EC Publishes its IP Strategy for the Next Four Years, Covering Full Range of IP Rights

The European Commission (EC) published its long-awaited EU Intellectual Property Action Plan on November 25, 2020.

Titled, “Making the most of the EU’s innovative potential—An intellectual property action plan to support the EU’s recovery and resilience,” the 21-page Action Plan was first announced in May 2020, but its publication was postponed due to the COVID-19 crisis. The Action Plan represents the EC’s strategy for its 2019–2024 mandate. INTA provided input to the EC’s consultation on the roadmap to its Action Plan in August 2019, and provided the EC with suggestions for intellectual property (IP) priorities on August 13.

The Action Plan covers a broad range of issues in the EU internal market as well as on the international stage, including:

Artificial intelligence (AI)
Counterfeiting and piracy
Designs
Geographical indications (GIs)
IP theft
Trade secrets
Patents
Plant variety rights
Challenges for small and medium-sized enterprises (SMEs)

The strategy behind the Action Plan is structured around five challenges and five key focus areas:

Challenge	Key Focus Area
EU’s IP system fragmentation “with procedures that are complex and costly and that sometimes lack clarity”	Upgrade the system for IP protection
Lack of use of IP opportunities by companies, in particular SMEs, and researchers	Incentivize the use and deployment of IP, notably by SMEs
Insufficient development of the tools to facilitate access to IP (and therefore allow the take up and diffusion of technologies)	Facilitate access to, and sharing of, intangible assets while guaranteeing a fair return on investment
Counterfeiting and piracy “are still thriving, including by taking advantage of digital technologies”	Ensure better IP enforcement
A lack of fair play at the global level “and EU businesses often lose out when operating abroad”	Improve fair play at a global level

INTA’s Key Takeaways and Action Items

Key Takeaway
Designs—Towards a Legislative Reform

The EC announces that it “will revise the EU legislation on design protection,” with the aim “to improve the accessibility and affordability of design protection in the EU, especially for the textile, furniture and electronics ecosystems, and to ensure that the design protection regime better supports the transition to the digital and green economy.” The timeline given for the publication of the EU legislative proposal is October–December 2021. The identified areas requiring action are registration procedures, protection of new forms of designs (e.g., animated designs and graphical user interfaces), lack of clarity of the scope of design rights, particularly regarding 3D printing, design infringing goods in transit, and design protection of spare parts.

The EC began reviewing the EU designs legal framework with a public consultation in April 2019, and a report on the IP implications of 3D printing, which, with respect to designs, is meant to feed into the review. The EU Commission then published on November 10, 2020, an Evaluation Report outlining the conclusions on the functioning of the EU designs system and recommended directions for its future. Finally, as part of the IP Action Plan, the EC published an Inception Impact Assessment announcing its intention to propose a revision of EU legislation on designs (Directive and Regulation), assessing the main issues the reform intends to tackle and the policy options to be pursued.

Through its Designs Committee, INTA has been closely monitoring the review since the very beginning, advocating for a new legal framework that provides more harmonized, clear, efficient, and user-friendly procedures, taking into account new technologies.

Action Item
In July 2018, INTA submitted, together with ECTA and MARQUES, a Joint Paper on the Legal Review of EU Designs Protection to the EC and the European Union Intellectual Property Office (EUIPO).

In April 2019, INTA responded to the EC’s public consultation on Design Protection in the EU.

INTA’s Designs Committee also submitted input to the EC (as part of the consultation on the Roadmap to the IP Action Plan) on the 3D printing report and is now preparing input on the Inception Impact Assessment.

Key Takeaway
GIs—Towards a New System

Stressing the need for a new approach to GI protection, the EC focuses on two main issues: (1) stronger, modernized, streamlined, and better GI enforcement for agricultural products, food, wines, and spirits (implying a review of the several existing legislation); and (2) the feasibility of creating an efficient and transparent EU GI protection system for non-agricultural products. The latter is very probable, given that the EU had launched a 2014 green paper (orientation document) and a public consultation to assess the appetite for such a system, with the EU Parliament strongly in favor. The timeline given for both issues is October–December 2021.

Action Item
INTA has been closely monitoring the first issue through its GI Committee. The GI Committee also responded to the 2014 public consultation and has been preparing a paper providing the Association’s position, should a non-agricultural system be introduced at EU level.

Key Takeaway
New Technologies and AI

The EC will “encourage an industry dialogue to act as a sounding board and to accompany the many ongoing initiatives in this area.”

