Monday, 14 July 2014

Is Hungary getting cold feet for unitary patent?

Although, Hungary has not yet ratified the critical Agreement on the Unified Patent Court, they were on course for it. Hungary has signed the agreement, is part of the EU unitary patent regulations, and will host one of the unified patent court's institutions, the Training Centre for Judges in Budapest. But now, Hungary apparently has some reservation about joining the unitary patent system, at least for just now.

Mr. Mihály Ficso, the Vice President for Legal Affairs of the IP office of Hungary, has given a presentation at the Premier Cercle's Unitary Patent & Unified Patent Court 2014. According to a report of Mark Richardson at Ipcopy, Hungary has a number of reservations:

- Ratification of Hungary will increase the number of valid patents in Hungary,
- Hungary may benefit from the unitary patent system without taking part in it,
- There are concerns about machine translations
- Renewal and court fees are not yet known

Mr. Ficso added that there is still a political will in Hungary to ratify the agreement. If I am not representing the Hungarian position fairly, I do apologize. Anybody who was actually at the presentation should feel free to correct me in the comments.

In part I can sympathize with the comments made by Mr. Ficso. All four reservations are true, yet I do not think they should block joining the unitary patent system.

The number of patent rights valid in Hungary will surely increase if the unitary patent is a success. This will hold for all participating countries though (perhaps excluding Germany). I'm not sure I agree with the underlying assumption that having a patent system that encourages not to protect your innovations would be an advantage for an economy.

Indeed, Hungary would benefit from the unitary patent system, even if it didn't take part in it. In fact the whole world will benefit from an improved European patent system. Also Hungarian companies could protect their innovation in a large part of Europe at low cost. Nevertheless, it would be even better for Hungarian companies if they could also protect their home market at the same time.

The concerns about machine translations are also valid. On the other hand, working with many languages is a reality of the patent profession. Machine translations have made life a lot easier. Although a human translation is (almost) always better, machine translations have advantages though. They are less costly, and are immediately available when needed. Should controversy arise, a human translation can always be made.

After the introduction of the London Agreement (of which Hungary is a member), translation requirements were greatly reduced. For example, a few years ago Hungary abolished the requirement that a full translation was needed. At present only the claims of a European patent need to be translation into Hungarian for validation.

As to the renewal fees. That we do not know their level is annoying. We only have Battistelli's enigmatic "They will be higher than many would hope, but lower than some might fear." On the other hand, Hungary takes part in the discussions regarding the level of these fees. If there are concerns as to their level, Hungary can influence the discussion.

I wish Mr. Ficso good luck in addressing these concerns, and I hope that in future I will be able to offer protection in Hungary to my clients as part of the unitary patent.


  1. There are a lot of misunderstandings in your post:

    Hungary is already a so called ,Participating Member State' of the Enhanced Cooperation reg. the Patent with Unitary Effect acc. To Art. 326 et seq. TFEU. There are two regulations ad secondary European law that will become law in Hungary directly and without any ratification (4 month after the UPC-Agreement comes into force) .

    The UPC-Agreement itself will not increase any number of valid patents. Its just an agreement to erect a new common court system, but this agreement is not EU law itself and has to be ratified.

  2. Thank you for commenting on my post. You are quite right that Hungary is a participating member state. Spain and Italy are the only two EU member states who do not participate in the so-called enhanced cooperation. However, you are mistaken as to the role of the unified patent court.

    Without ratification of Hungary, unitary patents will not be valid in Hungary.

    Article 18(1), second sentence of Regulation 1257/2012 provides that:

    By way of derogation from Articles 3(1), 3(2) and 4(1), a European patent for which unitary effect is registered in the Register for unitary patent protection shall have unitary effect only in those participating Member States in which the Unified Patent Court has exclusive jurisdiction with regard to European patents with unitary effect at the date of registration.

    If Hungary does not ratify the Agreement on a Unified Patent Court, then the Unified Patent Court will not obtain such exclusive jurisdiction in Hungary, and accordingly, unitary patents will not be valid in Hungary.