key  features  of  compulsory  licensing:  PO4  would  allow  the  EC  to 
directly  grant,  through  an  activation  measure,  a  compulsory  licence  for  crisis 
management.  PO4  would  specify  the  conditions  of  such  EU-level  compulsory 
licence,  including  the  purpose  (i.e.  manufacturing  of  this  product,  protected  by 
this(es) patent(s) to tackle a specific crisis), the duration (that will be limited to the 
purpose121), the remuneration122, the territorial scope (including safeguards to avoid 
diversion  of  goods  to  unauthorised  territories),  and  the  good  collaboration 
obligation123.  These  conditions  should  consider  the  EU  decision  activating  a  crisis 
mode  or  declaring  an  emergency,  and  the  conditions  therein  (such  as  the  duration 
and  territorial  coverage).  The  efficiency  and  timeliness  of  EU-level  compulsory 
licence would be ensured by adequate governance design124. In compliance with the 
TRIPS  Agreement,  the  EU-level  compulsory  licence  would  be  non-exclusive  and 
non-assignable.  

  Territorial reach of compulsory licensing: Under this option, the compulsory licence 
could have an EU-wide effect. However, the  activation measure would specify the 
exact  territorial  scope,  considering  the  crisis.  The  scope  could  be  modified 
depending  on  the  circumstances  (e.g.  crisis  expanding  to  other  countries,  need  for 
further manufacturing capacities). Under PO4, compulsory licences having a cross-
border effect could also be granted by the Commission in the context of Regulation 

116 Just like under PO3, the e advisory body should consider the comments made by the patent owner(s). 
117  This  would  certainly  be  the  case  when  the  trigger  is  outside  an  EU  crisis  instrument  and  where  the 
procedure  leading  to  the  granting  of  an  EU-level  compulsory  licence  would  be  a  request  made  by  more 
than  one  Member  State  to  the  Commission.  In  the  context  of  EU  crisis  instrument,  the  trigger  would 
usually be a Council decision, such as under SMEI, which would also involve Member States. 
118  Including  when  the  procedure  is  being  initiated  by  some  but  not  all  Member  States.  In  such  case,  all 
Member States would be represented in the advisory body, so to allow exchange of information and views 
on the need to issue a compulsory licence and the conditions (including the territorial scope) surrounding 
such compulsory licence. 
119  The  appeal  procedure  would  depend  on  the  nature  of  the  act  granting  the  licence  but  would  always 
involve a judicial review, as requested under the TRIPS Agreement. 
120 The Commission would also have the possibility to terminate the licence, subject to adequate protection 
of legitimate interests, if the conditions of the licence are not respected.  
121  If  the  compulsory  licence  is  granted  in  the  context  of  an  EU  crisis  instrument,  the  duration  of  the 
compulsory licence should be aligned to the duration of the emergency mode decided in the context of that 
EU crisis instrument. If the compulsory licence is granted upon request of the Member States, the duration 
will be specified in the EU-level compulsory licence, after having heard the advisory body (including the 
patent owner(s) should it make comment on this aspect).  
122 Criteria to determine the remuneration would be set-up. The remuneration would be specified in the act 
granting the EU-level compulsory licence, after having heard the advisory body.  
123  The  patent  owner(s)  would  have  to  collaborate  in  good  faith.  An  obligation  to  disclose  trade  secrets 
would not be provided. 
124 Notably: a) the establishment of a single procedure and decision-making at EU level instead of multiple 
procedures  and  decisions  at  national  level;  b)  access  to  an  accelerated  procedure  (e.g.  no  best  effort 
obligation to conduct negotiations); c) appeals against decisions should have no suspensive effect, so that 
the  licensee  can  already  start  producing  under  the  compulsory  licence,  regardless  of  the  outcome  of  the 
proceedings. 

32 

 
                                                 
(EC)  No  816/2006  should  the  manufacturing  of  the  pharmaceutical  product  be 
spread  across  several  Member  States,  subject  to  concerned  Member  States’ 
approval. 

  Support to EU resilience: In the context of an EU decision activating a crisis mode 
or  declaring  an  emergency,  this  option  would  provide  the  possibility  for  the 
Commission  to  grant  EU-level  compulsory  licences  for  cross-border  crises 
management.  PO4  would  provide  full  harmonisation  as  regards  the  granting  of 
compulsory  licence  to  tackle  a  cross-border  crisis  in  the  EU.  It  would  build  upon 
and  complement  existing  EU  crisis  instruments  by  providing  an  additional  tool  to 
help  tackle  a  crisis.  Under  this  option,  the  Commission  would  have  a  consultative 
role,  to  ensure  participation  of  relevant  stakeholders.  The  licensee(s)  could  be 
identified by the Commission, Member States and/ or directly apply to benefit from 
a  compulsory  licence.  Yet,  to  the  extent  Member  States  are  to  be  involved  in  the 
implementation  of  the  compulsory  licence,  they  would  be  also  bound  to  report  on 
the outcomes of the process to the Commission. Finally, as in PO3, a single contact 
point  would  be  set-up  in  the  context  of  Regulation  (EC)  No  816/2006.  However, 
under PO4 the function of the single contact point goes beyond a coordination role. 
PO4 would provide non-EU countries with the possibility to submit directly to the 
single  contact  point  (Commission)  an  application  for  an  EU-level  compulsory 
licence  in  case  of  cross-border  supply  and  manufacturing  (see  above,  point  on  the 
territorial  reach  of    compulsory  licensing).  Under  this  option,  the  Commission 
would retain its coordination role, assisted by the advisory body, as already provided 
under PO3. 

Figure 9: Simplified scheme for Option 4 

A detailed scheme describing the procedural steps foreseen under Option 4 is provided in 
Figure 22 and Figure 23 (Annex 6). 

5.3  Discarded options 

The possibility for a compulsory licence to cover other IP rights, and in particular plant 
variety  rights,  design  rights  or  copyright,  was  discarded.  The  possibility  to  grant  a 
compulsory  licence  for  a  Community  plant  variety  right  already  exists125.  Designs 
protection126  covers  the  appearance  of  a  product  and  does  not  extend  to  the  features  of 
appearance  of  a  product  that  are  solely  dictated  by  its  technical  function.  Since  the 
technical features of a design that could prove necessary to manufacture a critical good 
are free of design rights, a compulsory licence does not appear necessary in the field. The 
same  reasoning  applies  to  copyright  which  protects  a  specific  expression  of  an  idea  or 
creation. These ideas or creations can be expressed in another way should it be necessary 

125 See supra, point 1.2. 
126 A design  means ‘the appearance of the  whole or a part of a  product resulting from the features of, in 
particular,  the  lines,  contours,  colours,  shape,  texture  and/or  materials  of  the  product  itself  and/or  its 
ornamentation’ (Article 3 of regulation (EC) No 6/2002 of 12 December 2001 on Community design, see 
also Article 1 of Directive 98/71/EC of the European Parliament and of the Council of 13 October 1998 on 
the legal protection of designs). 

33 

 
 
                                                 
to  use  them  in  the  context  of  the  manufacturing  of  crisis  goods.  The  same  applies  to 
computer programmes protected under copyright law127.  

6  WHAT ARE THE IMPACTS OF THE POLICY OPTIONS? 

6.1  Option 1 – Recommendation on compulsory licensing for crisis management   

6.1.1 

Improve the key features of compulsory licensing 

Under Option 1, Member States would retain their margin of manoeuvre as regards the 
features of their national compulsory licensing schemes. The recommendation envisaged 
under  PO1  could  clarify  and  improve  the  features  of  national  compulsory  licensing 
schemes for crisis management and improve coherence across Member States. Although, 
the recommendation would raise awareness across Member States on the importance of 
an effective and  efficient  compulsory  licensing for crisis  management,  the risk remains 
that not all Member States would fully implement it because of the non-binding nature of 
the  recommendation.  PO1  could  therefore  have  only  a  limited  harmonising  effect.  In 
addition,  one  deviation  by  a  Member  State  (for  instance  an  embargo  period  in  the 
Member  State  with  the  manufacturing  capacities)  would  already  suffice  to  block  or 
significantly  impair  the  supply  of  crisis  relevant  goods  produced  under  a  compulsory 
licensing in certain cross border situations. Consequently, Option 1 is expected to lead to 
limited  improvements,  in  terms  of  effectiveness  and  efficiency,  of  national  compulsory 
licensing schemes for crisis management.  

6.1.2  Territorial reach of compulsory licensing  

Under Option 1 compulsory licensing would remain in the remit of Member States and 
their effect  would  be  limited to  the national  territory.  By  clarifying the  obligations  and 
flexibilities under the TRIPS agreement, the recommendation would bring legal certainty 
as  to  the  possible  territorial  reach  of  national  compulsory  licences,  including  on  the 
possibility  to  export  a  part  of  the  goods  manufactured  under  a  compulsory  licence  to 
another  Member  State.  However,  Member  States  would  remain  free  to  decide  whether 
and  how  to  take  advantage  of  these  flexibilities.  In  addition,  the  lack  of  EU-wide 
exhaustion would continue to limit the territorial reach of a compulsory licence. Multiple 
compulsory licences128 would still be needed for distributing products produced under a 
compulsory  licence  within  the  Single  Market.  Coherence  between  the  national 
compulsory licences would be subject to Member States’ willingness to carry out a joint 
harmonising effort of their national granting decisions and procedures. Consequently, the 
objective of giving national  compulsory licences  a more appropriate cross-border reach 
in crisis would be achieved to a very limited extent under Option 1.  

6.1.3  Support to EU resilience 

By  identifying  the  relevant  EU  crisis  instruments  and  related  transparency  and 
coordination  requirements,  the  recommendation  would  clarify  the  role  compulsory 
licensing can play in the context of the different EU crisis instruments. In that respect, the 

127  Article  1(2)  of  Directive  2009/24  of  23  April  2009  on  the  legal  protection  of  computer  program 
provides indeed for that “protection in accordance with this Directive shall apply to the expression in any 
form  of  a  computer  program.  Ideas  and  principles  which  underlie  any  element  of  a  computer  program, 
including those which underlie its interfaces, are not protected by copyright under this Directive.” 
128 One in each of the manufacturing Member States and one in each of the importing Member States. 

34 

 
                                                 
recommendation  could  support  the  EU  resilience  by  reinforcing  coherence  between 
national compulsory licences and EU crisis instruments. However, the decision to trigger 
the  compulsory  licence  would  remain  in  the  Member  Sates’  remit.  A  seamless 
embedding  of  national  compulsory  licensing  schemes  into  EU  crisis  instruments  is 
therefore not  to  be expected. The promotion of  good practices in  terms  of cooperation, 
transparency and information sharing between Member States, including for compulsory 
licences  for  export  purposes  to  non-EU  countries  would  facilitate  interaction  among 
Member States and between Member States and the Commission. However, divergences 
regarding the granting authority of a compulsory licence would remain. National actors 
would remain diverse, which would frustrate the possibility of communication between 
authorities across borders and could ultimately create barriers against engaging in holistic 
and uniform crisis responses across the EU.  

6.1.4 

Impacts per stakeholder group 

As PO1 would be based on non-binding actions, the cost and benefits are to a large extent 
uncertain,  as  they  depend  on  individual  decisions  of  each  Member  State.  First,  the 
countries  which  decide  to  apply  the  recommendation  on  good  practices  would  bear 
certain  one-off  cost  of  implementing  them.  Second,  if  the  majority  of  Member  States 
follows such approach, then it could be assumed that impact discussed in Table 2 below, 
can indeed materialise in the event of a cross-border crisis. 

Table 2: Impacts on stakeholders in the event of a cross-border crisis - Option 1 compared to the baseline 

Patent owners 

Manufacturers 
– potential 
licensees 
EU countries 

The general 
public (EU 
citizens) 
Non-EU 
countries 

Advantages 
(0/+) Somewhat lower costs of compulsory licensing negotiations, if 
recommendation applied by majority of MS. 
(0/+) Increased legal certainty (e.g. more clarity on the scope and 
what amount of remuneration may be expected), if recommendation 
applied by majority of MS. 
(0/+) Somewhat lower costs of compulsory licensing negotiations if 
recommendation applied by majority of MS.  

Disadvantages 
/ 

/ 

(0/+) Marginally lower costs of running the compulsory licensing 
procedure as EU countries can rely on additional information or 
support from other MS, but the main cost of launching and 
implementing the compulsory licensing procedure (negotiations with 
the patent holders and manufacturers) remain unchanged. 
(0/+) Marginally lower risk of delays or unavailability of critical 
products during crisis, if recommendation applied by majority of MS. 

(0/-) Cost of 
information 
exchange with other 
EU countries and 
the EC (optional).  
/ 

(0/+) Somewhat lower costs and improvement in legal certainty as 
regards compulsory licensing for export, if recommendation applied 
by majority of MS. 

/ 

Note: (0) neutral impact; (+) minor positive impact; (++) positive impact; (+++) significant positive impact; (-) minor 
negative impact; (- -) negative impact; (- - -) significant negative impact 

The impacts on patent owners would stay broadly the same as in the baseline. The cost 
of  participating  in  compulsory  licensing  negotiations  would  still  be  borne  in  each 
jurisdictions  concerned,  but  they  could  be  marginally  lower  if  the  compulsory  licence 
features  gain  in  coherence  across  the  EU.  Recommendations  could  improve  legal 
certainty  of  patent  holders,  for  example  as  regards  the  determination  of  remuneration 
(still, the remuneration to compensate the loss of income is likely be lower than the one 
to be received in voluntary agreements). Potential licensees would not experience much 
difference compared to the baseline scenario, except for a more streamlined approach of 
should 
negotiations,  and  consequently  marginally 

lower  participating  costs, 

35 

 
 
recommendations  be  implemented  at  national  level.  EU  countries  could  entail  costs 
should  they  decide  to  implement  the  recommendation  as  regards  cooperation, 
transparency  and  information  sharing.  The  costs  of  running  compulsory  licensing 
procedures could be decreased should all Member States adopt a more coherent approach 
to national compulsory licensing and share information thereon. Under the condition that 
the  respective  Member  State  makes  use  of  the  recommendation,  citizens  might  profit 
from an improved welfare as their possibility of gaining access to critical products would 
be  more  effective.  If  Member  States  would  implement  EU-wide  best  practices  on 
cooperation,  transparency  and  information  sharing  for  export  purposes,  non-EU 
countries might benefit of increased legal certainty and some administrative savings. 

6.2  Option 2 – Harmonisation of national laws on compulsory licensing for crisis 

management 

6.2.1 

Improve the key features of compulsory licensing 

Under PO2, a directive would be adopted to approximate national laws on the grounds, 
procedures,  scope,  and  conditions  of  compulsory  licensing  for  crisis  management.  This 
would create a certain degree of harmonisation on e.g. key aspects of the procedure, the 
competent  granting  authority  and  criteria  for  the  calculation  of  the  remuneration.  This 
would  improve  and  clarify  the  features  of  national  compulsory  licensing  for  crisis 
management  across  the  EU.  However,  the  Member  States  would  remain  competent  to 
determine whether a crisis exists and whether to grant a compulsory licence. Hence, the 
risk would remain that the directive would not be implemented and applied in a uniform 
manner  due  to  existing  differences  in  national  law  proceedings  and  judicial  traditions. 
Those  minimum  standards  of  harmonisation  could  result  in  incoherent  national 
compulsory licences for crisis management.  

6.2.2  Territorial reach of compulsory licensing  

The harmonisation of national  schemes  envisaged under PO2  could  facilitate the cross-
border  supply  of  goods  as  both,  the  compulsory  licence  granted  in  the  manufacturing 
Member  State  and  those  granted  in  the  importing  Member  States,  would  be  based  on 
similar rules. However, this  would only slightly improve the situation  if  manufacturing 
capacities  are  located  in  multiple  Member  States.  The  lack  of  exhaustion  would  still 
require each importing Member States to issue a licence to import the critical goods. 

6.2.3  Support to EU resilience 

Under PO2, clarification will be provided that national compulsory licences could also be 
issued  in  the  context  of  an  EU  decision  activating  or  declaring  a  crisis  or  emergency 
mode. Thereby, the risk of frictions and opposing decisions resulting from the two levels 
of decision making  (at  EU level  and  at  national level)  could  be mitigated (e.g.  the risk 
that a national authority denies the existence of a crisis in the context of its decision on a 
compulsory  licence,  despite  a  decision  at  EU  level  declaring  a  crisis  and  activating  an 
emergency  mode).  Transparency  and  information  sharing  obligation  would  allow 
national  compulsory  licences  to  be  better  coordinated  and  therefore  to  provide  a  better 
support  to  EU  crisis.  As  the  granting  authority  of  a  compulsory  licence  is  one  of  the 
aspects subject to harmonisation, Option 2 could facilitate cooperation and coordination 
among Member States and between Member States and the Commission.  

36 

 
6.2.4 

Impacts per stakeholder group 

The impacts of PO2 per stakeholder group are summarized in Table 3 below.  

Table 3: Impacts on stakeholders in the event of a cross-border crisis - Option 2 compared to the baseline 

Patent owners 

Manufacturers 
– potential 
licensees 
EU countries 

The general 
public (EU 
citizens) 
Non-EU 
countries 

Advantages 
(+) Somewhat lower costs of compulsory licensing negotiations 
as rules more coherent across MS.  
(+) Some improvement in legal certainty (e.g. clarity on the 
scope and what amount of remuneration may be expected), as 
rules more coherent across MS. 
(+) Somewhat lower costs of negotiations, as rules more 
coherent across MS. 

Disadvantages 
(0/-) Loss of control over 
patent rights, if 
harmonisation leads to 
wider geographical scope 
of CL. 
/ 

(0/+) Potentially lower costs of running the compulsory 
licensing procedure as EU countries can rely on additional 
information or support from other MS, but the main cost of 
launching and implementing the compulsory licensing procedure 
(negotiations with the patent holders and manufacturers) remain 
unchanged.  
(+) Better exchange of information about availabilities of 
product(s), in case of local shortages or cross-border value chain 
disruptions. 
(+) Marginally lower risk of delays or unavailability of critical 
products during crisis, as rules more coherent across MS. 

(+) Increased legal certainty and administrative savings due to 
EU countries information sharing and transparency obligation as 
regards compulsory licensing for export. 

(-) Cost of information 
exchange with other MS; 
(-) Cost of reporting to 
the EC on the 
implemented CL. 

/ 

/ 

Note: (0) neutral impact; (+) minor positive impact; (++) positive impact; (+++) significant positive impact; (-) minor 
negative impact; (- -) negative impact; (- - -) significant negative impact  

Patent  owners  and  potential  licensees  would  benefit  from  this  option  as  increased 
clarity and more coherent rules would improve legal certainty and facilitate negotiations. 
This  would  reduce their  costs  in  participating in  such negotiations as well as providing 
patent owners with a better framework for determining the remuneration. However, they 
would  still  face  costs  in  each  Member  State  launching  a  compulsory  licensing  process. 
EU countries would face one-off adjustment costs in the context of the implementation 
of  the  directive  through  the  adaptation  of  their  national  compulsory  licensing  schemes. 
While  Member  States  would  benefit  of  an  improved  information  exchange  and  EC 
support  (reducing  the  costs  related  to  compulsory  licence  procedure),  the  obligation  on 
information  sharing  and  reporting  would  at  the  same  time  incur  a  minor  recurring 
administrative  cost  for  Member  States,  each  time  they  (envisage)  grant(ing)  a 
compulsory  licence.  However,  these  costs  would  remain  low  because  compulsory 
licensing  is  a  last  resort  instrument,  expected  to  be  rarely  used.  In  case  of  crisis,  EU 
citizens would face a marginally lower risk of unavailability of critical products during 
crisis due to the reduction of fragmentation in national compulsory licensing schemes. As 
the  directive  would  contain  obligations  regarding  cooperation,  transparency  and 
information sharing in the context of compulsory licensing for export purposes, non-EU 
countries  would  benefit  of  increased  legal  certainty  throughout  the  Union  and 
administrative savings. 

37 

 
 
 
6.3  Option  3  –  Harmonisation  plus  a  binding  EU-level  measure  on  compulsory 

licensing  

6.3.1 

Improve the key features of compulsory licensing 

Under Option 3, all Member States would introduce in their national law a compulsory 
licensing scheme for cross-border crisis management triggered by an EU-level decision 
or  initiated  by  concerned  Member  States.  Albeit  the  co-existence  of  two  triggering 
mechanisms  may  seem  to  add  complexity  to  the  system,  yet  it  provides  for  more 
flexibility  to  address  all  possible  types  of  cross-border  crisis.  The  national  compulsory 
licences granted under this scheme would be based on a Commission activation measure. 
This  would  provide  full  harmonisation  on  some  of  the  key  conditions  (e.g.  territorial 
scope,  duration)  and  allow  clarity  and  coherence  of  the  different  national  compulsory 
licences.  Under  this  option,  Member  States  would  be  required  to  grant  a  compulsory 
licence  in  certain  cases.  This  option  would  therefore  result  in  improving  the  legal 
framework  on  compulsory  licensing  for  cross-border  crises.  However,  although  PO3 
would  require  Member  States  to  set-up  accelerated  procedures,  these  procedures  can 
differ nationally. In addition, some conditions such as remuneration would be decided at 
national  level.  Therefore, despite harmonised criteria for determining the  remuneration, 
the actual assessment can greatly vary from one Member State to another. Consequently, 
despite the harmonisation provided under Option 3, coherence and clarity would not be 
optimal as regards all the features of the national compulsory licences.  

6.3.2  Territorial reach of compulsory licensing  

Option 3 would provide a dynamic and efficient solution as regards the territorial scope 
of the compulsory licence: the licence would cover all EU countries being affected by the 
crisis and its territorial scope could be modified depending on the evolution of the crisis. 
National  granting  decisions  would  still  be  needed  for  each  Member  State  where  the 
manufacturing of products will take place. However, importing Member States would no 
longer need  to  issue a compulsory licence, as  national  granting decisions  would have a 
cross-border  effect,  coupled  with  an  exhaustion  for  the  EU  market.  Consequently, 
products manufactured under a national  compulsory licence having its source in  an EU 
activation  measure  could  be  exported  to  other  EU  countries  without  the  need  for  the 
importing  countries  to  issue  a  compulsory  licence.  This  option  would  also  solve  the 
discrepancies that may currently exist between the compulsory licence to export and the 
one to import (cf. supra).  

6.3.3  Support to EU resilience 

This  option would complement other EU crisis  instruments as the  activation  of a  crisis 
mode  under  an  EU  crisis  instrument,  such  as  SMEI,  can  be  the  trigger  leading  to  the 
granting  of  one  or  more  compulsory  licence(s).  The  reliance  on  the  existing  advisory 
body  when  the  trigger  originates  in  an  EU  crisis  instrument,  also  ensures  an  optimal 
coherence  with  EU  crisis  instruments.  The  transparency  and  information  exchange 
obligations  for  Member  States  as  regards  applications  for  and  granting  of  compulsory 
licences based on the Commission  activation  measure and in  the  context  of  Regulation 
(EC)  No  816/2006  would  improve  the  coordination  of  compulsory  licences  in  the  EU. 
The  support  provided  by  the  Commission  to  third  countries  would  facilitate  decision-
making  in  the  context  of  Regulation  (EC)  No  816/2006  in  case  multiple  compulsory 
licences  in  different  Member  States  are  required  to  address  the  third  country’s  needs. 
Both, non-EU countries and Member States would benefit from improved cooperation at 

38 

 
EU  level.  Non-EU  countries  would  benefit  from  greater  clarity  as  regards  the 
manufacture  and  sale  for  export  under  Regulation  (EC)  No  816/2006.  However,  in  the 
absence  of  a  compulsory  licence  with  an  EU-wide  effect  for  export  to  third  countries, 
they  would  still  need  to  apply  for  several  compulsory  licences  if  the  cross-border 
manufacturing chain of the product concerned requires it and may face legal uncertainty 
in that respect (including as regards the possibility to allow cross-border manufacturing 
of the final product).  

6.3.4 

Impacts per stakeholder group 

The impacts of PO3 per stakeholder group are summarized in Table 4 below. 

Table 4: Impacts on stakeholders in the event of a cross-border crisis - Option 3 compared to the baseline 

Patent owners 

Manufacturers 
– potential 
licensees 

EU countries 

Advantages  
(+ +) Lower costs of negotiations, as they would partially be run 
at EU level instead of multiple procedures in each EU country 
concerned.  
(+ +) Improvement in legal certainty (e.g. clarity on the scope 
and what amount of remuneration may be expected), as rules 
more coherent across MS. 
(+ +) Lower costs of negotiations, as they would partially be run 
at EU level instead of multiple procedures in each EU country 
concerned. 
(+) Lower costs of adapting the manufacturing facilities to the 
production of CL-covered item(s) due to economies of scale, if 
harmonisation leads to wider geographical scope.  
(+ +) Lower costs of running the compulsory licensing 
procedure (no or limited negotiations with the patent holders or 
manufacturers), as EU countries will mainly implement a 
decision made at the EU level (D). 
(+) Better exchange of information about availabilities of 
product(s), in case of local shortages or cross-border value chain 
disruptions 
(+) Better decision-making and cooperation in the context of 
compulsory licensing for export to non-EU countries (E). 
(+ +) Lower risk of delays or unavailability of critical products 
during crisis, as rules more coherent across EU countries (D). 

Disadvantages 
(- -) In case of a broader 
geographical scope of a 
CL, wider loss of control 
over patent rights. 

/ 

(-) Cost of participating 
in the advisory committee 
assisting the single 
contact point (E). 
(-) Cost of reporting to 
the EC on the 
implemented CL.  

The general 
public (EU 
citizens) 
Non-EU 
countries 
Note: (0) neutral impact; (+) minor positive impact; (++) positive impact; (+++) significant positive impact; (-) minor 
negative  impact;  (-  -)  negative  impact;  (-  -  -)  significant  negative  impact;  (D)  applies  only  in  case  of  an  EU-level 
compulsory licensing for domestic purposes, (E) applies only in case of compulsory licensing for export purposes (in 
the context of Regulation (EC) No 816/2006). 

(+ +) Increased legal certainty and administrative savings due to 
better coordination at EU level (E). 

/ 

/ 

Under  PO3,  patent  owners  would  benefit  from  a  reduction  of  costs  as  regards  the 
participation in the compulsory licensing process, since the process will be centralised to 
a  large  extent.  This  would  streamline  the  negotiations  on  many  aspects  (e.g.  duration, 
scope)  as  there will no longer be  differences between the national compulsory licences 
granted on the basis on  the  activation measure.  Nevertheless, patent  owners would still 
face cost in each country issuing a compulsory licence, as they would need to negotiate 
not  harmonised  aspects  (e.g.  remuneration)  and  participate  in  the  national  procedures. 
They would however benefit from increased legal certainty through, on the one hand, the 
single EU binding decision and, on the other hand, harmonisation of aspects left for the 
national level (i.e. elements such as the national procedure or the remuneration).  Under 
this  option,  patent  owners  may  experience  a  more  important  loss  of  control  on  their 
patent rights as this option would give a broader effect to a national compulsory licence, 

39 

 
 
allowing  it  to  have  a  cross-border  effect.  Overall,  the  situation  of  potential  licensees 
would  improve  under  PO3.  They  would  benefit  from  the  centralised  procedure  as  this 
would decrease their cost of participating in negotiations. In addition, the wider territorial 
scope  of  the  licence  would  allow  them  to  benefit  from  economies  of  scale  (i.e.  larger 
volumes of production)  when manufacturing the  required  items  (also  in  terms  of lower 
cost  for  adapting  the  production  facilities).  EU  countries  would  bear  the  adjustment 
costs  resulting  from  the  implementation  of  the  directive  into  their  national  law.  They 
would  also  face  some  minor  administrative  costs,  linked  to  the  transparency  obligation 
(reporting).  On  enforcement  costs,  Member  States  would  also  bear  the  cost  of 
participating  in  the  advisory  committee,  but  overall  they  would  benefit  from  the 
centralised  procedure.  Costs  of  direct  negotiations  with  the  patent  owners  and  the 
manufacturers  would  be  replaced  by  the  costs  of  participating  in  the  EU  level 
negotiations  (the  latter  are  expected  to  be  lower  than  handling  the  entire  negotiations 
process  nationally  i.e.  fewer  staff  involved  per  case  per  Member  State).  The  cost  of 
granting the national compulsory licence based on the Commission’s activation measure 
would remain (i.e. the issuance of a government order granting a compulsory licence for 
Member States with manufacturing capacities on their territory). Member States with no 
manufacturing  capacities  would  not  have  to  bear  any  cost  related  to  a  national 
compulsory  licence  as  a  licence  to  import  would  no  longer  be  needed.  Member  States 
would  benefit  from  a  more  coherent  approach  at  EU  level  when  tackling  crisis,  and  in 
particular as regards the use of compulsory licence in conjunction with another EU level 
crisis  instrument.  As  regards  the  export  to  non-EU  countries,  Member  States  would 
benefit from an improved decision-making and cooperation due to the establishment of a 
single  contact  point  (the  Commission)  assisted  by  an  advisory  committee.  At  the  same 
time,  the  participation  in  the  advisory  committee  could  generate  some  minor  costs  for 
Member  States,  but  only  when  such  situation  occurs.  In  case  of  a  crisis,  EU  citizens 
would  benefit  from  PO3  as  it  would  improve  the  EU’s  ability  to  conclude  voluntary 
agreements and its ability to issue an effective and efficient compulsory  licence for the 
whole  EU,  including  in  case  of  cross-border  supply  chain.  Non-EU  countries  would 
benefit from administrative savings due to the increased coordination at EU level. 

6.4  Option  4  –  EU-level  compulsory  licensing  to  complement  existing  EU  crisis 

instruments 

6.4.1 

Improve the key features of compulsory licensing 

Under PO4 the Commission  would directly  grant  a compulsory licence  and specify the 
conditions  under which this  licence is  granted.  The  granting decision would  specify all 
the conditions  of the  compulsory licence, including the remuneration. These conditions 
would be the same  for all territories where the compulsory licence applies. This  would 
ensure  an  optimal  clarity  and  coherence  as  regards  the  conditions  of  the  compulsory 
licence.  Since  there  would  only  be  one  procedure  –  at  EU  level  –  there  would  not  be 
divergences due to national decisions and/ or implementation. Consequently, by relying 
on  a  fully  harmonised  scheme,  Option  4  provides  an  optimal  coherence  and  clarity  as 
regards all the features of compulsory licensing for crisis management.  

6.4.2  Territorial reach of compulsory licensing  

PO4 would provide an optimal solution as regards the territorial scope of the compulsory 
licence:  one single compulsory licence would cover  all EU  countries being  affected by 
the crisis and all EU countries having the relevant manufacturing capacities. By creating 
an  EU-level  system,  this  option  would  guarantee  a  solution  that  is  fully  coherent  and 

40 

 
equally applicable in all Member States. A unique compulsory licence offers an efficient 
compulsory licensing scheme, which avoids national divergences likely to slow down an 
EU  reply  to  a  cross-border  crisis.  The  cross-border  effect  guarantees  an  effective 
compulsory  licensing  scheme  as  it  matches  the  reality  of  the  Single  Market  and  its 
inherently  cross-border  supply  chains  and  can  supply  the  whole  EU  market  (instead  of 
one country). A CL applicable on a wider territory can serve as an incentive for licensees 
to change their production line to accommodate the need for critical goods. 

6.4.3  Support to EU resilience 

Just  like  in  PO3,  this  option  would  complement  other  EU  crisis  instruments  as  the 
activation  of  a  crisis  mode  under  an  EU  crisis  instrument,  such  as  SMEI,  can  be  the 
trigger  leading  to  the  granting  of  a  compulsory  licence.  The  reliance  on  the  existing 
advisory  body  when  the  trigger  originates  in  an  EU  crisis  instrument,  also  ensures  an 
optimal coherence with EU crisis instruments. In addition, such EU-level system would 
provide  the  EU  and  its  Member  States  with  an  efficient  and  credible  compulsory 
licensing  system.  This  would  give  more  bargaining  power  to  the  EU  when  negotiating 
voluntary  agreements,  hence  supporting  other  EU  crisis  instruments.  Should  voluntary 
agreements fail, the EU would still have the possibility to rely on compulsory licence to 
start  manufacturing  of  critical  goods  in  the  EU  and  provide  an  EU  response, 
complementing other crisis measures. As in PO3, the coordination at EU level for third 
countries  would  facilitate  decision-making  in  the  context  of  Regulation  (EC)  No 
816/2006, should different compulsory licences be required to address the third country’s 
needs. Non-EU countries would benefit from the possibility to only have one compulsory 
licence covering multiple EU countries, in case of cross-border manufacturing. 

6.4.4 

Impacts per stakeholder group 

The impacts of PO4 per stakeholder group are summarized in Table 5 below. 

Table 5: Impacts on stakeholders in the event of a cross-border crisis - Option 4 compared to the baseline 

Patent owners 

Manufacturers 
– potential 
licensees 

EU countries 

Advantages 
(+ +) Lower costs of negotiations, due to a single procedure 
at EU level instead of multiple procedures in each MS 
concerned. 
(+ + ) More legal certainty (e.g. clarity on what level of 
remuneration may be expected), as a single procedure at EU 
level instead of multiple procedures in each EU country 
concerned.  
(+ +) Lower costs of negotiations, due to the single procedure 
at EU level instead of multiple procedures in each EU 
country concerned. 
(+) Lower costs of adapting manufacturing facilities to the 
production of the item(s) covered by the licence, due to 
economies of scale, if EU-level compulsory licensing leads to 
wider geographical scope.  
(+ + +) Significantly lower costs of running the compulsory 
licensing procedure (no negotiations with the patent holders 
or manufacturers), as EU countries will only implement a 
single decision made at EU level (D). 
(+) Better exchange of information about availabilities of 
product, in case of local shortages or cross-border value 
chains disruptions.  
(+) Better decision-making and cooperation in the context of 
compulsory licensing for export to non-EU countries (E). 

Disadvantages 
(- -) In the event of a 
broader geographical 
scope of a CL, wider loss 
of control over patent 
rights. 

/ 

(-) Cost of participating 
in the advisory 
committee assisting the 
single contact point (E).  
(-) Cost of reporting to 
the EC on the 
implemented CL. 

41 

 
 
The general 
public (EU 
citizens) 
Non-EU 
countries 

(+ + +) Significantly lower risk of delays or unavailability of 
critical products during crisis, as rules are consistent across 
all EU countries (D). 
(+ + +) Increased legal certainty and administrative savings 
when accessing critical goods in case of cross-border supply 
chains due to direct coordination at EU level (E). 

