Dispute over EU patent court venue 'a scandal'

A leading MEP has slammed the United Kingdom, Germany and France for failing to agree a location for the headquarters of the new European Patent Court – a dispute that is blocking the long-awaited introduction of a Europe-wide patent system designed to cut costs for businesses.

Guy Verhofstadt, president of the Alliance of Liberals and Democrats in the European Parliament, described the argument between London, Munich and Paris as "a scandal".

Discussions over the creation of a unified patent regime throughout the European Union have been ongoing for more than 30 years. But the site of the headquarters is now the only outstanding issue to be resolved after the other details were finalised in December last year.

With three countries vying to be the venue of the main court, European leaders agreed in March that a final decision would be made this month. However, national ministers meeting at this week's competiveness council in Brussels – billed as an opportunity to "gather consensus on the location of the seat" – failed to make progress.

A statement published by the council said: "The debate showed that further work was needed to reach consensus on the location." Although regional divisions will be located throughout the EU, hosting the headquarters is expected to bring significant economic advantages to one member state.

One study in the UK, by FTI Consulting, said the court not being located in London would see the UK economy lose out on between £683m and £2.95bn a year. The chief executive of the Law Society, Desmond Hudson, quoted by the Law Society Gazette, said: "If the UK government agrees that the new court should be based in Paris or Munich instead of London, we will see the UK's intellectual property expertise disappear overseas."

But Verhofstadt insisted the benefits of a single European patent system should not be held up by "member state infighting". He said: "The European patent is a longstanding issue on the European agenda. Now that agreement is within reach, France, Germany and the UK find nothing better to do than battle over the seat.

"The single patent could cost up to 80 per cent less for businesses, which would open up new opportunities for small and medium sized enterprises to access the internal market. The dispute is all the more incredible given the current context of looming recession."

He said that if no agreement was reached by June the court should be given a temporary home in Brussels – based on the template of the European Food Agency, which was hosted in the Belgian capital before eventually moving to Italy once a dispute with Finland was resolved.

Only Italy and Spain of the EU's 27 member states have refused to sign up to the single patent, in protest at the planned English, French and German language regime for applications and legal challenges. European Commissioner for economic and monetary affairs Olli Rehn, at a conference in Brussels this week, urged them to join the project as an "important solution to help the private sector".

Last month, though, the economic benefits of an EU patent were questioned by members of the UK parliament. In a report, the European scrutiny committee said there was "vehement opposition" to the idea among patent experts, who warned that small businesses would face a "convoluted, expensive and protracted" litigation system that would prove "far more burdensome" than the one already in place.