Intellectual Property Rights
Intellectual property is a very precious commodity in today’s business world. Intellectual Property Rights form part of the assets of a company. It is therefore important for businesses to identify, secure, and value their intellectual properties. However, it has not been easy for many businesses to identify these intellectual properties because each has many practical and legal differences. Some of the common intellectual properties that can be identified include patents, trademarks, trade secrets, and copyrights. Of these, trade secrets present the greatest challenge with many arguing on whether to regard them as intellectual property rights or not; in this article, I show that indeed they are.
Trade secrets
Trade secrets are pieces of information kept in secrecy and have commercial value. Legal protection makes it possible for this information to be valuable to the owners. Some laws protect inventions such as patent protection laws; however, trade secrets have advantages over patents. Trade secrets are cheaper and can be obtained quickly because they do not need approval from the government. They also cover the protection of areas of business that may not be patentable. Some may argue that it is odd for any law to allow the keeping of secrets. However, it should be understood that trade secrets are not just for secrecy, but disclosure. If trade secrets are not legally protected, then this will prompt some businesses to invest heavily in protecting their secrets. These investments may prove costly and inefficient because they may be handling a problem that could be addressed cheaply if a law is put in place to govern the use of trade secrets. Trade secret laws make it possible for smooth trading. Laws governing trade secrets ensure that there is a disclosure of secret information and at the same time allows self-disclosing inventions to be patented. If a legal right is put in place, an individual will not be worried that others will breach a confidential deal because he knows that the idea can only be used after compensation is made (Jordan 1).
Trade secrets as IP Rights
The above argument can only work if trade secrets are seen as Intellectual Property Rights that need proof that they are secret so that they can be protected. Treating trade secrets as intellectual property will ensure that there is no breach of confidentiality obligations, no unfair competition, which people do not enrich themselves unjustly, that the common law is not misappropriated, and that there is no access to someone’s property without permission. Trade secrets are property rights because they are owned by their inventor. Trade secrets should be treated as property because they manifest many characteristics of tangible types of property. For example, trade secrets can be assigned and they can also be used as trust especially in bankruptcy cases. Why should trade secrets be protected then if they are already secrets? Moreover, they are not properties that can be consumed like the other forms of property. However, while making these arguments, it should be kept in mind that as much as secrecy is a protection requirement, it is not a must for owners of trade secrets to maintain perfect secrecy. Such people are allowed to sell their products in which the secret has been used, and even disclose their secrets to others for an economic purpose. This means that treating secrets as rights does not exclude others from using them; it is only a way restricting the access, use and eventual disclosure of the secret possessed by other people (Powell et. al 1).
Referring to nonpublic information as the property does not necessarily mean that it must be real property; it only implies that it should be viewed as an Intellectual Property Right. Owners of trade secrets have a right to at least control some information even if the information is no longer in their possession. Secret information should be given rights just as copyrights and patents are given rights. This will encourage trade secret holders to invest more in research and development especially in areas that deal with the secrets. When trade secrets are treated as IP rights that are solely vested in their owners, they will serve as an additional motivation to do more innovations than patents can achieve. Another reason why trade secret laws should be encouraged is that they are better placed to protect information that can’t qualify to be protected by patents (Powell et.al 1).
But there are arguments that trade secret laws serve the same purpose as the other laws and therefore should not be treated with special concern. However, trade secrets are not protected just for the sake of protection, they are IP rights that should work and adhere to IP laws. They are not extensions of the principles of common law. There are many features that trade secrets share with other common IP rights. I will only look at two of these features that I think will best show why trade secrets should be treated as IP rights. Just like the other IP rights, Trade secrets promote invention and also disclosure of particular inventions. As an invention incentive, trade secret law gives an individual who owns information that is not known by competitors, an exclusive right to own that particular information. IP rights work based on exclusivity. When you look at both copyrights and patents, they carry the right to prevent others from using someone’s information to come up with new inventions. Copyrights and patents, therefore, serve a practicable purpose. They legally encourage the coming up with new and valuable ideas that enrich an individual provided that the owner of the ideas is not under any threat from others using the same idea. In essence patents and copyrights do away with any risks that have to do with investment especially in public goods that are very expensive to invent and imitate once the idea is developed (Powell et.al 1).