 / 

/ 

Note: (0) neutral impact; (+) minor positive impact; (++) positive impact; (+++) significant positive impact; (-) minor 
negative  impact;  (-  -)  negative  impact;  (-  -  -)  significant  negative  impact;  (D)  applies  only  in  case  of  an  EU-level 
compulsory licensing for domestic purposes, (E) applies only in case of compulsory licensing for export purposes (in 
the context of Regulation (EC) No 816/2006). 

Under PO4, patent owners would benefit from a reduction of costs and legal uncertainty 
since,  in  the  absence  of  national  procedures,  negotiations  would  be  limited  to 
participation in one EU-level procedure. In addition, they would gain legal clarity as the 
remuneration will be set at EU-level, no longer at national level. However, patent owners 
would  still  face  an  important  loss  of  control  on  their  patent  rights  since  the  impact  of 
compulsory licensing would no longer be limited to a given Member State. Under PO4, 
the greater territorial reach would also extend to compulsory licences for export to a non-
EU  country.  Overall,  the  situation  of  potential  licensees  would  improve  under  PO4. 
They would benefit from the centralised procedure and the wide territorial scope of the 
licence  that  can  bring  economies  of  scale.  EU  countries  would  need  to  bear  limited 
adjustments  costs  as  PO4  would  provide  an  EU-level  compulsory  licence,  through  a 
regulation,  on  top  of  existing  national  legislation.  They  would  face  some  monitoring 
costs  in  the  event  of  a  crisis,  linked  to  the  transparency  obligation.  However,  better 
sharing  of  information  would  also  allow  a  reduction  of  costs  for  Member  States  as  it 
could  help  identifying best  practices. On enforcement costs, Member States would  also 
bear the cost  of participating in  the advisory committee, but  overall they  would  benefit 
from the centralised procedure, as costs linked to the negotiations with the patent owners 
and  the  manufacturers  would  be  incurred  solely  at  EU  level  (i.e.  although  the  costs  of 
participating in the EU level negotiations would remain, they are expected to be lower as 
tasks  would  be  shared  among  many  countries).  The  new  compulsory  licensing  rules 
would  also  strengthen  EU  bargaining  position  as  27  countries  would  run  negotiations 
together and at once. In case of crisis, EU citizens would greatly benefit from this option 
as  it  would  improve  the  EU’s  ability  to  issue  an  effective  and  efficient  compulsory 
licence  for  the  whole  EU,  including  in  case  of  cross-border  supply  chain  disruptions. 
Non-EU  countries  would  also  benefit  from  this  option  as  this  would  provide  the 
possibility to rely on a compulsory licence covering a cross-border supply chain. 

6.5  Common impacts 

6.5.1 

Impacts on fundamental rights 

This  initiative  will  have  a  clear  impact  on  fundamental  rights  as  it  would  provide  an 
additional tool to face crises, including health-related (right to health care – article 35 of 
the Charter) or environmental crises (right to environmental protection – article 37 of the 
Charter). Through the increased probability of supply of critical goods and services the 
most fundamental  needs and rights  of EU citizens such as safety and health,  in  a crisis 
setting, would be more swiftly and efficiently catered to.  

Collective licensing, of course, also  concerns the right to intellectual property of patent 
owners  (article  17(2)  of  the  EU  Charter  of  fundamental  rights  –  the  ‘Charter’),  as 
compulsory licensing partially deprives patent owners of the control of their rights. The 
extent  to  which  this  initiative  impacts  these  rights  –  as  compared  to  the  baseline  –  is 
discussed  in  section  6.5.3  below.  IP  rights  are  not  absolute  rights  and  limitation  to  the 

42 

 
exercise of these rights are allowed under the Charter, provided that the proportionality 
principle  is  respected.  In  that  respect,  this  initiative  provides  for  that  compulsory 
licensing would remain an exceptional mechanism, with a scope limited to cross-border 
crises. In addition, compulsory licence would always be granted on a non-exclusive basis 
and  subject  to  a  definite  duration.  Finally,  patent  owners  would  have  the  possibility  to 
share  their  position  as  regards  the  granting  of  a  compulsory  licence  and  the  conditions 
surrounding  it.  An  important  aspect  of  the  conditions  concerns  the  ability  for  patent 
owners to receive a fair compensation for the limitation of their right. In that respect, the 
present initiative provides for that patent owners would always be entitled to receive an 
adequate  remuneration  in  respect  of  each  compulsory  licence  granted  under  this 
initiative. This remuneration would be determined, following clear criteria set in the EU 
legislation. In addition, patent owners would be entitled to share their position as regards 
this remuneration, in the context of discussions within the advisory body. As explained in 
the next title, this initiative may have a positive impact on other fundamental rights as it 
would provide an additional tool to  face crises, including health-related  (right  to  health 
care  –  article  35  of  the  Charter)  or  environmental  crises  (right  to  environmental 
protection – article 37 of the Charter). 

6.5.2  Social and environmental impacts 

Improved EU readiness to tackle a major crisis would bring positive social impacts, as it 
could help limit various disruptions to everyday societal processes by curbing the crisis 
or eliminating it altogether. Notwithstanding that societal disruption can be caused by a 
crisis in  any domain (e.g.  threats  to  the environment,  national  security,  etc.), the recent 
COVID-19  pandemic  provided  multiple  examples  of  disruptions  that  could  have  been 
avoided  with  a  more  effective  resilience  tool.  They  included  challenges  to  socio-
economic  activities  underpinning people’s lives (e.g. the loss in GDP due to  restrictive 
lock-downs, 
measures, 
unemployment)  affecting  health  and  wellbeing  (COVID-19  death  toll,  implications 
related to mental health, etc.). The exact amount of potential indirect economic impacts 
that can be avoided is impossible to quantify129, whereas the cost of major crisis can be 
paramount to any economy130.  

to  education,  businesses  closed  due 

limited  access 

to 

As far as  the environmental impacts  are concerned, they will  predominantly depend on 
the type of crisis that the EU may face in the future, assuming that it would be targeted 
by the new initiative (i.e. addressing such crisis would require access to patent protected 
products).  If  the  crisis  concerns  environmental  threats,  the  positive  impacts  of  the 
initiative  could  be  decisive  in  increasing  access  to  products  and  technologies  able  to 
tackle the crisis. Finally, since no environmental legislation is affected by this proposal 
and  its  principal  objective  is  to  streamline  and  harmonise  compulsory  licensing 
procedures  in  cross-border  crises,  no  significant  harm  to  the  environment  is  expected 

129  The  UN  noted  that  “without  urgent  socio-economic  responses  [to  the  COVID-19  pandemic],  global 
suffering  will  escalate,  jeopardizing  lives  and  livelihoods  for  years  to  come.  Immediate  development 
responses in this crisis must be undertaken with an eye to the future. Development trajectories in the long-
term  will  be  affected  by 
they  receive”, 
the  choices  countries  make  now  and 
https://www.undp.org/coronavirus/socio-economic-impact-covid-19 
130  According  to  CEPI  “The  COVID-19 pandemic  resulted  in  an unprecedented  economic  contraction  in 
2020,  with  EU  real  GDP  falling  by  6.1%,  more  than  during  the  global  financial  crisis.”,  source: 
https://cepr.org/voxeu/columns/eu-economy-after-covid-19-implications-economic-governance  

the  support 

43 

 
                                                 
under any of the options analysed. Potential impacts on relevant SDGs are discussed in 
Annex 3. 

6.5.3  Economic and competitiveness impacts 

This  initiative  rests  on  a  precautionary  principle  regarding  unforeseeable  future  crisis 
events,  with  a  small  probability  but  immense  economic  aftermath.  For  this  reason,  the 
economic and competitiveness  impacts strictly hinge on a balance of probabilities.  It  is 
fair to assume that the probability of crises events remains unaffected by this initiative. 
At the same time, the likelihood that any given crisis requires a Single Market response 
would normally be higher over time, as EU value chains increasingly interweave.  

This  initiative is  intended to  increase  the likelihood of supply and decrease the lead 
time  of  such  supply  of  patent  protected  critical  goods,  should  a  cross-border  crisis 
happen.  In  a  situation  of  a  health  or  an  environmental  crisis,  any  improvement  in  the 
expected supply of such critical products – however marginal – generates economic and 
competitiveness benefits of macro-economic proportions. That in itself trumps all other 
economic and competitiveness effects.  

Regarding the potential trade-off between keeping the incentives for innovation through 
IP protection131 and ensuring at the same time access to critical products in cross-border 
crisis  situations  through  compulsory  licensing,  it  is  possible  that  frequent  recourse  to 
compulsory licencing could in the long term carry the risk of dis-incentivising research 
and development132 (i.e. compulsory licensing might have a chilling effect on innovation 
and  investment  by  IP  holders  concerned,  as  it  marginally  reduces  the  overall  revenues 
from  innovation).  However  the  likelihood  of  using  a  compulsory  licence  for  crisis 
management  is  extremely  low  and  its  duration  limited.  Consequently,  the  potential 
revenue  loss  is  expected  to  be  negligible  compared  to  the  overall  revenue  from  the 
patented  product  and  the  proposed  initiative  is  not  expected  to  impact  long-term 
innovation  investments  of  the  patent  holder.  Furthermore,  of  import  here  is  assessing 
solely the incremental impact of this initiative, as compared to the status quo – namely 
the  existence  of  national  compulsory  licences.  This  counterfactual  boils  down  to  the 
change in the frequency of compulsory licensing events and their size (volume of critical 
goods). On the one hand, the intended streamlined and unitary EU compulsory licensing 
procedures  lower  the  compliance  and  enforcement  cost  of  their  launch.  On  the  other 
hand,  this  weakens  the  case  for  dis-coordinated  national  compulsory  licences  and 
increases the incentive for voluntary solutions (deterrence effect). When it comes to the 
volume of goods produced under a compulsory licence, the demand for critical goods is 
fairly  fixed,  by  the  number  of  EU  citizens  in  need  in  a  crisis  situation.  Yet,  given  the 
scope of proposed alignment (depending on the option) compulsory licences could cover 
wider geographic scope, as compared to the baseline, because some previously existing 
differences  in  national  rules  would  be  removed  (e.g.  embargos,  exemptions  in  material 
scope or sectorial coverage, etc.). This may imply that a greater volume of goods may be 
ultimately affected. Still, the new compulsory licensing rules would become more orderly 

131 “Intellectual property rights are designed to promote the creation of innovations and thus to promote 
economic advance and consumer welfare. This occurs by giving the innovator an exclusive legal right to 
the  economic  exploitation  of  his  innovation  for  a  period  of  time;  the  reaping  of  profits  serves  both  to 
reward the innovator for his investment and to induce others to strive to innovate in the future.”, source:  
“Competition policy and intellectual property rights”, OECD 1989, p.10.  
132  “The  excessive  use  of  compulsory  licensing,  for  example,  could  lead  to  increased  secrecy  and  lower 
investment in R & D.”, source: Idem, p.12   

44 

 
                                                 
and predictable, which – if anything – should make the business climate more amendable 
to innovation and investment.  

Last but not least, an orderly and modern regime for an EU compulsory licence should 
provide comfort to the civil society that in case of need critical goods will be effectively 
and  swiftly  supplied.  This  also  allows  a  predictable  and  TRIPS  compliant  compulsory 
licensing  scheme  in  the  EU,  which  should  prove  beneficial  to  EU  competitiveness  and 
licensors alike.  

6.5.4  Summary of cost and benefits specific to the compulsory licensing procedures 

The costs and benefits specific to compulsory licensing procedures and identified across 
all four options, can be grouped into the following main categories: one-off and recurrent 
costs/benefits (see Figure 24, Annex 6). 

The one-off implications consist of  cost that would be borne shortly after the proposed 
instrument enters into force (e.g. the legislation is enacted). They would mainly focus on 
direct  compliance  costs  for  the  authorities  (Member  States  and  the  EU  institutions), 
linked with the need to adjust the existing legal provisions on CL. It mainly affects PO2 
to  PO4,  as  PO1  is  voluntary  so  the  extent  of  such  actions  is  unknown.  As  far  as  the 
Commission 
the  activity  of  developing  new 
recommendations or legislation forms part of its normal activities. There will be no one-
off  direct  adjustment  cost  for  firms.  There  will  be  no  one-off  direct  benefits  of  the 
proposal either.  

is  concerned,  we  assume 

that 

As for the second category of cost/benefits, namely the recurrent ones, they would occur 
only if a cross-border crisis hits the EU and they would consist of the following:  

  Direct  compliance  and  enforcement  costs/benefits  for  authorities  in  charge  of  the 
negotiations and implementation of the terms of the compulsory licence, as well as 
the  provision  of  information  (i.e.  the  monitoring  costs  due  to  the  reporting 
obligation), see Figure 10 below.  

Figure 10: Task division between the Options, as compared to the baseline (PO0) 

Most  of  these  costs  would  materialise  anyway,  if  -  in  the  absence  of  the  proposed 
changes  -  the  same  compulsory  licensing  negotiations  and  implementation  were  to 
be  conducted  at  national  level.  In  other  words,  the  cost  of  compulsory  licensing 
negotiations  and  implementation  at  national  level  would  stay  unchanged,  when 
compared to the status quo. If national negotiations were to be replaced by the EU-
level  negotiations,  the  cost  for  Member  States  might  stay  unchanged  or  actually 
decrease as the same effort would be shared among several countries.  

The  collection  of  basic  information  on  compulsory  licensing  for  the  reporting 
obligations  would  be  carried  out  by  Member  States133  as  part  of  the  normal 

133  As  explained  in  section  5,  the  reporting  obligation  would  cover:  the  subject  matter  of  a  CL,  MS 
concerned, companies involved (patent holders and/or manufacturers), and the conditions agreed. 

45 

 
 
                                                 
documentation of any  compulsory licensing procedure - the additional cost of such 
task is therefore judged to be very low. Concretely, in PO2 the reporting obligation 
would generate some additional small cost of sharing information with the EC, but it 
would affect only the Member State where a compulsory license is to be granted in 
the event of a cross-border crisis. In PO3 and PO4 the EC would be directly involved 
in  the  compulsory  licensing  negotiations,  so  no  additional  information  sharing  by 
Member States would be needed in this respect. Yet, under PO2, PO3 and to a lesser 
extent under PO4, Member States would still need to report on the implementation 
of the CL, for which the existing administrative procedures should be used. As the 
reporting requirements would apply only in the event of a cross-border crisis, hence 
such  costs  would  be  rare.  Finally,  the  reporting  should  not  require  any  additional 
infrastructure nor data collection, therefore the digital impacts  are judged  to be not 
relevant in the context of this initiative134. 

increased  coherence  (lower 

  Direct  compliance  costs/benefits  for  firms  (i.e.  patent  holders,  as  well  as  the 
manufacturers  or  potential  licensees):  the  costs  of  participating  in  compulsory 
licensing  procedures  would  stay  broadly  the  same  as  long  as  they  remain  at  the 
national level (i.e. PO2 or partially PO3), with some potential marginal benefits due 
to 
the 
compulsory licensing negotiations take place at EU-level instead of fragmented and 
overlapping  processes  carried  out  in  several  Member  States  they  would  be  the 
source  of  cost  savings  for  firms.  The  central  procedure  is  estimated  to  replace 
roughly  4-5  procedures  in  each  jurisdiction135.  In  such  case,  the  savings  for 
companies  would  be  estimated  at  75%  to  80%  of  resources  that  would  be  needed 
otherwise, such as in-house staff or costs of external services, legal assistance, etc.  

legal  uncertainty).  However,  whenever 

 

Indirect  wider  socio-economic  benefits  for  the  EU  citizens  (general  public) 
stemming from the timely availability of products needed in crisis and the fact that 
the  crisis  could  be  marginally  shorter  and/or  constricted  (e.g.  affects  less  sectors 
than  otherwise  would  be  the  case)  and  that  severe  economic  repercussions  are 
avoided. 

Additionally, the European institutions can also bear certain direct costs linked with this 
initiative. In case of a cross-border crisis the Commission services would need to ensure 
good  governance  of  the  overall  process  and  run  the  central  compulsory  licensing 
negotiations  (PO3  and  PO4),  or  grant  and  implement  the  CL.  As  for  the  EU-level  CL, 
such additional costs would appear  mainly if none of the existing emergency bodies or 
instruments (e.g. SMEI or HERA coordination committees) can be re-used to take up this 
role. If a new sector-specific body needs to be set up136, then the Commission would bear 
the  relevant  costs,  but  given  their  ad  hoc  character  -  predominantly  by  drawing  on 
resources  and  expertise  already  available  in  the  Commission  services137.  As  a  cross-

134  No  particular  data  exchange  systems  are  envisaged,  the  CL  negotiations  would  take  place  as  either 
physical meetings or remotely using existing secured ICT technologies. 
135 Based on the estimate of the average number of Member States where Covid-related patents are active, 
as explained in section 2.2 (for further details see Annex 4 and 6).  
136  Yet,  this  role  could  be  undertaken  by  the  authorities  competent  for  compulsory  licensing  for  export 
purposes to be designated under Regulation (EC) No 816/2006, see footnote 101. 
137  While  it  is  very  difficult  to  estimate  the  costs  of  such  process  as  there  is  no  similar  precedent,  it  is 
assumed that CL negotiations should not take longer than 5 full-day meetings (40 hours) involving a Head 
of unit, 2 desk officers and secretariat support, while the monitoring of CL implementation might involve 1 
FTE over the period of 6 months per a CL case (so 1/6 of FTE per month on average). 

46 

 
                                                 
border crisis requiring the granting of a compulsory licence is assumed to be rare, these 
tasks  should  be  undertaken  by  the  available  commission  staff,  also  assuming  certain 
flexibility  and  cooperation  between  Directorates  General,  especially  when  the  crisis 
concerns their policy area.  

The  direct  and  indirect  benefits  of  a  well-functioning  compulsory  licensing  system 
for crisis  management  are assumed to greatly outweigh the above mentioned  minor 
direct compliance and enforcement costs, especially when compared with the indirect 
wider socio-economic impacts of a timely access to essential products needed to combat 
a  crisis.  Given  the  exceptional  character  of  compulsory  licencing,  no  significant 
administrative costs are expected as a result of the proposed initiative.  

7  HOW DO THE OPTIONS COMPARE? 

As  discussed  in  the  objectives,  a  compulsory  licensing  system  should  be  able  to 
efficiently tackle EU cross-border crisis in a timely manner and guarantee the supply of 
critical  goods  and  technologies  across  the  Single  Market,  even  in  the  absence  of 
voluntary  agreements.  It  should  also  protect  investment  in  innovation  by  adequately 
safeguarding the interests of IP owners. Lastly, it should offer a coherent and coordinated 
approach, in line with other EU crisis instruments in order to reinforce EU resilience. 

7.1  Comparison of options against the effectiveness and efficiency criteria 

Compulsory licensing for crisis management requires specific features that would ensure 
compulsory  licences  to  be  effectively  granted  to  tackle  the  crisis  (i.e.  adequate  ground 
and scope) and allow the efficient granting of a compulsory licence, in a swift manner. 
Clarification  of  these  features  –  and  their  actual  implementation  –  is  therefore 
necessary  to  fulfil  effectively  and  efficiently  the  general  objective  of  having  a 
compulsory licensing scheme that enables the EU to timely tackle crises. In that respect, 
PO1 is the least efficient option as it does not require Member States to implement these 
features  in  their  national  law.  PO2  and  PO3  would  increase  the  clarity  and  coherence 
since  they  require  Member  States  to  harmonise  some  features.  However,  the 
harmonisation does not cover all features, such as the remuneration (PO3) or the trigger 
(PO2).  In  addition,  divergences  could  still  exist  across  Member  States  at  the 
implementation  phase.  Granting  would  also  remain  national,  opening  the  door  for 
divergent practices and timing, when executing the national decisions. This would result 
in less coherence between national compulsory licences. In contrast, PO4 provides clarity 
as regards the features of the compulsory licence, as well as coherence, since there would 
be one single EU-level compulsory licence.  

A compulsory licence to tackle cross-border crises could only be effective if it applies to 
the  countries  manufacturing  the  critical  goods,  as  well  as  those  facing  the  crises.  The 
ability to export goods manufactured under a compulsory licence from one Member State 
to  the  other  is  therefore  a  key  element.  PO1  and  PO2  prove  insufficient  in  that  respect 
since  they  allow  at  best  the  export  of  goods.  Such  solution  is  impracticable  in  case  of 
cross-border  supply  chain.  In  addition,  the  lack  of  exhaustion  would  still  require 
importing  Member  States  to  issue  a  licence.  PO3  and  PO4  provide  a  better  solution  as 
they  both  provide  for  an  EU-wide  effect  to  the  compulsory  licences  (i.e.  both  are 
effective in guaranteeing a territorial scope that fits cross-border crises), whereas PO4 is 
the most efficient  as  regards compulsory licensing for export, as  it also  allows a cross-
border effect in this case. 

47 

 
All  options  can  support  other  EU  crisis  instruments  by  ensuring  that  compulsory 
licences  can  be  used  in  that  context,  albeit  with  different  degree  of  effectiveness  and 
efficacy.  PO1  scores  low  on  this  objective  as  it  solely  provides  for  the  possibility  for 
national  compulsory licence to  be granted in  the context  of EU crisis instruments.  PO2 
provides a better solution as this option would explicitly make the link between national 
compulsory licences and EU crisis instruments, mitigating the risk that a Member State 
denies the granting of a compulsory licence in the context of an EU decision activating a 
crisis mode. PO3 and PO4 go a step further by embedding compulsory licences in the EU 
crisis  instruments (i.e. by  using them as a  trigger to  grant  a compulsory  licence and by 
relying  on  the  existing  crisis  bodies).  The  last  two  options  would  also  strengthen  EU 
bargaining position as 27 countries would run negotiations together and at once. As far as 
the information exchange and transparency is concerned, PO1 provides no obligation and 
has therefore limited added-value compared to  the baseline.  All  the other options score 
better  in  this  respect,  although  the  exchange  of  information  and  coordination  between 
Member States and the Commission may generate some minor administrative costs (yet, 
under  PO4  such  costs  are  the  lowest,  as  where  there  would  only  be  one  compulsory 
licence granted centrally). Finally, PO3 and PO4 also score high in terms of transparency 
in decision making concerning export as they both allow the Commission, assisted by an 
advisory  body,  to  provide  support  –  through  increased  coordination  –  to  non-EU 
countries.  

Table 6: Comparison of policy options against the effectiveness and efficiency criteria 

Effectiveness in meeting policy objectives 

Improve the key features of 
compulsory licensing 
(0) 
(0/+) Limited harmonisation 
affecting coherence between 
national CLs. 

Territorial reach of 
compulsory licensing  
(0) 
(0) Unfit territorial reach 
to tackle cross-border 
crises. 

PO0 
PO1 

PO2 

PO3 

(+) Increased harmonisation 
but risk of non-aligned 
national CLs. Decision on 
crisis and compulsory 
licensing belongs to MS. 
Limited improvement for 
cross-border situations. 

(++) Increased clarity and 
coherence through 
harmonisation and one single 
act (basis for national CLs), 
but limited harmonisation on 
other key aspects.  

PO4 

(+++) Clarity and coherence 
resulting from one single 
procedure and one single CL 
at EU level. 

(0/+) EU countries can 
authorise export to limited 
extent, but no exhaustion 
(i.e. need of compulsory 
licensing to import).  

(++) EU-wide effect of the 
compulsory licensing 
based on an activation 
measure and exhaustion 
would result in fewer CLs. 
Territorial reach better fit 
to tackle cross-border 
crises.  
(+++) One single CL with 
adequate territorial reach 
(potentially the whole EU) 
and exhaustion would 
create an efficient tool to 
tackle cross-border crises, 
also addresses export. 

Support EU resilience 

Efficiency 

(0) 
(0/+) No full embedding 
of compulsory licensing 
in EU crisis instruments. 

(+) Better embedding of 
national compulsory 
licensing in EU crisis 
instruments and 
improved coherence 
between national CLs. 

(+++) Full alignment 
between EU crisis 
instruments and 
compulsory licensing 
(alignment of trigger and 
relevant bodies); support 
of EU bargaining power.  

(+++) Full alignment 
between EU crisis 
instruments and 
compulsory licensing 
(alignment of trigger and 
relevant bodies); support 
of EU bargaining power. 

(0) 
(0/+) Uncertain social and 
economic outcomes in the 
event of a crisis; regulatory 
cost depend on uptake. 
(+) Social and economic 
benefits for society if crisis 
limited or avoided, but may 
be undermined by national 
divergences in 
implementation; can be 
obtained at low regulatory 
costs. 
(++) Social and economic 
benefits for society if crisis 
limited or avoided; can be 
obtained at low regulatory 
costs. 

(+++) Social and economic 
benefits for society if crisis 
limited or avoided – highest 
probability due to a 
streamlined procedure; can 
be obtained at low 
regulatory cost. 

Note: (0) neutral impact; (+) minor positive impact; (++) positive impact; (+++) significant positive impact; (-) minor 
negative impact; (- -) negative impact; (- - -) significant negative impact 

As far as the subsidiarity/ proportionality is concerned none of the options go beyond 
what is necessary to achieve the identified problems/objectives. Their respective scope is 
limited  to  aspects  that  Member  States  cannot  achieve  satisfactorily  on  their  own  and 
where  the  Union  action  can  produce  better  results  (for  example,  in  terms  of  faster 
decision  making  in  times  of  crisis)  or  is  necessary  (for  example  issuing  an  EU-level 

48 

 
 
compulsory licence to solve the exhaustion problem). As explained in section 2, Member 
States could not solve the problem due to insufficient scale of legal instruments at their 
disposal. Options considered provide a mix of Member States and EU level actions with 
gradual  increase  of  the  EU  level  intervention.  Possible  instruments  for  implementing 
policy  options  are  in  case  of  PO1  a  set  of  recommendations;  in  case  of  PO2-PO3,  a 
harmonisation through a directive and in PO4, the introduction of a new layer through an 
EU regulation establishing an EU-level compulsory licence. Intervention of the Member 
States  is  guaranteed  through  the  use  of  existing  EU  crisis  instruments  or  through  the 
initiative  power  given  to  Member  States  to  start  the  process  leading  to  EU-level 
compulsory  licence.  The  initiative  is  limited  to  compulsory  licensing  to  tackle  cross-
border  crises.  Member  States  retain  their  full  competence  as  regards  compulsory 
licensing on other grounds. 

7.2  Comparison of impacts of options on stakeholders  

Under  PO1,  the  impacts  on  patent  holders  would  stay  broadly  the  same  as  in  the 
baseline: patent holders would still face a fragmented system but could benefit from more 
legal certainty as regards compulsory licensing across the Member States that apply the 
recommendation.  This  increased  legal  certainty  would  improve  even  more  under  the 
remaining  options  (PO2  to  PO4)  due  to  less  divergences  in  the  compulsory  licensing 
rules. However, under PO3 and PO4 patent holders may  face  certain loss of control on 
their patent rights since the scope of compulsory licensing would no longer be limited to 
a  given  Member  State.  In  addition,  as  negotiations  would  be  run  at  EU  level,  it  could 
reduce  their  negotiation  power.  This  would  be  mitigated  to  a  limited  extent  by  cost 
savings whenever patent owners would participate in one procedure only.  

The situation of potential licensees would barely improve under PO1 as their situation in 
terms  of increased  legal  certainty  will depend on the uptake of the recommendation by 
Member  States.  PO2  would  provide  them  with  more  coherent  rules,  which  would 
positively  impact  the  legal  certainty  and  reduce  costs.  However,  their  situation  would 
significantly improve only under PO3 and PO4. Under PO3 and PO4, they would benefit 
from  the  centralised  procedure  that  would  be  the  source  of  administrative  savings 
(although  PO3  would  maintain  negotiations  on  some  aspects  at  national  level).  If  the 
streamlined  compulsory  licensing  procedure  results  in  wider  territorial  scope  of  the 
licence,  this  could  translate  into  economies  of  scale  when  manufacturing  the  critical 
items.  

EU countries could entail some costs under PO1 but only to the extent that they decide 
to implement the recommendation. Under PO2 and PO3, costs for Member States would 
be higher as they would face one-off costs linked to the implementation of the directive 
into  their  national  laws.  In  both  case  they  would  also  face  recurring  costs  linked  to 
transparency obligations  in  the event  of a  crisis  (hence with  a very  low  frequency).  As 
granting  procedures  would  remain  national  under  PO2-PO3,  this  would  entail 
enforcement  costs  for  Member  States.  These  costs  would  disappear  under  PO4,  as  the 
granting of the compulsory licence would be implemented at EU level.  

The  risk  of  unavailability  of  critical  products  during  crises  decreases  as  compulsory 
licensing  schemes  become  more  effective  and  efficient.  For  this  reason,  EU  citizens 
would suffer the lowest risk under PO4. Such option would indeed allow a fully coherent 
and  cross-border  compulsory  licence,  which  is  not  the  case  under  any  other  option.  As 
regards  the  non-EU  countries,  PO1  and  PO2  only  provide  soft  measures,  likely  to 
support to non-EU countries to a limited extent. PO3 brings an added-value as it foresees 

49 

 
the  possibility  for  non-EU  countries  to  benefit  from  the  support  of  the  Commission, 
assisted  by  an  advisory  body,  when  facing  a  cross-border  manufacturing  process.  This 
benefit  would  remain  under  PO4.  In  addition,  PO4  ensures  that  products  being 
manufactured  across  several  EU  countries  could  also  be  the  subject  of  a  compulsory 
licence  for  export  purposes  to  non-EU  countries.  This  option  appears  therefore  highly 
beneficial to non-EU countries. 

Table 7: Comparison of the impacts of policy options on stakeholders (in the event of a crisis) 

d
e
t
c
e
f
f

A

PO0 
PO1 

PO2 

PO3 

PO4 

IP holders 

Selected firms from 
the population of 
103.000138 

Manufacturers - 
future licensees 
Selected firms from 
the population of  
2 million139 

(0) 
(0/+) Somewhat lower 
costs of compulsory 
licensing negotiations, 
and increased legal 
certainty. 
(+) Somewhat lower 
costs of compulsory 
licensing negotiations 
and some 
improvement in legal 
certainty, as rules more 
coherent across MS. 
(+) Lower costs of 
negotiations and 
improvement in legal 
certainty, but marginal 
loss of control over 
patent rights, if 
harmonisation leads to 
wider geographical 
scope. 

(0) 
(0/+) Somewhat lower 
costs of compulsory 
licensing negotiations.  

(+) Somewhat lower 
costs of negotiations, 
as rules more coherent 
across MS. 

(+ +) Lower costs of 
negotiations and lower 
costs of adapting the 
manufacturing 
facilities if 
harmonisation leads to 
wider geographical 
scope.  

(+) Significant lower 
costs of negotiations 
and improvement in 
legal certainty but loss 
of control over patent 
rights, if EU-level 
compulsory licensing 
leads to wider 
geographical scope.  

(+ +) Lower costs of 
negotiations and lower 
costs of adapting the 
manufacturing 
facilities if EU-level 
compulsory licensing 
leads to wider 
geographical scope. 

EU countries 

27 

(0) 
(0) Marginally lower costs of 
implementing the CL, but 
cost of information exchange 
with other EU countries (if 
applicable, as no obligation). 
(0/+) Potentially lower costs 
of implementing the 
compulsory licensing as and 
better exchange of 
information between MS, but 
cost of information exchange; 
cost of reporting to the EC. 
(+) Lower costs of launching 
the CL, better exchange of 
information between MS, 
including compulsory 
licensing for export but cost 
of participating in 
compulsory licensing 
negotiations on non-
harmonised aspects, cost 
related to the single contact 
point and cost of reporting to 
the EC  
(+ +) Significantly lower 
costs of launching the CL, 
better exchange of 
information between MS, but 
cost related to the single 
contact point and cost of 
reporting to the EC.  

The general public 
(EU citizens)  
Citizens affected by 
the crisis among 447 
million (2021)  

(0) 
(0/+) Marginally 
lower risk of delays 
or unavailability of 
critical products 
during crisis. 
(+) Marginally lower 
risk of delays or 
unavailability of 
critical products 
during crisis, as 
rules more coherent 
across MS. 
(+ +) Lower risk of 
delays or 
unavailability of 
critical products 
during crisis, as 
rules more coherent 
across MS. 

Non-EU 
countries 
Countries 
covered by 
Regulation (EC) 
No 816/2006 
(0) 
(0/+) Somewhat 
lower costs and 
improvement in 
legal certainty. 

(+) Increased 
legal certainty 
and limited 
administrative 
savings for non-
EU countries. 

(+ +) Increased 
legal certainty 
and 
administrative 
savings due to 
better 
coordination at 
EU level. 

(+ + +) Significantly 
lower risk of delays 
or unavailability of 
critical products 
during crisis, as 
rules coherent across 
all MS. 

(+ + +) 
Increased legal 
certainty and 
administrative 
savings due to 
coordination at 
EU level. 

Note: PO 1 is conditional on the implementation of recommendations by majority of MS. 

To complement the outline of impact on stakeholders, see also the SME test (Annex 8). 

7.3  Coherence with other EU policies and proportionality 

This  initiative  is  fully  coherent  with  other  EU  initiatives,  especially  those  aiming  at 
improving the EU’s resilience to crises (HERA, SMEI, etc.). Coherence with EU crisis 

138  Based on  PatentSight®  query  of  all  patents  active  in  EPO  (“active  in”  understood  as the  authority  in 
which at least one member of the patent family is active; this includes both pending applications that are 
still under prosecution and granted patents that are  still in force) that resulted in 103 052 unique owners. 
The analysis was based on 525 329 patent families active at 12/08/2022. The number could be higher as the 
proposed initiative could concern any patent and not only the EP. 
139 More than 2 million enterprises were classified as manufacturing in the EU in 2019 (i.e. NACE section 
C), source: Eurostat dataset sbs_sc_sca_r2, last updated on 27/10/2022.  

50 

 
 
                                                 
instrument  is  above  all  ensured  by  making  such  instrument  the  trigger  of  an  EU-level 
compulsory  licence.  In  addition,  this  initiative  provides  that  consultation  of  Member 
States  and  stakeholders  must  be  carried  out  within  the  relevant  (advisory)  bodies,  as 
provided for by the relevant EU crisis instrument.  

