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MEMO/04/117

Brussels, 19th May 2004

Results of Competitiveness Council, Brussels,
17-18 May 2004
(Jonathan Todd, Fabio Fabbi, Peter Sandler)

Proposed Community Patent Regulation (JT)

The Council noted that the necessary unanimity could not be found in support of the Presidency's compromise proposal for a Council Regulation on the Community patent. In these circumstances, the Presidency stated its intention of referring this matter to the President of the European Council.

An agreement on the broad outlines of the Regulation was reached in March 2003 (see MEMO/03/47) and further progress was made towards overall agreement at the November 2003 Council. However, a small number of points remain outstanding, in particular on requirements for the translation of patents and on how infringements of patents which might arise as a result of mistranslations should be treated.

Recent calculations show that the Community Patent will cost no more than a European Patent covering five countries. That would represent a cost saving to around two-thirds (68 %) of all applicants for European patents, at least 30 000 granted patents a year. For full EU coverage the Community patent would cost only 50% of a European patent for the 25 individual Member States - a saving of at least €30 000 per patent over 10 years.

In addition to the lower costs, Community Patent holders would benefit from far greater legal certainty, because disputes over interpretation would be heard before a single Community Patent Court with pan-EU jurisdiction (see also IP/04/137). A European Patent can currently be challenged in each and every country in which it is valid, which can give rise not only to uncertainty and potentially divergent interpretations but also to higher costs.

Commenting after the Council, Internal Market Commissioner Frits Bolkestein said “If I were to say to you that I am bitterly disappointed at the Council’s failure today to agree the Community Patent Regulation, you might say “We’ve heard this before”. And you would, unfortunately, be right. With regrettable regularity, a small number of Member States have blocked this proposal by giving precedence to narrow, vested interests rather than the broader interests of boosting Europe’s competitiveness by fostering research, development and innovation.”

“But may I make clear that today’s failure is despite the extraordinary efforts of the Council President, Mary Harney, to find an agreement.”

“The Commission will now have to reflect carefully on its next steps. All I can say is that all options are open, including withdrawal of the proposal. After all, if there is no prospect whatsoever of Member States agreeing this proposal, there is no point in keeping it on the Council’s table and going round in circles.

I am not saying the proposal will be withdrawn but that withdrawal will be considered. We will have to think very carefully whether another proposal is possible. The trouble is language. Some Member States say we should use just one language, namely English, but one Member State does not agree to that.”

Answering questions on vested interests, Mr Bolkestein replied “In various Member States, institutions and practices have become encrusted and they wish to continue in the same way and don’t wish to change. In this case, there is opposition to change in two Member States in particular.”

“The European Council will be apprised of today’s fiasco”, he continued. “What is the point of the European Council asking three times for the Competitiveness Council to agree the Community Patent, if it does not do so? This is a lesson we should take to heart.”

Proposal for a Directive on the Patentability of Computer Implemented Inventions (JT)

The Council reached political agreement by qualified majority (with the Austrian, Italian and Belgian delegations abstaining and Spain voting against), on a common position concerning the proposal for a Directive on the patentability of computer-implemented inventions (see IP/04/659). Once this text has been formally adopted by the Council, it will be submitted to the European Parliament for second reading.

The agreed text would establish rules for exclusions from patentability. In particular, it makes clear that a computer program as such cannot constitute a patentable invention and that a computer-implemented invention shall not be regarded as making a technical contribution merely because it involves the use of a computer, network or other programmable apparatus. Accordingly, inventions involving computer programs, whether expressed as source code, object code or any other form, which implement business, mathematical or other methods and do not produce any technical effects beyond the normal physical interactions between a program and the computer, network or other programmable apparatus in which it is run shall not be patentable.

"Technical contribution" is defined in the text as a means a contribution to the state of the art in a field of technology which is new and not obvious to a person skilled in the art. The technical contribution shall be assessed by consideration of the difference between the state of the art and the scope of the patent claim considered as a whole, which must comprise technical features, irrespective of whether or not these are accompanied by non-technical features.

After the Council, Internal Market Commissioner Frits Bolkestein commented “I am pleased that the Council has reached political agreement on the proposed Directive on computer-implemented inventions. This Directive will contribute to European competitiveness and assist the proper functioning of the Internal Market. We must reward investment in innovation if a real knowledge-based economy is to flourish in Europe. The Commission has always been committed to making sure that patents in this field, as in any other, cannot be used to squeeze out legitimate competition or to prevent others getting fair access to technology and ideas. The text now approved achieves that balance and I very much hope the new European Parliament will be able to approve it swiftly.”

Proposal for a Directive on the Recognition of Professional Qualifications (JT)

The Council reached political agreement by qualified majority (with Germany and Greece voting against), on the proposal for a Directive on the recognition of professional qualifications. Once this text has been formally adopted it will be submitted to the European Parliament for second reading. Discussions focused on the issue of cross-border provisions of services on a temporary and occasional basis, and in particular on the declaration requirements to be made in advance if the service provider moves from one Member State to another.