Trade secrets also serve the same purpose, they give owners of new inventions the right to impose restrictions on others from using his or their ideas, making them the sole beneficiary of all the profits that may accrue from it. However, indeed, the exclusion is not absolute under the laws of trade secrets, but this also applies to patents that are treated as Intellectual Property rights. Treating trade secrets as IP secrets will encourage law enforcement to pay more attention to the limits and requirements of trade secret law. This approach will no doubt promote efficiency in any economy. The fact that patents, copyrights and other IP rights expire after a specific period puts trade secrets in a better position because they can last indefinitely. Take, for example, a company like Coca-cola, which decided to use trade secret law to protect its secrets instead of patents which would have expired by now to pave way for others to use its formula. This formula has been in existence for many years, but because the company has exclusive rights to the formula under the trade secrets law, no other person or company can gain access to it (Powell et.al 1).
In summary, trade secrets should be treated as IP rights because that is what they are. Trade secrets do the same job as other Intellectual property such as patents and copyrights. They are incentives for innovation; they encourage disclosure and passing of innovation information to others although not explicitly. The use of trade secret laws ensures that there is no unnecessary investments in secrecy and gives others a chance to access innovation information to use it productively. As it has been shown, trade secrets serve better the purpose of IP laws than the common IP rights such as patents and copyrights in some special inventions. Patenting, for instance, does not serve well some of the industries, it is even worse when an inventor decides to leave the patent system. This is however made easier if trade secrets are treated as IP rights. This will allow inventors in such industries to fully participate in the innovative socio-economic system. Treating trade secrets as IP rights also enables individual to explore more on IP rights, find out how they are designed in order to comprehend trade secret law and the way it fits in with other laws (Powell et.al 1).
Trademark agreement
There are many provisions that are given in trademark agreements although they are not standard. These provisions however, should be carefully drafted to serve the purpose of the business in question. For instance, when drafting an agreement between an Australian licensor’s German trademarks to a US license, a number of clauses can be used. However, I think that the Granting Clause and the Quality Control Clause are a must.
Granting Clause
The grant clause is usually the most important clause of any license agreement and therefore, it is required to be specific. It is a provision that ensures that the trademark licensor has some control over the trademarks use. The most important and hence the main issues that this clause addresses are the scope and the degree of exclusivity that the granted trademark rights have in its use by the licensee. If the licensor specifies that the license is exclusive, then it will mean that it is only the licensee who will be allowed to use the mark. It also means that to gain from this exclusivity, the licensor has the right to seek financial returns and other guarantees from the trademarks performance. However, if the licensee does not make any gains from the use of the trademark, then the licensor will not receive any income from him. Exclusivity also implies that the licensee can only work in a particular region, during a specified period, and deal in specific products or all these can be combined (Siegal 2).
A nonexclusive license can also be given to a licensee especially if more are using the trademark on similar products. This is however, not liked by many licensees because it permits competition from other licensees. Non-exclusivity however, is liked by licensors who feel that many licensees are needed to meet the demand for the products using the trademark and also to put in place a wide product range. This is mostly a business decision made basing on the market performance of the particular products with the trademark. In this case, the trademark is being licensed just to one licensee; therefore, it does not need to be nonexclusive. This clause also addresses the particular trademark that is licensed and the products that should bear it. It is very important for the agreement to define precisely the products especially in an exclusive license to avoid locking out the products (Siegal 2).
The grant clause also specifies the scope of the trademark. This defines the boundaries in which the products bearing the trademark will be sold. For instance, it may be specified that the license cover the boundaries of a country or just some regions in the country. In other cases, the license can cover many countries. Of course trademark protection varies from region to region and therefore, the licensor’s right, protection of the trademark, and licensing formalities should be determined in relation to the country that the parties come from. This is done to avoid any possibility of causing damages to the trademark or exposing the parties to legal implications especially from third parties (Siegal 2).