As far as the proportionality is concerned, under PO1  Member States retain freedom to 
introduce or not the recommendation. Under PO2, harmonisation would be proportionate 
and  limited  to  provisions  essential  to  tackle  a  crisis.  Member  States  would  retain 
competence  for  compulsory  licensing  other  than  crisis  management.  The  same  would 
apply to PO3. Under PO4, Member States’ empowerment would be limited, but only in 
exceptional  circumstances.  The  EU-level  compulsory 
licensing  rules  would  be 
proportionate  and  limited  to  provisions  essential  to  tackle  a  cross-border  crisis,  while 
Member States will be consulted in the relevant (advisory) bodies throughout the process. 

8  PREFERRED OPTION 

All the options considered in the impact assessment are expected to improve on the status 
quo,  but  to  a  varying  extent.  However,  when  considering  the  specific  objectives,  it 
appears that Option 4 would be the most effective and efficient to achieve the objectives 
of this initiative.  The preferred option would  create a  single procedure  to grant  an EU-
level  compulsory  licence  with  adequate  features  to  tackle  a  crisis.  The  Commission 
activation measure would ensure that conditions are the same across the EU and would 
avoid national discrepancies likely to slow down or prevent a compulsory licensing from 
tackling  cross-border  crises.  This  single  compulsory  licence  would  be  applicable  in  all 
relevant  territories,  therefore  covering  any  cross-border  situation  (i.e.  would  also  cover 
smaller-scale crises, not affecting the whole EU). This would be the case for both the EU 
market  and  for  export  purposes  to  non-EU  countries.  Coherence  with  EU  crisis 
instruments would be ensured by the possibility to refer to a common trigger, as well as 
to the (advisory) bodies set-up by the EU crisis instruments. Alternatively, the procedure 
could be initiated by Member States affected by a crisis. Negotiations and coordination 
would be carried out at EU-level to ensure coherent approach across the EU. To prevent 
and stop any misuse of the compulsory licence140, safeguards should be in place to allow 
the Commission to take appropriate measures including, if need be, the reduction of the 
remuneration and the termination of the compulsory licence to ensure that the conditions 
of the compulsory licence are respected. The measures taken by the Commission should 
be  effective,  proportionate  and  dissuasive.  The  implementation  of  the  preferred  option 
would require adopting a new regulation establishing an EU-level compulsory licence for 
crisis  management.  PO4  is  the  most  balanced  and  proportionate  approach,  which  also 
takes  account  of  the  views  and  concerns  of  stakeholders.  The  preferred  option  would 
address  the  identified  problem  (i.e.  “EU  compulsory  licensing  rules  not  well  suited  to 
address  cross-border  crisis  in  a  timely  manner,  due  to  uncoordinated  procedures  and 
decision-making, as well as inadequate territorial reach”).  

140  As  explained  earlier  in  this  impact  assessment,  safeguards  will  be  established  along  the  whole  CL 
“lifecycle”, notably: i) pre-granting: an EU level CL could only be triggered in specific conditions, with a 
high threshold (i.e. activation of an EU emergency/ crisis mode, request by more than one Member State in 
the  case of a crisis in the EU  with a cross-border dimension); ii)  granting:  when considering the  need to 
issue  a  CL  and  the  conditions  thereof,  the  Commission  will  be  assisted  by  an  advisory  body,  involving 
Member  States  and  relevant  stakeholders;  iii)  post-granting:  the  CL  granting  decision  (including  the 
conditions) will be subject to appeal before a judicial court. 

51 

 
 
                                                 
Table 8: How the preferred option achieves the policy objectives? 

Objective  
SO1: Improve the key features of 
compulsory licensing, such as the 
trigger, scope and conditions of 
compulsory licensing, as well as 
improve the coherence of compulsory 
licensing in the EU to improve its 
effectiveness and efficiency in a crisis 
SO2: Ensure that the territorial reach of 
a compulsory licence, incl. for export 
purposes, can accommodate the reality 
of cross-border value chains operating in 
the Single Market  
SO3: Support EU resilience by 
improving the coordination, streamlining 
the decision making and allowing 
compulsory licences to better 
complement EU action in crises, 
including for export purposes to non-EU 
countries   

Preferred option: PO 4 (EU-level CL) 
PO4 would ensure that optimal features are in place to 
guarantee a swift granting procedure in the event of a 
cross-border crisis or a crisis affecting the Single Market. 
As it would create a single procedure at EU-level, the 
current fragmentation slowing down or preventing the use 
of compulsory licensing in crises would therefore be 
removed.  
PO4 would establish a compulsory licensing scheme in the 
EU able to tackle cross-border crisis (including covering 
cross-border supply chains, also for export purposes to 
non-EU countries). 

PO4 would provide the EU with a compulsory licensing 
tool that could be used in support of EU crisis instruments 
(as incentive to voluntary agreement or as a last resort 
measure to replace / complement them). Coherence with 
other EU crisis instruments would be ensured by referring 
to such instruments in order to the trigger an EU-level 
compulsory licensing (the exact choice of instrument will 
depend on the type of crisis). PO4 would also support 
non-EU countries needing to rely on compulsory licensing 
in the EU. 

The impacts of the preferred option on stakeholders were discussed in section 6.4.4. They 
can  be  summarized  as  follows:  the  preferred  option  (PO4)  is  more  effective  as  it  (i) 
removes  fragmentation  and  provides  more  clarity  and  coherence  on  the  features  of 
compulsory  licensing  for  crisis  management;  (ii)  provides  an  adequate  territorial  reach 
able  to  cover  cross-border  crises  and  supply  chains;  (iii)  provides  alignment  with  EU-
crisis  instruments.  The impact  on  EU countries would be positive as  it would increase 
their ability to tackle cross-border crises in a coherent and efficient way. Member States 
would benefit from a reduction of enforcement cost as negotiation would be centralised 
at EU level. EU citizens would also benefit from this initiative as it improves the ability 
of  the  EU  to  take  full  advantage  of  the  Single  Market  and  to  provide  access  to  critical 
goods  in  crises.  For  patent  owners,  this  initiative  would  indeed  remove  compulsory 
licensing fragmentation in the EU and costs associated with the participation in multiple 
national  procedures.  However,  in  the  event  of  a  broader  geographical  scope  of  a  CL, 
wider  loss  of  control  over  patent  rights.  This  impact  is  however  limited  as  compulsory 
licensing is an exceptional measure. In addition, patent owners would still benefit from a 
remuneration and the limitation of their right would be for a definite period. In addition, 
this solution would generally only apply once voluntary agreements were not available. 
Potential  licensees  would  benefit  from  administrative  savings  due  to  the  centralised 
procedure and economies of scale if its results in wider territorial scope of the CL. Non-
EU  countries  would  also  benefit  from  this  initiative  as  it  should  facilitate  access  to  a 
compulsory licence covering a cross-border supply chain.  

Finally, the EU-level  compulsory licensing  rules would be proportionate  and limited to 
provisions  essential  to  tackle  a  cross-border  crisis.  The  EU  level  compulsory  licensing 
decision  would  limit  Member  States  empowerment  only  in  exceptional  circumstances. 
Member States retain competence for compulsory licensing other than cross-border crisis 
management  and  will  be  consulted  in  the  relevant  (advisory)  bodies  throughout  the 
process. 

52 

 
 
8.1  REFIT and the application of the ‘one in, one out’ approach 

This preferred PO4 foresees the establishment of a new legal instrument where an EU-
level  compulsory  licensing  could  be  granted  in  a  cross-border  crisis  using  a  single 
procedure instead of several national procedures.  

Table 9: REFIT – cost savings related to the preferred option (PO4) 

Description 
Savings for patent 
holders and 
manufacturers 
(potential licensees). 

Amount 
75%-80% less 
resources than in the 
baseline, in the event 
of a cross-border crisis 

Savings for MS 
administrations. 

Impossible to estimate 
precisely 

Comments 
The compulsory licensing negotiations would take place 
only once at the EU-level instead of fragmented and 
overlapping processes in several EU countries (or 
instead of ca. 4-5 procedures in each jurisdiction that 
could be needed otherwise).  
Cost of running compulsory licensing negotiations are 
expected to decrease, as resources would be shared at 
EU-level.  

In the event of an unforeseen future crisis, PO4 would lower the costs of participation in 
compulsory  licensing  negotiations  incurred  by  patent  holders,  manufacturers  and 
Member States (notwithstanding the identification of some minor administrative costs of 
reporting, which may be incurred by Member States and thus do not fall under the ‘one-
in one-out’ approach).  As far as  the  firms are concerned,  such costs could be lower by 
roughly  75%  to  80%  when  compared  to  the  status  quo  scenario  (i.e.  based  on  a 
hypothetical situation where a single compulsory licensing procedure would replace 4-5 
procedures  in  each  jurisdiction).  For  Member  States,  if  national  compulsory  licensing 
negotiations  were  to  be  replaced  by  the  EU-level  negotiations,  the  compliance  and 
enforcement  cost  might  stay  unchanged  or  actually  drop  as  the  same  effort  would  be 
shared  among  several  countries.  The  exact  monetary  value  of  cost  savings  for 
stakeholders is not possible to provide due to scarcity of such events and also because the 
type  of  future  potential  crisis  and  its  scale  is  unknown.  Additionally,  as  the  new 
instrument should be used only during major crisis affecting the EU and as the last resort 
measure, hence its expected frequency is also very low.  

9  HOW WILL ACTUAL IMPACTS BE MONITORED AND EVALUATED? 

The legislation to be proposed would include a provision requiring an evaluation report 
five  years  after  the  granting  of  the  first  EU-level  compulsory  licence.  The  preferred 
option  obliges  Member  States  to  inform  the  Commission  when  they  are  considering 
granting  and  when  they  have  granted  a  compulsory  licence  for  crisis  management,  as 
well as providing information on the compulsory licence (i.e. transparency obligation on 
the subject matter of the compulsory licence, the manufacturer, the conditions, etc.). As 
discussed in section 1.3., the recourse to compulsory licensing is expected to be rare as it 
will be triggered by exceptional circumstances. As a consequence, the overall number of 
compulsory  licences  issued  on  the  basis  of  the  proposed  instrument  is  expected  to  be 
low141,  which  subsequently  means  that  monitoring  of  the  basic  descriptive  indicators 
would not require setting up of additional systems for data collection and monitoring (the 
collection and processing of information can be done manually). 

141 As illustrated in Table 25 (Annex 6) less than a dozen compulsory licences has been granted in the EU 
over the last decade, including non-crisis and plant variety compulsory licences. 

53 

 
 
                                                 
Table 10: Monitoring indicators 

Indicators 
Objective 1. Improve the key features of compulsory 
licensing:  
Perceptions about the new compulsory licensing 
system when compared with the status quo, 
especially with regards to its efficiency (e.g. duration 
as compared to the baseline), clarity. 
Objective 2. Territorial reach of compulsory 
licensing:  
Number of compulsory licensing cases where there is 
a cross-border element;  
Number of EU countries covered by compulsory 
licensing granted under the new system.  
Objective 3. Support EU resilience:  
Use or absence of use of compulsory licensing in the 
context of EU crisis instruments;  

Sources of information 
Online survey using similar questions as the OPC 
(to be carried out 3 years after entry into force); 
EU countries reporting; Information collected in 
the context of the work of crisis advisory bodies. 

ECJ, WTO and EU national case law; 
EU countries reporting; Information collected in 
the context of the work of crisis advisory bodies 

Reporting on EU crisis instruments; EU countries 
reporting; Information collected in the context of 
the work of crisis advisory bodies 

54 

 
 
 
ANNEX 1: PROCEDURAL INFORMATION 

1.  LEAD DG, DECIDE PLANNING/CWP REFERENCES 

Lead DG:  

  DG for Internal Market, Industry, Entrepreneurship and SMEs (DG GROW). 

Other Services involved: 

  SG, SJ, COMP, ENER, SANTE, HERA, TRADE, RTD, INTPA, JRC 

Agenda Planning Reference: 

  Ref. PLAN/2021/11425 

  The  initiative  is  included  in  the  Intellectual  Property  (IP)  Action  Plan  that  the 
Commission  adopted  on  25  November  2020  and  in  the  Commission  work 
programme 2023. 

2.  ORGANISATION AND TIMING 

The  Call  for  Evidence  was  published  on  1  April  2022.  It  was  followed  by  a  feedback 
period  that  lasted  until  29  April  2022.  57  stakeholders  submitted  feedback.  The 
Commission  held  a  public  consultation  from  7  July  2022  to  29  September  2022.  This 
consultation was available on the Better Regulation Portal of the Commission and open 
to anyone who wished to reply. The public consultation received 74 replies through the 
EU survey.  

The work on the Impact Assessment was  carried out from  April 2022 to  January 2023, 
during which an Interservice Steering Group (ISSG) met three times to give an update on 
the  ongoing  work  and  discuss  preliminary  versions  of  the  Impact  assessment  report, 
together with all the supporting documents. 

The  following  Commission  services  participated:  SG,  SJ,  COMP,  ENER,  SANTE, 
HERA, TRADE, RTD, INTPA and JRC. 

The deadline for adoption of a proposal by the Commission is April 2023.    

3.  CONSULTATION OF THE RSB 

The Regulatory Scrutiny Board  (RSB) was consulted in  an upfront  meeting on  15 July 
2022.  The  present  impact  assessment  report  was  submitted  to  the  RSB  on  06.01.2023. 
The Impact Assessment was discussed with the RSB on 01.02.2023. On 03.02.2023 the 
RSB delivered a positive opinion. The table below shows RSB comments and how they 
were addressed in the revised text. 

Table 11: RSB comments to the initial version of the impact assessment 

RSB comments 
(1) The problem definition is not sufficiently clear on the 
remaining scale of the problem.  

(2)  The  report does not  sufficiently  describe  the  content 
and  functioning  of  the  EU  level  options,  including  the 

DG GROW replies 
Additional clarifications have been introduced in sections 
2.3  and  2.4,  in  particular  concerning  the  likelihood  that 
the  envisaged  EU  compulsory  licensing  rules  will  be 
needed and the gap EU compulsory licensing rules would 
cover in the event of a cross-border crisis. 
Additional clarifications have been introduced in section 
8  concerning  safeguards  to  prevent  any  misuse  of  the 

55 

 
intended  safeguards.  The  expected  efficiency  gains  and 
overall effectiveness are not sufficiently demonstrated.  

(3)  The  report  does  not  comprehensively  analyse  the 
impact  on  competitiveness  and  innovation,  including 
investments in innovative products in case of crisis. 

proposed compulsory licence scheme. The efficiency and 
timeliness  of  EU-level  compulsory  licence  would  be 
ensured  by  adequate  governance  design,  which  is  now 
discussed at more length in section 5.2.4. 
Section 6.5.3 has been expanded by referring to a broader 
policy  trade-off  between  keeping  the  incentives  for 
innovation through IP protection while ensuring access to 
critical products in cross-border crisis situations.  

4.  EVIDENCE, SOURCES AND QUALITY 

Analysis presented in this impact assessment is based on the following key sources: 

  Feedback  to  the  Call  for  Evidence  on  Compulsory  Licensing  in  the  EU  that  the 
Commission  published  on  1  April  2022  (https://ec.europa.eu/info/law/better-
regulation/have-your-say/initiatives/13357-Intellectual-property-revised-framework-
for-compulsory-licensing-of-patents_en ).  

  Replies  to  the  Open  Public  Consultation  on  Compulsory  Licensing  in  the  EU  that 
(https://single-market-

was 
economy.ec.europa.eu/news/commission-seeks-views-and-input-compulsory-
licensing-patents-2022-07-07_en ), referred to as ‘OPC’. 

September 

2022 

open 

until 

29 

  “Compulsory  licensing  of  intellectual  property  rights”,  Center  for  International 
Intellectual Property Studies (CEIPI), Université de Strasbourg (UNISTRA), Impact 
Licensing  Initiative  (ILI),  Ecorys  Nederland  BV  (Ecorys),  Brussels  2023  ([link 
available once published]), referred to as ‘CEIPI(2023)’. 

  “Compulsory  licensing  in  Europe,  A  country-by-country  overview”,  European 
Patent  Office,  2018  (https://www.epo.org/learning/materials/compulsory-licensing-
in-europe.html ), referred to as ‘EPO(2018)’. 

Additionally,  the  following  data  sources  were  used  in  order  to  perform  an  in-house 
analysis: 

  PatentSight® database (https://go.patentsight.com/login.html). 

The remaining sources are provided in the footnotes, whenever they are referred to in the 
text.  

56 

 
 
 
 
ANNEX 2: STAKEHOLDER CONSULTATION (SYNOPSIS REPORT) 

Introduction 

As  underlined  in  the  Commission’s  intellectual  property  action  plan  (2020),  the 
Commission sees a need to ensure that effective systems for issuing compulsory licences 
are  in  place.  Against  that  background  the  Commission  started  in  2022  consulting 
stakeholders on compulsory licensing of patents in the EU, especially in  a cross-border 
crisis.  Consultation of stakeholders  also  covered  the efficiency of the EU procedure on 
compulsory licensing of patents for pharmaceutical products for export to countries with 
public health problems (Regulation (EC) No 816/2006). 

Consultation activities 
The  European  Commission  published  a  Call  for  evidence142  on  1  April  2022.  The 
feedback period to this call for evidence lasted 4 weeks and ended on 29 April 2022. The 
objective  of  this  call  for  evidence  was  to  gather  views,  opinions  and  evidence  from  all 
public  and  private  sector  stakeholders,  such  as  IP  right  holders,  users  of  IP-protected 
technologies  and  products,  the  health  sector  (including  generic  manufacturers,  start-ups 
and patient associations), public authorities, national IP offices, non-profit organisations, 
civil  society  representatives,  consumer  associations,  research  centres,  the  European 
Medicines  Agency  and  IP  lawyers.  It  gathered  views  on  the  different  grounds  and 
procedures for issuing compulsory licences in a crisis and aimed to discover bottlenecks 
and to assess the impact of compulsory licensing on stakeholders. In total, 57 feedbacks 
were received, of which one third came from business associations and 23% from non-
governmental  organisations  (NGOs).  Most  of  the  feedback  was  received  from 
respondents from BE (21%), DE (19%) and FR (11%). 

In March 2022, the Commission launched the study ‘Compulsory licensing of intellectual 
property rights’ [CEIPI(2023)]. The objective of the study was to assist the Commission 
in  defining  potential  problems  as  regards  compulsory  licensing  in  the  EU  as  well  as 
identifying  and  assessing  policy  options  to  improve  coherence  and  effectiveness  in  the 
field. To this end, the study aimed at collecting data through desk research, case studies, 
interviews  with  stakeholders  as  well  as  organising  two  workshops.  The  study  was 
conducted  by  the  Center  for  International  Intellectual  Property  Studies  (CEIPI),  the 
Université de Strasbourg (UNISTRA), the  Impact  Licensing  Initiative  (ILI) and Ecorys 
Nederland BV (ECORYS).  

In  the  context  of  the  Study,  Member  States  experts  were  contacted  to  complete  a 
questionnaire.  The  questions  focused  on  the  national  experiences  with  compulsory 
licensing,  the  scope  of  application  of  compulsory  licences  and  procedural  aspects.  In 
addition, a series of 25 semi-structured interviews of national experts,  academia, policy 
representatives  and  industry  experts  were  conducted.  These  interviews  focused  on 
gathering  ‘non-published’  data  on  national  procedures  and  legal  requirements  of 
compulsory licensing.  

Two workshops were held: 

https://ec.europa.eu/info/law/better-regulation/have-your-say/initiatives/13357-Intellectual-property-

142 
revised-framework-for-compulsory-licensing-of-patents_en 

57 

 
                                                 
  A  first  workshop  on  ‘Information  collection  on  specific  compulsory  licence  cases 
with exchange of views and experiences in the field of IPRs’ was held in Brussels 
on 28/29 April 2022; 

  A second workshop on ‘Policy options for compulsory licensing in Europe in case 

of a crisis’ was held in Brussels on 9/10 June 2022.  

A  total  of  24  participants  attended  both  workshops,  representing  patent  attorneys  from 
multiple Member States, policy officials and representatives from different industries.  

The European Commission also held an Open Public Consultation from 7 July 2022 to 
29 September 2022. This public consultation aimed to collect views from all stakeholders 
on how to build the most efficient compulsory licensing scheme in the European Union 
as well as to  ensure that it is  fit to  tackle EU-wide and  global crises.  This consultation 
was available on the Better Regulation Portal of the Commission and open to everybody. 
The  public  consultation  received  74  replies.  More  than  half  of  the  answers  came  from 
business associations (30%) and company/business organisation (24%), mostly from the 
health  sector  (34%).  The  largest  number  of  replies  were  from  Germany  (15),  Belgium 
(11) and FRFR (10). See for more statistics about the respondents and the key findings, 
the  Factual  Summary  Report,  published  on  the  Better  Regulation  Portal  of  the 
Commission. 

Table 12: Number of replies received in the open public consultation by stakeholder type 

I am giving my contribution as 
Academic/research institution 
Business association 
Company/business organisation 
Consumer organisation 
EU citizen 
Non-governmental organisation (NGO) 
Other 
Public authority 
Total 

Freq. 

Percent 
6.76 
29.73 
24.32 
1.35 
16.22 
8.11 
8.11 
5.41 
100 

5 
22 
18 
1 
12 
6 
6 
4 
74 

Source: OPC 

Analysis of responses 

Compulsory licensing as a crisis instrument 

In the context of the consultation activities, stakeholders were asked about the relevance 
of  compulsory  licence  as  a  crisis  management  instrument.  In  that  respect,  a  large 
majority  of  all  groups  of  respondents143  (82%,  N=  61)  consider  it  important  for  public 
authorities  to  allow  production  of  certain  products  and/or  use  of  certain  technologies 
necessary  to  tackle  a  crisis  through  a  compulsory  licence.  This  is  also  true  for 
respondents likely to be subject to a compulsory licensing decision (N=12), with 75% of 
them agreeing with the importance for public authorities to rely on compulsory licensing 
for crisis management purposes. In particular, in view of recent crises, such as the Covid-
19  pandemic  and  the  war  in  Ukraine,  respondents  consider  compulsory  licensing  as  a 
crisis management tool generally as positive (43%, N=20), even though it has been also 

143 By respondents we refer here to the respondents to the public consultation. 

58 

 
                                                 
pointed  out  that  existing  mechanisms  of  compulsory  licensing  under  the  TRIPS 
Agreement  and  national  IP  laws  revealed  not  to  be  sufficient  to  solve  the  problem  of 
urgent  access  to  life-saving  medical  tools  during  critical  situations  such  as  an  ongoing 
war, a pandemic or situations of severe medicines shortage and instead rather voluntary 
licensing  agreements  played  a  pivotal  role,  increasing  production  and  supply  for  the 
needed medicines. 

When  asked  about  the  fitness  of  current  rules  on  compulsory  licensing  for  crisis 
management,  stakeholders’  views  are  contrasted.  Many  respondents  consider  that 
current  national  laws  on  compulsory  licensing  are  fit  to  tackle  national  crises  (58%, 
N=43),  EU-wide  crises  (51%,  N=38),  and  global  crises  (50%,  N=37).  However,  stark 
disparities  exist  between  stakeholders.  All  NGOs  considered  that  current  compulsory 
licensing  rules  are  unfit  to  tackle  EU-wide  crises.  In  contrast,  all  business  associations 
and  companies  considered  that  compulsory  licensing  rules  are  fit  to  tackle  EU-wide 
crises.  Generally,  compulsory  licensing  rules  are  considered  less  fit  to  tackle  EU-wide 
crises than national and global ones144.  

When  asked  about  the  types  of  crises  for  which  compulsory  licensing  should  be 
possible,  almost  half  of  the  respondents  (45%,  N=33)  considered  that  compulsory 
licensing  should  be  allowed  only  for  specific  crises.  Interestingly,  three  quarters  of  the 
respondents  likely  to  be  subject  to  a  compulsory  licensing  decision  were  of  the  same 
opinion.  Another  quarter  considered  that  compulsory  licensing  should  be  allowed 
whenever  a  situation  is  determined  to  be  a  crisis  by  relevant  authorities.  Only  few 
respondents  considered  that  compulsory  licensing  should  never  be  used  (55%,  N=4). 
When asked about the types of specific crisis, respondents first mentioned health-related 
crises (34%, N=25), then war and/ or large-scale attack (28%, N=21), and finally energy-
related crises and natural disasters (each 26%, N=19). 

On priority aspects of compulsory licensing for crisis management, a large majority 
of  stakeholders  (74%,  N=55)  consider  the  speed  of  ensuring  access  to  products/ 
technologies  as  a  high  priority.  However,  only  a  third  of  stakeholders  (34%,  N=25) 
considered  that  putting  a  time  limit  on  negotiations  could  speed  up  the  granting  of  a 
compulsory licence for crisis management. Views diverged on the need to provide a clear 
time  limit,  some  considering  that  a  defined  time  period  (e.g.  1  month)  would  be 
necessary to avoid lengthy negotiations, others considering that this would not provide a 
flexible  solution.  In  contrast,  pre-defined  rules  on  essential  terms  of  the  licence  are 
quoted as an efficient way to speed-up the granting of a compulsory licence. Pre-defined 
rules  on  remuneration  appear  particularly  important  with  42%  of  respondents  (N=31) 
considering that it would speed up the granting of a compulsory licence. This is in line 
with  the  finding  that  protection  of  right  holders  (including  an  adequate  remuneration) 
was considered a high priority for 64% of respondents (N=47) to the public consultation.  

A  final  aspect  concerned  the  importance  of  voluntary  agreements  on  intellectual 
property rights, including in crises. Stakeholders generally highlight the importance of 
voluntary agreements to scale-up the manufacturing of critical products.  This view was 
often  reflected  in  the  feedback  to  the  call  for  evidence  as  well  as  in  the  replies  to  the 
public  consultation.  According  to  many  stakeholders,  the  COVID-19  pandemic  has 
showed that voluntary agreements offer a viable solution for the manufacturing of critical 

144  This  is  also  true  for  companies  and  business  associations  that  consider  that  rules  on  compulsory 
licensing are able to tackle national crises (94%), EU-wide crises (89%) and global crises (92%). 

59 

 
                                                 
goods  in  crises.  Along  these  lines,  three  quarters  of  the  respondents  to  the  public 
consultation  (74%,  N=55)  agreed  that  compulsory  licensing  is  a  last-resort  mechanism 
that  should  be  available  only  where  voluntary  arrangements  have  failed  or  are 
unavailable.  

However, views are contrasted on this issue: although almost all companies and business 
association  (97%)  agree  with  the  last  resort  approach,  two-thirds  of  NGOs  disagree.  In 
addition, several respondents to the public consultation highlighted that Article 31(b) of 
the TRIPS Agreement does not require seeking the authorisation of the patent owner (i.e. 
a  voluntary  agreement)  in  cases  of  a  national  emergency  or  other  circumstances  of 
extreme urgency or in cases of public non-commercial use. 

As regards aspects to determine whether voluntary agreements have failed, the majority 
of respondents favour whether reasonable efforts have been made by the licence seeker to 
obtain  an  agreement  with  the  IP  owner  and  the  time  period  allowed  for  concluding  a 
voluntary  agreement  over  the  types  of  voluntary  agreements  that  have  proven  to  be 
unsuccessful  or  unavailable,  such  as  agreements  with  suppliers  or  agreements  between 
competitors. 

Almost half of the respondents mentioned other aspects to be considered. These aspects 
included the scope of the licence (whether it is strictly limited to what is necessary), the 
protection of trade secrets and commercial interests of the IP owner and the guarantees 
given by the licensee.  

As  regards  the  impact  of  compulsory  licensing  on  the  various  players,  opinions  are 
divided  between  stakeholders.  While  companies  and  business  associations  point  to  the 
negative impact of compulsory licensing to IP rights holders, lowering the value of their 
investments  in  IP  rights,  impairing  the  IP  system  and  harming  society  in  the  long  run, 
NGOs are emphasizing the positive impact on citizens and the entire society by ensuring 
affordable and sustainable access to essential health products, when needed, at reasonable 
prices,  in  adequate  quantity  and  good  quality,  while  guaranteeing  a  balance  with  the 
innovation and IPR system. 

60 

 
 
Policy options as regards compulsory licensing for the domestic market  – Article 31 of 
the TRIPS Agreement 

Different  consultation  activities145  have  examined  experiences  of  stakeholders  and 
national experts with compulsory licensing at Member State level, in particular regarding 
possible  policy  options  to  ensure  an  effective  compulsory  licensing  system  for  crisis 
management. 

When presented with three main policy options to speed-up the compulsory licensing 
process  for  crisis  management,  stakeholders  favoured  the  option  consisting  of 
facilitating  communication  on  the  request/  granting  of  compulsory  licences  and  the 
sharing of information between EU countries (42%, N=31). The second preferred option 
referred  to  the  possibility  of  aligning  rules  on  compulsory  licences  (28%,  N=21).  The 
least  preferred  option  concerned  the  adoption  of  non-binding  guidelines  (22%,  N=16). 
Three out of four of the public authorities having replied to the public consultation are in 
favour  of  an  alignment  of  rules.  This  is  in  stark  contrast  with  NGOs  and  consumer 
organisations,  of  which  only  one  NGO  would  welcome  an  alignment  of  rules.  This 
reluctance  towards  an  alignment  of  rules  could  be  explained  by  the  willingness  to 
preserve the ability of Member States to trigger compulsory licences at national level, as 
this appears from discussions with stakeholders. 

The  public  consultation  further  investigated  the  option,  and  in  particular  the  relevant 
features of uniform rules on compulsory licences for crisis management. In general, 
respondents to the public consultation consider that the three main features to be aligned 
should be the  grounds  on which a  compulsory licence can be  granted  (43%,N=32), the 
scope  (42%,  N=31)  and  the  procedure  (32%,  N=24).  Divergences  exist  between  the 
different categories of stakeholders. Companies and business associations are less likely 
to consider that alignment is needed on the different features. They are only a bit more 
than  a  fifth  to  consider  necessary  to  align  the  grounds  and  the  scope  and  only  17%  in 
favour  of  aligning  the  procedure.  In  contrast,  more  NGOs,  public  authorities,  and 
academia are in favour of aligning the scope (73%), the grounds (67%) and the procedure 
(53%).  

The public consultation further examined the different features of a compulsory licence 
for crisis management purposes, which can be summarised as follows: 

Grounds for granting a compulsory licence – Around one third of the respondents to 
the  public  consultation  consider  that  the  following  grounds  for  granting  a  compulsory 
licence  should  be  aligned:  the  territorial  scope  of  crises  (the  possibility  to  declare  a 
national,  multinational  or  pan-European-crisis),  the  types  of  crises  for  granting  a 
compulsory  licence  (e.g.  health)  as  well  as  the  definition  of  crises  that  allow  a 
compulsory  licence  to  be  granted  should  be  the  same.  Divergences  exist  between  the 
different categories of stakeholders, with companies and business associations being less 
in  favour  of  an  alignment  of  the  grounds  for  granting  a  compulsory  licence  than 
academia, public authorities and NGOs having replied to the public consultation. 

Scope of the compulsory licence – More than a third (35%, N=26) of the respondents to 
the  public  consultation  consider  it  necessary  that  the  alignment  of  the  scope  of  what  a 

145Including  in  particular  the  interviews  and  workshops  organised  within  the  framework  of  the 
CEIPI(2023) study and the OPC. 

61 

 
                                                 
compulsory  licence  covers  should  extent  to  all  aspects  deemed  necessary  to  allow  the 
manufacturing of complex products.  

In particular, the Public Consultation reveals that 65% of the respondents (N=48) are of 
the  opinion  that  compulsory  licences  should  also  apply  to  supplementary  protection 
certificates.  In  this  sense,  responses  of  national  experts  to  the  questionnaire  sent  in  the 
context of the Study, show that the lack of explicit reference to supplementary protection 
certificates  in  national  compulsory  licensing  provisions  gives  rise  to  legal  uncertainty 
and different interpretation of similarly worded provisions146. Half of the respondents of 
the  Public  Consultation,  i.e.  50%  (N=37),  favour  compulsory  licences  that  apply  to 
patents as well as published patent applications.  

36%  of  respondents  (N=27)  welcome  if  compulsory  licences  also  included  the  know-
how.  Views  are  extremely  contrasted  on  this  point  with  only  5%  of  companies  and 
business associations being in favour (in contrast, considering academia and NGOs and 
public  authorities,  all  but  one  are  in  favour  of  including  know-how  in  the  scope  of  a 
compulsory licence).  

Moreover,  stakeholders  having  participated  in  the  context  of  the  study  generally  agree 
that regulatory data protections for medicinal products should not be an obstacle to the 
effective  implementation  of  a  compulsory  licence.147  In  contrast,  only  35%  of 
respondents (N=27) (and only 12% of the companies and business associations) consider 
it  useful  when  compulsory  licences  also  apply  to  regulatory  data  protections  for 
medicinal  products.  Finally,  a  third  of  the  respondents  are  of  the  opinion  that  a 
compulsory  licence  should  also  apply  to  other  IP  rights  but  did  not  elaborate  much 
further on the types of other IP rights. 

Conditions for granting a compulsory licence – Consultation activities have identified 
that alignment of the conditions for granting a compulsory licence should encompass the 
duration  of  the  licence  (38%,  N=28),  the  content  of  an  application  for  a  compulsory 
licence  (e.g.  indicate  the  patent,  the  owner  of  the  patent,  the  concerned  products,  etc.) 
(35%,  N=26),  remuneration  (34%,  N=25)  and  the  framework  and  duration  of  the 
negotiations (31%, N=23). During the consultation activities, stakeholders explained that 
patent  holders  which  are  subjected  to  a  compulsory  licence  run  risks  that  may  not 
adequately be dealt with  by the enforcement  of  patent and compulsory licence-relevant 
laws  alone.148  Insofar  safeguards  are  needed  in  the  form  of  complementary  contractual 
control  mechanisms  which  can  help  to  reduce  the  negative  consequences  of  the 
compulsory  licence.  In  this  sense,  protection  for  rights  holders,  such  as  a  reasonable 
period of time to allow negotiations between the licence seeker and the rights holder, a 
clear limitation of the duration of the compulsory licence and an adequate remuneration 
for  rights  holders  is  considered  of  high  priority  by  the  majority  of  respondents  of  the 
Public Consultation (69%). 

