Context: While the European Parliament (EP) largely adopted the European Commission’s (EC) proposed regulation on standard-essential patents (SEPs), the bill’s fate is uncertain. Even if it is ultimately passed into law, its final text could differ substantially, at least in certain areas, from the EC-EP proposal. SEP enforcement in the EU continues to expose the SEP Regulation’s flaws that are due to an insufficient understanding of reality (July 4, 2024 ip fray article), and the proposal is also controversial on the international stage (June 27, 2024 ip fray article).
What’s new: The EC’s Directorate-General for the Internal Market (DG GROW) today announced a call for tenders (EU tenders portal). DG GROW wants to spend € 320K on a study meant to assist in the implementation of the EU SEP Regulation. In particular, it’s about what standards should be subjected to the envisioned regulation and about essentiality checks.
Direct impact: The EC forges ahead as if the adoption of the SEP Regulation in the form it proposed (and the EP adopted) was a foregone conclusion. Someone will win the tender and produce a report on the basis of assumptions that the further legislative process could prove wrong. By issuing this tender now, the EC calls into question that it uses EU taxpayers’ money responsibly and that it respects the process (which is far from finished).
Wider ramifications: It was also questionable that the EC put an AI Office in place before the AI Act was formally adopted, but there was a political agreement in place, while the vast majority of EU member states have not even put forward their views on the proposal and the EC still owes the EU Council written answers to approximately 250 questions, a number of which raise serious issues. Instead of spending time and money on a study based on a hypothetical EU regulation, DG GROW might consider doing its homework and answering the Council’s questions in writing.
The EC’s call for tenders is based on at least three assumptions:
- There will be a SEP Regulation. Now, that is not an unrealistic assumption given the EP vote, but it is also far from certain as the proposal doesn’t appear to have much momentum in the Council.
- The final regulation will leave a lot of fundamental decisions, such as the scope (in terms of standards falling under the regulation), to the EC. In that case, the EC obviously would need to underpin its implementing acts with some “research.”
- The final regulation will come with an essentiality check regime along the lines of the current proposal, regardless of the fact that essentiality checks are snake oil (May 19, 2024 ip fray article).
If (in an alternative universe) more than 20 of the 27 EU member states had communicated their views to their peers in the Council’s Working Group, and if almost all of them were totally in favor of the current proposal, the adoption of the bill would be near and it would be reasonable to predict that the final text will be materially consistent with the EC-EP proposal. But that is not the case. Arguably, the call for tenders shows a lack of respect for the Council.
Even if the proposal was adopted in more or less its current forms, there would be 24 months for all preparations before it enters into force. The “study” that the EC is looking for could easily be conducted during a limited part of that period.
DG GROW’s attitude is all the more surprising after the recent EP elections, which shows that through the 27-member bloc there is growing skepticism of whether the EU benefits its citizens on the bottom line. Instead of respecting the legislative process and waiting until its outcome is reasonably reliably clear, they go ahead and spend EU taxpayers’ money. The EU Court of Auditors may have questions if this goes wrong.