ADMINISTRATIVE COUNCIL
Reports on meetings of the Administrative Council
Report on the 87th meeting of the Administrative Council of the European Patent Organisation (11 to 13 December 2001)
The Administrative Council of the European Patent Organisation held its 87th meeting in Munich from 11 to 13 December 2001 under the chairmanship of Mr Roland GROSSENBACHER (CH).
The President of the Office, Mr Ingo KOBER, presented the Office's activities report for the second half of 2001.
The Office's work situation had been dominated by sustained growth. The number of European patent applications filed in 2001 would probably reach 161 000 (by the end of October the Office had received 136 000). This figure represented an increase of 13% over 2000 - giving a rise of more than 100% within six years. The proportion of PCT applications filed with the Office was slightly above forecast at 65.5%. The expected workload for search in 2001 was likely to reach 160 000 (133 000 at the end of October), an increase of 11.6% compared with last year's figure of 143 235 searches. 44% of the search workload was related to PCT-type searches.
The workload in substantive examination would rise to 125 000 by the end of the year, an increase of 5% compared with 2000 (at the end of October the workload stood at 102 800); this was 5% below plan as a result of lower production in DG 1. Although the PCT Chapter II workload was up 18%, the increase would be less than forecast (44 500 as opposed to 45 600). The number of oppositions filed during 2001 would be 1 400 (1 165 during the first ten months), slightly lower than the figure for 2000. This decrease was due to the lower number of grants published last year. By the end of 2001, 1 330 technical appeals would be filed with DG 3 (1 195 at the end of October), 10.2% above forecast and 8.7% above last year's figure of 1 224. Over the same period, 45 legal and disciplinary appeals had been filed, bringing the total number of appeals to 1 375. Over the whole of 2001, the Office expected to receive approximately 23 000 extension fees, representing a 7.5% increase compared with 2000, during which 21 400 such fees were paid.
Production in search was expected to reach 129 000 files (106 000 at the end of October), 11% and 14% of which would have been completed under BEST in DG 1 and DG 2 respectively and about 1% by national offices. The Office's search output was 15% below plan. This figure was about the same as in 2000 owing to the days of strikes earlier in the year, but also through heavy investment in BEST training, and in particular as a result of experienced search examiners migrating to BEST. The positive impact of the investment in BEST would emerge in the years ahead (cf the most recent Medium Term Business Plan in CA/40/01).
The total number of European and PCT Chapter II final actions was expected to reach 92 000 (80 000 at the end of October), 13% higher than the equivalent figure in 2000.
The number of published granted European patents would reach about 34 700 (26 000 at the end of October), which was an increase of 26% over 2000. The number of coded grants by examiners was expected to reach 45 000 at the end of the year, which would eventually show through in the number of European patents published (the delay between coded grant and published patent being almost one year).
The boards of appeal would have settled 1 170 technical appeals by the end of the year, a lower figure than for new filings of technical appeals. At the end of October 980 cases had been settled, 1.3% more than during the same period in 2000 (967).
For the whole year 2001 compared with 2000:
The productivity of the Office as a whole, using the ADL methodology, was expected to show a 3.8% increase over the 2000 result. For the core products of the Office, the productivity change was estimated at a 4% increase in 2001 over the year 2000. Compared to the year 2000, the unit cost of production would reduce by 1% in 2001, which was 9% below the corresponding cost in 1995.
The backlogs had risen yet again. In search, it was anticipated that the backlog would stand at 66 000 by the end of 2001. At the end of October 2001, the Office's search backlog stood at 63 600 cases, of which 40 600 were European searches.
The backlog in substantive examination was expected to reach 67 000 by the end of 2001, and stood at 64 700 cases at the end of October.
With the ongoing changes in procedures, together with further recruitment, the EP direct search backlog should be eliminated by the end of 2003, one year earlier than formerly forecast. The substantive examination backlog would be almost eliminated by 2005.
There was no backlog in opposition cases, only working stock.