The Quality Control Clause
It is well known that trademarks protect a company from other companies using the distinguishing characters it carries. The trademark enables an individual to identify where the materials being bought come from. This is why the quality control provision is a very important clause in a trademark agreement. This is so because trademarks usually represent reputation the products bearing the particular trademark carry in terms of quality. In many instances, customers and consumers of certain products base their purchasing decisions on the quality reputation of the particular products. It will therefore, be detrimental on the side of the licensor if he or she does not monitor and control the quality of products that the licensee offers to consumers. The absence of this control may lead to the trademark becoming susceptible to abuse by the licensee or any other third party. For instance, in the US, absence of control may lead to people assuming that the trademark is abandoned. This means that it is important to ascertain that the licensee has the capacity and ability to meet the quality standards that the trademarked products have put in place to avoid destroying its reputation (Raysman et.al. 4-26).
This clause also carries another provision that specifies the usage of the trademark and the monitoring of quality control. In specifying the use of the trademark, the manner in which the licensee should use the trademark on his or her products, in advertisements and promotions is defined. This may specify that in order for the license to use any additions to the trademark, for instance, a new way of presenting the trademark, and then he or she will be required to get permission from the licensor first. In controlling quality, the licensee may be required to give the licensor access to his or her premises to carry out an inspection of the production process, the raw materials used, personnel, production records to make sure that the licensee is following the required quality standards. Inspection also enables the licensor to ascertain whether the licensee is adhering to international, national and local laws that pertains to the production and sale of products. Of course, it should be indicated in the agreement on when and how frequent the inspection is to be so that it does not disrupt the normal working of the licensee.
This clause also stipulates that anyone licensed to use a trademark should always use it in its entirety without additions or subtractions to it. It should never be printed over other marks as this will blur it, a situation that may confuse those who are used to the mark. Also under this clause, the trademark should, under no circumstance, be combined with other marks or used closely with other marks. If the circumstance forces the mark to be used with others, then the trademark owner may require that the trademark is made larger or prominent than the others (Raysman et.al. 4-26).
Product Piracy
Product piracy is simply the imitation or copying of a product whose invention, design and processing rights are held by someone else. People who engage in product piracy exploit other people’s technical know-how which perhaps has taken them years of extensive research and investment to be achieved for their own benefit without permission. This has affected the all people involved in the global production, sale and consumption of products.
There are many costs that piracy causes to the owners of the pirated products and the economy at large. First piracy leads to the loss of sales by the legitimate owners of the products. Enterprises that thrive on the invention and marketing expenses of others are usually competitively disadvantaged. Piracy also can bring about the risk of product liability because of imitations that lead to defective products. Another expense that is brought about by piracy is the costs that are incurred in efforts aimed at legal measures against products infringements. The losses that an industry, whose products are pirated, incurs are usually translated to the loss in public revenue and also brings about unemployment risks. Research has also shown that prevalence of piracy in a country, especially developing countries, discourages technological investment (Counterfeiting and piracy 10).
Piracy is an illicit practice and therefore, is mostly carried out by criminals who use piracy revenues to perpetrate other crimes. The fact that it is an illegal undertaking, the parties involved do not usually follow the required standards of employment, they avoid payment of taxes, and they do not care if the products adhere to the standards of quality or not. Piracy is a menace to all world economies whether developing or developed. Copyright piracy is the most affected area especially in the music, computer software, and movie industries. The countries in which pirated products are sold experience considerable losses in tax and excise. Countries that produce pirated products are at an advantage either; they also experience massive losses in revenue. This is because the producers of such products will hide their production costs from the authorities thereby denying their governments, tax revenues (Counterfeiting and piracy 10).
It is the developing countries that are adversely affected by piracy. The major loss that developing countries experience from piracy is the loss of investment opportunities from foreign investors. People or companies, which are willing to invest in a developing country usually terminate their investment plans on the premise that their intellectual property that will come from such investment risks being stolen by the preying criminal eager to gain from what is not theirs. Piracy therefore, discourages investment in developing countries. This reduces tax revenues in the short term, and also has long-term effects in that it impairs and slackens economic developments. For instance, businesses strongly founded on intellectual property rights such as those in IT, pharmaceuticals, and biotechnology; find it hard to invest in developing countries that have no laws in place to protect intellectual property rights (Counterfeiting and piracy 13).
