“Unitary Patent”

In the context of the establishment and functioning of the internal market, the first paragraph of Art. 118 TFEU confers the competence to create European intellectual property rights and to set up, as regards those rights, centralized, Union-wide authorization, coordination and supervision arrangements. The competence, conferred by the second paragraph of Art. 118 TFEU, to establish language arrangements for those rights is closely bound up with the introduction of the latter and of the centralized arrangements referred to in the first paragraph of that Article. As a result, that competence too falls within the ambit of the functioning of the internal market. The expression “relevant provisions of the Treaties” in Art. 26(1) TFEU makes it clear that competences falling within the sphere of the internal market are not confined to those conferred by Arts. 114 and 115 TFEU relating to the adoption of harmonization measures but cover also any competence attaching to the objectives set out in Art. 26 TFEU, such as the competences conferred on the Union by Art. 118 TFEU. Although it is true that rules on intellectual property are essential in order to maintain competition undistorted on the internal market, they do not constitute “competition rules” for the purpose of Art. 3(1)(b) TFEU. The scope of, and arrangements for, exercising the Union’s competences in the area of “competition rules necessary for the functioning of the internal market” are determined in Part Three, Title VII, Chapter 1 of the TFEU, in particular in Arts. 101 to 109 TFEU. To regard Art. 118 TFEU as forming part of that area would therefore be contrary to Art. 2(6) TFEU and the result would be to extend unduly the scope of Art. 3(1)(b) TFEU. As such the competences conferred by Art. 118 TFEU fall within an area of shared competences for the purpose of Art. 4(2) TFEU and are, in consequence, non-exclusive for the purpose of the first paragraph of Art. 20(1) TEU. A measure is vitiated by misuse of powers only if it appears, on the basis of objective, relevant and consistent evidence to have been taken solely, or at the very least chiefly, for ends other than those for which the power in question was conferred or with the aim of evading a procedure specifically prescribed by the Treaty for dealing with the circumstances of the case. Nothing in Art. 20 TEU or in Arts. 326 to 334 TFEU forbids the Member States to establish between themselves enhanced cooperation within the ambit of those competences that must, according to the Treaties, be exercised unanimously. On the contrary, it follows from Art. 333(1) TFEU that, when the conditions laid down in Art. 20 TEU and in Arts. 326 to 334 TFEU have been satisfied, those powers may be used in enhanced cooperation and that, in that case, provided that the Council has not decided to act by qualified majority, it is the votes of only those Member States taking part that constitute unanimity. In addition, Art. 20 TEU and Arts. 326 to 334 TFEU do not circumscribe the right to resort to enhanced cooperation solely to the case in which at least one Member State declares that it is not yet ready to take part in the legislative action of the Union in its entirety. In accordance with Art. 20(2) TEU, the Council may not authorise enhanced cooperation except “as a last resort, when it has established that the objectives of such cooperation cannot be attained within a reasonable period by the Union as a whole”. This condition is particularly important and must be read in the light of the second paragraph of Art. 20(1) TEU, which provides that enhanced cooperation is to “aim to further the objectives of the Union, protect its interests and reinforce its integration process”. The Union’s interests and the process of integration would not be protected if all fruitless negotiations could lead to one or more instances of enhanced cooperation, to the detriment of the search for a compromise enabling the adoption of legislation for the Union as a whole. In consequence, the expression “as a last resort” highlights the fact that only those situations in which it is impossible to adopt such legislation in the foreseeable future may give rise to the adoption of a decision authorising enhanced cooperation. It is apparent from the first paragraph of Art. 326 TFEU that the exercise, within the ambit of enhanced cooperation, of any competence conferred on the Union must comply with, among other provisions of the Treaties, that which confers that competence. The enhanced cooperation to which these actions relate must, therefore, be consistent with Art. 118 TFEU. With regard, on the other hand, to the expressions “throughout the Union” and “Union-wide” used in Art. 118 TFEU, it must be held that it is inherent in the fact that the competence conferred by that article is, in this instance, exercised within the ambit of enhanced cooperation that the European intellectual property right so created, the uniform protection