Procedure for granting a compulsory licence – As regards the procedure for granting a 
compulsory  licence,  43%  of  the  respondents  to  the  public  consultation  (N=32)  would 
welcome  an  alignment  of  the  type  of  procedure  (administrative  or  judicial  procedure). 
When it comes to NGOs and academia, 8 out of the 11 respondents are in favour of such 
alignment. Only 27% of the respondents to the public consultation (N=20) would like to 

146 CEIPI(2023), p. 38. 
147 CEIPI(2023), p. 47. 
148 CEIPI(2023), p. 85. 

62 

 
                                                 
see  an  alignment  on  whether  or  not  the  manufacturing  should  be  subject  to  a  final 
decision on all aspects of the compulsory licence. 

Procedures  on  compulsory  licences  for  crisis  management  should,  according  to 
stakeholders, rather be initiated by a competent authority (28%, N=21) than on request of 
the licence seeker (4%, N=3), or alternatively, providing both possibilities (23%, N=17). 

As regards an alignment of the recourse procedure for granting a compulsory licence, a 
majority of respondents to the public consultation would agree with an alignment of the 
time limit within which the application of an appeal is  admissible (42%, N=31) and an 
accelerated appeal procedure (38%, N=28). 35% of the respondents (N=26) are in favour 
of the suspensive effect of an appeal.  

Competence  to  administer  compulsory  licences  –  Even  though  at  national  level,  as 
demonstrated  in  the  questionnaires  sent  to  national  experts  and  as  confirmed  by 
stakeholders across all categories, various types of authorities are empowered to issue a 
compulsory  licence  for  different  purposes149,  a  strong  preference  was  expressed  by 
stakeholders  during  interviews  and  workshops  for  allocating  responsibilities  for 
administering  compulsory  licences  to  ‘specialised’  or  expert  authorities:  authorities 
which  hold  the  requisite  knowledge  of  a  product  and  relevant  expertise  in  order  to 
properly  evaluate  applications  for  compulsory  licences  and  make  key  assessments 
regarding the necessary scope of a compulsory licence.150  

As to the role of the European institutions, the Public Consultation revealed that a slight 
majority of respondents favour a consultative role on the request of EU countries, public 
authorities,  rights  holders,  licence  seekers,  etc.,  asking  for  advice  (39%,  N=29)  or  a 
coordinating  role  (e.g.  by  setting  up  channels/forums  and  methods  for  information 
sharing among EU countries and steering mutual assistance between EU countries) (36%, 
N=27)  over  a  decision-making  role  of  European  institutions  (e.g.  by  declaring  a  crisis, 
possibly triggering the granting of a compulsory licence (28%, N=21). 

Compulsory licensing for exports  

licensing  of  patents  for 
Regulation  (EC)  No  816/2006  regulating  compulsory 
pharmaceutical  products  for  export  purposes  had  never  been  used.  It  was  therefore 
important to collect views from stakeholders on how they consider this regulation, and in 
particular the fact that it was never used. 

41%  of  the  respondents  to  the  public  consultation  (N=30)  considered  that  Regulation 
(EC)  No  816/2006  allows  for  speedy  and  efficient  procedures  for  granting  compulsory 
licences to export pharmaceutical products to non-EU countries. 

149 CEIPI(2023), p. 29. 
150 CEIPI(2023), p. 73. 

63 

 
                                                 
Views  are  however  extremely  contrasted  on  this  issue:  among  companies  and  business 
associations, 95% agree with this view. In contrast, all NGOs having participated in the 
public consultation consider that this is not the case.  

On aspects of the Regulation that could be streamlined, we witness a lot of respondents 
having no opinion (around a third) or having not  replied (around 15%).  Replies appear 
again  contrasted  between  companies  and  business  associations,  on  the  one  hand,  and 
NGOs,  on  the  other  hand.  In  the  first  group,  only  one  respondent  considered  that 
elements of the regulation should be streamlined (i.e. conditions to submit an application, 
calculation  of  the  remuneration  and  the  simplified  and  accelerated  procedure).  In 
contrast,  all  but  one  NGOs  considered  that  conditions  to  submit  an  application  and  the 
calculation  of  the  remuneration  should  be  streamlined.  All  NGOs  considered  that  the 
simplified and accelerated procedure should be streamlined.  

Stakeholders generally disagree that the procedure set by Regulation (EC) No 816/2006 
should  be  made  more  flexible  to  adapt  to  the  needs  of  the  importing  country  (25 
respondents disagreed, 17 agreed and 32 did not reply or had no opinion). On whether the 
Regulation  provides  for  sufficient  guarantee  against  trade  diversion,  the  majority  of 
respondents (38%, N=28) agreed, while a minority of 6 respondents (8%) disagreed (the 
largest majority – 40 respondents – did no reply or had no opinion on the issue). 

Impacts of the different options 

Several questions on the impact of possible options were part of the public consultation. 
These  impacts  are  summarised  below,  with  a  particular  focus  on  the  impacts  on  EU 
businesses, IP owner, the ability of the EU to tackle crisis and the access to critical goods 
in crises. 

The majority of the respondents of the Public Consultation are seeing the  introduction 
of  a  uniform  compulsory  licensing  scheme  for  crisis  management  rather  negative  for 
EU  businesses  (38%,  N=28)  and  EU  IP  owners  (43%,  N=32).  However,  it is  generally 
perceived more positive as regards the EU’s ability to tackle crises (38%, N=28) and the 
provision of access to critical goods (36%, N=27).  

64 

 
 
Stakeholders favour the option of allowing a compulsory licence to be granted at EU 
level  in  the  event  of  an  EU-wide  crisis  compared  to  nationally  granted  compulsory 
licences  for  EU-wide  crises.  In  that  respect,  the  responses  to  the  Public  Consultation 
show that the option of granting a  compulsory licence at  EU level  is  generally deemed 
more positive by stakeholders as regards the EU’s ability to tackle crises (35%,  N=26) 
and for providing access to critical goods (34%, N=25) than the granting of a compulsory 
licence at national level (respectively, 11%, N=8 and 12%, N=9). There is again a stark 
contrast  between  stakeholders.  All  NGOs  consider  that  the  granting  of  a  compulsory 
licence  at  EU  level  for  EU-wide  crises  would  have  a  positive  effect  on  the  ability  to 
tackle  crises  and  the  access  to  critical  goods.  However,  a  majority  (around  50%)  of 
companies and business associations consider that the impact would be negative. A larger 
majority of companies and business associations considers that such option would have a 
negative effect on EU businesses (87%) and IP owners (90%). 

65 

 
 
 
 
As  regards  the  impact  of  introducing  a  mechanism  for  coordinating  compulsory 
licensing among EU countries, it is seen positive for the EU Single Market by 35% of 
the respondents (N=26). For the impact on EU businesses (28%, N=21), EU IP owners 
(25%, N=26) and the EU patent system (35%,  N=26), negative responses predominate, 
especially  by  companies,  business  organisations  and  business  associations,  whereas, 
again, respondents are more positive about the impact on the EU’s ability to tackle crises 
(35%, N=26) and the impact on the access to critical goods for the public (28%, N=21). 
This is the case, above all, for NGOs. Moreover, the impact of introducing a mechanism 
for  coordinating  compulsory  licensing  among  EU  countries  on  the  public  authorities’ 
decision-making processes is viewed positively by the majority of the respondents (29%, 
N=22). 

66 

 
 
 
The  questions  on  the  impact  of  creating  an  EU  single  contact  point  and  coordination 
mechanism  between  Member  States  and  of  an  EU-level  centralised  procedure  to  grant 
compulsory licences on export of pharmaceutical products to non-EU countries received 
only few evaluable answers. Most of the respondents either had no opinion, answered in 
a neutral way, or did not submit any answer. However, of the responses on the impact of 
creating an EU single contact point and coordination mechanism between Member 
States  for  compulsory  licences  for  export  of  pharmaceutical  products  to  non-EU 
countries, positive answers  on the impact  on the EU  Single Market  predominate (19%, 
N=14  vs  negative  answers:  3%,  N=4),  even  by  companies,  business  organisations  and 
business associations. As to the impact on EU businesses and EU IP owners, companies, 
business  organisations and business  associations  see it  rather negative (53%, N=21 and 
55%, N=22), whereas NGOs have a rather positive view. The majority of the respondents 
also saw the creation of an EU single contact point and coordination mechanism between 
Member States for compulsory licences for export of pharmaceutical products to non-EU 
countries more positively as regards the impact  on the EU patent system (18%, N=13), 
the EU’s ability to tackle crises (18%, N=13), access to critical pharmaceutical products 
for  non-EU  countries  (19%,  N=15)  and  on  the  public  authorities’  decision-making 
process (19%, N=15). 

Of the answers received on the impact of an EU-level centralised procedure to grant 
compulsory  licensing  on  export  of  pharmaceutical  products  to  non-EU  countries, 
negative answers predominate on the questions  about the impact on EU businesses and 
EU  IP  owners,  mostly  stemming  from  companies,  business  organisations  and  business 
associations,  whereas  more  positive  answers  were  received  on  the  impact  on  the  EU 
patent system, on EU’s ability to tackle crises, access to critical pharmaceutical products 
for non-EU countries and on the public authorities’ decision-making process. 

How the results of consultation activities were used? 

The results of the various consultations presented above underpin the whole evaluation of 
the currently fragmented framework of national compulsory licensing systems of patents 
for  domestic  purposes  as  well  as  of  the  efficiency  of  the  EU  procedure  on  compulsory 
licensing of patents for export to countries with public health problems (Regulation (EC) 
No 816/2006). They were used to judge the effectiveness and efficiency of compulsory 
licensing in the EU to tackle cross-border crises and helped in formulating policy options 
for the future. 

67 

 
ANNEX 3: WHO IS AFFECTED AND HOW? 

1.  PRACTICAL IMPLICATIONS OF THE INITIATIVE 

The  new  instrument  is  intended  to  make  the  issuing  of  CLs  in  crisis  situations  more 
coherent  and  streamlined,  especially  in  terms  of  timing.  This  would  reduce  the 
multiplicity  of  authorities  involved  in  such  procedures  and  therefore  increase  legal 
certainty that is crucial for patent holders/companies that may be concerned by a CL. The 
proposed changes will also improve the transparency of the process, which is especially 
important  for  stakeholders.  The  key  stakeholders  that  may  be  affected  by  the  new 
provisions are the current patent holders, followed by any company that may take the role 
of a future manufacturer (licensee). As far as patent holders are concerned, the majority 
of such companies are large enterprises - a breakdown of patent applications originating 
from European countries shows that 75% of them were filed by large companies, 20% by 
individual 
inventors  and  SMEs,  and  5%  by  universities  and  public  research 
organisations. 

Figure 11: Patent applications originating from European countries by applicant type [%] 

Source: Patent Index 2021 – At a glance, EPO, status: 1.2.2022 

2.  SUMMARY OF COSTS AND BENEFITS 

I. Overview of Benefits (total for all provisions) – Preferred Option 
Amount 

Description 

Comments 

Direct benefits 

Savings  for  patent 
holders 
and 
manufacturers 
(potential licensees) 

75%-80% 
less 
resources  than  in  the 
baseline,  in  the  event 
of  a  cross  border 
crisis. 

The  compulsory  licensing  negotiations  would  take  place 
only  once  at  the  EU-level  instead  of  fragmented  and 
overlapping processes in several EU countries (or instead 
of  ca.  4-5  procedures  in  each  jurisdiction  that  could  be 
needed otherwise). 

Main recipients:  firms involved in  compulsory  licensing 
granting process.  

68 

 
 
  
 
Savings 
administrations. 

for  MS 

Impossible to estimate 
precisely 

The cost of running compulsory licensing negotiations are 
expected  to  decrease151,  as  resources  would  be  shared  at 
EU-level  
Main recipients: MS administrations 

Access 
to  critical 
goods  in  times  of 
crisis. 

response 
due 

Better  overall  EU-
to 
level 
to 
crisis 
of 
availability 
critical goods. 

Impossible to estimate 
precisely 

Availability  of  products  that  otherwise  would  not  be 
accessible, which also prevent other costs from occurring. 

Main  recipients:  EU  citizens  or  firms  in  need  of  the 
critical goods. 

Indirect benefits 

Impossible to estimate 
precisely 

Wide  socio-economic  benefits  due  to  limited  scale  of  a 
crisis 

Main recipients: EU citizens / the entire society. 

Administrative cost savings related to the ‘one in, one out’ approach* 

n.a. 

n.a. 

n.a. 

II. Overview of costs – Preferred option 

Citizens/Consumers 

Businesses 

Administrations 
(EU countries) 

One-off  Recurrent  One-off 

Recurrent152 

One-off 

Recurrent 

Create 
EU-level 
compulso
ry 
licensing 
for  crisis 
managem
ent 

Direct 
adjustment 
costs 

Direct 
administrative 
costs 

Direct 
regulatory 
fees and 
charges 

Direct 
enforcement 
costs 

0. 

0 

0 

0 

Indirect costs 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

Costs of compulsory 
licensing negotiations 
(but lower than in 
status quo as a single 
procedure at EU level 
would replace 
multiple procedures in 
each EU country 
concerned) 

0 

Cost of 
implementing 
the legislation 

0 

0 

0 

0 

0 

0 

0 

Cost of 
compulsory 
licensing 
negotiations and 
EU countries 
involvement in 
the committee 
for the adoption 
of the activation 
measure153. 

0 

Costs related to the ‘one in, one out’ approach 

151  Some  minor  administrative  costs  of  reporting  may  be  incurred  by  Member  States,  which  do  not  fall 
under the ‘one-in one-out’ approach. 
152 The frequency of recurrent costs is expected to be extremely low, as they would be incurred only in the 
event of a cross-border crisis and if there is a need to use compulsory licensing for crisis management. 
153 If establishing a separate committee necessary (otherwise the existing bodies would be used). 

69 

 
 
 
 
 
                                                 
Total   

Direct 
adjustment 
costs  

Indirect 
adjustment 
costs 

Administrativ
e costs (for 
offsetting) 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

3.  RELEVANT SUSTAINABLE DEVELOPMENT GOALS 

III. Overview of relevant Sustainable Development Goals – Preferred Option(PO4) 

Relevant SDG 

Expected progress towards the Goal 

Comments 

More effective response to a major cross-border crisis affecting the EU can be potentially related to:  
Goal 3: Good health and 
well-being 

If  the  crisis  concerns  health-related 
aspects. 

to 

 

access 

facilitate 
critical 
products that  may be necessary to 
reduce 
epidemics, 
prevent 
mortality, 
to 
ensure 
healthcare. 

access 

Goal 6: Ensure 
availability and 
sustainable management 
of water and sanitation 
for all 
Goal 13: Take urgent 
action to combat climate 
change and its impacts 

Goal 7: Ensure access to 
affordable, reliable, 
sustainable and modern 
energy for all 

Goal 8: Promote 
sustained, inclusive and 
sustainable economic 
growth, full and 
productive employment 
and decent work for all 

Goal 9: Build resilient 
infrastructure, promote 
inclusive and sustainable 
industrialization and 
foster innovation 

Goal 11: Make cities and 
human settlements 
inclusive, safe, resilient 
and sustainable 

 

 

 

 

 

 

 

 

If the crisis concerns environmental 
aspects. 

depending  on  the  exact  type  of 
crisis,  for  example:  ensure  access 
to  clean  water,  reduce  pollution, 
minimize the release of hazardous 
chemicals, etc. 
strengthen  resilience  and  adaptive 
capacity to climate-related hazards 
and natural disasters,  

energy, 

depending  on  the  exact  type  of 
crisis,  for  example:  ensure  access 
to 
energy 
efficiency, upgrade technology for 
supplying  modern  and  sustainable 
energy 

improve 

the  crisis  concerns  energy 

If 
networks and energy supply.  

help  sustain  per  capita  economic 
accordance  with 
growth 
in 
national  circumstances 
(despite 
the crisis);  
help  restore  full  and  productive 
employment. 

the  crisis  affects  productive 

If 
activities, jobs or entrepreneurship. 

If  the  crisis  concerns  industrial, 
regional 
trans-border 
infrastructure,  or  technologies  and 
industrial processes.  

or 

the 

crisis 
If 
infrastructure  or  other 
settlements. 

concerns  urban 
human 

and 

restore  quality, 

reliable, 
help 
sustainable 
resilient 
infrastructure,  including  regional 
and  trans-border  infrastructure,  to 
support  economic  development 
and human well-being; 
help 
capabilities of industrial sectors. 

technological 

restore 

the 

depending  on  the  exact  type  of 
crisis, for example: provide access 
to  safe,  affordable,  accessible  and 
sustainable 
systems, 
reduce 
the  number  of  people 
affected and substantially decrease 

transport 

70 

 
 
 
 
 
 
 
the direct economic losses relative 
to  global  gross  domestic  product 
including 
caused  by  disasters, 
water-related disasters; 

Figure 12: Relevance to UN Sustainable Development Goals – example of European Patents active in Germany 

Source: PatentSight®, search executed on 11/12/2022. 

71 

 
 
 
ANNEX 4: ANALYTICAL METHODS 

The  analysis  contained  in  this  impact  assessment  predominantly  builds  on  input  from 
stakeholder  collected  via  the  open  public  consultation,  a  dedicated  study  “Compulsory 
licensing of intellectual property rights” (see Annex 1, point 4) and data collected from 
desk  research  (e.g.  academic  studies,  existing  impact  assessment  reports  such  as  SMEI 
proposals, etc.). Whenever possible, a quantitative information is provided and analysed. 
For  example,  a  small  in-house  analysis  concerning  the  geographical  coverage  of 
European  patents  was  carried  out  and  then  used  in  the  problem  definition  –  the 
methodology applied for this task is discussed below.  

Nonetheless,  as  compulsory  licensing  is  the  “last  resort  instrument”  it  is  used  only  in 
exceptional circumstances therefore the available data on the subject is extremely scarce. 
In  view  of  the  absence  of  granular  data  on  the  subject,  this  assessment  discusses  the 
plausible  magnitude  of  potential  impacts  of  each  policy  option,  rather  than  its  exact 
quantification  in  monetary  terms.  As  a  consequence,  the  cost/benefit  analysis  is  not 
developed to the level that otherwise is expected in an impact assessment. As a fall-back 
strategy,  the  main  evidence  base  of  the  report  comes  from  the  consultations  with 
stakeholders (see Annex 2).  

GEOGRAPHICAL COVERAGE 

The objective of this task was to identify the average number of Member States in which 
patents needed in a crisis situation are active. In order to build such hypothetical case, the 
recent COVID pandemics was used as a proxy for a possible crisis. A list of patents that 
could  be  needed  in  such  situation  was  established  based  on  PatentScope  COVID-19 
INDEX154 where the following areas were identified as pertinent to a global health crisis 
caused by coronavirus: 

  Artificial respiration, 

  Diagnostics, 

  Disinfection, 

 

Informatics, 

  Medical Equipment, 

  Medical Facilities and Transport, 

  Medical Treatment, 

  Medical treatment/Prophylactic, 

  Medical treatment/Therapeutic, 

  Personal protective equipment. 

154 https://patentscope.wipo.int/search/en/covid19.jsf (the new PatentScope search facility provides search 
queries specially curated by patent information experts who have identified technological areas relevant to 
the detection, prevention and treatment of COVID-19) 

72 

 
                                                 
The PatentScope COVID-19 INDEX defines the exact scope of relevant patents by using 
International patent classification (ICP)155 codes listed in Table 13, below. 

Table 13: List of IPC codes used in PatentScope COVID-19 Index 

A61H 31/00 
A61M 16/00 

A61B 
A61B 1/00 -
>A61B 16/00 

A61B 5/00 
A61B 5/01 

A61B 5/08 

A61B 6/00 
C12Q 

C12Q 1/00 

C12Q 1/68 

C12Q 1/70 

G01N 

G01N 33/48 

G01N 33/569 

A61L 2/00 

A61L 9/00 
F24F 3/16 

G16B 

G16C 

G16H 

A61B 50/00 

Artificial respiration or heart stimulation, e.g. heart massage 
Devices for influencing the respiratory system of patients by gas treatment, e.g. mouth-to-
mouth respiration; Tracheal tubes 
DIAGNOSIS; SURGERY; IDENTIFICATION 
Instruments for performing medical examinations of the interior of cavities or tubes of the 
body by visual or photographical inspection, e.g. endoscopes; Illuminating arrangements 
therefor 
Measuring for diagnostic purposes; Identification of persons 
Measuring for diagnostic purposes; Identification of persons + Measuring temperature of 
body parts 
Measuring for diagnostic purposes; Identification of persons + Measuring devices for 
evaluating the respiratory organs 
Apparatus for radiation diagnosis, e.g. combined with radiation therapy equipment 
MEASURING OR TESTING PROCESSES INVOLVING ENZYMES, NUCLEIC 
ACIDS OR MICROORGANISMS; COMPOSITIONS OR TEST PAPERS THEREFOR; 
PROCESSES OF PREPARING SUCH COMPOSITIONS; CONDITION-RESPONSIVE 
CONTROL IN MICROBIOLOGICAL OR ENZYMOLOGICAL PROCESSES 
Measuring or testing processes involving enzymes, nucleic acids or microorganisms; 
Compositions therefor; Processes of preparing such compositions 
Measuring or testing processes involving enzymes, nucleic acids or microorganisms; 
Compositions therefor; Processes of preparing such compositions + involving nucleic 
acids 
Measuring or testing processes involving enzymes, nucleic acids or microorganisms; 
Compositions therefor; Processes of preparing such compositions + involving virus or 
bacteriophage 
INVESTIGATING OR ANALYSING MATERIALS BY DETERMINING THEIR 
CHEMICAL OR PHYSICAL PROPERTIES 
Investigating or analysing materials by specific methods not covered by groups G01N1/-
G01N31/131 + Biological material, e.g. blood, urine; Haemocytometers 
Investigating or analysing materials by specific methods not covered by groups G01N1/-
G01N31/131 + Biological material, e.g. blood, urine; Haemocytometers + Chemical 
analysis of biological material, e.g. blood, urine; Testing involving biospecific ligand 
binding methods; Immunological testing + Immunoassay; Biospecific binding assay; 
Materials therefore + for microorganisms, e.g. protozoa, bacteria, viruses 
Methods or apparatus for disinfecting or sterilising materials or objects other than 
foodstuffs or contact lenses; Accessories therefor 
Disinfection, sterilisation or deodorisation of air 
Air-conditioning systems in which conditioned primary air is supplied from one or more 
central stations to distributing units in the rooms or spaces where it may receive 
secondary treatment; Apparatus specially designed for such systems + characterised by 
the treatment of the air otherwise than by heating and cooling + by purification, e.g. by 
filtering; by sterilisation; by ozonisation 
BIOINFORMATICS, i.e. INFORMATION AND COMMUNICATION TECHNOLOGY 
SPECIALLY ADAPTED FOR GENETIC OR PROTEIN-RELATED DATA 
PROCESSING IN COMPUTATIONAL MOLECULAR BIOLOGY 
COMPUTATIONAL CHEMISTRY; CHEMOINFORMATICS; COMPUTATIONAL 
MATERIALS SCIENCE 
HEALTHCARE INFORMATICS, i.e. INFORMATION AND COMMUNICATION 
TECHNOLOGY SPECIALLY ADAPTED FOR THE HANDLING OR PROCESSING 
OF MEDICAL OR HEALTHCARE DATA 
 Containers, covers, furniture or holders specially adapted for surgical or diagnostic 

155 Established by the Strasbourg Agreement of 1971. 

73 

 
                                                 
A61B 50/39 

A61M 

A61M 1/00 

B25J  
B25J 9/00  
C12M  
C12M 3/00  
A61G  

A61G 3/00  

A61G 10/00  
A61G 12/00  

appliances or instruments, e.g. sterile covers 
 Containers, covers, furniture or holders specially adapted for surgical or diagnostic 
appliances or instruments, e.g. sterile covers + Containers specially adapted for 
packaging, protecting, dispensing, collecting or disposing of surgical or diagnostic 
appliances or instruments + for collecting or disposing of used articles + the containers 
containing antimicrobial, antiviral or disinfectant agents 
 DEVICES FOR INTRODUCING MEDIA INTO, OR ONTO, THE BODY; DEVICES 
FOR TRANSDUCING BODY MEDIA OR FOR TAKING MEDIA FROM THE 
BODY; DEVICES FOR PRODUCING OR ENDING SLEEP OR STUPOR 
Suction or pumping devices for medical purposes; Devices for carrying-off, for treatment 
of, or for carrying-over, body-liquids; Drainage systems 
MANIPULATORS; CHAMBERS PROVIDED WITH MANIPULATION DEVICES 
Programme-controlled manipulators 
APPARATUS FOR ENZYMOLOGY OR MICROBIOLOGY 
Tissue, human, animal or plant cell, or virus culture apparatus 
TRANSPORT, PERSONAL CONVEYANCES, OR ACCOMMODATION 
SPECIALLY ADAPTED FOR PATIENTS OR DISABLED PERSONS; OPERATING 
TABLES OR CHAIRS; CHAIRS FOR DENTISTRY; FUNERAL DEVICES 
Ambulance aspects of vehicles; Vehicles with special provisions for transporting patients 
or disabled persons, or their personal conveyances, e.g. for facilitating access of, or for 
loading, wheelchairs 
Treatment rooms for medical purposes 
Accommodation for nursing, e.g. in hospitals, not covered by groups A61G1/-
A61G11/120; Prescription lists 
PREPARATIONS FOR MEDICAL, DENTAL, OR TOILET PURPOSES 

A61K  
A61K 35/00   Medicinal preparations containing materials or reaction products thereof with 

undetermined constitution 

A61K 45/00   Medicinal preparations containing active ingredients not provided for in groups 

A61K31/-A61K41/132 
PEPTIDES 

C07K  
A61K 35/76   Medicinal preparations containing materials or reaction products thereof with 

undetermined constitution + Microorganisms or materials therefrom + Viruses; Subviral 
particles; Bacteriophages 
A61K 38/00   Medicinal preparations containing peptides 
A61K 39/00   Medicinal preparations containing antigens or antibodies 
A61K 39/12   Medicinal preparations containing antigens or antibodies + Viral antigens 
A61K 39/215   Medicinal preparations containing antigens or antibodies + Viral antigens + 

C07K 14/165 

C12N 

Coronaviridae, e.g. avian infectious bronchitis virus 
Peptides having more than 20 amino acids; Gastrins; Somatostatins; Melanotropins; 
Derivatives thereof + from viruses + RNA viruses + Coronaviridae, e.g. avian infectious 
bronchitis virus 
MICROORGANISMS OR ENZYMES; COMPOSITIONS THEREOF; 
PROPAGATING, PRESERVING, OR MAINTAINING MICROORGANISMS; 
MUTATION OR GENETIC ENGINEERING; CULTURE MEDIA 
Viruses, e.g. bacteriophages; Compositions thereof; Preparation or purification thereof 

C12N 7/00  
C12N 15/00   Mutation or genetic engineering; DNA or RNA concerning genetic engineering, vectors, 

e.g. plasmids, or their isolation, preparation or purification; Use of hosts therefor 

C12N 15/50   Mutation or genetic engineering; DNA or RNA concerning genetic engineering, vectors, 

e.g. plasmids, or their isolation, preparation or purification; Use of hosts therefor + 
Recombinant DNA-technology + DNA or RNA fragments; Modified forms thereof + 
Genes encoding microbial proteins, e.g. enterotoxins + Genes encoding viral proteins + 
Proteins from RNA viruses, e.g. flaviviruses + Coronaviridae, e.g. infectious bronchitis 
virus, transmissible gastroenteritis virus 
Medicinal preparations containing organic active ingredients 
Medicinal preparations containing inorganic active ingredients 
Medicinal preparations of undetermined constitution containing material from algae, 
lichens, fungi or plants, or derivatives thereof, e.g. traditional herbal medicines 

A61K 31/00 
A61K 33/00 
A61K 36/00 

A61K 39/395  Medicinal preparations containing antigens or antibodies + Antibodies; 

Immunoglobulins; Immune serum, e.g. antilymphocytic serum  

74 

 
A61K 39/42 

A61K 39/44 

C07 
C07D 
C07H 

C07H 21/00 

C07K 16/10 

C12P 

C12P 19/34 

A41D 13/11 

A41D 13/12 

A61B 42/00 

A61F 9/04 

A62B 7/00 -
>A62B 33/00 
A62B 18/02 

A62B 23/00 
A62B 23/02 
A62D 5/00 

A62D 7/00 

A62D 9/00 

Medicinal preparations containing antigens or antibodies + Antibodies; 
Immunoglobulins; Immune serum, e.g. antilymphocytic serum + viral 
Medicinal preparations containing antigens or antibodies + Antibodies; 
Immunoglobulins; Immune serum, e.g. antilymphocytic serum + Antibodies bound to 
carriers 
ORGANIC CHEMISTRY 
HETEROCYCLIC COMPOUNDS 
SUGARS; DERIVATIVES THEREOF; NUCLEOSIDES; NUCLEOTIDES; NUCLEIC 
ACIDS 
Compounds containing two or more mononucleotide units having separate phosphate or 
polyphosphate groups linked by saccharide radicals of nucleoside groups, e.g. nucleic 
acids 
Immunoglobulins, e.g. monoclonal or polyclonal antibodies + against material from 
viruses + from RNA viruses 
FERMENTATION OR ENZYME-USING PROCESSES TO SYNTHESISE A 
DESIRED CHEMICAL COMPOUND OR COMPOSITION OR TO SEPARATE 
OPTICAL ISOMERS FROM A RACEMIC MIXTURE 
Preparation of compounds containing saccharide radicals + Preparation of nitrogen-
containing carbohydrates + N-glycosides + Nucleotides + Polynucleotides, e.g. nucleic 
acids, oligoribonucleotides 
Professional, industrial or sporting protective garments, e.g. surgeons' gowns or garments 
protecting against blows or punches + protecting only a particular body part + Protective 
face masks, e.g. for surgical use, or for use in foul atmospheres 
Professional, industrial or sporting protective garments, e.g. surgeons' gowns or garments 
protecting against blows or punches + Surgeons' or patients' gowns or dresses 
Surgical gloves; Finger-stalls specially adapted for surgery; Devices for handling or 
treatment thereof 
Methods or devices for treatment of the eyes; Devices for putting in contact-lenses; 
Devices to correct squinting; Apparatus to guide the blind; Protective devices for the 
eyes, carried on the body or in the hand + Eye-masks 
Respiratory apparatus 

Breathing masks or helmets, e.g. affording protection against chemical agents or for use 
at high altitudes+ Masks 
Filters for breathing-protection purposes 
Filters for breathing-protection purposes + for respirators 
Composition of materials for coverings or clothing affording protection against harmful 
chemical agents 
Composition of materials for transparent parts of gas-masks, respirators, breathing bags, 
or helmets 
Composition of chemical substances for use in breathing apparatus 

The IPC creates a hierarchical system for the classification of patents (and utility models) 
according to the different technical fields to which they belong. The classification system 
contains about 70 000 entries, i.e. classification symbols or codes that can be allotted to 
patent documents. Symbols are arranged in a hierarchical, tree-like structure: 

  at  the  highest  level  are  the  eight  sections  corresponding  to  very  broad  technical 

fields (e.g., Section C deals with chemistry and metallurgy); 

  sections  are  further  subdivided  into  classes  (e.g.,  Class  C21  deals  with  the 

metallurgy of iron); 

75 

 
 
  classes  are  divided  into  more  than  600  subclasses  (e.g.,  Subclass  A21B  contains 

bakers' ovens and machines or equipment for baking).156 

  subclass is divided into groups (e.g., “A23F 3: Tea; Tea substitutes […]”). Groups 
are either main groups (e.g., “A23F 3/00: Tea; Tea substitutes […] (Not otherwise 
classified)”) or subgroups (e.g., “A23F 3/16: Tea extraction […]”). The symbols of 
the main groups end with “/00”. 

INDEX  contains  many  subclasses 

At this point it is important to note that the list of IPC codes selected for the PatentScope 
(e.g.  C07D  HETEROCYCLIC 
COVID-19 
COMPOUNDS), as well as even a class (i.e. C07 ORGANIC CHEMISTRY). Yet, such 
high level definitions seemed too broad for the intended analysis157, as they may contain 
a significant share of patents that were only indirectly related to fighting the pandemics. 
As  a  consequence,  these  high  level  codes  were  not  taken  into  account  in  the  analysis 
(marked  with  caps  lock  in  Table  13).  Nonetheless,  all  the  remaining  codes  from  the 
Table, with the level of granularity of groups or subgroups, were used as a basis in the 
search of active patents and later used to come up with the final estimate. 

Once  the  crisis-related  patents  were  identified  according  to  PatentScope  list  of  IPC, 
PatentSight®158  database  was  used  to  extract  the  information  on  the  number  and 
geographical  coverage  of  such  patents  within  the  EU.  The  query  resulted  in  216 381 
patent families in which at least one member was currently active159 in EU-27 Member 
States. The dataset reporting date (i.e. last server update) was 12/08/2022. The variables 
extracted were the following:  Patent Family, Active Authorities Today,  IPC Subclasses 
(Symbol)160.  

First,  the  observations  were  identified  by  their  granting  patent  office  –  the  basic 
tabulation for the main dataset is provided below (Table 14), showing that the European 
Patents accounted for 87.5% of all patents in the dataset. 

Table 14: Origin of patents in the retained dataset – frequency and percentage by patent office. 

Patent office 
EP 
National patent offices of EU-27 
US 
WO 
Other 
Total 

Freq. 
189 316 
15 678 
8 235 
2 396 
756 
216 381 

Percent 
87.49 
7.25 
3.81 
1.11 
0.35 
100 

is 

PatentSight® 

156 https://ec.europa.eu/eurostat/statistics-
explained/index.php?title=Glossary:International_patent_classification_(IPC) 
157  Unless  supplemented  by  a  text  search,  which  is  also  an  option  offered  in  PatentScope  COVID-19 
INDEX. 
158 
(https://go.patentsight.com/?welcome=1 ) 
159  Based  on  the  “Active  Authorities  Today”  variable  which  listed  names  of  countries  where  the  patents 
were active (i.e. the authorities in which at least one member of the patent family is currently active. This 
includes both pending applications that are still under prosecution and granted patents that are still in force) 
160  As  explained  earlier  observations  were  searched  (filtered)  by  IPC  groups  and  subgroups,  but  once 
identified, only their subclass IPC codes were exported as this level of granularity was judged sufficient for 
later descriptive analysis.  

subscription 

commercial 

accessible 

database 

patent 

upon 

a 

76 

 
                                                 
Second, information contained in the Active Authorities variable was processed in order 
to  remove  all  other  jurisdictions  were  the  members  of  each  patent  family  were  active, 
except  for  EU-27  countries.  This  step  makes  this  exercise  different  from  the  usual 
approach to counting the patent family size161 as defined in the literature, because it will 
capture  only  the  “EU  subset”  of  a  patent  family  (i.e.  the  patent  family  size  would 
normally include a validation in for example the US, whereas here information on non-
EU validations is ignored).  

