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EU Commission -Consultations on compulsory licensing and a revision of the framework for Standard Essential Patents

Part 1- Compulsory Licensing

Intellectual Property rights continue to have priority for the EU Commission. 

The current proposals are based on the Action Plan on Intellectual Property and concern not only compulsory licensing but also standard essential patents (SEPs). Last month, the Commission had already suggested a standardised or harmonised procedure in a Call for Evidence on the legal framework of supplementary protection certificates (SPCs).

The initiative on compulsory licensing is intended to initiate a revision of the framework for compulsory licensing of patents in the EU, harmonizing the procedure currently regulated and implemented by different procedures in different states.

The background of the initiative is the experience of the discussions on the so-called TRIPS waiver and the fragmented legislation on compulsory licensing of patents in the EU. Under the TRIPS Agreement, in particular Articles 31 and 31a and the Annex, WTO members are permitted to license the use of the subject matter of a patent without the consent of the patent owner if certain conditions are met.

As the conditions and procedures applicable to such licenses (for example, in terms of scope or determination of royalties) vary from Member State to Member State legal certainty is impaired. In this context, the Commission’s arguments for revision focus on the availability of crisis management (e.g., for the cross-border manufacture and distribution of pharmaceutical products, such as vaccines).

The Call for Evidence for an Impact Assessment paper considers options of legislative and non-legislative measures. However, as is clear from the description of the initiative, a legislative proposal is likely.

The Commission recognizes that the grant of compulsory licenses has a significant impact on the patent holder concerned: the remuneration to which the rights holder is entitled may be significantly less than the amount which could have been agreed under other circumstances.

Comment

Compulsory licensing should continue to be an extraordinary measure taken as a last resort in cases where voluntary agreements are out of reach.

If a more convergent, predictable and harmonized regime is to be created, it must be limited to specific exceptional cases which are clearly defined.

There is an opportunity to comment on the suggestions in the Call for Evidence Paper.

Intellectual property – revised framework for compulsory licensing of patents

Deadline for contributions: 29 April 2022

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Authors

Dr Gisela Grabow

Counsel

Lawyer (England/Wales)