It was agreed that Member States may require that, where the service provider crosses internal market borders for the first time in order to provide services, he shall inform the competent authorities in the host Member State in a written declaration including information concerning insurance cover or other means of personal or collective protection with regard to professional liability. Such a declaration shall be renewed once a year if the service provider intends to provide temporary or occasional services in that Member State during that year. The service provider may supply the declaration by any means. Member States may require that the declaration is also accompanied by the following documents:

  • proof of the nationality of the service provider
  • an attestation certifying that the holder is legally established in a Member State for the purpose of practising the activities concerned
  • evidence of professional qualifications
  • any means of proof that the service provider has practised the activity concerned for at least two years during the previous ten years.

Speaking after the Council, Commissioner Bolkestein said “Persuading Member States to get rid of barriers within the Internal Market is a bit like pulling teeth - it’s a bloody business and painful. In the end, the result is there. In some respects, it is disappointing but it is acceptable.”

Community Customs Code (JT)

The Council reached political agreement by qualified majority (with Greece, Italy, Malta, Portugal and Sweden voting against), on the draft common position on the proposal for a Regulation amending Council Regulation establishing the Community Customs Code. Being formally adopted, this text will be submitted to the European Parliament for second reading. The Commission’s proposal, presented in July 2003, aims to improve security at the external borders, while facilitating trade through simplified procedures and the use of information technology (see IP/03/1100). In this context, the main feature agreed upon regards the concept of an Authorised Economic Operator (AEO). An AEO would benefit from facilitated customs controls relating to safety and security and/or from simplifications provided for under customs rules throughout the Community.

Proposal for a Directive on Services in the Internal Market (JT)

The Presidency submitted a note on the state of play regarding the ongoing examination of the proposed framework Directive on Services in the Internal Market highlighting the complexity and sensitivity of some of the issues involved. The examination of this file in the competent Working Party is still at an early stage and therefore no debate is foreseen in Council at this time.

Commissioner Bolkestein told the Council “The Commission is well aware of the on-going debate on the Services proposal in certain Member States. It is quite right that such an important proposal should be the subject of wide consultation and discussion. However, in some cases, the debate appears to be influenced by interpretations of the Directive which are inaccurate. The Commission is therefore very much engaged in clearing up these misunderstandings so that the negotiation can focus on the real issues. I am confident that the constructive discussion which is taking place in the Working Party on Competitiveness and Growth will allow a better understanding of the Commission’s proposal. The Commission is calling for a rapid, thorough and balanced negotiation on this key proposal, which is aimed at improving the competitiveness of the European economy, creating more and better quality jobs and raising the living standard of every EU citizen.”

Regulation on Sales Promotions (JT)

In the light of opposition from several Member States to the Presidency compromise text, the Council decided to instruct its preparatory bodies to further examine the proposal for a Regulation concerning sales promotions in the Internal Market in order to agree on a common position at one of its future sessions. The proposed Regulation would remove barriers to cross-border sales promotions caused by divergent national rules on discounts, premiums, free gifts, promotional contests and promotional games (see IP/01/1351).

ITER (FF)

European Research Commissioner Philippe Busquin presented the state of play of negotiations on the ITER nuclear fusion project. The Council welcomed the Commission’s efforts towards successfully concluding such negotiations with ITER international partners. The Council also invited the Commission to push negotiations forward with a view of building ITER at the European candidate site of Cadarache in France.

Visas for third countries’ researchers (FF)

The Council welcomed the Commission’s proposals in this field, aiming at facilitating entry and movement of researchers from non-EU countries in the EU. The Presidency expressed its intention of forwarding the remarks made by the Competitiveness Council to the Justice and Home Affairs Council of Ministers. The Council addressed inter alia the issue of host organisations, welcoming researchers in the EU, with a view to avoiding additional and needless bureaucratic procedures for such organisations.

Future of EU research (FF)

Commissioner Busquin outlined the main guidelines of the future of EU research, paving the way for the publication of a Commission Communication on this issue at the beginning of June. In the context of the Dutch Presidency, the Communication and its blueprint for the future of EU research should be addressed at a workshop in the Netherlands on July 2-3.

Competitiveness, Innovation and Better Regulation (PS)

The Council had a wide ranging debate on competitiveness. The Commission’s Communication on an industrial policy for an enlarged Union was taken as a good starting point for discussions, and its analysis of the risks and challenges for industry deindustrialisation and challenges for Europe was welcomed.

Particular emphasis was placed on the investment in research and innovation, the new importance attached to impact assessment, steps to achieve a better regulatory environment, the importance of tailoring policy responses to the needs of specific sectors, the role of SMEs and, finally, the importance of the biotechnology and life sciences sector.

REACH (PS)

The Council took stock of progress on the Commission’s proposals to overhaul the way chemicals are registered, evaluated and authorised in the EU. The overall approach of promoting an innovative chemicals sector and ensuring a high level of protection for health and the environment was welcomed. Discussion focused on three issues: the conditions for registering chemicals, the obligations placed on operators as regards their duty of care and the role of the future chemicals Agency. Council agreed to look more closely at each of these and invited Member States to work out specific proposals on these issues in greater detail, so that discussion could be taken forward under the Dutch Presidency.


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