[Fsfe-ie] IP-Watch: Industry Readies For Round Two Of EU Patent Directive

teresahackett at eircom.net teresahackett at eircom.net
Thu Jan 19 16:05:08 CET 2006

A new entry has been posted to the Intellectual Property Watch weblog.

Prague—Patent-dependent industries that spent heavily for lobbying on a 
failed directive on the patentability of computer-related inventions are 
learning from their mistakes as they prepare for the possible 
resurrection of the issue.

Lobbyists attending a Progress and Freedom Foundation (PFF) in Prague on 
17 January signalled they will move early on the patent directive issue 
following the European Commission’s release this week of a questionnaire 
asking for views on the patent system. Comments received by the 31 March 
deadline could lead to the formulation of a new proposed directive.

“It’s starting again,” said Guenther Schmalz, director of IP for Europe 
for software maker SAP. “And I hope this time we will be better prepared.”

Schmalz, who lobbied on the directive last year, said industry “started 
very late” last time and will not let it happen again. He told 
Intellectual Property Watch that industry representatives developed 
informal networks last summer which are being revived. The networks are 
specific to each industry but also cut across industries that use patents.

Schmalz added that the difficulty in getting cross-industry consensus on 
specific positions led to favouring informal networks rather than formal 
coalitions. For instance, companies that make software can have 
different purposes for patented products. His company is the third 
largest independent software maker in the world after Microsoft and 
Oracle, but other companies develop more software than SAP. Siemens has 
twice the number of software developers that SAP has, but Siemens 
develops the software embedded in its machines rather than for retail.

Schmalz said opponents of the directive had a three-year start on 
industry. He described the opponents’ arguments and tactics, such as 
protests and an effective door-to-door campaign to convince parliament 
members of the problems with the directive. Schmalz called for a 
“bridge” between positions on the directive, and posed questions to be 
answered about the need for special rules for the protection of 
computer-implemented inventions.

He identified some areas of disagreement with opponents that will need 
to be resolved, such as interoperability and whether a requirement that 
a software patent solve a technical problem would limit frivolous patents.

Jonathan Zuck, whose Association for Competitive Technology includes 
4,000 large and small companies, said patent quality is “key” to getting 
support for a directive. Zuck, along with Stephen McGibbon, Microsoft’s 
representative for Central Europe, and others at the meeting 
acknowledged a problem with frivolous patents. Zuck said they can never 
be entirely eliminated, but fears can be lessened by taking the quality 
problem “head on” and showing it can be addressed. He also said more 
emphasis should be placed on letting small businesses speak for 
themselves on the issue.

Schmalz also mentioned an effort to develop a European community-wide 
patent, but said the requirement to put every filing in all 25 EU 
languages makes it more expensive than obtaining a patent. Zuck said 
industry “desperately wants” community patents.

Despite SAP’s call for a bridge, some meeting participants fed distrust 
of the directive’s opponents. PFF’s James DeLong asked how the 
opposition got its funding, and whether it came from foundations. 
Schmalz replied that it came from open-source software companies. 
Speaking to the like-minded business audience, Schmalz also said that 
some industry representatives reported being personally threatened 
during the debates last summer.

Meir Pugatch of the University of Haifa (Israel) and the pro free market 
Stockholm Network, warned industry representatives that this is not time 
for a “vacation” in the aftermath of last summer’s defeat. If there is a 
need to be filled, he said, it will be filled by one side or the other, 
so industry would be advised to act quickly.

Microsoft’s McGibbon said EU Internal Market Commissioner Charlie 
McCreevy sees the patent directive as “fundamental” to Europe’s 
productivity and competitiveness. Later, PFF President Ray Gifford said 
fear of lost competitiveness is an effective argument with policy 
makers. Schmalz also raised the spectre of Asian software developers 
taking jobs from Europeans if measures are not taken to improve the 
European patent system.

Highlighting the need for improvements in the patent system, DeLong said 
that in the United States, each patent application gets about 20 hours 
of review, but that because of the backlog it takes two years for the 
decision to come out.

Czechs Lean Toward Support for Directive

Dana Berova, minister of informatics for the Czech Republic, predicted 
the discussions over EU software patents “will continue for years.” She 
made clear that her country backs the patent directive, which she said 
should not change Czech law.

In response to questions, she said the Czech government is not under 
pressure to oppose intellectual property protections, and that the 
education of lawyers and others needs to take place to improve the 
environment for patenting.

Berova also said that in the debate over a development agenda at the 
World Intellectual Property Organisation that smaller economies should 
not have different levels of intellectual property rights appropriate to 
their size and conditions. Differing levels of development should be 
addressed in other ways, she said.

Karel Cada, president of the Czech Industrial Property Office, said 
Czech innovators do not recognise the advantage in obtaining patents for 
their work, and that the number of patent filings in the country is far 
below its height in the 1930s. The Czech Republic joined the European 
Patent Office in 2002 and the European Union in 2004.

Cada argued against several concerns that had been raised by opponents 
of the software patent directive. For instance, he said it would not 
give patents to pure software, that only technical solutions would be 
patentable, and that no trivial patents would be granted.

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