10 myths

Ten myths about the European patent system

Myth 1: "The European patent system works well. The European Patent Office is leading in a policy to prevent the adoption of undesired American elements into European patent law ".

Reality: The European patent system is becoming more and more a burden for firms. There is an undeniable tendency to follow the United States.

Myth 2: "Patents are indispensable for innovation – now more than ever."

Reality: Occasional success stories are actually the exceptions that proverbially prove the rule. The patent system moves competition from the market to the courtroom. In several fields, patenting activity is found to increase while R&D expenditure in the same industry decreases, a phenomenon known als the patent paradox.

Myth 3: "Patents are indispensable for protection against imitation."

Reality: While it may sound contradictory, imitation is, to some extent, normal in a free economy; and therefore it is not considered illegal. Innovative products often build upon the products of competitors. Incidentally, pure 'me too'-imitation rarely pays: a smart competitor adds something, creating a better and more appealing product.

From a competition law perspective, 'protection' of a market can even be illegal, and constitute a crime. Actually, it is often more important for firms to protect their reputation, a purpose much easier and more effectively reached by a smart branding strategy, including trademark registration.

Myth 4: "Patents are indispensable as an incentive for research."

Reality: Whether true researchers are actually motivated by patents is very questionable (Machlup & Penrose 1950). Rather there is a substantial risk that patents provide perverse incentives for improper behaviour – food for thought, in particular taking in account the current economic crisis. While research prospers with the free exchange of ideas, a researcher who wants to patent his inventions should work in strict isolation until the patent applications have been secured.

Myth 5: "The patent system is a excellent tool for knowledge valorisation by universities."

Reality: The United States experience ('Bayh Dole Act') shows that the patent system certainly has not improved the research climate in universities. Here as well the patent system gives perverse incentives, for instance not to cooperate.

Myth 6: "Companies want patents – only ‘left wing' activists are opposed."

Reality: Of course companies want patents, but controversy on the social use of patents is very old. Nowadays companies are faced with a minefield of patents in their R&D activities, which requires expensive precautions in a time that a reduction of administrative burden of companies is a political priority.

Furthermore, there is an increasing risk of new ‘bubbles’ because firms increasingly activate 'intellectual property' on their balance sheets. De balance value of firms who activate patents, and the associated creditworthiness is likely to be subject to strong variations, because inventions may be superseded overnight.

Myth 7: "Patent policy making is subject to democratic decisions."

Reality: Actually the European Patent Office – no EU-institution – is practically only controlled at the level of officials by the member states, by an 'Administrative Council' what primarily represents the national patent offices, who have a direct financial interest in EPO policy. The EU does not control the EPO. On the contrary: the EU has issued several controversial Directives intending to extend patent law. The Biotechnology Directive met strong resistance from the Dutch government. The Software Patent Directive was eventually rejected, after a long and heavy political struggle. Like in many other fields, lobbyists in particular of American companies skilfully exploit EU’s 'democratic deficit'.

Myth 8: "The EU needs a strong patent system in order to be able to compete with the rest of the world, the United States in particular."

Reality: Patents have territorial effect: European patents are patents for Europe, and not just for Europeans. Americans use European patents against European competition.

Myth 9: "The software patent dilemma is addressed energetically by the EPO now that its Enlarged Board of Appeal has been invoked in order to shed its light on the limits of software patentability."

Reality: The EPO President indeed recently has referred some questions about this issue to the EPO Enlarged Board of Appeal. However, these questions are limited to legal details. The basic premises of the present rules are not questions, and those have actually led to so much legal uncertainty, and so many questions of the appropriateness of software patents.

Myth 10: "International treaties do not allow substantial changes in patent legislation."

Reality: Actually international bodies such as WIPO and WTO are populated by patent specialists who are naturally strong believers in the blessings of patents. They are likely to ignore the connections with other parts of law. Even EU Commissioner Neelie Kroes wonders whether the present patent system really furthers the economy. There is no coherent policy. For political scientists, the peculiar governance of the patent system meanwhile has become a popular research object. Fundamentally it can’t be true that the structures prohibit a democratically controlled effective policy, in particular in the present time of a serious economic recession.

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