161  OECD,  Measuring 
INTELLECTUAL PROPERTY'S ECONOMIC IMPACT © OECD 2015, p. 92. 

technological  and  economic  value  of  patents,  ENQUIRIES  INTO 

the 

77 

 
 
                                                 
ANNEX 5: LEGAL BACKGROUND AND THE KEY LEGAL 
PROVISIONS 

5A.  THE INTERNATIONAL LEGAL CONTEXT 

The Paris Convention162 of 1883 already enabled countries to  take legislative measures 
providing  for  the  grant  of  compulsory  licences  to  prevent  abuses  resulting  from  the 
exercise  of  patent  exclusive  rights163.  This  explains  why,  at  the  time  the  TRIPS 
Agreement was negotiated, most countries in the world already had in place compulsory 
licensing  schemes.  The  TRIPS  Agreement  leaves  untouched  the  principles  on 
compulsory  licensing  laid  down  in  the  Paris  Convention.  However,  it  provides  several 
conditions for the granting of compulsory licences. 

As  indicated  in  the  introduction,  a  compulsory  licence164  refers  to  the  possibility  for  a 
government  to  allow a third party to  use  a patent  without the authorisation of the right 
holder,  subject  to  certain  conditions  aiming  at  preserving  the  legitimate  interests  of  the 
patent holders. The TRIPS Agreement sets the international legal obligations as regards 
compulsory  licensing.  It  provides  two  types  of  compulsory  licensing  schemes:  (i) 
compulsory licensing for the domestic market (Article 31), which applies to all types of 
products  and  (ii)  compulsory  licensing  for  the  export,  which  only  applies  to 
pharmaceutical products (article 31bis).  

Article 31 allows the granting of a compulsory licence, for any type of product.  In this 
context,  the  compulsory  licence  must  be  predominantly  for  the  supply  of  the  domestic 
market  of  the  WTO  Member  authorising  the  use.  This  condition  limits  in  practice  the 
export of goods made under a compulsory licence.  

The TRIPS Agreement does not list the grounds on which a compulsory licence can 
be  granted.  The  WTO  members  retain  their  margin  of  manoeuvre  in  this  respect,  as 
explicitly  confirmed  by  the  Doha  Declaration165.  Nor  does  the  TRIPS  Agreement  limit 
the  purposes  of  a  compulsory  licence,  which  can  be  to  import  or  locally  manufacture 
products.  In  contrast,  the  TRIPS  agreement  provides  several  conditions  under  which  a 

162 Paris Convention for the protection of industrial property of March 20, 1883. 
163 See article 5(2) of the Paris Convention that provides for that “Each country of the Union shall have the 
right  to  take  legislative  measures  providing  for  the  grant  of  compulsory  licenses  to  prevent  the  abuses 
which might result from the exercise of the exclusive rights conferred by the patent, for example, failure to 
work”. Article 5(3) further provides that forfeiture of the patent shall not be provided for except in cases 
where  the  grant  of  compulsory  licenses  would  not  have  been  sufficient  to  prevent  the  said  abuses  and 
article  5(4)  states  that  a  compulsory  license  may  not  be  applied  for  on  the  ground  of  failure  to  work  or 
insufficient  working  before  the  expiration  of  a  period  of  four  years  from  the  date  of  filing  of  the  patent 
application or three years from the date of the grant of the patent, whichever period expires last. 
164 The term “compulsory licence” is found in national patent laws but not in the TRIPS Agreement where 
article 31 refers to the “use [of patents] without authorization of the right holder”.  
165  The  Doha  Declaration  states  in  that  respect  that:  “Each  Member  has  the  right  to  grant  compulsory 
licences and the freedom to determine the grounds upon which such licences are granted.” Article 31 lists 
some  possible  grounds  (national  emergency  or  extreme  urgency,  public  non-commercial  use,  remedy  to 
anti-competitive  practices,  dependency  of  patents)  that  are  often  included  in  national  legislations  (see  in 
that  respect  the  EPO  study  on  Compulsory  licensing  in  Europe,  2018).  The  only  limitation  as  regards 
grounds concern semi-conductors where article 31 TRIPS provides that compulsory licensing in such case 
shall  only  be  for  public  non-commercial  use  or  to  remedy  a  practice  determined  after  judicial  or 
administrative process to be anti-competitive. 

78 

 
                                                 
compulsory  licence  can  be  authorised  (see  Annex  5).  These  conditions  constitute  the 
frame for any TRIPS-compliant compulsory licensing scheme for the domestic market.  

Among other conditions, Article 31 of the TRIPS Agreement does not allow compulsory 
licensing  to  supply  foreign  markets  (or  at  least  not  predominantly).  This  condition  was 
the  result  of  negotiations  on  the  TRIPS  Agreement  but  it  left  a  gap  in  the  compulsory 
licensing system whereby countries with no or limited manufacturing capacity were not 
able to make us of this system. The link between the TRIPS Agreement and public health 
was clarified in 2001 Doha Declaration (Annex 5) which also mandated further work on 
the  issue  of  the  members  with  no  or  limited  manufacturing  capacity.  This  resulted  in 
implementation of the so-called Paragraph 6 system which in turn led to the adoption of 
Article 31bis of the TRIPS Agreement. 

transparency,  packaging) 

Under Article 31bis of the TRIPS Agreement, a country can grant a compulsory licence 
to  the  extent  necessary  for  the  purposes  of  production  and  the  export  of  a 
pharmaceutical  product.  It  establishes  a  specific  mechanism  of  mainly  procedural 
requirements  (e.g. 
the 
circumstances of two sides – the exporting country and the importing country. Depending 
on  where  the  product  is  protected  by  a  patent,  either  only  the  exporting  or  both  the 
exporting and the importing country may need to issue relevant compulsory licences. The 
European Union implemented this new disposition in its legal order through the adoption 
of regulation (EC) No 816/2006166. The EU may only act as an exporter to the countries 
with no or limited manufacturing capacity.  

that  would  allow 

to  address 

5B.  THE EU LEGAL CONTEXT AND PRACTICE 

There is no EU harmonisation as regards compulsory licensing for the domestic market, 
including  as  regards  European  patents  with  a  unitary  effect167.  EU  countries  have  all 
implemented  compulsory  licensing  schemes  but  for  different  grounds  and  following 
different procedures, in accordance with the flexibilities left at international level.  

In  contrast,  compulsory  licensing  for  export  purposes  of  pharmaceutical  products  is 
regulated  by  Regulation  (EC)  No  816/2006.  In  the  context  of  Regulation  (EC)  No 
816/2006, EU countries remain the main points of contacts for granting the compulsory 
licence,  checking  whether  the  conditions  are  respected  and  when  it  is  terminated.  The 
role of the Commission remains limited to the case where the export of the product under 
a  compulsory  licence  would  be  directed  to  an  importing  country  which  is  not  a  WTO 
member. In such case, the importing country must make a notification to the Commission 
instead of the WTO.  

The mechanism under Article 31bis of the TRIPS Agreement was only used once, in the 
Canada-Rwanda case (see Annex 5d). In 2021 Bolivia and Antigua and Barbuda notified 
the  WTO  of  their  intention  to  use  Article  31bis  of  the  TRIPS  Agreement  for  the 
production  of  COVID-19  vaccines,  but  this  has  not  resulted  in  a  compulsory  licence 
under the system. For the system to function, a manufacturer of these products must be 

166  Regulation  (EC)  No  816/2006  of  the  European  Parliament  and  of  the  Council  of  17  May  2006  on 
compulsory  licensing  of  patents  relating  to  the  manufacture  of  pharmaceutical  products  for  export  to 
countries with public health problems. 
167 Recital 10 of Regulation EU No 1257/2012 of 17 December 2012 implementing enhanced cooperation 
in  the  area  of  the  creation  of  unitary  patent  protection  provides  that:  “compulsory  licences  for  European 
patents with unitary effect should be governed by the  laws of the participating Member States as regards 
their respective territories.” 

79 

 
                                                 
identified and the exporting country where that manufacturer is located must be ready to 
issue  a  compulsory  licence  for  that  purpose.  Regulation  (EC)  No  816/2006  was  never 
used nor evaluated168. 

Two  other  EU  legislations  provide  for  a  compulsory  licensing  scheme.  First,  the 
Regulation on Community plant variety rights169 provides for the possibility for the Plant 
Variety  Office  to  grant  a  compulsory  licence  on  a  community  plant  variety  right,  on 
application  by  a  Member  State,  by  the  Commission  or  by  an  organisation  set  up  EU 
level170.  Second,  the  Biotech  Directive171  provides  for  the  possibility,  where  a  plant 
breeder cannot use a plant variety without infringing a patent, to apply for a compulsory 
licence.  

As  discussed  in  section1.3,  compulsory  licensing  is  often  presented  as  a  ‘last  resort 
mechanism’172. In the vast majority of cases, voluntary agreements are the most efficient 
solution  to  ensure  the  manufacturing  and  supply  of  critical  products.  Voluntary 
cooperation  ensures  not  only  the  licensing  of  necessary  IP,  but  is  likely  to  provide  the 
crucial  tools  needed  to  manufacture  the  product,  including  know-how,  technical 
expertise, qualified personnel for training and even access to raw materials. For instance, 
in the context of the COVID-19 crisis, hundreds of voluntary agreements were concluded 
to ensure the scaling up of the COVID-19 related products across the globe. There were 
several tries to increase the production of certain products through compulsory licences, 
e.g. in  Israel,  Hungary and Russia, but it does  not  appear that they have brought  major 
results in terms of access to these products. Likewise, to this date, no compulsory licence 
was granted to produce COVID-19 vaccines based on the WTO Decision on the TRIPS 
Agreement.  

5C.  COMPULSORY LICENSING AND THE TRIPS WAIVER 

On 2 October 2020, several  WTO members submitted a proposal  for  a  decision by the 
WTO  General  Council  that  would  waive  WTO  members’  obligation  to  protect  and 
enforce some IP rights in relation to the prevention, containment or treatment of COVID-
19.  The  assumption  was  that  IP  rights  were  an  impediment  to  a  swift  scaling-up  of 
manufacturing capacities and that access to vaccines in developing countries could not be 
found by operating within the IP system. The proposal was then made to waive IP rights. 
The EU submitted an alternative proposal on 18 June 2021, insisting on the need to make 
full  use  of  the  flexibilities  of  the  TRIPS  Agreement,  especially  as  regards  compulsory 
licensing.   

168 Article 19 of Regulation (EC) No 816/2006 provides that “Three years after the entry into force of this 
Regulation,  and  every  three  years  thereafter,  the  Commission  shall  present  a  report  to  the  European 
Parliament,  the  Council,  and  the  European  Economic  and  Social  Committee  on  the  operation  of  this 
Regulation including any appropriate plans for amendments. The report shall cover, in particular: (a) the 
application of Article 10(9) on determining the remuneration of the rights-holder; (b) the application of the 
simplified  and  accelerated  procedure  referred  to  in  Article  16(4);  (c)  the  sufficiency  of  the  requirements 
under  Article  10(5)  to  prevent  trade  diversion,  and  (d)  the  contribution  this  Regulation  has  made  to  the 
implementation of the system established by the Decision.” 
169 Regulation No 2100/94 of 27 July 1994 on Community plant variety right. 
170 Article 29 of the Plant Variety Regulation. 
171 Article 12 of Directive 98/44/EC of 6 July 1998 on the legal protection of biotechnological inventions. 
172 Article 31 of the TRIPS Agreement requires that efforts must be made to obtain authorisation from the 
right holder on reasonable terms and conditions and that such efforts proved unsuccessful. However, there 
are no specific rules on what those terms and conditions are or what type and length of efforts are required. 
Also,  this  requirement  can  be  waived  in  “the  case  of  a  national  emergency  or  other  circumstances  of 
extreme urgency or in cases of public non-commercial use”. 

80 

 
                                                 
Waiving  IP  rights  differs  from  compulsory  licensing.  A  compulsory  licence  is  an 
authorisation  granted  by  a  government  to  a  party  other  than  the  patent  holder  to  use 
a patented  invention  without  the  consent  of  the  patent  holder.  The  TRIPS  Agreement 
explicitly allows compulsory licensing, provided that some conditions, such as a limited 
duration and the payment of an adequate remuneration, are met. The TRIPS Agreement 
does  not  provide  for  a  mechanism  to  waive  IP  rights.  Waiving  IP  rights  consists  of 
depriving  the  patent  owner  of  its  rights,  including  of  the  possibility  to  ask  for  a 
remuneration.  

This explains why the EU, among other WTO members, were not in favour of waiving IP 
rights.  The  EU  considered  that  the  TRIPS  Agreement  already  provides  for  a  solution, 
namely compulsory licensing. Compulsory licensing is  a legitimate tool to  scale up the 
production  of  critical  goods.  For  compulsory  licensing  to  be  an  efficient  tool,  it  is 
however  necessary  to  ensure  proper  implementation  at  national  level,  taking  full 
advantage of the flexibilities of the TRIPS Agreement. 

Discussions  at  WTO  level  pursued  and  led  to  a  consensus  during  the  12th  Ministerial 
Conference  of  June  2022.  The  agreement  mainly  provides  clarifications  of  existing 
flexibilities  (i.e.  the  calculation  of  the  remuneration  can  take  into  account  the 
humanitarian  and  not-for-profit  purpose  of  vaccine  distribution  programme,  there  is  no 
need  to  make  efforts  to  obtain  the  authorisation  from  the  right  holder  in  case  of  an 
emergency,  and  a  compulsory  licence  can  be  based  on  any  instrument  available  in  the 
law).  In  addition,  the  agreement  waived  the  “predominantly  for  the  domestic  market” 
condition,  meaning  that  products  manufactured  under  a  compulsory  licence  can  more 
easily be exported to other countries.  

This  agreement,  valid  for  5  years,  is  applicable  to  developing  countries  and  limited  to 
COVID-19  vaccines,  with  the  possibility  of  an  extension  to  cover  the  production  and 
supply  of  COVID-19  diagnostics  and  therapeutics.  Discussions  are  still  ongoing  as 
regards the extension of the agreement. 

5D. CONDITIONS UNDER WHICH A COMPULSORY LICENCE CAN BE GRANTED 

UNDER ARTICLE 31 OF THE TRIPS AGREEMENT 

Article  31  of  the  TRIPS  agreement  provides  several  conditions  under  which  a 
compulsory licence can be authorised which can be summarised as follows: 

  The compulsory licence shall be considered on its individual merits. This condition 
aims at preventing blanket authorisations not taking into account the circumstances 
of each authorisation.  

  Prior to the compulsory licence, the user shall made efforts to obtain authorisation 
from the right holder on reasonable terms and conditions. This requirement may be 
waived  in  the  case  of  a  national  emergency  or  other  circumstances  of  extreme 
urgency173 or in cases of public non-commercial use. 

  The scope and duration of the compulsory licence shall be limited to the purpose for 

which it was authorised. 

173  The  Doha  Declaration  states  in  that  respect  that  “Each  Member  has  the  right  to  determine  what 
constitutes  a  national  emergency  or  other  circumstances  of  extreme  urgency,  it  being  understood  that 
public  health  crises,  including  those  relating  to  HIV/AIDS,  tuberculosis,  malaria  and  other  national 
emergency or other circumstances of extreme urgency”. 

81 

 
                                                 
  The compulsory licence shall be non-exclusive and non-assignable. 

  The  compulsory  licence  shall  be  authorised  predominantly  for  the  supply  of  the 

domestic market. 

  The  compulsory  licence  shall  be  terminated  if  and  when  the  circumstances  which 
led  to  it  cease  to  exist  and  are  unlikely  to  recur.  This  condition  is  subject  to  the 
legitimate interests of the licensee. 

  The right holder shall be paid adequate remuneration.  

  The  legal  validity  of  any  decision  relating  to  the  authorisation  of  a  compulsory 
licence  and  any  decision  relating  to  the  remuneration  shall  be  subject  to  judicial 
review. 

5E. ARTICLE 31BIS OF THE TRIPS AGREEMENT AND ITS IMPLEMENTATION 

IN EU LAW 

Article  31  of  the  TRIPS  Agreement  does  not  allow  compulsory  licensing  to  supply 
foreign markets (or at least not predominantly). At the height of the AIDS epidemic this 
quickly  proved  controversial.  Once  bound  by  the  TRIPS  Agreement,  countries  with 
manufacturing  capacities  could  no  longer  export  goods  manufactured  under  a 
compulsory  licensing  to  foreign  markets.  Some  countries,  facing  grave  public  health 
problems,  consider  that  the  system  implemented  by  the  TRIPS  Agreement  severely 
affected their access to medicines174. This led in 2001 to the Doha Declaration which in 
turn led to the adoption of Article 31bis of the TRIPS Agreement. 

The  Doha  Declaration  first  recognised  the  “gravity  of  the  public  health  problems 
affecting many developing and least-developed countries, especially those resulting from 
HIV/ AIDS, tuberculosis, malaria and other epidemics.” With that background, the Doha 
Declaration reaffirmed the right of WTO members to ‘use, to the full, the provisions in 
the  TRIPS  Agreement,  which  provide  flexibility  for  this  purpose’.  These  flexibilities 
include: 

 

 

the  right  for  each  Member  to  grant  compulsory  licences,  to  freely  determine  the 
grounds for such licences, and to freely establish its own exhaustion regime; 

the  right  for  each  Member  to  determine  what  constitutes  a  national  emergency  or 
other circumstances of extreme urgency.  

Importantly,  paragraph  6  of  the  Doha  Declaration  stated  that  “WTO  Members  with 
insufficient  or  no  manufacturing  capacities  in  the  pharmaceutical  sector  could  face 
difficulties in making effective use of compulsory licensing under the TRIPS Agreement. 
We instruct the Council for TRIPS to find an expeditious solution to this problem”.  

Based on that, the WTO Decision of 30 August 2003 was adopted. It introduced Article 
31bis into the TRIPS Agreement, whose main feature can be summarised as follows: 

174  Before  the  TRIPS  Agreement,  Low  and  Medium  Income  Countries  (LMCIs)  were  able  to  obtain 
medicines manufactured in countries where patent rights were not recognised. The TRIPS Agreement put a 
stop to such practices as WTO members were under the obligation to grant and respect patent rights and 
only allow compulsory licensing predominantly for the supply of their domestic market. 

82 

 
                                                 
  This  mechanism  only  concerns  pharmaceutical  products  which  are  defined  in  the 
2003 Decision as any patented product, or product manufactured through a patented 
process,  of  the  pharmaceutical  sector  needed  to  address  the  public  health 
problems175.  

  Export is only possible to eligible importing Members. The 2003 Decision specifies 
that eligible importing  Members include any least-developed country Member  and 
any  other  Member  that  has  made  a  notification  to  the  Council  for  TRIPS  of  its 
intention to use the system as an importer176. EU countries have opted out of using 
the system as importers. 

  The importing country must make a notification to the Council of TRIPS on (i) the 
names and expected quantities of the expected products, (ii) its insufficient or lack 
of manufacturing capacities177 and (iii) its intention to grant a compulsory licence in 
accordance with article 31 of the TRIPS Agreement. 

  The compulsory licence issued by the exporting country must respect the following 
conditions: (i) only the amount necessary to meet the needs of the eligible importing 
Member(s)  may  be  manufactured  under  the  licence  and  the  entirety  of  this 
production shall be exported;  (ii) the products  produced under the licence shall be 
clearly  identified  through  specific  labelling  or  marking  and  (iii)  before  shipment 
begins,  the  licensee  shall  post  on  a  website  information  on  the  quantities  being 
supplied  to  each  destination  and  the  distinguishing  features  of  the  product(s).  The 
exporting country must also notify to the Council of TRIPS the grant of the licence.  

  Adequate  remuneration  must  be  paid  in  the  exporting  country  but  not  in  the 
importing  country  if  the  compulsory  licence  to  import  was  granted  for  the  same 
products already covered by the compulsory licence to export. 

 

Importing  countries  must  take  reasonable  anti-diversion  measures  to  prevent  re-
exportation of products made under the compulsory licence (best efforts obligation). 

The  European  Union  implemented  this  new  disposition  in  its  legal  order  through  the 
adoption  of  Regulation  (EC)  816/2006  which  relevant  features  can  be  summarised  as 
follows: 

  The  regulation  covers  compulsory  licensing178  for  the  manufacture  and  sale  of 
pharmaceutical  products179  intended  for  export  to  eligible  importing  countries  in 
need of such products.  

 

In  terms  of  procedure,  Member  States  can  provide  a  compulsory  licence  to  any 
person  making  an  application180  to  the  competent  authority181  of  the  Member 

175  Active  ingredients  necessary  for  its  manufacture  and  diagnostic  kits  needed  for  its  use  are  explicitly 
included. Vaccines are not explicitly mentioned but it is usually considered that they are covered. 
176 Members can decide to use the system as importers in a limited way, for example only in the case of a 
national  emergency  or  other  circumstances  of  extreme  urgency  or  in  cases  of  public  non-commercial 
use.   This  was  for  instance  the  case  of  some  EU  countries  (e.g.  Czech  Republic,  Cyprus,  Estonia, 
Lithuania, etc.) before their accession to the  European Union. This is still the case  for non EU countries 
such as China, Israel, Mexico, Türkiye. 
177 Unless the importing country is a least developed country. 
178 Compulsory licensing of patents and supplementary protection certificates. 
179 Pharmaceutical products are defined as any product of the pharmaceutical sector, including  medicinal 
products as defined in Article 1(2) of Directive 2001/83/EC. 

83 

 
                                                 
State(s) where the patents and supplementary protection certificates have effect and 
cover  the  manufacture  and  sale  for  exports.  A  person  can  apply  for  a  compulsory 
licence  to  authorities  in  more  than  one  country.  In  accordance  with  the  TRIPS 
Agreement, importing country(ies) must make a notification to the WTO or, in case 
of a non-WTO member, to the Commission. 

  The application for a compulsory licence must include evidence of a specific request 
from  (i)  authorised  representatives  of  the  importing  country(ies),  (ii)  a  non-
governmental  organisation  acting  with  the  formal  authorisation  of  the  importing 
country(ies), or (iii) UN bodies or other international health organisations with the 
formal authorisation of the importing country(ies). 

  The  compulsory  licence  must  be  limited  to  the  purpose  of  manufacturing  the 
product  for  export  and  distribution  in  the  country(ies)  cited  in  the  application. 
Products  made  or  imported  under  the  compulsory  licence  cannot  be  put  on  the 
market  of  another  country182.  To  this  end,  the  regulation  provides  for  specific 
labelling obligations as well as the setting-up of a website with relevant information 
on the quantities and features of products made under the compulsory licence.  

  Adequate  remuneration  must  be  paid  by  the  licensee  to  the  right-holders  as 

determined by the competent authority. 

5F. THE RWANDA – CANADA  CASE  UNDER  ARTICLE 31BIS  OF  THE TRIPS 

AGREEMENT 

The mechanism under Article 31bis of the TRIPS Agreement was only used once, in the 
context  of  the  Canada-Rwanda  case.  Médecins  Sans  Frontières  (Doctors  without 
Borders)  had  identified  five  urgently  needed  drugs  for  its  field  projects,  one  of  them 
being a treatment for HIV/ AIDS. Rwanda was the importing country in need of access to 
HIV  medicine183.  A  Canadian  privately  held  generic  manufacturer,  Apotex,  agreed  to 
produce  the  drugs.  The  chronology  of  the  process  of  exporting  Apo-TriAvir  went  as 
follows184: 

180  Article  6(3)  of  Regulation  (EC)  No  816/2006 provides  the  elements  to  be  included  in  the  application 
(such  as  the  name  and  contact  details  of  the  applicant,  the  non-proprietary  name  of  the  pharmaceutical 
product, the amount needed, where applicable, evidence of prior negotiation). 
181  Member  States  need  to  notify  the  Commission  of  the  designated  competent  authority  to  grant 
compulsory licences under Regulation (EC) No 816/2006. 
182 Article 13 of the Regulation provides for the prohibition of importation on the territory of the EU. 
183  Médecins  Sans  Frontières,  “Neither  expedious,  nor  a  solution:  The  WTO  August  30th  decision  is  unworkable”, 
Issue  Brief,  29  August  2006 
:  https://msfaccess.org/neither-expeditious-nor-solution-wto-august-30th-decision-
unworkable  
184 
notification 
https://docs.wto.org/dol2fe/Pages/FE_Search/FE_S_S009-
DP.aspx?language=E&CatalogueIdList=67527&CurrentCatalogueIdIndex=0&FullTextSearch=  
- Canada’s notification to the WTO Council of grant of a CL for export  under the 30 August 2003 decision, 4 October 
2007: https://www.wto.org/english/news_e/news07_e/trips_health_notif_oct07_e.htm  

the  WTO 

Rwanda’s 

Council 

TRIPS, 

2007, 

July 

for 

19 

to 

84 

 
                                                                                                                                                 
Figure 13: Chronology of the process of exporting Apo-TriAvir 

December 2004 - Apotex 
agreement to produce a 
fixed-dose combination 

September 2005 -
Amendment of Schedule 1 
of CAMR to include fixed-
dose combination drugs

August 2006 - Regulatory 
approval of product by 
Health Canada

October 2007 - Canada 
notification to WTO Council 
for TRIPS of intent to export 
medicine

September 2007 - Apotex 
files and obtains a 2-year CL

May 2007 - Rwanda 
notification to the WTO 
Council for TRIPS of intent 
to import medicine under 
Art. 31bis

May 2008 - Apotex received 
final tender approval from 
Rwanda to export the CL 
drug

Source: CEIPI(2023), p. 65. 

The  first  shipment  of  the  Apotex  drug  was  sent  to  Rwanda  in  September  2008185. 
However,  it  appears  that,  by  the  time  the  first  shipment  of  Apo-TriAvir  arrived  to 
Rwanda, a generic product made by a Chinese manufacturer was already on the market. 

Although  the  export  of  Apo-TriAvir  is  the  first  and  only  fully  executed  case  of 
compulsory licensing under Art. 31bis, all parties involved in the procedure criticized the 
Canadian  compulsory  licensing  law  and  deemed  it  “unworkable”186.  In  their  review  of 
the  Canadian  compulsory  licensing  law  submitted  to  the  Government  of  Canada, 
Médecins Sans Frontières criticized the process provided for in the Canadian compulsory 
licensing law as being onerous and unnecessarily hindered by Health Canada’s approval 
for  eligibility  under  the  regime187.  A  key  criticized  element  is  the  timeframe  in  the 
Rwandan case  expanding over four and  a half  years before the first  shipment was ever 
made.  Upon  completion  of  the  application,  the  manufacturing  company  in  Canada 
declared that they would not go through the Canadian compulsory licensing law process 
again  unless  it  were  simplified188.  The  delay  could  be  explained  by  the  implication  of 
Health Canada and the Canadian Intellectual Property Office as evidenced by the process 
map below (Figure 14). 

185 K. Lybecker and E. Fowler, “Compulsory  Licensing in Canada and Thailand: Comparing Regimes to 
Ensure Legitimate Use of the WTO Rules”, Journal of Law, Medicine & Ethics, Vol. 37, Issue 2, Summer 
2009, pp. 222-239.  
186 Apotex Corp. Press Release after receiving final tender approval from Rwanda for Vital HIV drugs, 7 
May  2008,  https://www.biospace.com/article/releases/apotex-corp-receives-final-tender-approval-from-
rwanda-for-vital-aids-drug-/  
187 Médecins Sans Frontières, idem, supra 130. 
188  T.Talaga,  ”Hope  for  cheap  HIV  drugs  dims”,  Toronto  Star,  19  September  2009,  available  at: 
https://www.thestar.com/life/health_wellness/2009/09/19/hope_for_cheap_hiv_drugs_dims.html. 

85 

 
 
                                                 
Figure 14: Access to Medicine Process - Health Canada and the Canadian Intellectual Property Office 

Identification of eligible importing country and product

Patent search

(Where applicable): File drug submission then file the distinguishing features 
package with Health Canada + differences in export product marking if applicable

Negotiations for voluntary licence with patentee

Patentee's refusal to grand a voluntary agreement

 Access to medicine process initiated 

Submission of WTO notification by both exporter and importer

Submission of solum declaration for export to Health Canada 

Provision of copy of supply agreement with importing country to the Health Canada commissionner 
and the patentees

Website notification and payment of royalties 

Provision of notice for export 

Source: CEIPI(2023), page 66. 

The  Canadian  compulsory  licensing  law  has  been  amended  several  times  since  the 
Médecins  Sans  Frontières  initiative,  but  it  appears  it  has  not  been  used  since  the 
Rwandan case, as demonstrated by Health Canada’s189 most recent reports as well as the 
WHO, WIPO and WTO 2020 study on “Promoting Access to Medical Technologies and 
Innovation”190. 

189  Health  Canada  evaluation  reports:  https://www.canada.ca/en/health-canada/corporate/transparency/corporate-
management-reporting/evaluation.html  
190 “Promoting Access to Medical Technologies and Innovation - Second Edition - Intersections between public health, 
trade”,  29  July  2020:  https://www.wto.org/english/res_e/publications_e/who-wipo-
intellectual  property  and 
wto_2020_e.htm  

86 

 
 
 
 
 
                                                 
ANNEX 6: SUPPLEMENTARY EVIDENCE 

Illustration of the need for several national compulsory licences in case of EU cross-
border crisis 

Figure  15  and  Figure  16  below  are  provided  to  illustrate  the  need  for  several  national 
compulsory  licences  in  case  of  EU  cross-border  crisis  affecting  the  Single  Market, 
especially  with  regards  to  the  need  of  issuing  corresponding  licences  for  all  partners 
involved in  the manufacturing process,  as  well as  in  the final  use.  In  addition,  national 
compulsory licences remain applicable to the national territory, meaning that the goods 
produced  under  a  compulsory  licence  cannot  be  exported  to  another  Member  State,  or 
only in small quantities 

Figure 15: National compulsory licensing  systems in practice in case of a patented product with cross-border value 
chains – example 

Source: own elaborations. 

Figure 16: EU compulsory licensing system in practice in case of Member States with export limitations – example 

Source: own elaborations. 

87 

 
 
 
Figure 17: Export of goods to other Member States, 2021, [EUR billion] 

Source:  Eurostat  -  Comext  DS-018995,  https://ec.europa.eu/eurostat/statistics-explained/index.php?title=Intra-
EU_trade_in_goods_-_main_features 

Table 15: Are current national laws on compulsory licensing fit to tackle: national crisis? 

I am giving my contribution as 
Academic/research institution 
Business association 
Company/business organisation 
Consumer organisation 
EU citizen 
Non-governmental organisation (NGO) 
Other 
Public authority 
Total 

Source: Open public consultation, Question 3 

No 
opinion  Yes 
1 
1 
1 
0 
1 
0 
2 
1 
7 

1 
19 
15 
0 
4 
0 
2 
2 
43 

No 

3 
1 
1 
1 
6 
6 
2 
1 
21 

Table 16: Are current national laws on compulsory licensing fit to tackle: EU crisis? 

I am giving my contribution as 
Academic/research institution 
Business association 
Company/business organisation 
Consumer organisation 
EU citizen 
Non-governmental organisation (NGO) 
Other 
Public authority 
Total 

Source: Open public consultation, Question 3 

No 
opinion  Yes 
1 
1 
1 
0 
1 
0 
2 
1 
7 

0 
18 
14 
0 
3 
0 
2 
1 
38 

No 

4 
2 
2 
1 
7 
6 
1 
2 
25 

Total 
5 
21 
17 
1 
11 
6 
6 
4 
71 

Total 
5 
21 
17 
1 
11 
6 
5 
4 
70 

Table 17: Are current national laws on compulsory licensing fit to tackle: global crisis? 

I am giving my contribution as 
Academic/research institution 

No 
opinion  Yes 
1 

0 

No 

4 

Total 
5 

88 

 
 
Business association 
Company/business organisation 
Consumer organisation 
EU citizen 
Non-governmental organisation (NGO) 
Other 
Public authority 
Total 

Source: Open public consultation, Question 3 

2 
1 
1 
7 
5 
1 
1 
22 

1 
1 
0 
1 
0 
3 
2 
9 

18 
15 
0 
2 
0 
1 
1 
37 

21 
17 
1 
10 
5 
5 
4 
68 

Table 18: Number of Member States where EP patents were active, by COVID-related IPC as defined in PatentScope 
COVID Index (WIPO)  

IPC Description 
A41D - OUTERWEAR; PROTECTIVE GARMENTS; 
ACCESSORIES 
A61B - DIAGNOSIS; SURGERY; IDENTIFICATION 
A61F - FILTERS IMPLANTABLE INTO BLOOD VESSELS; 
PROSTHESES; [...] BANDAGES [...]; FIRST-AID KITS 
A61G - TRANSPORT, PERSONAL CONVEYANCES, OR 
ACCOMMODATION SPECIALLY ADAPTED FOR PATIENTS OR 
DISABLED PERSONS 
A61H - PHYSICAL THERAPY APPARATUS;[...] ARTIFICIAL 
RESPIRATION; 
A61K - PREPARATIONS FOR MEDICAL, DENTAL, OR TOILET 
PURPOSES 
A61L - METHODS OR APPARATUS FOR STERILISING 
MATERIALS OR OBJECTS [...]; DISINFECTION, STERILISATION 
[...] 
A61M - DEVICES FOR INTRODUCING MEDIA INTO, OR 
ONTO, THE BODY 
A62B - DEVICES, APPARATUS OR METHODS FOR LIFE-
SAVING 
A62D - [...] COMPOSITION OF CHEMICAL MATERIALS FOR 
USE IN BREATHING APPARATUS 
B25J - MANIPULATORS; CHAMBERS PROVIDED WITH 
MANIPULATION DEVICES 
C07D - HETEROCYCLIC COMPOUNDS 
C07H - SUGARS; DERIVATIVES THEREOF; NUCLEOSIDES; 
NUCLEOTIDES; NUCLEIC ACIDS 
C07K – PEPTIDES 
C12M - APPARATUS FOR ENZYMOLOGY OR 
MICROBIOLOGY 
C12N - MICROORGANISMS OR ENZYMES; COMPOSITIONS 
THEREOF; [...] 
C12P - FERMENTATION OR ENZYME-USING PROCESSES TO 
SYNTHESISE A DESIRED CHEMICAL COMPOUND[...] 
C12Q - MEASURING OR TESTING PROCESSES INVOLVING 
ENZYMES, NUCLEIC ACIDS OR MICROORGANISMS  

89 

Average 
all 
patents 

Average 
EP 

Total 
patent 
families 

2.35 
2.49 

3.61 
3.01 

1738 
61955 

3.62 

4.03 

8987 

2.76 

3.52 

1970 

2.86 

3.40 

1834 

6.53 

7.27 

99648 

3.70 

4.47 

14964 

3.52 

3.88 

22375 

2.31 

2.96 

2663 

3.46 

4.09 

202 

1.90 
7.74 

6.45 
7.20 

2.62 
8.18 

6.74 
7.54 

9734 
24052 

9689 
33736 

3.87 

4.23 

8780 

6.16 

6.54 

46613 

6.77 

7.06 

14042 

4.63 

5.07 

26094 

 
G01N - INVESTIGATING OR ANALYSING MATERIALS BY 
DETERMINING THEIR CHEMICAL OR PHYSICAL PROPERTIES 
G16B - BIOINFORMATICS, [...] ICT SPECIALLY ADAPTED FOR 
GENETIC OR PROTEIN-RELATED DATA PROCESSING [...] 
G16C - COMPUTATIONAL CHEMISTRY; 
CHEMOINFORMATICS; COMPUTATIONAL MATERIALS 
SCIENCE 
G16H - HEALTHCARE INFORMATICS, [...] ICT SPECIALLY 
ADAPTED FOR THE HANDLING OR PROCESSING OF 
MEDICAL OR HEALTHCARE DATA  
F24F - AIR-CONDITIONING; AIR-HUMIDIFICATION; 
VENTILATION; USE OF AIR CURRENTS FOR SCREENING 

4.33 

4.78 

33219 

4.84 

5.15 

2072 

4.79 

5.02 

329 

2.73 

3.26 

7441 

2.35 

3.14 

1744 

Source: own analysis based on PatentSight® data for selected IPC codes; Note: IPC descriptions shortened. 