The technical boards of appeal would have 3 350 appeals pending at the end of the year, an increase of 210 cases or 6.7% compared with 2000.
In line with the mandate from the Paris Intergovernmental Conference of June 1999 to reduce the duration of the procedure to three years, the Council had agreed at its October meeting to amend Rules 25 and 51 EPC. Combining Rules 51(4) and 51(6) EPC would on average reduce the period between the request to agree to the patent text and the publication of the mention of grant from one year to about six months. In parallel, the strict time limit for filing a divisional application under Rule 25 EPC had been liberalised.
Following the tragic events in the USA, the Council had agreed at its October meeting to amend Rule 85 EPC with retroactive effect from 11 September. Under the new Rule 85(5) EPC, an expired time limit for receipt of written material could, under certain conditions, be excused when the postal services were interrupted or delayed owing to war, revolution, civil disorder, strikes, natural catastrophes or the like.
The Guidelines for Examination in the EPO had been amended following intense internal and external consultation regarding the patentability of business methods and software-related inventions. The amendments in force since the beginning of October had been published on the EPO website and in the October issue of the Official Journal, bringing the Guidelines into line with the case law of the boards of appeal and with examining practice. Applicants now had a clear picture of examination procedure in these areas of technology.
On 1 October 2001 a new board of appeal, Mechanics 3.2.7, had taken up its duties. The number of Technical Boards of Appeal had thus risen to 19.
The Presidium of the Boards of Appeal, the body which adopts the boards' business distribution scheme and Rules of Procedure, had been given a new structure through the amendment of Rules 10 and 11 EPC, adopted by a decision of the Administrative Council in October.
On 12 November 2001, there had been another meeting between Members of SACEPO (in particular representatives of the epi and UNICE) and the Boards of Appeal of the EPO. This had been the ninth such MSBA get-together. No meeting had been held in 2000 owing to the Diplomatic Conference.
The 2001 edition of the "Ancillary Regulations to the EPC" had been published in July. This collection of important secondary legislation to the EPC had been produced by DG 3 for over ten years. The report on the case law of the boards of appeal during 2000 had been published in October as a "Special Edition" of the Official Journal. The fourth edition of the "Case law of the Boards of Appeal of the European Patent Office" (the "White Book") was due to be published early in 2002.
In the field of documentation, efforts to provide EPO examiners with the best and most comprehensive electronic search tools had continued, for example by substantially extending the online databases. In the field of non-patent literature, nearly half a million publications from the most important publishers specialising in electricity/physics had been made available to examiners for full-text searching. The complete full-text database of all US patent documents published from 1836 to 1970 had also been loaded into EPOQUE. The facsimile version of these US patents was available from BNS, the EPO's digital library, and had been made accessible for the general public via esp@cenet. In addition, enhanced bibliographic data for the period 1920-1970 had been captured.
These recent developments had made the EPO the only organisation in the world with such an extensive patent and non-patent literature collection indexed for full-text searching. The complete EPOQUE full-text collection now contained about ten million documents. The milestone of 100 million records in the EPOQUE databases had been passed in November.
Since the release of the epoline Online Filing product on 8 December 2000, a total of 500 patent applications had been received online.
There were currently 2 500 separate users of the Online European Patent Register, and the number continued to rise. A link to the EPO Boards of Appeal decisions database was currently being tested.
Final testing of the online file inspection system with 1 400 users was under way. The results of the online questionnaire demonstrated that this product had been very well received. Following requests for additional improvements from these customer questionnaires, a new and even more user-friendly version was currently under development. The next development phase would include links to the Online European Patent Register, enabling the customer to follow all aspects of the patent application through epoline.
Investment and Pensions Europe, the leading magazine for Europe's pension industry, had named the country leaders for the first ever pan-European awards to recognise pension scheme excellence in investment, fund structure and administration. The magazine's prestigious panel of over 60 pension experts across Europe had named the Pension Reserve Fund of the European Patent Office as leader for Germany in investment strategy, ex aequo with Nestlé's pension fund.
