Empirically, it’s referred to methods of making existing laws more efficient AND effective.

On 10 July 2020, an initiative was launched by the European Commission, to effectively protect and manage intellectual property EU‑wide. The initiative, a proposed action plan, aims to (i) upgrade the EU’s intellectual property system; (ii) promote a smart use of intellectual property; (iii) ensure a more effective enforcement of intellectual property and (iv) promote a global level playing field. The Commission is seeking feedback from all stakeholders and those who would like to provide comments. The feedback period ends on 14 August 2020.

The note accompanying the proposed action plan points out that the market value of leading companies is increasingly determined by intangible assets such as brands, designs, inventions, artistic or literary works, know‑how and data. The proportion of intangible assets in companies’ overall value is said to have risen from a mere 17% in 1975 to 84% in 2015. Intellectual property rights (IPRs), namely, patents, trademarks, designs, geographical indications and copyright, are felt to promote the deployment and diffusion of inventions and creations, adding value to the EU economy. A robust IP policy should aid economic recovery from the crisis following the Covid‑19 outbreak and, by stimulating technological developments, IP can also play an important role in promoting a greener and digital economy.

Hong Kong companies doing business in Europe will know that the EU already has a vigorous IP framework. For instance, it is possible to have EU‑wide titles for trademarks, designs and plant varieties. IP civil enforcement procedures as well as trade secret rules have been harmonised. Yet, especially in these more challenging times, a more strengthened framework is proving to be necessary. The IP action plan aims to propose concrete initiatives to improve the IP framework and the way it is used in practice. The reasons for improvement are multiple:

First, parts of the EU’s IP system remain too fragmented with procedures that are too complex and costly. European patents are subject to expensive national validation procedures and parallel litigation in multiple EU countries. Design and geographical indication (GI) protection remain too cumbersome. More clarity is required as regards the protection of new forms of designs; the implications of 3D printing, and the protection of inventions generated or implemented using artificial intelligence (AI).

Second, the uptake of IP in particular by SMEs and research centres is still limited. Only 9% of EU SMEs have registered IP rights compared to 36% of larger companies. In the current crisis, IP registration numbers have further dropped, to the detriment of their competitiveness and resilience. Recent analysis shows that SMEs’ reluctance to use IP rights is largely due to lack of knowledge about IP. Even if they do use IP rights, they find the system too costly, complex and difficult to navigate.

Third, tools to share out IP are insufficiently developed. For instance, the licensing of standard-essential patents (SEPs) remains a risky and costly exercise for patent holders and implementers.

Fourth, in spite of existing efforts, there is still, it is felt, an unacceptable and high level of counterfeiting and piracy, while cybertheft is posing new challenges. Imports of counterfeit and pirated goods into the EU amount to as much as € 121 billion, representing up to 6.8% of EU imports (against 5% of EU imports in 2013). These also constitute serious health, safety and security threats to consumers, and negatively affect public revenues and the environment.

Fifthly, there is deemed to be a lack of global fair play, with EU businesses frequently losing out when dealing abroad, because non-EU countries either do not sufficiently protect IP or apply divergent standards.

The action plan is intended to promote a coherent EU‑wide approach to IP policies and will be the basis for further initiatives to be taken at EU level, both legislative and non‑legislative. The action plan will focus on the need to align EU initiatives with measures taken at national level.