Figure  18:  Main  branch  groups  in  parts  and  components  -  share  of  parts  and  components  in  each  branch  group’s 
trade (%) 

Source: Gaulier, G., Sztulman A., Ünal D., Are Global Value Chains Receding? The Jury Is Still Out. Key Findings 
from the Analysis of Deflated World Trade in Parts and Components, CEPII Working Paper 2019-01, Paris, page 18. 

90 

 
 
 
Table 19: Overview of different national grounds for a compulsory licensing(CL) applicable in crises 

Legal provision for 
granting CL for 
crisis management 

Austrian Patent Act 
(Patentgesetz), section 
36(5)  
Code of Economic Law, 
Art. XI.38 

Competent authority for 
crisis CL 

Assessment 

Comment 

Austrian Patent Office 

Public interest crises 

“public interest”, could be also in case of a “national emergency” or “other 
circumstances of extreme urgency” 

Council of Ministers (for public 
health CL). 

Public health crises 

Law of Patents and Utility 
Models Registration 
(1993), Art. 32(2) 
Patent Act, Art. 104(5) 

Bulgarian Patent Office 
(Disputes department) 

Public interest 

Zagreb Commercial Court 

National urgency 

Cypriot Patents Act, Sec. 
55 

Council of Ministers 

National security or 
public safety 

Industrial Property Office 

Public Interest 

“public health grounds” 
“a) a medicine, a medical device, a medical device or product for diagnosis, a derived 
or combinable therapeutic product; b) the process or product necessary for the 
fabrication of one or more products indicated under a); and c) a diagnostic method 
applied outside the human or animal body” 
“public interest, even if negotiations with the right owner have not been conducted” 

“in situations of extreme urgency on a national level, in particular for national security, 
public interest protection in the field of health, food supply, environmental protection 
and improvement, or to remedy an anti-competitive practice” 
“in situations of extreme urgency on a national level, in particular for national security, 
public interest protection in the field of health, food supply, environmental protection 
and improvement” 
“in there exists a threat to an important public interest” 

Member 
State 

Austria 

Belgium 

Bulgaria 

Croatia 

Cyprus 

Czechia 

Denmark 

Estonia 

Act on Inventions and 
Rationalisation Proposals 
No. 527/1990 Coll. 
(Czech Patent Act), Sec. 
20 
Danish Patents Act, Sec. 
47 

Estonian Patents Act of 
16 March 1994, Sec. 
47(1) 

Maritime and Commercial High 
Court in cases on the merits 
(Section 50 of the Patents Act) 
Harju County Court (court of 
first instance) 

Public interest 

“essential public interests render it necessary” 

National defence and 
public interest 

“national  defence,  environmental  protection,  public  health  and  other  significant 
national interests of the Republic of Estonia require the use of the invention, including 
the need to use the invention in connection with a natural disaster or other emergency” 

“in the event of an epidemic” and in an emergency situation” (referring to the meaning 
set  in  the  Communicable  Disease  Prevention  and  Control  Act  and  in  the  Emergency 
Situation Act) 

91 

 
 
 
 
Finland 

France 

Finnish Patents Act 
(550/1967), Sec. 47 
French Intellectual 
Property Code (CPI), Art. 
L613-16 

Ministry in charge of industrial 
property (on request of the 
Ministry of Public Health) 

Public heath 

Market Court 

Public interest 

“considerable public interest” 

“Interests of public health”:  
“(a) a medicinal product, a medical device, an in vitro diagnostic medical device or an 
ancillary therapeutic product 
(b) a process for obtaining them, a product necessary  for obtaining them or a process 
for manufacturing such a product 
c) an ex vivo diagnostic method.” 
“The patents for these products, processes or diagnostic methods may only be subject 
to the ex officio license system in the interest of public health when these products, or 
products derived from these processes, or these methods are made available to the 
public in insufficient quantity or quality or at abnormally high prices, or when the 
patent is exploited under conditions that are contrary to the interest of public health” 
“in the interest of the national economy”: “if the absence of working or the inadequacy 
in  quality  or  quantity  of  the  working  undertaken  is  seriously  prejudicial  to  economic 
development and the public interest” 
“in the interest of the national defence” 

This  article  allows  the  Prime  Minister,  when  a  state  of  health  emergency  is  declared, 
and for the sole purpose of guaranteeing public health : 
-  to  order  the  requisition  of  all  goods  and  services  necessary  for  the  fight  against  the 
health disaster as well as of any person necessary for the functioning of these services 
or the use of these goods; 
-  to  take  any  measure  allowing  the  provision of  appropriate  medicines  to  patients  for 
the eradication of the health disaster. 
“the public interest calls for the grant of a compulsory licence”.  
Public  interest  cannot  be  described  in  general.  It  exists  if  a  medicine  to  treat  serious 
illnesses has specific therapeutic characteristics that comparable medicines do not have, 
or not to the same extent or if the use of such a medicine leads to a reduction of side 
effects  that  would  have  been  suffered  when  prescribing/using  different  medicines. 
However,  public  interest  cannot  exist  if  there  is  a  similar  treatment  possible  with  a 
different medicine191. 
“epidemic situation of national importance is determined by the German Bundestag” 

Art. L613-18 CPI 

Ministry in charge of industrial 
property 

National economy 

Art. L613-19 CPI 

Law n° 2020-290 of 
March 23, 2020 of 
emergency to face the 
epidemic of covid-19 
introduced a new article 
L.3131-15 in the public 
health code 
Sec. 24(1) Patent Act 
(Patent Gesetz) 

Germany 

Ministry in charge of industrial 
property (on request of the 
ministry in charge of national 
defence) 
Prime Minister 

National defence 

Public health 

Federal Patent Court 
(Bundespatentgericht) 

Public interest 

Infektionsschutzgesetz - 
IfSG and Sec. 13 German 

Federal Ministry of Health 

191 EPO(2018), p. 30. 

92 

 
 
                                                 
Greece 

Hungary 

Ireland 

Italy 

Latvia192 

Lithuania 

Luxemburg 

Malta 

Netherlands 

PA 
Arts. 13 Greek Patents 
Act 
Art. 33/B(1) Hungarian 
Patents Act 

Sections 70 to 75 of the 
Patents Act 1992. Buscar 
cual 
Intellectual Property Code 
(Codice della proprietà 
industriale  
2005, hereinafter IP Code 
or IPC), Art. 70-bis 
Art. 54(3) of the Patent 
Law of 2007, amended on 
1 January 2016. 
Art. 54(5) Patent Law 
Patent Law of the 
Republic of Lithuania of 
18 January 1994,  
No. I-372 (modified on 3 
February 2012). 
Law of 20 July 1992 on 
Patents, Art. 63 

Art. 39 of the Patents and 
Designs Act (Cap. 417 of 
the Laws of Malta)  
Patents Act of 15 
December 1994 (Dutch 
Patent Act), Art. 57(1) 
Art. 59 Dutch Patent 

192 EPO(2018), p. 75. 

Hellenic Property Organisation 
(OBI) 
Hungarian Intellectual Property 
Office (HIPO) is  
competent to grant compulsory 
licences based on  
Art. 33/A PA (for the treatment 
of public health problems). 
Controller of Patents, Trade 
Marks and Designs 

Italian Minister of Health in 
agreement with the Italian 
Minister of Economic 
Development 

National health or 
national defence 
Public health 

X 

National emergency 

“Imperative need for purposes of national health or national defence exists”.  

“For the interest of public health problems” 
“In  the  interest  of  meeting  domestic  demand  stemming  from  a  public  health  crisis” 
referred to in Subsection (2) of Section 228 of Act CLIV of 1997 on Health Care.  
Covering  patented  medicinal  products,  active  substances  or  investigational  medicinal 
products as well as  medical devices or for patented procedures, equipment or devices 
required for the production of healthcare products. 
“a demand in the State for the subject matter of the patent is not being met or is not 
being met on reasonable terms or that the establishment or development of commercial 
or industrial activities in the State is unfairly prejudiced” 
“national health emergency” for “medicines and medical devices deemed essential for 
dealing with the health emergency” (requires the declaration of a state of emergency)  

Administrative court of first 
instance 

National defence or 
economic interests 

“vital importance for the welfare, defence or economic interests of the people of 
Latvia” 

Cabinet of Ministers 
Government of the Republic 

National emergency 
Public needs, 
national security or 
public health 

“state of national emergency” 
“public needs, national security and public health protection, development of 
economically important sectors, or if a competent court determines that a method of the 
exploitation of a patented invention by its owner or licensee is anti-competitive” 

Government 

Public interest 

“public interest”. They are also called ex-officio licences, which are delivered by the 
Government where the invention has been declared by decree of public interest. 

Minister responsible for the 
protection of industrial property 

National security 

“where the national security or public safety so requires, even without the agreement of 
the proprietor of the patent or the patent application” 

Minister of Economic Affairs  

Public interest 

“public interest” 

N/A 

National defence 

“national defence” 

93 

 
 
 
 
 
 
                                                 
Poland 

Portugal194 

Romania 

Slovakia 

Slovenia 

Spain 

Act193 
Act of 30 June 2000 on 
Industrial  
Property, Art. 82(1) 
Act of 30 June 2000 on 
Industrial  
Property, 
Industrial  
Property Code in Arts. 
107 to 112.  
Arts. 43(4) of the 
Romanian Law No. 
64/1991 on patents 
(Romanian Patents Act) 
Slovak  
Patent Act, Sec. 27 
Art. 125(1) Industrial 
Property Act (ZIL-1-
UPB3) (amended up  
to 6 December 2013).  
Patents Act (Ley 
24/2015), Art. 95(2)  

Patent Office 

National emergency 

Patent Office  

Public interests 

“to prevent or eliminate the state of national emergency, in particular in the field of 
defence, public order, the protection of human life and health, as well as the protection 
of the natural environment” 
“to prevent or remove a threat to important state interests, in particular public safety 
and order” 

Government 

Public interest 

“public interest” 

Bucharest Tribunal 

National emergency 

“a) in national emergency cases; 
b) in other cases of extreme emergency; 
c) in cases of public use for non-commercial purposes.” 

District Court Banská Bystrica 

Public interest 

“in case of threat to an important public interest” 

District Court of Ljubljana 

Public interest or 
national security 

“where the public interest is concerned, in particular if national security, nutrition, 
health or the development of other vital sectors of the national economy so requires” 

Patent and Trademarks Office 
(OEPM) (by request of the 
Government) 

Public interest 

“public interest”, meaning:  
 (a) the initiation, increase or generalisation of the exploitation of the invention, or the 
improvement of the conditions under which such exploitation takes place, are of major 
importance for public health or national defence. 
(b)  The  non-exploitation  or  the  inadequacy  in  quality  or  quantity  of  the  exploitation 
carried  out  is  seriously  detrimental  to  the  economic  or  technological  development  of 
the country. 
c) The needs of national supply. 
“public interest of utmost importance requiring a compulsory licence to be granted to 
someone who intends to exploit the invention commercially” 

Sweden195 

Section 47 of the Swedish 
Patents Act No. 837 of 
1967 as  
amended.  

Patent and Market Court 

Public interest 

193 EPO(2018), p. 85. 
194 EPO(2018), p. 97. 
195 EPO(2018), p. 103. 

94 

 
 
                                                 
Table 20: Institutions competent to grant compulsory licences across Member States  

Ministry/ 
Governme
nt 

Patent 
Office/ 
IPO 

Court 

Agency 

Other 

Competiti
on 
Authority 

X 

X 

X 

X 

X 

X 

X 

X196 

X 
X 

X 
X 
X 

X 
X 
X 
X 

X 
X 
X 
X 
X 

Austria 
Belgium* 
Bulgaria 
Croatia 
Cyprus 
Denmark 
Estonia 
Finland 
France 
Germany 
Greece* 
Hungary 
Ireland 
X 
Italy* 
Lithuania* 
X 
Luxembourg*  X 
X 
Malta 
X 
Netherlands 
Poland 
Romania 
Slovakia 
Slovenia 
Spain 
Sweden 
TOTAL 
Source: CEIPI (2023), pp 32-33 
Note: Results exclude Latvia and Portugal. *= In times of crisis, the usual authority for applying for/granting 
compulsory licences is different. From Questionnaire Responses, Member States responses on question 18. 

X 
X 
X 

X 
14 

X 
X 

13 

X 

X 

X 

X 

X 

X 

X 

2 

1 

9 

1 

# of Auth. 
competent 
to grant 
CL 
2 
2 
2 
1 
2 
1 
2 
1 
2 
2 
2 
2 
1 
4 
2 
2 
1 
2 
1 
1 
1 
1 
2 
1 
40 

196 Minister + Committee on CL or Minister + Advisory Committee (on Bioethics): “The Advisory Committee on Bio-
ethics  is  an  intergovernmental  committee  established  by  the  national  and  regional  governments  to  inform  the  public 
and the authorities about bio-ethical topics. The Committee is composed of lawyers, geneticists, ethicists, philosophers 
and physicians from different organizations and representing a broad scale of ideological and philosophical beliefs.” 

95 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                 
Table 21: Overview of divergences in scope, procedures and conditions 

Scope 

Procedures 

Conditions 

Member 
State 

Patent 
Appl.197  

SPC198 

RDP
199 

Trade 
secrets/know-
how 

Appeal 

Preliminary relief 

Embargos200 

Criteria for remuneration 

Austria 

No 

No 

No 

No 

Yes 
(Appeal to the Higher Regional Court of Vienna 
and (in exceptional cases) to the Austrian Supreme 
Court) 

Uncertain 
(The Austrian Patent Code 
does not foresee the specific 
possibility of a compulsory 
licence by way of a 
preliminary injunction but 
provides for an expedited 
decision before the Austrian 
Patent Office, in case a 
patented invention is needed 
in the public interest) 

Belgium 

No 

No 

No 

No 

Yes 
(Administrative appeal for annulment of the 
decision can be introduced before the Council of 
State) 

No 

Yes  
(Four years after 
application date or three 
years after grant date if 
the patented invention is 
not exploited to an 
appropriate extent). 

Yes 
Appropriate remuneration 
determined by the 
Austrian PO considering 
the economic value of the 
licence (section 37.1 
Patent Code). 

Yes 
(Four years from the 
filing date of the patent 
application or three 
years from the grant 
date of the patent in 
case there is a lack of 
exploitation)  

Yes 
Adequate remuneration to 
the patentee, taking the 
economic value of the 
licence into account. 

197 CEIPI(2023): The CL legislation of many Member States does not explicitly refer to the possibility for a CL to cover published patent applications. There are different views among 
the national experts consulted on how to interpret the absence of reference to published patent applications. In some Member States national experts consider that requests for a CL can 
cover published patent applications, e.g., in Croatia, Greece, Romania and Spain even though the law is unclear. 
198  CEIPI(2023):  While  it  was  reported  that  SPCs  are  covered  by  CL  legislation  in  some  MS,  e.g.,  in  Croatia,  Czech  Republic,  Estonia,  Greece,  Hungary,  Lithuania,  Romania  and 
Slovakia, it was reported that in several other MS CLs cannot cover SPCs on the basis of literal interpretation (because SPCs are not explicitly mentioned in the CL provisions). In the 
absence of cases, explicit mention in the law (e.g., Section 70 d of the Finnish PA and Art. 100(5) of the Spanish PA) or in authoritative official documents of interpretative value (e.g., 
Memorandum (MvT) for the legislative bill of 19 April 2021, amending the Netherlands Patents Act 1995, p. 2, clarifying the application of CLs to SPCs and paediatric extensions of 
SPCs). 
199 Regulatory Data Protection. 
200 Some MS have national laws that provide a certain period during which a CL cannot be requested. 

96 

 
                                                 
Bulgaria 

No 

No 

No 

No  
(However, Art. 9 
Trade Secret 
Law states: 
“The 
acquisition, use 
or disclosure of 
a trade secret 
shall not be 
considered 
unlawful in the 
following cases 
[...] for the 
protection of an 
interest 
recognized by 
the law of the 
European Union 
or by the 
Bulgarian 
legislation.”) 

Croatia 

Yes 

Yes 

No 

No 

Cyprus 

No 

No 

No 

No 

Czech 
Republic 

No 

Yes 

No 

No 

Yes 
The BPO decision may be appealed within three 
months of its announcement to the parties before 
the Sofia City Administrative Court. The decision of 
the Sofia City Administrative Court is subject to 
cassation before the Supreme Administrative 
Court, whose decision is final. The Sofia City 
Administrative Court and the Supreme 
Administrative Court may return the case back to 
the BPO for a new decision on the merits based on 
the court’s explicit instructions on the application of 
the law. 

Yes 
The decisions of the court issued in the procedures 
for the grant of a compulsory licence may be 
appealed in accordance with the rules laid down in 
the Act on Civil Proceedings. The High 
Commercial Court has jurisdiction on appeal. 

Yes 
The Registrar’s decision may be referred to the 
Administrative Court for review and the decision of 
the Administrative Court may be appealed before 
the Supreme Court panel of three Supreme Court 
judges. 

Yes 
The decision on grant or rejection of the 
compulsory licence may be appealed within one 
month to the President of the Office. The appellate 
decision may be subject to administrative review 

97 

_ _ 

_ _ 

_ _ 

_ _ 

Yes 
(The invention has not 
been exploited for a 
period of four years from 
the date of filing of the 
patent application or 
three years from the 
grant of the patent)  

Yes 
Art. 32(10) provides that 
the compulsory licensee 
shall owe the patent owner 
a remuneration but does 
not provide as to who 
determines it. 

Yes 
(Lack of exploitation: 
after the expiration of a 
period of four years from 
the filing date of a patent 
application, or after the 
expiration of three years 
from the date the patent 
was granted)  

Yes 
Taking into account the 
economic value of the 
authorisation and need to 
correct anti-competitive 
practice (Art. 69(5) PA). 

Yes 
(Any time after the 
expiration of four years 
from the date of the 
grant of a patent – Art. 
49 Patent Laws)  

Yes 
Reasonable remuneration 
according to the nature of 
the invention and the 
economic value of the 
authorisation. 

Yes 
(In case of an 
insufficient use of the 
invention, a compulsory 
licence cannot be 

Yes 
The grant of a compulsory 
license shall not affect the 
right of the proprietor of 
the patent for the 

 
 
relating to all factual and legal aspects before the 
Prague City Court. The judgment of the Prague 
City Court may be challenged in a cassation 
complaint with the Czech Supreme Administrative 
Court. 

granted before four 
years from patent 
application filing date or 
three years from the 
grant)  

Yes 
Decisions delivered by the Maritime and 
Commercial High Court or the district court can be 
appealed to the Eastern or Western High Court, or 
the Supreme Court (Danish Administration of 
Justice Act, Sections 368(1) and (4)). According to 
Section 368(4) of the Danish Administration of 
Justice Act, a decision delivered by the High 
Courts or the Maritime and Commercial High Court 
may be appealed to the Supreme Court if the 
outcome of the case is of fundamental legal 
importance and of general importance to the 
application and development of the law or has 
significant societal implications in general, or 
where there are other special reasons why the 
case should be heard before the Supreme Court. 

Uncertain201 

Yes 
(In case the invention is 
not exercised, three 
years of the grant of the 
patent or four years from 
the filing of the patent 
application) 

compensation of the value 
of the license. If the value 
of the license is not 
agreed by concerned 
parties it shall be 
determined, upon request, 
by the court, taking into 
account the importance of 
the invention and the 
value of the license 
contracts in the relevant 
technical field (Section 
20.7). 

Yes 
The Maritime and 
Commercial Court shall 
decide as the court of first 
instance whether a 
compulsory licence shall 
be granted and shall also 
determine the extent to 
which the invention may 
be exploited, fix the 
compensation and lay 
down the other terms of 
the compulsory licence 
(Section 50). 

Denmark 

No 

No 

No 

No 

Estonia 

No 

Yes 

No 

No 

Yes 
The court decision granting or refusing a 
compulsory licence for an invention may be 

_ _ 

Yes  
(Lack of use of the 
invention within three 

A court shall determine the 
terms and conditions of 
the compulsory licence, 

201 The rules allow the Maritime and Commercial High Court or the district court to order a compulsory licence as a preliminary measure. On the other hand, it may be argued that the 
competence to grant compulsory licences  lies only  with  the  Maritime and Commercial  High Court in cases on the  merits, according to Section 50 of the  Patents  Act. Whether  that 
would prevent the same court from granting a compulsory licence as a preliminary measure is unclear. If a potential compulsory licence can be granted as a preliminary measure, it 
would probably at least require that the person requesting the compulsory licence had negotiated with the patentee to obtain a licence by agreement first, according to Section 49 of the 
Patents Act. 

98 

 
 
                                                 
appealed first to the circuit court and further to the 
Supreme Court. 

Finland 

Yes202 

France 

Yes 
Art. L613-
19 French 
Intellectual 
Property 
Code (CPI) 

Uncertain 
(Section 
70d of the 
Finnish PA 
could 
argue for 
the 
extension 
to SPCs) 

No 

No 

Yes 
Under Section 7(4) of the Market Court 
Proceedings Act (100/2013), a party may appeal 
by submitting a written petition of appeal to the 
Supreme Court. Any appeal to the Supreme Court 
is subject to a leave to appeal. The period for filing 
a request for an appeal is 60 days from the day of 
the Market Court’s initial adjudication. 

Uncertain 
 (Possible according to the 
law wording, uncertain in 
practice) 

No 

No 

No 

Yes 
Decisions may be appealed following the regular 
civil appeal procedures (i.e. within one month). 
Decisions of the ministry in charge of industrial 
property may be appealed pursuant to the relevant 
public law provisions. 

Uncertain 
(The law does not foresee it. 
There is no case law to 
date) 

years from the 
publication of the notice 
concerning the grant of 
the patent or within four 
years from the filing of 
the patent application)  

including the extent and 
duration of the use of the 
invention and the amount 
and procedure for 
payment of the licence fee 
(Art. 47.3). 

Yes 
(If three years have 
elapsed since the grant 
of the patent and four 
years have elapsed from 
the filing of the 
application and the 
invention is not worked 
or brought into use to a 
reasonable extent in 
Finland – section 45 PA) 

Compulsory licences shall 
be granted by a court of 
law, which shall also 
decide the extent to which 
the invention may be 
exploited and shall 
determine the 
remuneration to be paid 
and any other conditions 
under the licence (Section 
50). 

Yes 
(Lack of exploitation: 
three years following the 
grant of the patent, or 
four years following the 
publication of the 
application)  

Yes 
According to special 
conditions, which might be 
determined by a tribunal 
(Art. L613-12). 

Germany 

No  
(CL 
expressly 
only 
permissible 
after the 
patent has 
been 

Yes 
(CL 
extends 
also to a 
SPC, it 
may also 
be applied 
for and 

No 

No 

Yes 
The decision of the Federal Patent Court may be 
appealed before the FCJ (Bundesgerichtshof). 

Yes 
(Section 85 Patent Code) 

No 

Yes 
Equitable remuneration 
considering the economic 
value of compulsory 
licensing. 

202 According to Section 48 Finnish PA, it is possible for a third party to obtain a CL for the exploitation of an invention where the third party at the time of public disclosure of the 
patent application documents was exploiting the invention for which the patent has been applied, on the condition that the application leads to the grant of a patent and that there are 
special reasons for granting the CL and that the third party was not aware or could not have been aware of the patent application. The CL can also extend to a time period preceding the 
grant of the patent. 

99 

 
 
 
                                                 
granted) 

granted in 
isolation 
only for 
the SPC) 

Greece 

Yes 

Yes 

No 

No 

Yes 
The decision can be appealed before the Court of 
Appeal, whose decision can be further appealed 
before the Supreme Court. In the case of a 
compulsory licence granted by the State, the 
decision may be appealed before the Supreme 
Administrative Court. 

No 

Yes 
(Three years from grant 
or four years from filing 
of a patent have passed)  

Hungary 

No 

Yes 

No 

No 

Yes 
CL for public health grounds: 
The decision of the HIPO may be subject to judicial 
review before the Metropolitan Court. The decision 
of the Metropolitan Court may be appealed before 
the Metropolitan Court of Appeal, and the decision 
of the Metropolitan Court of Appeal is subject to 
judicial review before the Curia (Hungarian 
Supreme Court). 

Yes203 
(There is no court practice 
relating to the preconditions 
and its scope) 

Yes 
(Lack of exploitation: 
four years from the date 
of filing of the patent 
application or within 
three years from the 
grant of the patent)  

Yes 
Established by the 
competent court and 
accompanied by an 
opinion of the IP office 
regarding, amongst 
others, the terms of the 
compensation and the 
amount, which are 
determined in accordance 
with the extent of the 
industrial exploitation of 
the protected invention. 
(Article 13.5 and 13.6). 

Yes 
The patentee shall receive 
adequate compensation 
for the compulsory license, 
which shall be fixed, failing 
agreement between the 
parties, by the court. The 
compensation shall take 
into adequate account the 
economic value of the 
compulsory license. In 
particular, it shall be 
commensurate with the 
royalty the holder of the 
compulsory license would 

203 Given the principle that a preliminary injunction can be requested in all civil litigation, including the lawsuit for granting a compulsory licence based on dependency and  lack of 
genuine use, seeking provisional relief seems to be theoretically possible (other types of compulsory licence belong to the competence of the HIPO and thus are not civil lawsuits). 
Special  provisions  of  the  PA  regarding  preliminary  injunctions  (presumptions,  factors  to  be  considered)  relate  only  to  infringement  disputes,  and  therefore  a  provisional  injunction 
sought in the context of a compulsory licence would be governed by the general provisions of the Code of Civil Procedure (Act CXXX of 2016). 

100 

 
 
                                                 
have paid on the basis of 
an exploitation contract 
concluded with the 
patentee, taking into 
account the licensing 
conditions in the technical 
field of the invention 
(Article 33.3). 

Ireland 

Yes 

(Section 
76(1) Irish 
PA) 

No 

No 

No 

Yes 
A decision of the Controller can also be appealed 
to the High Court. The decision of the High Court 
can be further appealed to the Court of Appeal on 
a point of law. If the 63 IE matter is of general 
public importance or the interests of justice require 
it, an appeal shall lie to the Supreme Court. 

Uncertain 
(The Irish courts have not, to 
date, granted a compulsory 
licence by way of preliminary 
relief) 

No 

Yes 
Adequate remuneration, 
considering the economic 
value of the licence. 

Italy 

No 

Uncertain  
(Law 
refers 
explicitly 
to patents 
only, 
coverage 
of SPC is 
a matter of 
legal 
interpretati
on)) 

No 

No 

Yes 
The decision is taken by the UIBM (IPO), which is 
a branch of the Ministry of Productive Activities. 
Hence, it can be appealed as an administrative 
procedure before the Lazio Regional 
Administrative Court (T.A.R. Lazio). 

Yes 
(An IP civil court may issue 
an order equivalent to a 
compulsory licence but there 
is no precedent for this. 
Such an order may be also 
applied via a preliminary 
measure in order to skip the 
length of the UIBM 
procedure.) 

Latvia 

No 

No 

No 

No 

Yes 
Since the decision to grant a compulsory licence is 
taken by an administrative court of first instance, it 
may be appealed to the Administrative Court of 
Appeal. The rulings of the latter, in turn, may be 
appealed to the Supreme Court of Latvia. 

_ _ 

Yes  
(Four years after 
application and three 
years after grant if lack 
of effective exploitation 
by the patent owner). 

Yes 
Adequate remuneration, 
determined considering 
the economic value 
of the authorization (Art. 
70bis.2). 

Yes 
(if a patented invention 
has not been used in 
Latvia or has been used 
to an insufficient degree 
within four years from 
the date of application or 
three years from the 
date on which the grant 
of a patent was 
published) 

Yes 
Determined by the court, 
observing the economic 
value of the licence, the 
extent of use of an 
invention and other 
circumstances (Section 
54.9). 

Lithuania 

No 

Yes 

No 

No  
(However, the 

Yes 
All final decisions of a competent court or authority 

_ _ 

No  

Yes 
Fair remuneration, taking 

101 

 
 
described in the above may be appealed to a Court 
of Appeal of Lithuania. 

into consideration 
economic value of the 
invention (Art. 39.2). 

laws of the 
Republic of 
Lithuania may 
establish 
obligation to 
trade secret 
holder to 
disclose 
information 
constituting 
trade secret for 
reasons of 
public interest to 
court, 
government, or 
public 
administration 
institution and 
(or) body.) 

Luxembourg 

No 

No 

No 

No 

Yes 
Before the Luxembourg Court of Appeal. 

_ _ 

Yes 
(Lack of exploitation: 
three years from the 
grant of a patent or four 
years from the filing date 
of the patent application) 

Malta 

Yes 

(Art. 40 
Maltese 
Patent and 
Designs 
Act) 

No 

No 

No 

Yes 
For compulsory licences granted in the public 
interest the decision may be appealed to the 
relevant court of first instance indicated herein and, 
even if the Act is silent on this issue, in terms of 
general laws of procedure a further appeal from 
judgment thereof is possible by application filed 
before the Court of Appeal. 
The act is silence for the other situations of 
compulsory licensing. 

_ _ 

Yes 
(Expiration of a period of 
four years from the date 
of filing the application 
for the patent or three 
years from the grant of 
the patent)  

Yes 
Adequate remuneration, 
considering the economic 
value of the licence. 

Yes 
“Equitable remuneration” 
for a sworn application 
filed by any person who 
proves his ability to work 
the patented invention in 
Malta. Determined by the 
Court. 
“Appropriate 
remuneration” for: 
Sworn application filed by 
the owner of the patent. 
Application filed by a 
breeder. 
Application filed by the 
holder of a patent 
concerning a 

102 

 
 
Netherlands 

No 

Yes 

No  

No 
(The 
Netherlands 
Trade Secrets 
Act do not 
contain any 
provisions on 
forced access to 
know-how. 
However, the 
Act leave open 
the possibility of 
such a statutory 
forced access 
regulation.) 

Poland 

No 

No 

No 

No 

Yes 
After a decision by the Minister about a compulsory 
licence in the public interest, both parties (applicant 
and patentee) may lodge an objection,21 which is 
a complaint sent to the Minister himself to re-
evaluate his previous decision. The term to submit 
an objection is six weeks.22 After the decision on 
objection, an appeal can be lodged to the 
administrative chamber of the District Court of The 
Hague.23 A final appeal may be lodged to the 
Council of State (Raad van State). Both the 
objection and the appeal have suspensive effect, 
unless the decision of the Minister provides 
otherwise on grounds of urgency. 

Yes 
Parties to the proceedings are entitled to lodge a 
complaint with the Voivodeship Administrative 
Court in Warsaw. A decision rendered by the 
Voivodeship Administrative Court can be appealed 
before the Supreme Administrative Court. 

No 

Yes 
 (Three years of lack of 
use before a CL can be 
requested). 

No 

No  

biotechnological invention 
who cannot exploit it 
without infringing a prior 
plant variety right. 
National security or public 
safety. 

Yes 
In case of national 
defence, the Minister who 
is directly concerned shall 
determine, by agreement 
with the patent holder, the 
fee to be paid to the patent 
holder by the State (Art. 
59). 

Yes 
Determined proportion to 
the market value of the 
license, of the royalty and 
the manner and time limits 
of payment (Art. 84.2). 

Portugal 

No 

No 

No 

No 

Yes 
The decision to grant or not grant a compulsory 
licence can be appealed to the Intellectual Property 
Court. The expert panel’s decision on the terms 
and compensation of the compulsory licence may 
also be appealed to the Intellectual Property Court. 

No 
(The law does not 
contemplate the possibility 
of obtaining a compulsory 
licence by way of a 
preliminary injunction.) 

Yes 
(Lack of exploitation: 
four years of the filing 
date or three years of 
the grant date)  

Yes 
Adequate remuneration, 
taking into account the 
economic value of the 
licence (Art. 108.6). 

Romania 

Yes 

Yes 

No 

No 

Yes 
The decision may be appealed to the Bucharest 
Court of Appeal. 

No  
(There is neither case law 
nor special statutory 
provisions relating to the 
possibility of obtaining a 
compulsory licence within a 
preliminary injunction 

Yes 
(If the invention has not 
been used or has not 
been sufficiently used, 
four years from the filing 
date of the patent 
application or a period of 

Yes 
Determined by the 
Bucharest Tribunal in 
relation to the commercial 
value of the licences 
granted. 