Recruitment had progressed very well in 2001 with 435 offers for examiner posts made and 340 examiner vacancies filled in DG 1 and DG 2 so far. The remaining offers were expected to be accepted in early 2002. In total, 8 600 applications had been filed in 2001 and 1 090 candidates had been interviewed. Including offers already made, some 200 examiner posts were expected to be vacant at the end of the year.
Recruitment of non-examining staff had been highly successful in 2001 both in general and in IS in particular, where almost all the vacant posts had been filled. During the first eleven months of the year 7 827 applications had been received, 519 interviews held and some 269 offers made.
Following the recruitment freeze in The Hague, DG 1 recruitment had been focussed on employment needs in Munich and Berlin. This joint effort at employing new staff could be considered symbolic of the BEST era and the changing nature of the Office.
The Office's financial situation continued to be very healthy with income increasing by 10% to DEM 1.6 billion. Expenditure had increased by 13% to DEM 1.3 billion.
At DEM 288 million, the operating result was expected slightly to exceed last year's figure of 284 million.
Net working capital was projected to increase at year end by DEM 75 million, or 10%, to reach DEM 830 million.
Concerning the Community patent, the Belgian Presidency had indicated that the deliberations of the Internal Market Council of 26 November had been inconclusive with regard to the issues of both translation requirements and the possible role of national patent offices in the procedure for the grant of Community patents.
On 26 November, the Federal Yugoslav Republic had signed a co-operation and extension agreement with the European Patent Organisation, bringing the number of extension states to seven. The agreement would enter into force by virtue of an exchange of letters once the Yugoslav patent law had been amended as required.
Following the amendment of the PCT Agreement by the last PCT Assembly, the Director General of WIPO had been notified that, with effect from 1 March 2002, the EPO would no longer act as ISA or IPEA for international applications from the USA concerning biotechnology or business methods, or as IPEA for those concerning telecommunications.
Pursuant to Article 3(4)(c) of the agreement, the initial duration of these limitations would be three years, without prejudice to the EPO's right to issue any further notice under Article 3(4) of the agreement which it may consider necessary. It was expected that the limitations would initially concern about 5 000 cases per year from the USA.
An extension of the time limit under Article 22 PCT had been adopted at the PCT Assembly in Geneva in September, allowing entry into the national or EPO regional phase for all PCT applications at 30/31 months. It was expected that this measure, due to come into effect on 1 April 2002, would reduce the number of Chapter II examinations by one third. The full impact of this amendment, however, would only show through some time in 2003 when all PCT states had undertaken the necessary amendments to their national law.
A streamlined PCT procedure would allow examining capacity to be applied to those filings where the applicant had a true interest in pursuing his application further.
Taken together, the measures undertaken in 2001 would permit the necessary shift from PCT to EPC work without compromising the final product - the European patent.
The first meeting of the Working Group on PCT Reform last month in Geneva had concentrated on two main points, namely the US proposal on an expanded international search report, which had met with considerable support from many delegations including the EPO, and the proposal to eliminate the concept of designations in the PCT.
Both issues and proposed PLT-related changes would be discussed further at the next meeting in spring 2002.
The steady rise in the number of candidates for the European qualifying examination (EQE) had continued in 2001. 1 164 candidates had sat the examination, an increase of 12% over the previous year. The pass rate for first-time sitters was 35%, compared with 29% for candidates resitting the examination.
The Office was preparing a CD-ROM version of all Compendia from 1990 to 2001, which would be available at the end of 2001. This would contain all the examination papers, examiners' reports in the original language and examples of answers written by candidates in the three official languages, as well as all the relevant legal texts. The CD-ROM would be interactive for the last three years' papers and it was hoped that demand for it would become as great as it had always been for the paper version of the Compendium.
The number of professional representatives qualified to represent clients before the EPO was at present 6 200. This figure included just over 100 Turkish patent attorneys entered on the list as so-called grandfathers. For some years now the number of deletions had remained about 100 lower than the number of registrations.
