On 11 December 2012, the European Parliament voted in favour of the EU Council’s draft regulations establishing unitary patent (‘UP’) protection across the EU Member States (excluding Spain and Italy) using the enhanced co-operation procedure, which is to be overseen by a Unitary Patent Court.

On the same day, Advocate-General Bot issued his Opinion that the Court of Justice should dismiss Spain and Italy’s challenge to the Council’s authorisation of enhanced co-operation on the basis that the creation of intellectual property rights falls within the EU’s non-exclusive competences. If his Opinion is followed, the Unitary Patent Regulation will come into force once it is ratified by 13 contracting states (including the UK, Germany and France), making the pan-European patent right available from 1 January 2014.

The UP will co-exist with existing national patents and the centralised application system for European patents (EPs), creating the potential for three layers of patent protection. The European Patent Office will grant UPs with unitary effect for the territory of the 25 participating states at the patentee’s request. Applications for unitary effect must be in English, French or German or translated into one of those languages (the cost of which will be reimbursed), but no further translations will be required.

This is a welcome step considering that the current cost of patent registration in every EU country is €36,000, €23,000 of which goes on translation costs. The prohibitive costs of pan-European patent protection is an all too familiar barrier for SME and individual inventors which has contributed to China and the US outperforming Europe on creative output, according to figures from the World Intellectual Property Organisation. According to the European Commission, the new UP will cost between €980 and €2,380, broadly in line with the average cost of a US patent (€1,850).

Putting potential cost savings aside, there would be no obligation to follow the UP route. Applicants will be able to choose to have a UP or a collection of EPs or both (perhaps a UP for the 25 UP contracting states and an EP for Spain, Italy and the other non-EU but European Patent Convention signatories, including Switzerland and Turkey).

As part of the measures, a new Unified Patent Court (‘UPC’) will hear disputes over UPs and EPs, although there will be a 7 year transitional period applicable to the latter during which revocation or infringement actions may still be brought in national courts. While decisions of the UPC will apply in all participating Member States (in contrast to enforcement or revocation of the EP, which can currently involve multiple legal proceedings in various countries), the loss of jurisdiction for national patent courts to hear patent infringement claims is a particularly controversial part of the proposals.

Technology companies, for instance, are worried that it will play into the hands of patent trolls trying to monetise their patent portfolios.

This is a space to watch in 2013. It remains to be seen whether, and in what form, the UP will come to fruition and indeed how much of a stimulus it will prove to be.