103 

 
procedure.) 

three years after the 
grant of the patent)  

Slovakia 

No 

Yes 

No 

No 

Decisions of the Court are subject to full judicial 
review with respect to all legal and factual aspects 
of the decision. The first instance decision of the 
Court, whether grant of the compulsory licence or 
rejection of an application, may be appealed within 
fifteen days to the Regional Court Banská Bystrica. 

_ _ 

Yes 
(Lack of use: four-year 
period from the patent 
application filing date or 
three-year period from 
the date of grant) 

Slovenia 

No 

No 

No 

No 

Yes 
The decision may be appealed to the Court of 
Appeal of Ljubljana (Art. 31 Non-Contentious Civil 
Procedure Act, Official Gazette of SRS, No. 30/86 
as amended). 

_ _  

No 

Adequate compensation 
as well as terms of 
payment shall be 
determined by a court on 
proposal of one of parties 
to licence agreement 
taking into consideration 
the importance of an 
invention and usual 
licence prices in a 
particular field. 

Mandatory compensation, 
determined with regard to 
the circumstances of each 
case, while taking into 
account the economic 
value of the compulsory 
licence (Art. 127.2). 

Spain 

Yes 

Yes 

No 

No 
(But the parties 
must act in 
good faith. For 
the patentee 
this means inter 
alia that it must 
disclose to the 
licensee the 
know-how in its 
possession that 
is necessary for 
an adequate 
exploitation of 
the invention - 
article 100.4 of 
the Spanish 
Patent Act.) 

Yes 
The decision reached by the OEPM is appealable 
at an administrative level (i.e. to be resolved within 
the OEPM) and subsequently before the 
contentious-administrative courts, first to the 
Tribunal Superior de Justicia, then to the 
Contentious-Administrative Chamber of the 
Tribunal Supremo. The appeal will be heard by the 
Tribunal Supremo only if it deems the case to have 
a cassational interest for the formation of case law. 

Uncertain 
(Not expressly, but the 
provisional measures that 
both courts and 
administrative bodies may 
adopt under general 
procedural law constitute an 
open list, and therefore in 
cases of urgency it might be 
theoretically possible.) 

Yes 
(Failure to exploit or 
insufficient exploitation 
of the patented invention 
for more than four years 
after the filing of the 
patent application, or 
three years after the 
publication of the 
mention of grant)  

Yes 
Based on the economic 
importance of the 
invention. 

Sweden 

No 

No 

No 

No 

Uncertain 

Yes 

Yes 

104 

 
 
 
 
Yes 
An appeal to the Patent and Market Court of 
Appeal is subject to the grant of leave to appeal. A 
further appeal to the Supreme Court is then subject 
to a double requirement for leave to appeal (i.e. 
first from the Patent and Market Court of Appeal 
and subsequently from the Supreme Court). 

(No explicit provisions and 
has not been done in 
practice. It is conceivable 
that the court would consider 
arguments concerning the 
right to a compulsory licence 
in deciding whether to grant 
preliminary injunctive relief 
against a defendant.) 

(Lack of exploitation: 
three years have passed 
from the grant of the 
patent and four years 
from the date of filing of 
the patent application) 

Established by the Court. 

105 

 
 
 
The  table  below  gives  an  overview  on  existing  and  upcoming  Emergency  Instruments  and  Responses  in  the  EU,  based  on  Annex  9  of  the  impact 
assessment on SMEI204 and complemented by  an evaluation  of  the  relevance of these instruments  for the initiative on compulsory licensing for  crisis 
management, marked as: highly relevant, relevant, less relevant. 

Table 22: Detailed mapping of existing and upcoming Emergency Instruments and Responses 

Emergency instrument/ 
measure 
Integrated Political Crisis 
Response (IPCR) 
Mechanism 
European Alliance 
Against Coronavirus 
EU Rapid Alert Function 

EU Rapid Alert system 
Function 

EU Vaccines Strategy and 
Joint Vaccine 
Procurement 
European Health Union 
(first key initiative : 
Serious Cross-Border 
Threats to Health 
Regulation) 
HERA and the Emergency 
Framework Regulation 
(EU) 2022/2372 

Status 

Council Implementing 
Decision; Existing 
mechanism 
Ad-hoc group 

Ad-hoc solution 
Regulations 
Existing mechanism: 
European Union Rapid 
Information System 
(Safety Gate/RAPEX) 
Communication 

Responsible 
DGs/bodies 
Council 

Relevance for CL  Comment 

Highly relevant 

The activation decision (full activation mode) of the Presidency can trigger the CL 
granting process under Option 3 and 4. 

GROW 

Relevant  

GROW 

Relevant  

As a platform for collaboration (among others matchmaking events) the initiative aims 
at fostering voluntary solutions and therefore avoiding a CL. 
The initiative aims at detecting disruptions in supply chains. 

DG JUST 

Less relevant 

The initiative is about an alert system for dangerous goods. 

SANTE 

Highly relevant 

The initiative refers to the public health emergency recognized under the European 
Health Union (see below). 

Regulation (EU) 
2022/2371 

SANTE 

Highly relevant 

Recognition of public health emergency by COM Implementing Act can trigger the 
CL granting process under Options 3 and 4.  

Commission DG 
established on 16 
September 2021 with 
Commission Decision 

HERA 

Highly relevant  

The Council Regulation on a framework of measures for ensuring the supply of crisis-
relevant medical countermeasures in the event of a public health emergency at Union 
level, which should have been recognised under the serious cross-border threats to 
health regulation (see above), provides the framework for HERA’s proposed crisis 

204 COMMISSION STAFF WORKING DOCUMENT Impact Assessment Report Accompanying the document REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE 
COUNCIL for a Single Market Emergency Instrument Brussels, 19.9.2022 SWD(2022) 289 final, Register of Commission Documents - SWD(2022)289 (europa.eu) 

106 

 
                                                 
C(2021) 6712 

-Regulation 

Communication 

Global initiative 

DG Health 
and Food 
Safety 
TRADE/ 
INTPA 

mode and enables the Union to take necessary measures for sufficient and timely 
availability and supply of crisis-relevant medical countermeasures in case of future 
public health emergencies. As the objective of the regulation is to establish a 
framework of measures for ensuring the supply of crisis relevant medical counter-
measures in the event of a public health emergency at Union level, a CL could give 
bargaining power when negotiating voluntary agreements, hence facilitating 
conclusions of voluntary agreements. CL could also serve as a last resort instrument 
for the supply of the Union with crisis relevant goods, in case voluntary solutions fail.  
The initiative refers to the public health emergency recognized under the European 
Health Union (see above).  

Highly relevant 

Highly relevant  

A CL allows as a last resort instrument access to IP protected products, if there are 
suitable production capacities. 

Ad hoc Task Force 

GROW 

Relevant  

The initiative aims at avoiding the need of a CL (e.g. by promoting voluntary 
partnerships etc.) 

Commission 
Recommendation (13 
March 2020) 
accompanied by 
guidance, followed by 
the introduction of 
temporary measures 
adjusting the PPE 
export authorisation 
scheme for 30 days 
Commission 
Regulation 

GROW 

Relevant 

The initiative aims at speeding up the production of critical products in times of crisis. 

SANTE/ 
TRADE 

Relevant 

A CL can also, under certain circumstances, secure the continuous supply with crisis 
relevant products. 

Legislative Proposal 

SANTE 

Highly relevant 

The initiative refers to the public health emergency recognized under the European 
Health Union (see above).  

Proposal announced in 
the Lessons Learnt 

SANTE/ 
ECDC 

Less relevant 

The initiative already takes effect at a very early stage (No crisis yet, only early signals 
of potential threats). At this stage, a CL is not to be considered (last resort instrument). 

107 

Emergency Assistance on 
Cross-Border Cooperation 
in Healthcare 
COVAX Facility and 
Vaccine Sharing 
Mechanism 
Task Force for Industrial 
Scale-up of COVID-19 
Vaccines 
Coronavirus Response in 
Relation to Personal 
Protective Equipment 

Extra-EU Export 
Authorisation Mechanism 
of Covid-19 Vaccines and 
their Active Substances 
Joint Procurements for 
Medicinal Counter 
Measures 
A New European 
Pandemic Information 

 
  
Gathering System & New 
European Chief 
Epidemiologist & 
European Health Data 
Space 
A Framework for the 
Activation of an EU 
Pandemic State of 
Emergency 
Short-term EU Health 
Preparedness for COVID-
19 Outbreaks 
Union Civil Protection 
Mechanism (UCPM) 

RescEU 
Humanitarian Air Bridge 
European Civil Protection 
Pool (ECPP) 
EU Solidarity Corps 

The Seveso Directive 
Technological Disaster 
Risk Reduction 
Proposal for a Directive to 
Enhance the Resilience of 
Critical Entities Providing 
Essential Services in the 
EU 
Emergency Support 
Instrument 

Communication 

Proposal announced in 
the Lessons Learnt 
Communication 

Relevant  

The initiative aims among others at supporting the manufacturing of essential counter-
measures in times of crisis. 

Communication 

Relevant 

The initiative aims at ensuring free movement of essential critical supplies in the EU 
and concluding agreements with vaccine producers. 

Based on a number of 
legal acts, including 
Decision 1313/2013, 
as amended by  
Regulation 2021/836 
See above 
See above 
See above 

ECHO 

Highly relevant  

In the event of a disaster within the Union a patent protected technology could be 
needed. A CL could help in case voluntary solutions fail 

ECHO 
ECHO 
ECHO 

Highly relevant  
Less relevant 
Highly relevant  

The initiative refers to the UCPM (see above). 
The initiative provides for a transport service. 
The initiative refers to the UCPM (see above) 

Regulation 

Less relevant 

Directive 

ENV 

Highly relevant  

The initiative aims at promoting solidarity and visibility of humanitarian aid among 
Union citizens 
In the event of a major accident within the Union a patent protected technology could 
be needed. A CL could help in case voluntary solutions fail. 

Proposal for a 
Directive 

Financial instrument 
(set up by Council 
Regulation 2016/369 
and activated by a 
separate Council 

HOME 

Less relevant 

The initiative is about critical entities rather than critical products. 

BUDG 

Highly relevant  

Council decision activating the Emergency Support can trigger the CL granting 
process under Options 3 and 4.  

108 

 
 
 
 
Regulation) 
Communication 

Less relevant 

The initiative is a recovery instrument embedded in a long-term EU budget. 

Legislative Proposal 

GROW 

Highly relevant 

The declaration of the Single Market Emergency Mode can trigger the CL granting 
Process under Options 3 and 4.  

Guidelines 

Relevant 

The initiative aims at addressing disruptions to the delivery of goods.  

Communication and a 
planned 
Communication 

MOVE 

Relevant 

A CL could be considered (as a last resort instrument) where a certain patent protected 
technology is needed to overcome the disruption in the EU transport and mobility 
system. 

Ad hoc group 

SG 

Relevant  

Council 
Recommendation 

JUST 
HOME 

Less relevant 

The Clearing House Serves among others as a platform for dialogue and information 
sharing between Member States and h industry. Its Matchmaking Platform aims at 
facilitating voluntary solutions. With this objective the initiative aims at avoiding the 
need for a CL. 
The initiative is about the free movement of persons in times of crisis. 

Communications 

EMPL 

Less relevant 

The initiative is about the free movement of workers in times of crisis. 

Communication; 
planned proposal for a 
regulation and changes 
in Practical Handbook 
for Border Guards 
Communication 

HOME 

Less relevant 

The initiative is about introducing internal border controls in times of crisis. 

GROW 

Less relevant 

The initiative focuses on the allocation of skilled persons (health care workers) rather 
than the supply with products. 

Repair and Prepare for the 
Next Generation 
The Single Market 
Emergency Instrument 
(SMEI) 
Border Management 
Measures to Protect 
Health and Ensure 
Availability of Goods 
‘Green Lanes’ System and 
the Forthcoming Transport 
Mobility Contingency 
Plan 
COVID-19 Clearing 
House for Medical 
Equipment (CCH) 

Council Recommendation 
on Coordinated Approach 
to the Restriction of Free 
Movement 
Free Movement of 
Workers, Posted Workers, 
Service Providers 
Schengen Strategy and 
Foreseen Revision of 
Schengen Border Code as 
Regards Border Closures 

Guidance on Free 
Movement of Health 
Professionals and 
Minimum Harmonisation 
of Training in Relation to 
COVID- 19 Emergency 

109 

 
 
 
 
 
 
 
Measures 
Temporary Restriction on 
Non-essential Travel in 
the EU  
Re-open EU 

EU Digital COVID 
Certificate 
EU Passenger Locator 
Form 

National Contact Tracing 
Apps 

Treatment of Third 
Country Nationals at the 
External Borders 
Contingency Plan for 
Ensuring Food Supply and 
Food Security 

Common Market 
Organisation Regulation 
(EU) No 1308/2013 
Regulation (EU) 
2021/2115 (CAP Strategic 
Plans) 
Market observatories 

Agricultural civil dialogue 
groups 
Fighting Disinformation - 
Communications, Action 
Plan and Code of Practice 

Communications 

Less relevant 

The initiative is about travel restrictions in times of crisis. 

GROW/ 
JRC 
JUST/ 
CNECT 

Less relevant  

The initiative focuses on providing information to EU citizens.  

Less relevant  

The initiative focuses on persons rather than products. 

Less relevant 

The initiative focuses on persons (tracing) rather than products 

Less relevant  

The initiative focuses on persons (tracing) rather than products. Relevant at most if a 
particular app or the software is behind the app is patent protected and access is 
needed. 

Less relevant 

The Initiative focuses on persons rather than products. 

Web portal 

Regulation 

Commission 
Implementing 
Decision 
National actions & 
Recommendation & 
Implementing 
Decision 
Regulation 

Communication 

Highly relevant  

AGRI/ 
MARE/ 
SANTE 

The declaration of a food crisis affecting more than one Member State could trigger 
the CL granting process under Options 3 and 4. 
A patent protected technology might be needed in times of a food crisis. A CL could 
be the last resort instrument. 
The initiative is about market disturbance (significant price rises or falls). 

Regulation 

AGRI 

Less relevant  

Regulation 

AGRI 

Less relevant 

The initiative lays down rules on general and specific objectives to be pursued through 
financial Union support. 

AGRI 

Less relevant  

AGRI 

Less relevant 

The initiative provides different sectors with more transparency by means of 
disseminating market data and short-term analysis in a timely manner.  
The initiative is a stakeholder consultation tool. 

Less relevant  

The initiative lacks a triggering mechanism in times of crisis. 

In particular: Joint 
Communication 
accompanied by 
actions 

110 

 
 
 
 
 
 
 
 
Data Act 
Cyber-security 

Act 
Directive 

CNECT/ G1  Less relevant 
Less relevant 

Chips Act 

Act 

Highly relevant 

Security of Energy Supply  Regulation 

ENERGY 

Highly relevant 

Communication 

Relevant  

The initiative aims at creating a Single Market for data. 
However, it does not seem impossible that a CL could be needed in this context to gain 
access to a critical information and communication technology that could help fight 
cyber-attacks. 
The activation of the crisis stage (semi- conductor crisis) by COM through an 
Implementing Act can trigger the CL granting process under Options 3 and 4. 
The declaration of a Union emergency by COM can trigger the CL granting process 
under Options 3 and 4. 
The initiative is about improving the supply chain resilience. A CL could become 
relevant in case certain patent protected technologies or procedures for the 
reprocessing of goods are needed. 
Nevertheless, it is conceivable that a CL is needed in case a patent protected 
technology is required. 
Products produced under a CL also face restrictions/ barriers in the Single Market 
(lack of EU- wide exhaustion) 

Less relevant 

Relevant  

Critical Raw Materials 
Resilience 

Copernicus Programme & 
Galileo Programme 
Single Market 
Enforcement Task Force 
for Compliance with 
Single Market Rules 
(SMET) 
Defence and Security 
Work Contracts 
Crisis Management and 
Resilience Acquis in the 
Financial Services Area 

Regulations 

Communication 

Directive 

Regulations and 
Directives 

Less relevant 

Less relevant 

The initiative is about (incompatible) procurement requirements in times of crisis 
(deadlines imposed by the usual award procedures). 
The initiative aims at the free movement of capital. 

EXEMPLARY CRISIS DEFINITION 

As far as the crisis definition used in other initiatives is concerned, an overview of the most pertinent ones is provided below: 

Table 23: The definition of crisis in other existing and upcoming Emergency Instruments and Responses – selected examples 

Instrument 
Integrated Political 
Crisis Response (IPCR) 
Mechanism 

Crisis definition 
Article 3(a)*: “‘Crisis’ means a situation of such a wide-ranging impact or political significance, that it requires timely policy coordination and 
response at Union political level”.  
2 Cumulative Elements:  
1) 
+  

Wide-ranging impact or political significance  

111 

 
 
 
 
 
 
 
 
 
2) 

Requirement of timely policy coordination & response at Union level 

*Council Implementing Decision (EU) 2018/1993 of 11 December 2018 on the EU Integrated Political Crisis Response Arrangements L 320/28] 

European Health Union 

Public health emergency: Article 2(1)(e)*: in order for the Regulation to apply, the threats need to fall under the categories of serious cross-border 
threats to health set out in (a) – (d): threats of biological/ chemical/ environmental/ climate/ unknown origin. 

*REGULATION (EU) 2022/2371 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 23 November 2022 on serious cross-
border threats to health and repealing Decision No 1082/2013/EU 

HERA and the 
Emergency Framework 
Regulation (EU) 
2022/2372 

Public health emergency: Article 2(2)*: “‘Public health emergency’ means a public health emergency at Union level recognised by the 
Commission in accordance with Article 23 of Regulation (EU) No…/…[the SCBTH Regulation”, i.e. Regulation (EU) No …/… of the European 
Parliament and of the Council of … on serious cross-border threats to health and repealing Decision No 1082/2013/EU].  
“Europe needs to be better prepared to anticipate and address jointly the ongoing and increasing risks, not only of pandemics but also of man-made 
threats such as bioterrorism.”** 

Union Civil Protection 
Mechanism (UCPM) 

*REGULATION (EU) 2022/2371 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 23 November 2022 on serious cross-
border threats to health and repealing Decision No 1082/2013/EU 
**Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the 
Committee of the Regions – Building a European Health Union: Reinforcing the EU’s resilience for cross-border health threats 

Disaster: 
Article 4(1)*: "'Disaster' means any situation which has or may have a severe impact on people, the environment, or property, including cultural 
heritage". 
Scope/Triggering of civil protection mechanisms by – Article 1(2)*: “The protection to be ensured by the Union Mechanism shall cover primarily 
people, but also the environment and property, including cultural heritage, against all kinds of natural and man-made disasters, including the 
consequences of acts of terrorism, technological, radiological or environmental disasters, marine pollution, hydrogeological instability and acute 
health emergencies, occurring inside or outside the Union. In the case of the consequences of acts of terrorism or radiological disasters, the Union 
Mechanism may cover only preparedness and response actions.” 

*Decision No 1313/2013/EU of the European Parliament and of the Council of 17 December 2013 on a Union Civil Protection Mechanism, latest 
amendment by Regulation (EU) 2021/836 of the European Parliament and of the Council of 20 May 2021 

The Seveso Directive 
Technological Disaster 
Risk Reduction 

Major accident: 
Article 3(13)*: “‘major accident’ means an occurrence such as a major emission, fire, or explosion resulting from uncontrolled developments in 
the course of the operation of any establishment covered by this Directive, and leading to serious danger to human health or the environment, 
immediate or delayed, inside or outside the establishment, and involving one or more dangerous substances” 

112 

 
 
 
 
 
 
 
 
 
 
Major emission, fire, or explosion resulting from uncontrolled developments in the course of the operation of an establishment 

3 Cumulative Elements: 
1) 
+ 
2) 
+ 
3) 

Leading to serious danger to human health or the environment 

Involving one or more dangerous substances 

*Directive 2012/18/EU of the European Parliament and of the Council of 4 July 2012 on the control of major- accident hazards involving 
dangerous substances, amending and subsequently repealing Council Directive 96/82/EC 

Emergency Support 
Instrument 

Ongoing or potential natural or man-made disaster:  
Article 1(1)*: Measures have to be “appropriate to the economic situation in the event of an ongoing or potential natural or man-made disaster. 
Such emergency support can only be provided where the exceptional scale and impact of the disaster is such that it gives rises to severe wide-
ranging humanitarian consequences in one or more Member States and only in exceptional circumstances where no other instrument available to 
Member States and to the Union is sufficient.” 

3 Cumulative Elements: 
1) An ongoing or potential natural or man-made disaster” 
+ 
2) Exceptional scale and impact of the disaster is such that it gives rises to severe wide-ranging humanitarian consequences in one or 
more Member States 
+ 
3) No other instrument available to Member States and to the Union is sufficient. 

*Council Regulation (EU) 2016/369 of 15 March 2016 on the provision of emergency support within the Union as amended by Council 
Regulation (EU) 2020/521 of 14 April 2020 activating the emergency support under Regulation (EU) 2016/369, and amending its provisions 
taking into account the COVID-19 outbreak 

SMEI 

‘Crisis’ Article 3 (1)*: means an exceptional unexpected and sudden, natural or man-made event of extraordinary nature and scale that takes place 
inside or outside of the Union. 
In principle SMEI provides for a two-stage mechanism: 
1. 
strategic importance and which has the potential to escalate into a Single Market emergency within the next six months (Article 3 (2)*). 
2. 
the Single Market or the functioning of the supply chains that are indispensable in the maintenance of vital societal or economic activities in the 
Single Market (Article 3 (3)*). 

The Single Market emergency means a wide-ranging impact of a crisis on the Single Market that severely disrupts the free movement on 

Single Market vigilance mode means a framework for addressing a threat of significant disruption of the supply of goods and services of 

113 

 
 
 
 
 
 
 
*Proposal for a Regulation of the European Parliament and the Council establishing a Single Market emergency instrument and repealing Council 
Regulation No (EC) 2679/98 

Chips Act 

Article 18* Activation of the crisis stage 
A semiconductor crisis shall be considered to occur when there are serious disruptions in the supply of semiconductors leading to significant 
shortages, which: 
entail significant delays or significant negative effects on one or more important economic sectors in the Union, or 
prevent the supply, repair and maintenance of essential products used by critical sectors. 

*Proposal for a Regulation establishing a framework of measures for strengthening Europe's semiconductor ecosystem (Chips Act) 

Note: based on COMMISSION STAFF WORKING DOCUMENT Impact Assessment Report Accompanying the document REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL 
for a Single Market Emergency Instrument Brussels, 19.9.2022 SWD(2022) 289 final, Register of Commission Documents - SWD(2022)289 (europa.eu) 

Table 24: The triggering and de-triggering of crisis instrument in other existing and/or upcoming Emergency Instruments and Responses – selected examples 

Instrument 
Integrated Political 
Crisis Response (IPCR) 
Mechanism 

Triggering and De-triggering 
Two Modes:  
(Article 2(1)(2),(b)):*  

Information sharing mode (pre-stage) to establish the situation & prepare for possible full activation 

 
  Full activation mode to prepare response measures 

Activation:  
(Article 4):*  

  Article4(1)*: Presidency takes IPCR activation decision (initiative by Member States possible)  
  Article 4(2)*: Triggering upon invocation of solidarity clause (Article 222 TFEU) – still formal adoption by Presidency  
  Article 4(5)*: “The decision to activate the IPCR in information sharing mode may also be taken by agreement of the GSC, the 

Commission services and the EEAS, in consultation with the Presidency” 

Switching between modes:  

  Article 4(6)*: the Presidency may decide at any point to escalate or de-escalate the operation from one mode of activation to the other 

(exception: solidarity clause invocation requires full mode)  

Deactivation:  
(Article 5):* 

  Decision taken by Presidency after consultation with Member States, Commission and the HR (no deactivation when solidarity clause is 

114 

 
 
 
 
 
 
  
 
  
invoked) 

*Council Implementing Decision (EU) 2018/1993 of 11 December 2018 on the EU Integrated Political Crisis Response Arrangements L 320/28]  

European Health Union 

Recognition of emergency situations:  
Article 23(1):* “The Commission may, based on the expert opinion of the Advisory Committee referred to in Article 24, formally recognise a 
public health emergency at Union level; including pandemic situations where the serious cross-border threat to health in question endangers public 
health at the Union level.” 

Two Cumulative Elements for recognition:  
1) Serious cross-border threat to health  
2) Endangerment of public health at Union level 

  Prior liaising with the WHO (Article 23(3)*) 
  Adoption by means of implementing acts 
  Examination procedure in Article 27(2)*  
  Exception (Article 23(4), subpara. 3*): for cases where this is duly justified on imperative grounds of urgency related to the severity of a 
serious cross-border threat to health or due to the rapidity of its spread among Member States – more expeditious procedure: immediately 
applicable implementing acts to recognise a public health emergency  
“The new rules will enable the activation of EU emergency response mechanisms, in close coordination with the World Health 
Organization (WHO), without making it contingent upon the WHO’s own declaration of a Public Health Emergency of International 
Concern (PHEIC).” (cf. No. 3, p. 7**) 

 

  Enabling effect of measures following the recognition (Article 25*) (recitals 18, 19*) 

Termination:  

  Article 23(2)*: termination as soon as one of the applicable conditions is no longer met. 

* REGULATION (EU) 2022/2371 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 23 November 2022 on serious cross-
border threats to health and repealing Decision No 1082/2013/EU 
**Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the 
Committee of the Regions – Building a European Health Union: Reinforcing the EU’s resilience for cross-border health threats 

HERA 

Activation:  

  Recognition of a public health emergency required (cf. Article 2(2)*) 
  Article 3(1): upon proposal of the Commission, the Council “may adopt a regulation activating the emergency framework where 

appropriate to the economic situation.”   

  Article 3(3)*: Duration of the activation is limited to 6 months, but renewable (Article 4* procedure)  

115 

 
 
 
 
 
 
 
The Single Market 
Emergency Instrument 
(SMEI)   

  Funding: Activation of emergency funding, Article 13*: “Where this measure is activated, emergency support under Regulation (EU) 

2016/369 is activated to finance expenditure necessary to address the public health emergency […]” “In the event of a public health 
emergency at Union level, in order to ensure the necessary flexibility and rapidity in implementation, the Council could also trigger 
financing through the Emergency Support Instrument (ESI), demonstrated in the past to be both flexible and fast. During the COVID-19 
crisis, the ESI27 proved efficient and effective in ensuring rapid and flexible funding, essential in times of urgency” (p. 13, No. 6.3**)  
“The Council activation of the emergency framework will also specify which of the […] emergency measures, appropriate to the 
economic situation, should be implemented” (p. 9, No. 4)**  
 Two phases: "preparedness phase" and "crisis phase". In the “crisis phase”, HERA will be able to draw on stronger powers for swift 
decision-making and implementation of emergency measures. (p. 2, No. 2**) 

 

 

* REGULATION (EU) 2022/2371 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 23 November 2022 on serious cross-
border threats to health and repealing Decision No 1082/2013/EU 
**Communication from the Commission to the European Parliament, the European Council, the Council, the European Economic and Social 
Committee and the Committee of the Regions – Introducing HERA, the European Health Emergency preparedness and Response Authority, the 
next step towards completing the European Health Union 

In principle, SMEI provides for a two-stage mechanism: 

1) Single Market vigilance mode addressing a threat of significant disruption of the supply of goods and services of strategic importance and which 
has the potential to escalate into a Single Market emergency within the next six months 

  Activation (Article 9*): It is activated by a Commission implementing act taking into consideration the opinion of the Advisory Group 

(composed of one representative per Member State).  

  Extension and deactivation (Article 10*): The Commission, if it considers that the reasons for activating the vigilance mode remain valid, 
and taking into consideration the opinion provided by the advisory group, may extend the vigilance mode for a maximum duration of six 
months by means of an implementing act (Art. 10 (1)*). Where the Commission, taking into consideration the opinion provided by the 
advisory group, finds that the threat is no longer present, it shall deactivate the vigilance mode in full or in part by means of an 
implementing act (Article 10 (2)*). 

2) The Single Market emergency mode 

  Activation (Article 14*): It shall be activated by means of a Council implementing act upon the Commission’s proposal taking into 

consideration the opinion of the Advisory Group. 

  Extension and deactivation (Article 15*): Where the Commission considers, taking into consideration the opinion provided by the 

advisory group, that an extension of the Single Market emergency is necessary, it may propose to the Council to extend the Single Market 
emergency no later than 30 days before the expiry of the period for which the Single Market emergency has been activated (Article 15 
(1)*). Where the Commission, taking into consideration the opinion provided by the advisory group, considers that the criteria for 
activation of Single Market emergency are no longer fulfilled, it shall propose to the Council the deactivation of the Single Market 
emergency (Article 15 (2)*). 

116 

 
 
 
 
*Proposal for a Regulation of the European Parliament and the Council establishing a Single Market emergency instrument and repealing Council 
Regulation No (EC) 2679/98   

Chips Act 

Article 18* Activation of the crisis stage: 

  Article 18(2)*  “Where an assessment of the Commission provides concrete, serious, and reliable evidence of a semiconductor crisis, the 

Commission may activate the crisis stage by means of implementing acts in accordance with Article 33(2)*. The duration of the activation 
shall be specified in the implementing act. (…)” 

  Article 18(3)* “Before the expiry of the duration for which the crisis stage was activated, the Commission shall, after consulting the 

European Semiconductor Board, assess whether the activation of the crisis stage should be prolonged. Where the assessment concludes 
that a prolongation is appropriate, the Commission may prolong the activation by means of implementing acts. The duration of the 
prolongation shall be specified in the implementing acts adopted in accordance with Article 33(2)*. (…)” 

*Proposal for a Regulation establishing a framework of measures for strengthening Europe's semiconductor ecosystem (Chips Act) 

Note: based on COMMISSION STAFF WORKING DOCUMENT Impact Assessment Report Accompanying the document REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL 
for a Single Market Emergency Instrument Brussels, 19.9.2022 SWD(2022) 289 final, Register of Commission Documents - SWD(2022)289 (europa.eu) 

117 

 
 
 
 
 
Compulsory licensing during COVID crisis 

COVID-related compulsory licencing  in the world: 

  Hungary: HIPO CL for Gilead’s remdesivir;  

 

Israel: CL granted for Iopinavir/ritonavir (Kaletra) produced by Abbvie; 

  Russia: CL granted by the government for the Eurasian patents (ЕА025252, ЕА025311, ЕА029712, ЕА020659, ЕА032239 and ЕА028742) Gilead 

for remdesivir. 

Source: CEIPI(2023), p.126. 

Examples of compulsory licences 

Table 25: Identified case law on compulsory licences 

Member 
State / EU 

Year  Domain / 

Outcome 

product 

Austria 

1972  Medicine / 

Inderal, 
propranolol 
hydrochloride 

Issued and 
cancelled 
in review 
procedure 

Duration 
until CL 
granting 
Ca. 2 years 
and 8 
months 

Belgium 

2022 

EP2160038B2  Appeal 

Further information 

The parties 

Source 

Application made on grounds of no sufficient exploitation of the 
patent. 
The CL was granted in first instance, but the appeal of the patentee 
against this decision was successful before the Supreme Court, and 
the application was dismissed.  
The question at issue was whether the import of a product 
manufactured abroad using a patented process in Austria was or was 
not an “exploitation of the invention in Austria”. While the first 
instance did not accept such importation as an exploitation of the 
invention in Austria and therefore granted a CL, the board of appeals 
approached the issue from a different perspective and argued that 
under the circumstances, it was unreasonable to demand from the 
patentee to exploit the patent in Austria and reversed the first 
instance’s decision so that the CL was denied.  
Remarkably, this case and further CJEU case law (C-235/89, C-
30/90, C-191/90) finally led to the provision being amended. 
With respect to Télé-Secours, the Court considered that Tunstall’s 

Claimant: 
Austrian 
company 
Arcana KG  
Dr. G. Hurka 

Defendant:  
British 
company 
Imperial 
Chemical 
Industries Ltd 

Claimant: 

“Compulsory 
Licensing in 
Europe: A 
Country-by-
Country 
Overview” (EPO, 
2018), p. 10-11 

118 

 
 
 
 
method for 
Tone 
Signalling 

pending 

 – – 

Bulgaria 

 – – 

 – – 

 – – 

 – – 

behaviour was abusive because the patented system became 
necessary to Télé-Secours’ activities over the years. This system was 
the safest way to connect the hardware sold by Tunstall to the Télé-
Secours call center. If Télé-Secours could not use the patented 
system with third parties’ software, it would be forced to stay with 
Tunstall. The Court therefore considered that Tunstall’s refusal to 
license was an abuse of the economic dependency of Télé-Secours. 
With respect to Victrix the Court also considered that Tunstall’s 
refusal to license was abusive. This license was necessary for Victrix 
to compete on the Belgian market and the refusal was discriminatory 
because Tunstall already licensed its technology to other major 
actors of the telecare market. 
The Brussels court ordered Tunstall to grant a non-exclusive license 
to Télé-Secours and to Victrix for the remaining duration of the 
patent and for the Belgian territory. The the license fee should be 
equal to the average price paid by the other licensees taking into 
consideration the remaining duration of the patent. The parties have 
three months to conclude a license agreement. It also ordered 
Tunstall to furnish all information needed to use the protocols it 
developed based on its patented telecommunication system. 
No CL procedures were issued in Bulgaria (at least since 1993, the 
year the current Bulgarian Law of Patents and Utility Models 
Registration was first adopted). 

Tunstall (UK) 

Defendants : 
Victris SL 
(Spain) & Téle-
Secourts 
(Belgium) 

 – – 

Croatia 

 – – 

 – – 

 – – 

 – – 

There have been no cases concerning CL in Croatia. 

 – – 

Cyprus 

 – – 

 – – 

 – – 

 – – 

There has been only one case in recent years, which related to 
licensing of a medication for a genetic condition ordered by the 
Council of Ministers under Art. 55 Cypriot Patents Law, Law 16(I) 

 – – 

119 

“Compulsory 
Licensing in 
Europe: A 
Country-by-
Country 
Overview” (EPO, 
2018), p. 18 
“Compulsory 
Licensing in 
Europe: A 
Country-by-
Country 
Overview” (EPO, 
2018), p. 56 
“Compulsory 
Licensing in 
Europe: A 

 
 
of 1998, as amended (1998 to 2006), but there is no reported decision 
as the issue was not contested. 

Czech 
Republic 

2000  No available 
information  

Not issued 

 – – 

The application for a CL was rejected, because the patentee proved 
that it sufficiently works the invention through licensees in the Czech 
Republic. 

