EU Council Formally Adopts Controversial Patent Proposal

By Matthew Broersma  |  Posted 2005-03-07

EU Council Formally Adopts Controversial Patent Proposal

The Council of the European Union on Monday formally endorsed the EUs controversial legislation on IT patenting, paving the way for the proposal to move to its long-delayed next step in the legislative process. The proposed directive will now become European law within a year, unless it is rejected altogether.

The proposals opponents, including prominent open-source software developers such as Linus Torvalds, Members of European Parliament (MEPs) and the national governments of several EU member states, had hoped to prevent the EU Council from taking Mondays step of formally adopting the proposal as its "Common Position." The European Parliament passed several resolutions asking the European Commission, the EUs executive branch, to start the legislative process over from scratch, a request the Commission denied.

Critics say the directive would effectively allow software patents to be obtained and enforced in Europe.

Click here to read how an EU patent law could affect open source.

The decision was welcomed by industry bodies such as the Business Software Alliance and the European Information and Communications Technology Industry Association, which believe it will improve the patent protection available to IT businesses.

"This is definitely a very significant step forward," said EICTA spokesman Leo Baumann. "It has already taken far too long. We believe the agreement is balanced; its a good framework for protecting and encouraging innovation throughout Europe."

The BSA said the directive—formally known as the "directive on the patentability of computer-implemented inventions (CIIs)"—is needed to make the European patent system more responsive to the needs of European inventors. "We support the CII Directive as one tool in building a better patent system. We wish to remind the European Institutions that the system needs to evolve as the needs of inventors evolve," said Francisco Mingorance, director of policy, BSA Europe, in a statement.

The proposed directives critics said the endorsement made a "mockery" of the EUs legislative process, given the widespread opposition of elected bodies such as national parliaments and the EP. "We will ask the European Parliament to make very serious amendments, and ask them to throw it out, if they can, so as not to take a risk," said Florian Mueller, head of the campaign. "It would be an acceptable outcome for us if we kill this directive. The key thing for us is to get a good directive, or none at all."

The Foundation for a Free Information Infrastructure claimed the adoption violated procedural rules and argued the Common Position no longer has the required support among member states. "This is a very sad day for democracy," said the FFII in a statement.

The outcome of the current controversy doesnt just affect European companies—any company doing business in the EU must be aware of the impact of software patents, lawyers say. For companies involved in developing software, patents mean either the ability to add another layer of legal protection to their inventions, or an added risk that their products will infringe competitors patents. Organizations may also be at risk if they use software that infringes patents, unless they have an indemnity agreement with the software provider.

Next Page: Denmark stands back.

Page 2

Late last week, it appeared that Denmark and Poland might force the Council to reopen debate on the directive. In the end, Danish Minister of Economic Affairs Bendt Bendtsen decided not to stand in the way of the endorsement and instead attached a written declaration of Denmarks opposition. Several other countries, including Hungary, Latvia, the Netherlands, Poland and Cyprus, have added similar declarations.

It is highly unusual for a Common Position to be renegotiated after it has been agreed upon—a step that happened back in May 2004—and Council delegates said they were unwilling to set a disruptive precedent by reopening the debate.

While efforts to stop the directive in its tracks have failed procedurally, protesters have gained ground politically, Mueller said. "The reputation with which [the text] goes to the Parliament now is a much different one than if we had never tried to prevent this decision," he said.

To read David Courseys analysis of the pros and cons of software patents, click here.

The text will now go to a second reading in the European Parliament, where MEPs will have a strict three-month limit to make changes or reject it, and decisions require a more substantial majority than in a first reading. These conditions would originally have presented a nearly impossible barrier for making any changes, but there is now much greater political will among MEPs, Mueller said. "This has been so bitterly contested over the past few months that on the day they vote on this, the turnout is going to be really high," he said.

Check out eWEEK.coms for the latest news, reviews and analysis about productivity and business solutions.

Rocket Fuel