EU takes key step towards bloc-wide patent system

By Huw Jones

LONDON, March 24 (Reuters) - The European Union's executive arm has proposed a single bloc-wide litigation system for defending patents, a move that would cut legal costs for companies.

A cheap one-stop system for filing and defending a patent in the EU to nurture new business ideas has been a goal for decades but thwarted by disagreement over which languages and court structure to use.

The European Commission formally asked the bloc's member states on Tuesday for a mandate to set up a unified patent litigation system that would have jurisdiction over existing European patents and a future single EU community patent.

This would avoid the need for a company to defend a patent in several national courts, a costly process.

"European businesses find the current patent litigation system complex, slow and costly," EU Internal Market Commissioner Charlie McCreevy said in a statement.

By 2013 a unified court system would save 148-289 million euros ($202 million to $394 million) a year, the Commission said.

Lobbyists for smaller firms welcomed the move.

"We hope this development will give a new impetus to the conclusion of negotiations on the community patent," said Jonathan Zuck, president of the Association for Competitive Technology.

"Small and medium-sized firms cannot wait for it, they need it today," he said.

A new system of courts would give a role to the EU's top court, the European Court of Justice. It would need backing from the bloc's 27 member states and the wider group of 35 nations party to the European Patent Convention.

The ECJ will be asked for an opinion on the compatibility of the Commission's plans with EU treaty rules.

"In parallel, outstanding issues concerning other components of the patent reform package such as the regulation on the community patent and the relationship between the EU and the EPO (European Patent Office) will likewise have to be addressed," the European Commission said. (Editing by Dale Hudson)