European patent system stifling innovation

The lack of a Europe-wide community patent poses "incredible challenges" for small businesses and undermines the EU's goal of becoming the most competitive knowledge-based economy in the world, according to a new study

The existing intellectual protection (IP) system - under which companies have to file a patent in every EU member state - is "a telling example” of the Union's fractured regulatory framework, argues the study presented at an IP Summit in Brussels.

To bypass the EU regulatory framework, many innovative companies and especially SMEs end up skipping the European market by applying for a patent in the US. Jonathan Zuck of the Association for Competitive Technology said: "For the EU to even consider catching up with the US and Japan, a single IP-protection must be put in place."

Under the current system, filing a patent in Europe can take twice as long (44 months) than in the US and Japan, while the cost of a European patent is almost five times higher than in the US (€10,330) and three times greater than in Japan (€16,450), the study shows.

“The current patent system is outdated. It needs to be brought in line with the requirements of the 21st century," Michael Setton, CEO of the French e-Consulting company Cyberfab, told the IP summit.

But businesses said they were sceptical that an agreement on a Community patent would be reached under the incoming Czech EU Presidency, investing their hopes in Sweden, which assumes the EU helm in the second half of 2009.

Administrative simplification and more innovative policies featured high on the list of demands by businesses surveyed for the study. However, efforts to streamline legislation differ largely across member states, the study shows. While numerous EU states - such as Finland, Sweden, France and Germany - have higher innovation levels than in the USA or Japan, others, mostly from the new Eastern European member states but also Spain - are "falling further behind", it reveals.