Context: The importance of the Netherlands as a patent jurisdiction is understood by some and underestimated (or “misunderestimated” as former U.S. president George W. Bush once said) by many. With fewer than 20 million inhabitants, the country may appear small, but it is a key market and the Port of Rotterdam is an extremely important entry point for goods into the EU and even beyond. Also, various companies have important subsidiaries (such as Europan distribution centers) in that country.
What’s new: On Friday, the Dutch Ministry of Economic Affairs launched a public consultation on a major reform of the Dutch Patent Act of 1995 (link to government website (in Dutch)). The consultation is open until the end of March. The most fundamental change envisioned by the Dutch government is that national Dutch patents would be examined as opposed to registered in an unexamined form. Moreover, wiht a view to climate change, patent protection will be extended to economic activities at sea, such as wind farms. Also, the courts in The Hague (district court and appeals court) will have jurisdiction over certain question relating to Dutch national patent grants, and technically qualified judges will be appointed there. And it will become possible to pursue PCT (Patent Cooperation Treaty) applications in the Netherlands as opposed to going via the European Patent office (EPO).
Direct impact: It appears that the government already knows fairly well what it wants to do, and in a parliamentary democracy, the government typically knows that it will get the necessary majority support in the legislature. That said, stakeholders may still try to push for certain adjustments, given the government’s basic ideas could be implemented in different ways.
Wider ramifications: While the Unified Patent Court (UPC) is increasingly popular, innovators with clever patent prosecution and (long-term) litigation strategies can benefit from the particular features of certain national patent systems in Europe. Those strategic options are not widely understood yet, but may in the mid to long term give some patentees a significant advantage as they enforce their rights.
From registration to substantive examination
One “feature” of the Dutch national patent system has so far been that patents are registered, meaning that they merely have to meet formal criteria, but are not examined for novelty, inventive step and industrial applicability. That is why they do not enjoy any presumption of validity in court. The Dutch government now wants to align its patent system with that of other major jurisdictions. The Dutch patent office (Octrooicentrum Nederland (OCNL)) will conduct examinations of patent applications when the reform bill is in force.
The ministry is realistic that even an examination procedure does not lead to absolute legal certainty, but considers it preferable over the status quo.
It is worth noting that certain Dutch overseas territories are not covered by EPO-granted patents that are registered in the Netherlands, but are covered by Dutch national patents.
Challenging Dutch national patents post-grant; avoidance of divergent decisions
It will be possible to oppose, at a low cost (no mandatory legal representation), Dutch patents at the patent office.
In order to eliminate the risk of inconsistent decisions on a Dutch patent, all civil (infringement litigation) and administrative (appeals of patent office decisions) matters will be consolidated in the Hague District Court, and appealed from there. That court will be in a position to appoint technically qualified judges.
PCT applications
The Dutch patent office will join the PCT system directly. So far, patent filers had to go through the EPO in order to receive protection in the Netherlands for PCT purposes.
Enforceability at sea
The Netherlands is an important country for renewable energy in the form of wind farms, particularly wind farms at sea. Maritime law distinguishes between different zones. Dutch patent law as it stands today covers the part of the North Sea that is considered Dutch territory, but allows enforcement with respect to activities beyond that zone only with respect to “natural resources” on the continental shelf. After the contemplated reform, Dutch patent law will be enforceable in the Exclusieve Economische Zone (EEZ) (“Exclusive Economic Zone”). That means wind turbines and solar parks in that zone will also be subject to Dutch patent law.
This is an interesting approach to climate policy. There are stakeholders out there who argue that climate change would best be served by weakening intellectual property rights. The Dutch government, however, clearly believes that by strengthening patent enforcement in the climate tech context, there will be a stronger incentive to innovate and, as a result, more innovation, which in turn contributes to the fight against climate change.
Exclusive licensees get standing
So far, exclusive licensees of a patent do not having standing to sue under Dutch patent law unless there is a specific provision in a contract. The reform bill will change that and bestow standing on exclusive licensees by default.
Overall impression
The overall thrust of the bill is patentee-friendly and reflects a desire to harmonize the Dutch system with that of other countries, including the German patent system. While there is nothing in it that relates specifically to standard-essential patents (SEPs), the Dutch patent reform proposal goes in the opposite direction from the proposed EU SEP Regulation, which is about weakening patent rights by complicating and delaying enforcement.