Claimant:  
Czech company 
EXIMPO 

Denmark 

1943  Medicine /  

Issued 

Isopropylantip
yrin 

No 
available 
information 

Application made on grounds of no sufficient exploitation of the 
patent. 
The Supreme Court confirmed a CL for production of a medicine 
during the Second World War as the product was not exploited in 
Denmark. 

1966  Medicine /  

Issued 

Phenylbutazon
e 

No 
available 
information 

1972  Military / 
Delaying 
mechanism, 
which is part 
of the catapult 
seat 

Issued 

No 
available 
information 

Application made on grounds of no sufficient exploitation of the 
patent. 
The Danish Patents Commission granted a CL (today, only the courts 
have such competence) to a defendant due to the fact that the patent 
had not been sufficiently exploited in Denmark considering the 
demand for it and without there being any legitimate reasons for it. 
The decision was confirmed by the Maritime and Commercial Court 
and subsequently by the Supreme Court. 
The Danish Ministry of  
Defence had imported SAAB Draken fighter planes that had  
catapult seats. An English company had a patent to a  
delaying mechanism that was part of the catapult seat. The  
Danish Ministry of Defence and SAAB were awarded a  
compulsory licence for said delaying mechanism. 

Defendant:  
Philips  
Electronics, 
N.V. 
No available 
information 

No available 
information 

Claimant:  
Danish Ministry 
of  
Defence and 
SAAB 
Defendant: no 
available 
information 

Country-by-
Country 
Overview” (EPO, 
2018), p. 25 
“Compulsory 
Licensing in 
Europe: A 
Country-by-
Country 
Overview” (EPO, 
2018), p. 28 

“Compulsory 
Licensing in 
Europe: A 
Country-by-
Country 
Overview” (EPO, 
2018), p. 34 
“Compulsory 
Licensing in 
Europe: A 
Country-by-
Country 
Overview” (EPO, 
2018), p. 34 

“Compulsory 
Licensing in 
Europe: A 
Country-by-
Country 
Overview” (EPO, 
2018), p. 34 

120 

 
 
Estonia 

 – – 

 – – 

 – – 

 – – 

There have been no cases concerning CL in Estonia. 

 – – 

Finland 

1979  Medicine 

Not issued  No 

available 
information 

Application made on grounds of no sufficient exploitation of the 
patent and of public interest. 
The District Court concluded that also subjective reasons, such as 
market-related and economic reasons presented by the defendant in 
the case, could constitute a legitimate ground for non-exploitation of 
a patent within the meaning of Section 45 Finnish Patents Act 
(550/1967). As the demand for the drug was sufficiently satisfied 
through import and production in Finland, and was available at a 
reasonable price, also no such public interest as set forth in Section 
47 existed. The decision was later confirmed by the Court of 
Appeals, and further appealed to the Supreme Court. The parties 
settled before the Supreme Court was able to render its decision. 
Application made on grounds of no sufficient exploitation of the 
patent. 

A CL was granted to the alleged infringer because the patent owner 
did not exploit the patent in France (the patent was however 
exploited in Germany). 

No available 
information 

No available 
information 

Issued 

No 
available 
information 

France 

1983  Motor vehicle 
safety / 
Coupling head 
intended to air 
brake systems 
on motor 
vehicles 
Industrial 
production of 
meat / 
Machine for 
the automatic 
production of  
skewers 

1997 

Issued 

No 
available 
information 

Application made on grounds of no sufficient exploitation of the 
patent. 

Claimant: 
NIJAL 

The defendant was the owner of a patent on a machine for the 
automatic production of skewers, which the defendant was not 
exploiting. For this reason, the Court of Appeal granted a licence on 
the patent to the claimant, a company commercialising a machine for 
the automatic production of skewers. 
The requested CL was not granted because the patent had expired. 

121 

Defendant: 
EMSENS 

2003  No available 

Not issued 

 – – 

No available 

“Compulsory 

“Compulsory 
Licensing in 
Europe: A 
Country-by-
Country 
Overview” (EPO, 
2018), p. 36 

“Compulsory 
Licensing in 
Europe: A 
Country-by-
Country 
Overview” (EPO, 
2018), p. 42 

“Compulsory 
Licensing in 
Europe: A 
Country-by-
Country 
Overview” (EPO, 
2018), p. 45 
“Compulsory 
Licensing in 
Europe: A 
Country-by-
Country 
Overview” (EPO, 
2018), p. 45 

 
 
 
 
 
 
information 

information 

 – – 

The requested CL was not granted because the patent had expired. 

Confidential 

Preliminary CL granted to a pharmaceutical company involved in an 
injunction procedure with another pharmaceutical company. The 
patent was eventually invalidated. 

Applicant: 
Shionogi 

WHO/WIPO/WT
O (2020), p. 240 

Defendant: 
Merck Sharp & 
Dohme 

Ca. 2 years 
and 2 
months 
(including 
the 
negotiation 
phase) 
 – – 

Not issued 

The requested CL was not granted because the patent had expired. 

Confidential 

 – – 

 – – 

There have been no cases concerning CL in Greece. 

 – – 

Germany 

1995  Medicine / 
Interferon 
gamma 
(rheumatoid 
arthritis) 

2016  Medicine / 
Raltegravir 
(HIV/AIDS) 

Issued and 
cancelled 
in review 
procedure 

Issued 

2018  Medicine / 
alirocumab 
(cholesterol-
lowering 
treatment) 
 – – 

 – – 

Greece 

Hungary 

No 
avail
able 
infor
ma-
tion 

Medicine /  
active 
ingredient for 
reducing blood 
pressure 

Not issued 
in the first 
instance, 
but 
decision 
annulled at 
second 

No 
available 
information 

Application made on grounds of dependency of patents. 
The specificity of the present case is that a process patent was 
compared with a product patent. 
The court of first instance rejected to grant a CL and established that 
the plaintiff had failed to provide an appropriate basis of comparison, 
since it is not enough to prove that the dependent patent represents an 
important technical advance of considerable economic significance; 

No available 
information 

122 

Licensing in 
Europe: A 
Country-by-
Country 
Overview” (EPO, 
2018), p. 44 
WHO/WIPO/WT
O (2020), p. 240 

WHO/WIPO/WT
O (2020), p. 240 

“Compulsory 
Licensing in 
Europe: A 
Country-by-
Country 
Overview” (EPO, 
2018), p. 54 
“Compulsory 
Licensing in 
Europe: A 
Country-by-
Country 
Overview” (EPO, 
2018), p. 59 

 
 
 
instance 

Ireland 

1966 

Not issued 

– – 

Industry / 
Sealing head 
used for 
securing metal 
caps to bottles 
and jars so as 
to create an 
air-tight seal 

Italy 

2005  Medicine / 
imipenem-
cilastatin 
(antibiotic) 
SPC 

Issued 

At least ca. 
1 year and 
10 months 

it should also be demonstrated that this progress exists in respect of 
the earlier patent. 
At second instance, the Metropolitan Appeal Court annulled the 
decision of the Metropolitan Court and ordered the first instance 
court to reopen the case. The Metropolitan Appeal Court established 
that in terms of “significant technical progress” a comparison 
between the product and process patents was also possible.  
The decision of the Metropolitan Appeal Court was not challenged 
by the Curia (Supreme Court) because the basic patent’s term had 
expired. 
Application made on grounds of abuse of monopoly rights. 

The Irish Supreme Court held that even though there was a void 
restrictive clause in an agreement, this did not necessarily mean that 
demand was not being met on reasonable terms. However, this case 
was decided under legislation that has now been repealed. 

CL granted as remedy to anti-competitive behaviour. 

2007  Medicine / 
finasteride 
(prostetic 
hyperplasia) 
SPC 

Issued 

No 
available 
information 

CL granted as remedy to anti-competitive behaviour and to allow 
parallel export to neighbouring markets with expired patent 
protection. 

Latvia 

– – 

– – 

– – 

– – 

According to the information provided by the Latvian Patent Office 
(www.lrpv.gov.lv/en), no CL have been granted or registered in 

123 

Claimant:  
Thomas Hunter 
Ltd. 

Defendant:  
James Fox & 
Company Ltd. 
and B. & J. 
Metal Caps Ltd. 
Claimant: 
Competition 
and Market 
Authority 

Defendant 
(Rightholder): 
Merk & Co. 
Claimant: 
Competition 
and Market 
Authority 

Defendant 
(Rightholder): 
Merk & Co. 
– – 

“Compulsory 
Licensing in 
Europe: A 
Country-by-
Country 
Overview” (EPO, 
2018), p. 63 

WHO/WIPO/WT
O (2020), p. 240 

WHO/WIPO/WT
O (2020), p. 240 

“Compulsory 
Licensing in 

 
 
 
 
 
Latvia. 

Lithuania 

– – 

– – 

– – 

– – 

There have been no cases concerning CL in Lithuania. 

– – 

Luxembo
urg 

– – 

– – 

– – 

– – 

There are no published cases concerning CL in Luxembourg. 

– – 

Malta 

– – 

– – 

– – 

– – 

There are no published cases concerning CL in Malta. 

– – 

Netherlan
ds 

1986 

Protected plant 
variety of 
tulips 

Not Issued 

– – 

CL to plant variety rights. 

Claimant: 
Pennings  

Defendant: 
Schoorl 

Poland 

– – 

– – 

– – 

– – 

On the basis of the currently applicable legislation, no proceedings 
concerning CL have been recorded. 

– – 

124 

Europe: A 
Country-by-
Country 
Overview” (EPO, 
2018), p. 76 
“Compulsory 
Licensing in 
Europe: A 
Country-by-
Country 
Overview” (EPO, 
2018), p. 72 
“Compulsory 
Licensing in 
Europe: A 
Country-by-
Country 
Overview” (EPO, 
2018), p. 74 
“Compulsory 
Licensing in 
Europe: A 
Country-by-
Country 
Overview” (EPO, 
2018), p. 83 
Case nr. BIE 
1987.18, 
Chairman of the 
District Court of 
Haarlem; 
Pennings vs 
Schoorl, 
16.07.1986 
“Compulsory 
Licensing in 
Europe: A 

 
 
 
 
Portugal 

– – 

– – 

– – 

– – 

There is no available information concerning cases involving CL in 
Portugal. 

– – 

Romania 

– – 

– – 

– – 

– – 

There have been no cases concerning CL in Romania. 

– – 

Slovakia 

– – 

– – 

– – 

– – 

Based on information provided by the Industrial Property Office of 
the Slovak Republic, there is no record that a CL application was 
ever filed in Slovakia. 

– – 

Slovenia 

– – 

– – 

– – 

– – 

There is no available information concerning cases involving CL in 
Slovenia. 

– – 

Spain 

2001  Medical /  

Not issued 

– – 

Carboxyalkyl 
dipeptide 
derivatives 
(anti-

The OEPM closed the compulsory licence proceedings  
because the parties settled. The patentee appealed the OEPM’s 
decision but the Court of Appeals and later the Supreme Court 
dismissed the appeal and confirmed the OEPM’s decision. Since a 
licence agreement between the parties was reached, it was no longer 

Claimant: 
Merck & Co. 
Inc. 

Defendant: 

125 

Country-by-
Country 
Overview” (EPO, 
2018), p. 96 
“Compulsory 
Licensing in 
Europe: A 
Country-by-
Country 
Overview” (EPO, 
2018), p. 98 
“Compulsory 
Licensing in 
Europe: A 
Country-by-
Country 
Overview” (EPO, 
2018), p. 100 
“Compulsory 
Licensing in 
Europe: A 
Country-by-
Country 
Overview” (EPO, 
2018), p. 108 
“Compulsory 
Licensing in 
Europe: A 
Country-by-
Country 
Overview” (EPO, 
2018), p. 106 
“Compulsory 
Licensing in 
Europe: A 
Country-by-
Country 

 
 
hypertensives) 

2003  Medical 

Not issued 

– – 

2015  Medicine / 
Sofosbuvir 
(hepatitis C) 

Not Issued 

– – 

a compulsory licence (subject to the contentious administrative 
courts) but a contractual licence (subject to the civil courts) and 
therefore the contentious administrative jurisdiction could not rule in 
relation to its validity. 
Application made on grounds of no sufficient exploitation of the 
patent. 

A pharmaceutical company had requested a CL over a patent that 
was considered to be unexploited in Spain. The OEPM refused to 
grant the licence and Madrid’s  
High Court of Justice revoked the OEPM decision based on formal 
reasons, namely the fact that the OEPM had not respected the 
established procedure for granting CL. However, the patentee 
appealed before the Supreme Court, which reinstated the original 
OEPM decision, denying the compulsory licence on the grounds that 
a compulsory licence cannot be granted in a situation when the 
substantive requirements are not met. In this case it was concluded 
that the patent was being exploited in Belgium, and therefore this 
exploitation in an EU member state was considered sufficient in view 
of the rulings of the Court of Justice of the European Union in the 
cases C-60/1990 and C-235/1989. 
The Supreme Court ruled that granting of CL in cases of public 
interest is at the discretion of the government, and not an obligation 
imposed by the law. 

Sweden 

1937  Military 

Issued 

No 
available 
information 

Application made on grounds of no sufficient exploitation of the 
patent. 
The case was regarding the possibility to avoid a CL by starting to 
exploit or expanding the exploitation of the patent in Sweden after 
the filing of an action for a CL (where the answer was negative). 

Inke, S.A. 

Overview” (EPO, 
2018), p. 39 

Claimant: 
Astur-Pharma 
S.A. 

Defendant: 
Leo 
Pharmaceu- 
tical Ltd. A/S 

“Compulsory 
Licensing in 
Europe: A 
Country-by-
Country 
Overview” (EPO, 
2018), p. 39 

Claimant: group 
of patients 
suffering from  
hepatitis C.  
Defendant: 
Minister of  
Health 
No available 
information 

WHO/WIPO/WT
O (2020), p. 240 

“Compulsory 
Licensing in 
Europe: A 
Country-by-
Country 
Overview” (EPO, 
2018), p. 104 
“Compulsory 
Licensing in 

1945  No available 
information 

Issued 

No 
available 

Application made on grounds of no sufficient exploitation of the 
patent. 

No available 
information 

126 

 
 
 
 
information 

The case was regarding the existence of a valid reason for not 
exploiting the invention in Sweden where importing from Germany 
was not considered sufficient. 

1947  No available 
information 

Not issued 

– – 

Application made on grounds of no sufficient exploitation of the 
patent. 

No available 
information 

The patented products were manufactured in Sweden and the fact 
that raw material was imported was not considered relevant. 

UK (pre-
Brexit) 

2015  Medicine / T-
DM1 (breast 
cancer) 

Not Issued 

– – 

CL requested by patient group following plans to remove T-DM1 
from list of cancer treatments paid for by UK Government 
(Kmietowicz, 2015a). Price discount negotiated. 

Not Issued 

– – 

2019  Medicine / 
lumacaftor-
ivacaftor 
(cystic 
fibrosis) 

2001 

Protected plant 
variety of 
potato 

Not Issued 

– – 

A Crown Use licence was requested by a patient group.261 The UK 
Government considered issuing a Crown Use licence (a type of 
government-use licence) after a pricing deal had not been reached 
with the originator following three years of negotiations 
(McConaghie, 2019). A few months after the government announced 
that it was considering a Crown Use licence, a confidential pricing 
deal was agreed (Parsons, 2019). 

Dutch seed breeder Meijer owns the UK plant breeders’ rights in 
‘Lady Rosetta’, a potato variety popularly used in crisp manufacture, 
with MBM acting as its exclusive agent in the UK. Sacker applied 
unsuccessfully for compulsory exploitation rights in the protected 
variety, arguing that Meijer’s refusal to issue a licence was 
unreasonable, and that the rights’ holder was failing to satisfy 
demand in the UK market. 

127 

Rightholder: 
Roche 
Request made 
to: UK 
Government 
Request made 
by: The 
coalition for 
affordable T-
DM1 
Request made 
for: NHS 
Engmand 
Rightholder:  
Vertex 
Request made 
by: Just 
Treatment 
Defendant: 
Meijer BV & 
MBM Produce 
Limited 
C: Sacker 
Potatos Ltd 

Europe: A 
Country-by-
Country 
Overview” (EPO, 
2018), p. 104 
“Compulsory 
Licensing in 
Europe: A 
Country-by-
Country 
Overview” (EPO, 
2018), p. 104 
WHO/WIPO/WT
O (2020), p. 241 

WHO/WIPO/WT
O (2020), p. 241 

UK Controller of 
Plant Variety 
Rights, UK Plant 
Variety Rights 
Office and Seeds 
Division of 
DEFRA; Sacker 

 
 
 
EU 

2018 

Protected plant 
variety of 
blackcurrant / 
“Ben Starav” 

Not issued 

Application made on public interest grounds. 

Potatos Ltd vs C 
Meijer BV & 
MBM Produce 
Limited, 
31.10.2001 
CPVO Decision 
NCL001, 
28.03.2018 

Claimant: 
Pixley Berries 
(Juice) Limited  
Defendant: 
Lucozade 
Ribena Suntory 
Limited 

128 

 
 
 
 
Fair compensation and adequate remuneration of right holders 

The TRIPS Agreement explicitly provides that the right holder shall be paid an adequate 
remuneration, to be determined depending on the circumstances of the case and taking as 
one criterion – but not the only one – the economic value of the authorisation. Different 
practices exist across countries and there is no single accepted approach to determine the 
adequate  remuneration.  Methods  of  calculation  are  sometimes  applied  to  decide  on  the 
adequate level of remuneration. This is for instance the case as regards Regulation (EC) 
No 816/2006, which provides that in case of national emergency or other circumstances 
of extreme urgency or in cases of public non-commercial use, the remuneration shall be a 
maximum  of  4%  of  the  price  paid  by  the  importing  country.  By  comparison,  licensing 
fees in the pharmaceutical industry amount to approximately 4-5% of the patented item 
(which is deemed one of the higher licensing rates among all industries).  

This initiative would provide pre-defined rules to ensure a smooth and quick procedure 
while providing legal certainty to right holders. To that end, it would rely on a calculation 
method similarly to what exists in Regulation (EC) No 816/2006 (i.e. maximum 4/6% of 
the price of the generic product). However, as required under the TRIPS Agreement, the 
initiative would also include other criteria considering the circumstances of the case that 
could  influence  the  percentage.  These  criteria  would  include  the  subsidies  or  other 
contributions  that  the  right  holder  has  received  to  develop  the  invention,  the  degree  to 
which  development  costs  have  been  amortized  and  the  humanitarian  circumstances 
relating  to  the  issue  of  the  licence.  Based  on  these  criteria,  the  advisory  body  would 
propose a percentage in  its  recommendation based on which either the Commission (in 
PO4) or the Member State (in PO3) would determine the remuneration.  In addition,  an 
appeal  procedure  is  foreseen  in  the  context  of  which  the  remuneration  should  be 
reviewed, including upon request of the right holder.  

129 

 
 
 
Table  26:  Share  of  respondents  to  the  public  consultation,  per  main  category,  agreeing  to  a  compulsory  licence  on 
patents and patent applications 

Company - Business association/ organisation 
NGOs 
Public authorities 
Academic/ research institution 

20%, N= 8 
100%, N= 6 
75%, N= 3 
100%, N= 5 

Source: OPC, total number of replies N=74 

Table  27:  Share  of  respondents  to  the  public  consultation,  per  main  category,  agreeing  to  a  compulsory  licence  on 
SPCs 

Company - Business association/ organisation 
NGOs 
Public authorities 
Academic/ research institution 

55%, N= 22 
100%, N= 6 
75%, N= 3 
80%, N= 4 

Source: OPC, total number of replies N=74 

Table  28:  Share  of  respondents  to  the  public  consultation,  per  main  category,  agreeing  to  a  compulsory  licence  on 
RDP 

Company - Business association/ organisation 
NGOs 
Public authorities 
Academic/ research institution 

2.5%, N= 1 
100%, N= 6 
75%, N= 3 
80%, N= 4 

Source: OPC, total number of replies N=74 

Table  29:  Share  of  respondents  to  the  public  consultation,  per  main  category  agreeing  to  a  compulsory  licence  on 
know-how  

Company - Business association/ organisation 
NGOs 
Public authorities 
Academic/ research institution 

5%, N= 2 
100%, N= 6 
50%, N= 2 
80%, N= 4 

Source: OPC, total number of replies N=74 

Table 30:  Share of  respondents  to  the public  consultation,  per  main  category,  agreeing  to a  compulsory  licence  for 
cross-border uses 

All 
Company - Business association/ 
organisation 
NGOs 
Public authorities 
Academic/ research institution 

Source: OPC¸ total number of replies N=74 

Manufacturing  across  several 
EU countries  
46%, N= 34 
12.5%, N= 5 

100%, N= 6 
75%, N= 3 
80%, N= 4 

Export to another country 

45%, N= 33 
10%, N= 4 

100%, N= 6 
75%, N= 3 
100%, N= 5 

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Figure 19: Detailed scheme describing the procedural steps foreseen under Option 2 

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Figure 20: Detailed scheme describing the procedural steps foreseen under Option 3 

Figure 21: Detailed scheme describing the procedural steps foreseen under Option 3 (export) 

Note: AC – advisory committee, COM – the Commission, MS – Member State.  

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Figure 22: Detailed scheme describing the procedural steps foreseen under Option 4 

Figure 23: Detailed scheme describing the procedural steps foreseen under Option 4 (export) 

Note: AC – advisory committee, COM – the Commission, MS – Member State.  

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Figure 24: Typology of impact considered in this impact assessment   

Source: own elaborations 

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ANNEX 7: SUPPLEMENTARY LEGAL ANALYSIS: THE PRINCIPLE 
OF EXHAUSTION IN THE SINGLE MARKET 

1. The principle of EU-wide exhaustion in general 

EU rules on exhaustion are largely the result of the jurisprudence of the Court of Justice 
of  the  European  Union  interpreting  Article  34  TFEU  on  measures  having  equivalent 
effect  to  quantitative  restrictions  between  Member  States.  The  Court  of  Justice  has 
always interpreted the Treaty as meaning that rights conferred by IP rights are exhausted 
within the Single Market  by  virtue of putting  the relevant  goods on the  market  (by the 
right holder or with his/her consent) in the European Union. See for instance cases: e.g. 
Centrafarm and Adriaan de Peijper v Sterling Drug Inc (C-15/74), Merck and Co Inc. vs 
Stephar BV and Petrus Stephanus Exler (C-187/80). 

Under  EU  law,  once  a  good  protected  by  an  intellectual  property  right  has  been  put 
lawfully on the market within the European Union (i.e. by the right holder or with his or 
her  consent),  the  rights  conferred  by  that  intellectual  property  right  in  relation  to  the 
commercial exploitation of the good become exhausted. In that case, the right holder can 
no longer invoke the intellectual property right in question to prevent the further resale, 
rental, lending or other forms of commercial exploitation of the good by third parties. 

In  contrast,  once  a good protected by an intellectual property  right  has been put  on the 
market  within  the  EU  by  a  person  other  than  the  right  holder  and  without  his  or  her 
consent,  that  right  holder  may  inter  alia  oppose  to  the  import  by  third  parties  of  such 
good  into  the  European  Union  or  to  the  putting,  resale  or  otherwise  commercial 
exploitation  of  such  good  into  the  European  Union  market  in  so  far  as  such  import  or 
commercial  exploitation  would  constitute  an  infringement  of  the  intellectual  property 
right concerned. 

2. The principle of exhaustion as regards patents 

In principle, EU secondary law in relation to patents (including rules on supplementary 
protection  certificates  extending  the  protection  of  patents  for  pharmaceutical  and  plant 
protection  products)  do  not  include  specific  rules  on  exhaustion,  but  the  general 
principles affirmed by the jurisprudence of the Court of Justice apply.  

Otherwise, “if a patent proprietor could preclude the importation of protected products 
marketed  in  another  Member  State  by  him  or  with  his  consent,  he  would  be  able  to 
partition  the  national  markets  and  thus  restrict  trade  between  the  Member  States, 
although  such  a  restriction  is  not  necessary  to  protect  the  substance  of  his  exclusive 
rights under the parallel patents.” See for instance case: Pharmon v Hoechst (C-19/84). 

In  this  spirit  also  REGULATION  (EU)  No  1257/2012  OF  THE  EUROPEAN 
PARLIAMENT  AND  OF  THE  COUNCIL  of  17  December  2012  implementing 
enhanced cooperation in the area of the creation of unitary patent protection states that in 
accordance with the case-law of the Court of Justice of the European Union, the principle 
of the exhaustion of rights should also be applied to European patents with unitary effect. 
Therefore, rights conferred by a European patent with unitary effect should not extend to 
acts  concerning  the  product  covered  by  that  patent  which  are  carried  out  within  the 
participating Member States in which that patent has unitary effect after that product has 
been placed on the market in the Union by, or with the consent of, the patent proprietor, 

135 

 
unless  there  are  legitimate  grounds  for  the  patent  proprietor  to  oppose  further 
commercialisation of the product (Article 6 and recital 12). 

3.  Lack  of  exhaustion  of  patent  rights  on  products  manufactured  under  a 
compulsory licence 

The relationship between the principle of EU-wide exhaustion and compulsory licensing 
was subject to the CJEU Judgement of 9 July 1985 (C-19/84, Pharmon v Hoechst). The 
judgement was based on the following facts: 

  Hoechst  was  the  proprietor  of  a  patent  in  Germany  and  of  parallel  patents  in  the 
Netherlands and in the United Kingdom in respect of the same invention, namely a 
process for manufacturing the medicine known as 'frusemide'. 

  DDSA  Pharmaceuticals  Ltd,  a  British  company,  obtained  a  compulsory  license  to 
exploit  the  invention  in  respect  of  the  parallel  patent  granted  to  Hoechst  in  the 
United Kingdom. 

  DDSA sold 'frusemide' tablets which it had produced under the compulsory license 
to Pharmon, a pharmaceutical company in the Netherlands who intended to market 
these pharmaceutical products in the Netherlands. 

  Hoechst brought an action against Pharmon before the Dutch Courts for infringing 

rights arising under Hoechst's Netherlands patent.   

The  CJEU,  which  had  been  asked  by  the  Hoge  Raad  of  the  Netherlands  to  give  a  preliminary 
ruling, made the following observations in its decision: 

  First, the CJEU recalled that in accordance with the principle of the territoriality of 
the  acts  of  the  public  authorities  of  a  Member  State,  a  compulsory  licence  cannot 
confer on its holder rights in the territories of the other Member States. 

  Afterwards the CJEU clarified that the question is whether the principle of EU-wide 
exhaustion  applies  where  the  product  imported  and  offered  for  sale  has  been 
manufactured in the exporting Member State by the holder of a compulsory licence 
granted  in  respect  of  a  parallel  patent  held  by  the  proprietor  of  the  patent  in  the 
importing  Member  State.  Briefly:  Does  EU-wide  exhaustion  apply  to  products 
manufactured under a compulsory licence? 

  The CJEU pointed out  that  where  a  compulsory licence  is  granted to a third party 
which allows to carry out manufacturing and marketing operations which the patent 
proprietor would normally have the right to prevent, the patent proprietor cannot be 
deemed  to  have  consented  to  the  operation  of  that  third  party.  Such  a  measure 
deprives the patent proprietor of his  right  to  determine freely the conditions under 
which he markets his products. 

  Finally,  the  CJEU  stated  that  the  substance  of  a  patent  right  lies  essentially  in 
according the inventor an exclusive right of first placing the product on the market 
so  as  to  allow  him  to  obtain  the  reward  for  his  creative  effort.  It  is  therefore 
necessary to allow the patent proprietor to prevent the importation and marketing of 
products manufactured under a compulsory licence in order to protect the substance 
of his exclusive rights under his patent. 

Thus,  following  this  judgement,  products  manufactured  under  a  national  compulsory 
licence (granted for the use of a national patent) in one Member State cannot be imported 

136 

 
in  another  Member  State  (where  there  is  a  parallel  patent)  without  the  consent  of  the 
patent proprietor. When products are brought into circulation under a compulsory license 
the  principle  of  EU-wide  exhaustion  does  not  apply.  As  regards  the  import  of  the 
protected  products  in  another  Member  State,  the  patent  proprietor  is  consequently 
allowed to stop this marketing operation.  

4. Consequences for cross-border supply in times of crisis 

Under the current compulsory licensing regime in the Member States, based on national 
law  and  domestic  considerations,  a  Member  State  cannot  consider  the  impact  of  a 
compulsory  licence  granted  in  its  jurisdiction  on  the  situation  in  other  Member  States. 
Nor can it make EU-wide arrangements when issuing  a  compulsory licence that would 
aim  at  tackling  a  cross-border  crisis  (territoriality  of  national  compulsory  licensing 
schemes).  In  this  context,  the  lack  of  exhaustion  of  national  patent  rights  on  a  product 
made under a compulsory license is a crucial obstacle preventing an EU-wide approach 
for addressing a crisis via a compulsory licence. There is no Single Market for products 
produced under a compulsory licence. 

The free movement of goods in the Single Market is one of the fundamental freedoms of 
the Treaties (articles 34 and 35 TFEU). However, it is not applicable without restrictions. 
They can be justified by the protection of industrial and commercial property (article 36 
TFEU).  In  its  jurisdiction  the  CJEU  has  aimed  at  balancing  the  different  interests 
involved  by,  on  the  one  hand,  allowing  the  free  circulation  of  patented  goods  if  the 
marketing  was  done  with  the  consent  of  the  patent  owner  (EU-wide  exhaustion),  but 
restricting the free circulation if this consent is missing, as in the case of a compulsory 
license (no EU-wide exhaustion). Whereas the advantages of a Single Market might not 
be needed when the crisis affects only one Member State that has the capacities to supply 
itself  with  critical  products  under  a  national  compulsory  license,  the  lack  of  a  Single 
Market  for  such  products  and  its  effects  become  a  significant  barrier  to  cross-border 
supply in times of an EU-wide crisis when some Member States depend on the capacities 
of others. 

If a product that is important for solving an EU-wide crises can be manufactured in one 
Member State under a compulsory licence, that compulsory licence would not allow the 
supply  in  another  Member  State.  Multiple  compulsory  licences  would  need  to  be 
requested  in  all  importing  Member  States.  These  additional  compulsory  licences  in  the 
importing  Member  States  would  be  necessary  to  prevent  the  patent  holder  from 
exercising his patent rights to stop the goods from being imported (still exercisable due to 
the lack of exhaustion). Apart from the fact that requiring multiple national compulsory 
licenses is a high hurdle for cross-border supply within the EU Single Market, this also 
bears  the  risk  of  contradicting  decisions  (for  instance  diverging  in  content)  due  to  the 
current legal fragmentation of national compulsory licensing schemes.  

137 

 
ANNEX 8: SME TEST  

This  SME-test  investigates  the  impacts  of  the  preferred  policy  option  on  SMEs  that 
might be concerned by compulsory licencing issued to address a crisis. 

The test has been conducted in line with the 4-steps foreseen, as following: 

STEP-1: IDENTIFICATION OF AFFECTED BUSINESSES 

As  mentioned  in  Annex  3,  the  majority  of  EPO  patent  applications  originating  from 
European  countries  were  filed  by  large  companies  (75%),  followed  by  SMEs  and 
individual  inventors  (20%),  and  5%  by  universities  and  public  research  organisations 
(see: Figure 11). The 2022 IP SME Scoreboard collected data among 8.372 SMEs in all 
27 EU Member States.  Only 10  % of these SMEs reported that they own registered  IP 
rights,  such  as  patents.  Among  those  SMEs  owning  a  registered  IP  right,  national 
trademarks are the most commonly owned registered type if IP right, owned by 6 % of 
SMEs. This is followed by EU trademarks (EUTM) and patents (both owned by roughly 
4 % of SMEs – 4.2 % EUTMs and 3.6 % patents). The least frequently owned registered 
types of IP rights are breeder rights / plant variety rights (1 %) and registered Community 
design (2 %). Thus, the number of patents owned by SMEs is in general low. However, 
the  initiative  is  considered  relevant  for  SMEs  as  it  targets  patented  products  that  are 
needed for crisis management, regardless of the patent owner (be it a large company or a 
SME). Since SMEs own patents, even if this applies to them to a small extent, it cannot 
be  ruled  out  that  a  SME-owned  patent  will  be  subject  of  a  compulsory  licence.  
Nevertheless,  as  the  initiative  focuses  on  patents,  only  a  very  small  part  of  the  SMEs 
could possibly be affected directly by compulsory licencing.  

STEP-2: CONSULTATIONS OF SME STAKEHOLDERS 

As far the OPC are concerned, the SMEs contributed, but they have not constituted the 
majority of respondents (74 in total, out of which 18 companies/business organisations), 
see Figure 25 below. 

Figure 25: Number of respondents to the OPC by size-classes among companies 

Source: OPC 

Additionally,  twenty  two  business  associations  contributed  to  the  OPC,  among  which 
many could have represented the views of smaller companies. Inputs received in the OPC 
have not pointed out towards potential negative consequences towards SMEs. The same 
concerned the feedback received following the Call for Evidence. 

138 

 
 
STEP-3: ASSESSMENT OF THE IMPACT ON SMES 

Impacts  that  may  materialise  as  a  result  of  the  preferred  option  (PO4)  will  mainly 
concern  the  patent  holders,  but  the  number  of  SMEs  that  own  IP  rights  in  the  EU  is 
relatively low (see above). Furthermore, apart from the fact that a compulsory licence is 
an extreme event in terms of probability (last resort instrument that has been used very 
rarely in the past), it can be assumed that small enterprises are more prone to enter into 
voluntary agreements than larger firms, hence there could be no need to use the CL at all. 
This  is  because  the  manufacturing  capacities  of  an  SME  may  be  insufficient  to  satisfy 
sudden  increase  in  demand  induced  by  crisis  (e.g.  carry-out  large  scale  production  to 
serve  several  Member  States),  so  they  would  be  more  willing  to  benefit  from 
remuneration from a licensing agreement. In other words, if during a major cross-border 
crisis there is a need for access to critical goods covered by a patent held by an SME, the 
probability  that  such  circumstances  would  lead  to  CL  negotiations  is  lower  that  if  the 
patent holder was a large company.  

Yet, if a CL is nevertheless granted, the terms and conditions for an SME would be the 
same as for a large company (i.e. the proposed rules would be identical, irrespective of 
the patent holder size).  

STEP-4: MINIMISING NEGATIVE IMPACTS ON SMES. 

The preferred policy option (PO4) is not expected to have negative effects on SMEs.   

139