On AI specifically, IP was not part of the scope of the AI White Paper published in February 2020 by the EC, but was mentioned as part of the EU IP Action Plan. Here, the EC commissioned a study on trends and developments in Artificial Intelligence—Challenges to the IP rights framework, published along with the Action Plan which states its view that “whilst inventions and creations autonomously created by AI technologies are still mostly a matter for the future, … AI systems should not be treated as authors or inventors.”

Action Item
INTA has been working to include the potential of AI in terms of IP rights registrations and enforcement in the EC’s strategy.

In this regard, the Association was successful in including several amendments in a non-legislative parliamentary report that will provide the EU Parliament’s recommendations to the EC on the AI strategy with regard to IP.

INTA also shared its two reports on AI with the EU institutions:

Key Takeaway
SMEs’ Access to IP

The EC published its EU SME Strategy in March 2020. It aims to strengthen SMEs’ capacity to adapt to the COVID-19 crisis and climate neutrality challenges, reap the benefits of digitalization, reduce regulatory burdens, and improve their opportunities to access finance. The EC lists four specific targeted actions:

With the EUIPO, offer €20 million financial support to SMEs to cover partial reimbursements for their trademark and design registration fees and for an IP pre-diagnostic (a scan of the SMEs’ intangible assets with strategic advice on asset management).
Provide tailored IP advice in the Horizon Europe Programme, assisting innovative businesses at different stages of the research and innovation (R&I) process, and explore expanding IP advice to other EU research and investment programs, including the advisory hub under Invest EU.
In cooperation with the EUIPO, develop the European IP Information Centre—a one-stop shop with access to information about IP, including easy-to-use filing systems, domain name protection, and company names.
Enable SMEs to more easily leverage their IP when trying to access finance. The “tech due diligence” pilot project announced in the SME strategy will be a way to test IP evaluation in a broader technology-related context. The EC will also explore how to better use bank guarantees to support SMEs and creators in projects based on IP.

The EC will also launch an awareness-raising campaign to foster valorization of IP in the valuation of companies by investors. For instance, the EC will update its recommendation on the management of IP in knowledge transfer activities via the Guiding Principles for Knowledge Valorisation. This revision will be accompanied by a Code of Practice for smart use of IP and combined with InvestEU support to project holders via technical, financial, and legal advice, including advice on IP. Steps will also be taken to ensure that publicly funded IP is used in a fair and effective manner. The EC has already launched a new platform to favor the valorization of EU-funded R&I results and a platform presenting EU-supported R&I to tackle the spread of coronavirus and support preparedness for other outbreaks.

The EC will also seek to improve the conditions for companies to protect and use IP in public procurement with a view to stimulating innovation and economic growth.

Action Item
INTA is very active in supporting SMEs to understand and access IP rights and is extending its pro bono scheme to Europe.

The Association is working closely with the EC, based on the work of the INTA 2018 Presidential Task Force on SMEs, and was invited to two dedicated events organized by the EC—one in December 2018 and the other in November 2019.

INTA also cooperates with the EUIPO in the field of SMEs through a working group of the European Cooperation project (ECP), specifically the project entitled “Supporting SMEs”—also known as ECP6.

The Association has also been working with other organizations in this area and, in 2020, contributed to the interactive resources for SMEs called 4 Reasons 4 Designs Rights and 4 Reasons 4 Trademarks, published by 4iP Council.

Key Takeaway
IP Rights Infringement

The EC continues to closely monitor the application of the Directive on the Enforcement of IP Rights (IPRED) “to ensure effective and balanced judicial redress,” but is not considering any legislative review at this stage.

The EC put forward, on December 15, 2020, a legislative proposal on a Digital Services Act (DSA) with “new rules [that] will clarify and upgrade the responsibilities of online platforms and remove disincentives for their voluntary actions to address illegal content (goods or services) they intermediate.” The EC does not provide clarification on the scope of these new rules.

To enhance anticounterfeiting efforts, the EC “urges Member States and the Council” to include IP crime among the priorities of the next EU Policy Cycle – European multidisciplinary platform against criminal threats (EMPACT), for the period 2022–2025.

With regards to customs, the EC will also support member states’ customs authorities in “improving risk management and anti-fraud actions, in particular through the establishment of an EU layer of data analytics capabilities, by better equipping Member States with customs control equipment and by enhancing cooperation within the EU and with customs authorities of partner countries.”

To reinforce cooperation between all involved players, the EC will establish, by April–June 2022, an EU Toolbox against counterfeiting, with rights holders, suppliers, various sets of intermediaries and public enforcement authorities working together to curb piracy and counterfeiting. It will be based “among others on reported practices and principles developed in the context of various industry-led initiatives.” The Toolbox will clarify roles and responsibilities and identify ways to work together, notably, “the sharing of relevant data on products and traders, in compliance with EU data protection law. The Toolbox will also promote the use of new technologies such as image recognition, artificial intelligence and blockchain. Where appropriate, the Toolbox will be accompanied by benchmarks to make it possible to measure progress.”