It is not just about investment; piracy also affects the transfer of technology whereby countries find it hard to secure technology especially if it comes as a package. Without proper laws in place to protect these technologies, it becomes very hard as those bearing it will be discouraged by piracy. For any country to be successful in the global economy today, it must embrace innovation. The economy requires that businesses renew or improve their products regularly so that they can keep their market share. Inventions and innovations that are sustained to bring about new products give a business a technological advantage in the competitive market. Because of this advantage, businesses usually invest heavily in innovations and inventions. However, piracy destroys this investment enthusiasm as businesses find it hard to invest if they know that particular invention or innovation will end up being pirated. Piracy leads to low turnover and loss of market share of legitimate enterprises (Counterfeiting and piracy 14).
Piracy also affects the employment patterns in society. When losses are realized by genuine producers of products because of piracy, the losses will automatically affect employment. Employment may show some signs of improvement in the initial stages of the introduction of pirated goods. This, however, changes especially when legitimate producers realize losses, they stop more hiring of workers and even retrench the existing worker to cut on costs. Pirated products also cause infringements to the existing labor laws especially if the pirated products are produced by undeclared workers in sweatshops. This usually affects economies because it causes market destabilizations. As already mentioned, piracy affects the security of the public especially where profits realized from pirated products end up in the hands of criminal groups who then use it to finance organized crimes. Research has found out that criminal activities such as terrorism are funded from money made from pirated products. Piracy brings about corruption, dilution of public morality whereby genuine businesses are forced to join in the trade or risk going out of funds from little or no sales at all (Counterfeiting and piracy 15).
Pirated goods do not just affect the genuine owners of their intellectual property right; they also have adverse effect to those who consume them. First, pirated products usually cost a price that does not actually translate to costs put in its production thereby exhorting money from customers. They also lie to customers about the quality of the pirated product therefore, they pose adverse health and safety risks to them. There is usually intentional cheating of the customers by those who sell pirated goods about their quality because they are usually produced without proper quality checks. Those people who sell pirated goods do not offer after-sales services and do not help consumers if the products cause injury or damages to the customer. Many cases have been reported whereby consumers of pirated products died or suffered health effects of pirated products (Counterfeiting and piracy 19).
Product piracy also poses a threat to societal norms, especially regarding culture. Intellectual property rights are very vital in the cultural sector, especially in audiovisual products. Non-written products like folklore, music, performance, dance, and rituals use audiovisual as their main medium of preservation. This is an important sector of the economy; however, inadequate protection undermines its development. It also poses a potential threat to a society’s cultural heritage and diversity. This is because many pirated products do not respect cultural sensitivity that may be needed when revealing and showing certain topics. They go-ahead to sell and distribute culturally sensitive materials to anyone provided they make some financial gains from. This is usually rampant in developing countries with sectors that have no economies of scale (Counterfeiting and piracy 23).
Protecting a business’ intellectual property acts as an incentive for businesses in a country to adapt imported products and technology to their own business environment. This in turn motivates the development of domestic culture, innovation and technology. Such a move will encourage economic growth that makes countries technologically self-dependent, meaning they can no longer depend on technology from another country to grow its economy. Many of the developed countries put adequate measures in place to protect intellectual property. For any country to develop economically, it has to compete in regional and global markets. To produce products that can compete on the world market needs high technological levels. In developing countries, most of the technology lays in the hands of the private sector which decides when and how to transfer their product technology. The private sector will not be willing to transfer their technology if they know that other people capitalize on it and make illegal gains from their efforts. This hampers the transfer of technology in developing countries (IP Protection 1).