given by it and the arrangements attaching to it will be in force, not in the Union in its entirety, but only in the territory of the participating Member States. Far from amounting to infringement of Art. 118 TFEU, that consequence necessarily follows from Art. 20(4) TEU, which states: “Acts adopted in the framework of enhanced cooperation shall bind only participating Member States”. It cannot be validly maintained that, by having it in view to create a unitary patent applicable in the participating Member States and not in the Union, the creation of unitary patent protection damages the internal market or the economic, social and territorial cohesion of the Union. While it is, admittedly, essential for enhanced cooperation not to lead to the adoption of measures that might prevent the non-participating Member States from exercising their competences and rights or shouldering their obligations, it is in contrast, permissible for those taking part in this cooperation to prescribe rules with which those non-participating States would not agree if they did take part in it. Indeed, the prescription of such rules does not render ineffective the opportunity for non-participating Member States of joining in the enhanced cooperation. As provided by the first paragraph of Art. 328(1) TFEU, participation is subject to the condition of compliance with the acts already adopted by those Member States that have taken part in that cooperation since it began. In the context of the establishment and functioning of the internal market, the first paragraph of Art. 118 TFEU confers the competence to create European intellectual property rights and to set up, as regards those rights, centralized, Union-wide authorization, coordination and supervision arrangements. The competence, conferred by the second paragraph of Art. 118 TFEU, to establish language arrangements for those rights is closely bound up with the introduction of the latter and of the centralized arrangements referred to in the first paragraph of that Article. As a result, that competence too falls within the ambit of the functioning of the internal market. The expression “relevant provisions of the Treaties” in Art. 26(1) TFEU makes it clear that competences falling within the sphere of the internal market are not confined to those conferred by Arts. 114 and 115 TFEU relating to the adoption of harmonization measures but cover also any competence attaching to the objectives set out in Art. 26 TFEU, such as the competences conferred on the Union by Art. 118 TFEU. Although it is true that rules on intellectual property are essential in order to maintain competition undistorted on the internal market, they do not constitute “competition rules” for the purpose of Art. 3(1)(b) TFEU. The scope of, and arrangements for, exercising the Union’s competences in the area of “competition rules necessary for the functioning of the internal market” are determined in Part Three, Title VII, Chapter 1 of the TFEU, in particular in Arts. 101 to 109 TFEU. To regard Art. 118 TFEU as forming part of that area would therefore be contrary to Art. 2(6) TFEU and the result would be to extend unduly the scope of Art. 3(1)(b) TFEU. As such the competences conferred by Art. 118 TFEU fall within an area of shared competences for the purpose of Art. 4(2) TFEU and are, in consequence, non-exclusive for the purpose of the first paragraph of Art. 20(1) TEU. A measure is vitiated by misuse of powers only if it appears, on the basis of objective, relevant and consistent evidence to have been taken solely, or at the very least chiefly, for ends other than those for which the power in question was conferred or with the aim of evading a procedure specifically prescribed by the Treaty for dealing with the circumstances of the case. Nothing in Art. 20 TEU or in Arts. 326 to 334 TFEU forbids the Member States to establish between themselves enhanced cooperation within the ambit of those competences that must, according to the Treaties, be exercised unanimously. On the contrary, it follows from Art. 333(1) TFEU that, when the conditions laid down in Art. 20 TEU and in Arts. 326 to 334 TFEU have been satisfied, those powers may be used in enhanced cooperation and that, in that case, provided that the Council has not decided to act by qualified majority, it is the votes of only those Member States taking part that constitute unanimity. In addition, Art. 20 TEU and Arts. 326 to 334 TFEU do not circumscribe the right to resort to enhanced cooperation solely to the case in which at least one Member State declares that it is not yet ready to take part in the legislative action of the Union in its entirety. In accordance with Art. 20(2) TEU, the Council may not authorise enhanced cooperation except “as a last resort, when it has established that the objectives of such cooperation cannot be attained within a reasonable period by the Union as a whole”. This condition is particularly important and must be read in the light o