The annual meeting of the US Bar/EPO Liaison Council had been held in San Francisco in November and provided an excellent opportunity to discuss matters of common interest with American practitioners and inform them about the Office's strategies for coping with the flood of PCT applications of American origin.
At the sixth meeting of the WIPO Standing Committee on the Law of Patents in November, work had continued on a draft Substantive Patent Law Treaty. The proceedings were still in the early stages, but the ambit of the treaty was ambitious, with the focus on "deep" harmonisation of both the law and practice relating to patentability requirements and post-grant validity.
The Revision Act to the European Patent Convention, adopted in November 2000, had been open for signature until 1 September 2001. Seventeen member states had signed the act during this period. The remaining three member states as well as any state acceding to the EPC could accede to the revision act until it entered into force. Accessions occurring thereafter would be to the EPC as revised.
The signed revision act, the final act of the conference, and the Council decisions of 28 June 2001 regarding the new version of the EPC and the transitional provisions had been forwarded to the German government, which would in future act as depository for ratification instruments.
The above-mentioned documents as well as further related publications had been published in a special edition of the EPO Official Journal and on the EPO website.
The Council would be asked to decide at its present meeting on the new framework proposed for designing, implementing and monitoring technical co-operation programmes with member states. This proposal came at the end of a year-long consultation process to which all the delegations had contributed. It would simplify technical co-operation procedures and provide a workable solution for the future.
Trilateral co-operation had achieved some important results in 2001, providing the driving force behind the extension of the time limit for entry into the national/regional phase under PCT Article 22(1) and the amendment of the agreement between the EPO and WIPO concerning the limitation of the EPO's mandate to carry out PCT work. The report on the 19th trilateral conference would be presented to the Council at the present meeting.
The second Latin American Encounter on Patent Information Dissemination jointly organised with Mexico's IMPI had attracted a record number of participants. This event had met with great interest in the region and was now a major factor in the promotion of patent information in Latin America.
A meeting of heads of Latin American industrial property institutes had taken place in Madrid in September. Organised jointly with the OEPM, it had discussed "New Perspectives for European-Latin American Co-operation in the Field of Industrial Property; the Challenges of the New Millennium".
In ASEAN, the first regional and national committee meetings under the EC-ASEAN IPR programme (ECAP 2) had been held in Brussels on 27 June.
A feasibility study for the EC on the modernisation of the Indian Patent Office had been carried out during the first six months of the year. Limited activities under the EC-India intellectual property programme would start in January 2002.
The EU-China intellectual property co-operation programme had been initially planned to last until the end of 2001. An extension until the end of 2003 was under discussion between the Commission, the Chinese beneficiaries and the EPO.
As part of the EPO's bilateral co-operation with SIPO, three symposia had taken place in October in Munich, Rome and London to introduce the newly revised Chinese patent law to the European public. The symposia had been organised in co-operation with the host national patent offices and had been very well attended, mainly by patent professionals and representatives from industry.
Among the numerous activities in the CIS states, assistance in the development of MIMOSA had been provided to Belarus and Rospatent (Russia).
Implementation of the last Phare-financed RIPP programme for central and eastern Europe was due to be completed by the end of December. More than 40 seminars, most of them on enforcement, had taken place under RIPP 4. The end of the RIPP project had been marked by a closing symposium in Bucharest in November, in which many member states had participated.
The EPO had continued to help national offices prepare for accession to the EPC. During the year the President had visited Estonia, Latvia, Lithuania and Romania for talks on accession-related matters. This period had also been noteworthy in that the EPO, after several years' break, had re-established official links with Yugoslavia and Croatia.
An EPO-UKPO-ARIPO conference had been organised in Botswana in co-operation with WIPO and UPOV to discuss the "Modernisation of Patent Offices and Particular Challenges of the IP System in Sub-Saharan Africa".