Developing countries are prone to little or no protection of intellectual property. They have governments that allow the provision of products and technology without much restriction and at low costs. This discourages the creators or inventors of technology who have, in most cases, resorted to moving to other countries especially developed countries where there is adequate protection of intellectual property, or some decide only to use and avail older technology which they feel they can lose without much harm. Piracy in developing countries has increased their long-run costs because these countries depend largely on technology from other countries, which is sometimes old or even outdated. Developing countries have economic climates that encourage product infringements, inadequate protection of businesses from piracy has encourage copying. This reduces advancements in cultural, technological, and industrial developments. Lack of legislation or their inadequacy discourages and reduces the ability of would be innovators from committing their efforts to long-term plans to come up with high-tech products that can give them competitive space not just in their countries’ markets, but also on the global market. Lack of IP protection has also led to the absence of a labor force that is technically capable to work with advanced technology because technological investments in such countries are discouraged. The few technologically capable workers opt to move out leading to brain drain. In the cultural sector, the few talented people are discouraged from creating new products because of competition from pirates who sale inferior and cheap products. Therefore, inadequate IP protection, paves the way for piracy, which in turn discourages the transfer of advanced technology. In cases where technology is introduced, it is in ways that can not lead to long term development of developing economies (IP Protection 1).
4(A) Patents in Europe
Patents are usually given to protect inventions from being used or distributed by others other than their inventor without permission. An invention that is patented can benefit their inventor through royalties even if the inventor is not able to personally exploit them. Patent laws require that for an invention to be patented, it has to be novel, one that can be applied industrially, and it should not be obvious. This is to make sure that no one can easily come up or copy the invention.
European patenting
European member states usually use the “first to file” approach in their patenting laws when given out patent rights. This means that the individual who applies for patent for an invention first will be granted the patent right. European patents usually carry a 20-year protection term, however, individual members of the European Union can extend this period. The European Patent Convention that was held in 1973 in Munich established the European Patent Office that was mandated to grant patents to European member states. Through this legal framework, patents are granted through a single granting procedure. This procedure however, does not seem to be a single procedure when it comes to its enforcement. Patents in this procedure are basically patents from different countries bundled together. The legal framework set up by the EPC made it possible for the member countries to get patent protection just through a single patent application. In this case, a patent applicant chooses the members countries in which patent protection should be accorded. The extent of protection and revocation procedures apply uniformly in all European member states under the EPC (Smith 1).
There have been discourses with people arguing that because the EU works as a single marketing block, then it should also work as a single market when it comes to patenting. The bundling of patents from the many EPC member states is accompanied by costs of language translations. It is estimated that getting a European patent can cost ten times what it takes to acquire one in Japan or in the US. This is why many of the European inventors find it expensive to protect their inventions. That is why currently discussions are ongoing to put in place a framework that will allow innovators to protect their inventions, one that will ensure that there are minimum costs of translation and one that not require one to validate the patent in the different European nations. Under the current system is very expensive especially in the already mentioned area of translations. The complexity involved also discourages many of the European innovators. For instance, for a patent to be granted, applications have to be examined first by the European Patenting Office. The EPO can only grant the patent if it is satisfied that all the requirements are met. However, the granted patent becomes valid after the owner seeking for the patent right from the relevant authority. Validation usually involves translations that encompass other legal costs making the whole process very costly. This cost has seen many European inventors resort to patenting their ideas and inventions in just a few European states (Smith 2).
These cost issues saw a proposal made in 2000 to regulate patenting by coming up with a community patent which they called the EU patent. In 2009, an agreement was unanimously reached by EPC member states that an enhanced system of patenting was crucial if innovations were to be encouraged in Europe. This aimed at setting up a single European patent; the agreement however, did not address the contentious issue of translations. In 2010, a proposal that addressed translation in EU patents was made. The proposition is that patenting is to be carried out in English, German, or French. The three European official languages are English, German, and French. This means that all patents granted in Europe should be published in either, French, English or German whereby translations of claims will be included in the other two official languages. It also stipulates that the patent proprietor should not make any other translation unless there is a disagreement in the patent. In such an event, then the translation will be done at the proprietor’s expense (Smith 2).
The adoption of this proposal, however, has not been affected because there is no agreement on which regime should be used in translation and it is also not compatible with some EU treaties. This means that Europe has no prospect of getting another patenting system any time soon. Inventors and innovators should therefore, find more suitable ways of working with the current system that is complex and also expensive. They will have to EPC system that, bundles up different patents from individual EU nations, patents that have to be validated first by member states before they can be recognized (Smith 3).