With regard to fake COVID-19–related products, the EC will promote campaigns to combat the entry of the most harmful counterfeit goods for consumers in the EU market. Nonetheless, the negative impact of counterfeiting during the COVID-19 crisis is not mentioned in the introduction to this section, and it is only briefly mentioned once further. Anticounterfeiting deserved more visibility, and its impact on consumers is addressed to a lesser degree than its impact on growth, businesses, etc.

Action Item
INTA is closely monitoring the DSA and has convened a task force of members from the Anticounterfeiting, Internet, and Enforcement Committees to look at our own best practices and how they could be adapted to fit the DSA (as well as the parallel U.S. initiatives) with an aim to provide an input to the EU public consultation.

With regard to SOCTA/EMPACT, INTA, through its Anticounterfeiting Committee, has been working closely with the European Observatory on Infringements of IP Rights to reach out to EU member states to include IP crime as a priority.

Key Takeaway
Fair Play at a Global Level

Recognizing that “the EU is in a unique position to act as a global standard setter in IP” and that it needs “to better protect ourselves against IP theft,” the EC lists the following actions:

Consider EU accession to the Singapore Treaty on the Law of Trademarks, to protect the value of brands.
Increase participation in global Internet discussions so that the international domain name system (DNS) fully respects IP rights, including GIs, and ensure that IP protection is also reflected appropriately in policies concerning the governance of the domain name space and access to information on registrants (“WHOIS” data).
Continue to seek ambitious IP chapters in free trade agreements (FTAs), with high standards of protection, to ensure a level playing field for EU businesses, and boost economic growth.
Make full use of IP dialogues with key trading partners and other priority countries, including Brazil, China, South Korea, Thailand, Turkey, and the United States, to promote reforms. The EC will also further enhance the reach of its IP Key programs, offering technical co-operation in China, Latin America, and South East Asia.
Leverage the Counterfeit and Piracy Watch List and the Third Country Report.
Following its March 2020 Guidance concerning foreign direct investment and the protection of Europe’s strategic assets, call on all EU member states to make full use of their foreign investment screening mechanisms and, for those member states that currently do not have a screening mechanism, to set up a full-fledged screening mechanism to address relevant aspects of security and public order of foreign direct investments.
Continue to assist European companies abroad. Launch a new IP SME helpdesk assisting European companies in India (early 2021).

Increase efforts to offer qualified technical assistance to help developing countries make best use of IP to support their economic growth. For instance, as part of the IP rights action plan for Africa, the EC will promote better generation, protection, and management of IP (including GIs) in the region.

Regarding the Toolbox, INTA will get in touch with the EC to share its own best practices and contribute to the Toolbox’s development.

Action Item
INTA advocates for IP to be framed as an essential pillar of a sound EU global trade strategy.

In 2020, the Association contributed to the EC’s consultation on EU Trade Policy Review, stressing the importance of IP rights being thoroughly addressed to achieve a solid EU trade policy.

INTA is closely monitoring the negotiations and implementation of FTAs and provides regular input to the EC on areas of concern or improvement. In this context, the Association provides regular input to the EC DG TRADE on the EU IP Rights Dialogues and Working Groups with third countries and on the IP Key projects.

INTA also provides active support to the implementation of EU IP programs and activities in third countries, benefiting from its global membership and presence on the ground, working notably with the EUIPO, EU institutions and EU member states’ IP Attachés, and EU IP helpdesks for SMEs around the world.

Regarding WhoIs, INTA supports increased engagement from the EC, including collaboration between DG GROW and DG CONNECT to ensure that the necessary balance envisioned by the General Data Protection Regulation (GDPR) is attained. INTA strongly believes that an accessible WHOIS system with properly balanced personal privacy rights and IP rights is key to the security and stability of the Internet and, ultimately, the protection of IP owners and the consumers they serve.

INTA also encourages the EC to implement clear, transparent, and easily accessible rules governing access to its fraud reporting tools and system for rights owners. Access to these tools are strongly needed to provide the appropriate balance between protecting individual privacy concerns versus combating serious consumer harms like trademark infringement and counterfeiting. INTA has been engaging both the EC and ICANN on this issue.

For more information and to get involved in this advocacy effort, in Brussels or at the EU national level, contact Hélène Nicora, Chief Representative Officer – Europe; Carolina Oliveira, Policy Officer—Europe; or Hadrien Valembois, Policy Officer—Europe, at [email protected].

Although every effort has been made to verify the accuracy of this article, readers are urged to check independently on matters of specific concern or interest.