Two highly successful events dedicated to our new member state Turkey had been organised in co-operation with the Turkish Patent Institute, the epi and representatives of several member states: a symposium on the "European patent system - chance and challenge for Turkey", attended by 300 participants, and a seminar on "The role of the European patent", attended by 150 Turkish patent attorneys.
A one-week symposium on "Enforcement of IP Rights and Patent Litigation", organised by the EPO International Academy, had taken place at the EPO in Munich from 10 to 14 September. Thanks to support from the European Commission, various national offices, the Max Planck Institute and the epi, a programme including ten half-day working sessions and 42 speakers had been offered to the 270 participants, among them 170 judges specialising in IP from more than 53 countries.
This year's EPIDOS Annual Conference had taken place in Cardiff, Wales, in October. Repeating the good co-operation of 1999 in Ellas, the conference had been held together with the European Commission's PATINNOVA event. The UK Patent Office had been closely involved and more participants and exhibitors had been attracted than ever before. The President thanked the UK Patent Office and the Commission for all their efforts in making these events so successful.
Given the growing role of the Internet, as well as the esp@cenet and epoline developments, the Office was expanding its communication capacity with the introduction of multi-megabit lines to provide flexibility and resilience. A similar set-up was being implemented for communication between Munich and The Hague. In order to improve the technical management and speed of the local area networks connecting PCs with each other and with the mainframe and other servers, the Office was introducing the Ethernet technology network to replace the existing Token Ring technology which had been used for many years.
The Office was currently planning the migration to Windows 2000, which would replace OS/2 Warp as the operating system on all end-user PCs. The OS/2 system had served the Office well for many years but now needed to be replaced. The Office-wide roll-out of the new "platform" was due to start in the first half of 2002.
Turning to the Internet, the President reported that the esp@cenet statistics continued to show consistent growth, with some 8 500 users carrying out a total of 60 000 searches on an average working day.
The EPO website had also continued to grow, both in terms of content and usage. A new website with better presentation was being developed for implementation in 2002.
The European Patent Office had participated in 32 fairs and exhibitions in 2001 in an effort to raise public awareness of patents and patent information.
It was intended to place more emphasis on patent information training. Training activities for national offices had already been increased in 2001. EPO training experts would be looking at ways to exploit modern electronic media with a view to offering the best possible courses to a broad range of users.
Interest remained high in all areas of EPO patent information activities, and particularly in the Japanese patent information services. The EPO's role in this field was to provide a European service to help users interpret this complex data.
Turning to CD-ROMs, the President reported that an agreement with WIPO had been reached on co-financing GLOBALPat production following the USPTO's withdrawal from the project.
The President reported positive developments with the INPADOC databases, where in the second half of 2001 significant progress had been made with the project on entry and non-entry of international patent applications into the national phase. Bulgaria, Georgia, Kenya, Korea, Latvia and Romania had started to supply data, which had been loaded into the legal status database. The latter now involved co-operation with 38 patent offices.
The eleven co-operation programmes currently in progress mainly concerned the expansion of national esp@cenet facilities, electronic capture of national documents and the installation of DVD jukebox networks.
Once the President had concluded his activities report, the Council addressed several major issues.
The Council appointed Mr Hans-Joachim LÖFFLER (DE) for a further period of three years from 1 January 2002 as Deputy Chairman of the PRFSS Supervisory Board.
The Council unanimously approved draft decisions amending Rule 29(2) EPC and Article 10 of the Rules Relating to Fees.
The Council also approved a change to the Service Regulations to provide for contract employment of A6 staff.
The Council approved a new framework of technical cooperation with contracting states which provided increased resources and a system of bilateral and multilateral support for technical co-operation.
The Council approved the 2000 accounts and, after discussing the report by the Board of Auditors and hearing the opinion of the Budget and Finance Committee, discharged the President in respect of the 2000 accounting period.
Finally, the Council adopted the 2002 budget, with income and expenditure in balance at EUR 921 805 000. Provision was made in the table of posts for 5 978 employees, an increase over 2001 of some 465 posts (including 280 examiners).