Trademark law
Trademark registration, just like patenting, helps in protecting brand value by preventing people from using it to offer competition to the real owners of the brand. Acquiring a brand, through registration, gives the brand-owner exclusive rights to stop others from using it. National trademark registries in different countries carry the mandate of granting trademark rights. In Europe, the EC realized that for member countries to trade effectively, and then barriers between them had to be done away with. They based this decision on the fact that trademarks are rights held by individual countries whose goods bearing the brands exchanged freely in the community. It would therefore, become a barrier to trade if procedures and laws used in granting trademarks and also their enforcement differed. just like the issue raised about patenting a single market by member states, the issue on trademarks also brought about the Trademarks Harmonization Directive(THD) that put in place the law and procedures to be used in granting trademark rights in all European member states (Abbe 1).
Under this directive, for a sign to be registered as a trademark, it should be presentable graphically, should have a distinct character that distinguishes one product from another. As much as this was a measure taken to remove trade barriers, each member state retained its granting rights and therefore their trademarks. This raised disputes especially in situations where products bearing a brand entered a different market with products bearing a similar brand. This created conflicts between member states. To solve this problem, the EU employed the same tactic it sought to use in its proposal concerning patents, the use of a community trademark. Under this system, owners of brands only need to make a single application for trademark registration to what was referred to as the Community Trade Mark Office (OHIM) which was headquartered in Spain. This meant that once an individual was given trademark rights, then he or she could use just one registration to carry out business activities under the brand throughout the European Community (Abbe 1).
This directive faced difficulties in its implementation. Initially, Europe was accustomed to using words as trademarks, it, therefore, becomes difficult to register shapes, sounds or smells, which had not been used before. Disputes emerged between trademark owners and the registries, and also between competing trademark owners, concerning what was to be registered as a trademark. Evidence shows that these disparities still exist especially when it comes to determining what should be registered as a trademark especially in the world that is seeing more and more innovative trademarks coming up in the market. These differences are also witnessed in courts, OHIM, and in national offices. Just like what we saw about patent rights, these difference in the way trademarks are perceived has dire consequences on the owners and developers on trademarks, they also affect the way registries work, and have diverted the efforts behind harmonization of trademark laws and how they are applied in Europe. No brand owner would like to invest his resources in a brand only to be told that it is not possible to obtain its registration. This is further made worse with the prospect of the trademark being taken up by others if the owners use it. Harmonization is therefore a long way to go and therefore, businesses and brand owner have to cope with the existing procedures and laws to guard their trademarks just as they have to cope with the EPC framework to protect their patent rights (Abbe 1).
4(B) Arguments against EU Commission’s plan to introduce a European and EU Patents Court
As discussed above, the current European patent system has many flaws that need to be corrected. This has led to years of lobbying by groups to bring about changes in the patents laws. Basing on these concerns, the EU has proposed the introduction of a European and EU Patents Court. This proposal has received a range of views from many people with some supporting it and others arguing against it. Those against it have raised several issues; however, for the purposes of this paper, we will only look at two of their arguments.
Democracy concerns
Many of the opponents of this proposal have argued that a European and EU Patents Court will cause a meltdown of European democracy, which is being enjoyed now by the EC member states. They strongly believe that anyone who values democracy should appreciate that laws must be enacted basing on the interest of the public. This can only happen if those responsible for the making of the laws are directly accountable for their actions to the people. This proposal aims to bring about a shortcut whereby people sitting at the court will not be directly accountable to the people. In fact, the European Patent Office has not been working smoothly as many of the European Patent Convention member states have raised constitutional concerns in its role in issuing patents. They have argued along similar lines, that the office is not an institution that is accountable to the people in these countries democratically, and still it is given the mandate to grant patents that affect their citizens. Currently, the EPO acts as an administrative office that grants patents and is also vested with the responsibility of interpreting the EPC. When this office acts as an interpreter of the EPC, it has extended its de facto mandate (Jtadeusz 1).
This additional mandate has seen the office make decisions that have led to unconstitutional extensions into issues that deal with patents. It is very clear that EPO is not among the EU’s institutions that are democratically accountable to the people, but because it was set up legally, it can do all the above without any sanction. This means that it has become a jurisprudential body; however, it can not be trusted to make transparent and ethical law decisions because it was just set up as a financial institution that gets revenue by giving out patents. With this said, one has to understand that the current EPC allows courts in respective EU countries to interpret the European Patent Convention. This means that decisions made by the EPO are not in any way binding to the courts in the respective EU countries. This means that the additional mandate of the EPO can not be felt now. However, the proposal by the EU Commission to come up with a single patent court shows that there is a high chance of the court to use its de facto mandate to affect the working of courts in individual countries (Jtadeusz 1).
Based on the issues witnessed under the current EPC/EPO system, one clearly gets a rough picture of what things would be like if the EU Commissions proposal goes through. Indeed a European and EU Patents Court will be an institution that will lie outside the jurisprudential control of any EU institution including the EU parliament that people have democratically put in place. This means that this proposal aims at the put in place a single justice system that will handle issues concerning the validity of patents that are granted even in states that are not EU members provided they are signatories to the EPC. This means that the commission wishes to replace one institution that was plagued with unaccountability issues with another one. Another issue that has been a constant pain when it comes to patenting and competition in the market is the defending and litigating costs involved in patent claims. It, therefore, follows that any agreement made concerning litigation should show that it will provide some cost benefits to those making claims and those defending claims. The proposal by the EU commission has not carried out any impact assessment to show that a European and EU Patent Court will offer these cost savings. In effect, it will increase costs whereby different countries may have different court requirements that may need extra costs to implement in a single court (Jtadeusz 1).
People need an independent judiciary; the single court being proposed by the EU commission does not guarantee this independence. A court system that will be seen by people to be independent should have a staff of qualified people, a staff that is independent of any institution that may have interests of an economic nature in its role of issuing, preparing or litigating patents. This is very important if democracy is to prevail. All those advocating for a single court seem to have forgotten or avoided this crucial factor. As it is, this proposal gives all member states that are under EPO automatic membership into the single jurisdiction that is being proposed by the EU commission. Such a framework is bound to cause conflicts of interest. For any court system to work in this case powers must be clearly separated between those tasked with carrying out administrative duties and those who will be responsible for determining what is and what isn’t valid. The proposal does clearly lay out the measures that should be taken against those who have an economic interest of the court. Such loopholes show clearly that the proposed institution will not be independent in carrying out its duties in service to the European citizens (Jtadeusz 1).
The lack of a proper system of checks and balances especially in regards to the selection of those who are supposed to work in the court compromises the validity of this court. Determining what should be patentable or not should be left in the hands of an institution that people have put in place democratically such as the European Parliament. Such an institution will be accountable to the people in that in case it fails to serve its mandate, then the people have a chance of selecting others to replace them. But a system such as the one in the EU commission’s proposal, is undemocratic, it is not even under the EU, and has loopholes that compromise its independence if allowed, will jeopardize and distort the direction of patenting in the whole of Europe not just now, but for generations to come. Gauging from what has been experienced under European Patent Office; the absence of accountability and conflicts of interest, a single court will not add anything to the current efforts to promote growth through innovation, in fact, it will be pulling down the strides made so far (Jtadeusz 1).
Language concerns
Opponents are also concerned about the issue of language which they feel will greatly affect the people’s right of defense. The commission is of the opinion that the patent ought to be in English, German or French. Patency should be offered in the seeker’s language and then translated into English, French or German. Those applying for patents or claims will do so in their languages, which will then be translated in English, French or German, that patents, if granted will be published in the authentic language during the process, making it legally binding. First, some strongly believe that in order to minimize costs and enhance simplicity, the patent system should embrace a one language system. Working under a single court will not be practically cost-effective. The proposal only allows the court to operate in three official languages; this will prove impractical especially where exact meanings of words may be required in court proceedings. This means that translations will have to be made at every stage of the court proceedings and also at the required speed. Such a process is bound to be inefficient and costly (Kim 12).
A country like Spain was actively against the idea of setting up a single court for the whole of the EU region. This true to some extent, it is very unfair to subject an individual to legal rights enforcement in a language that he or she does not understand. People should be allowed to use their own languages especially when litigating or defending claims. An occasion may arise whereby summons in law may be given to a business entity in a language it does not understand, looking for translation may take time and jeopardize its rights of defense (Kim 12).
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