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PREPARATION OF INTELLECTUAL PROPERTY LEGISLATION
The Hungarian Patent Office (HPO) performed its duties related to the preparation of legislation with a comprehensive approach in an efficient and proactive manner. The majority of the tasks focused on the preparation and management of amendments to legislation concerning industrial property and copyright. An important part of the work was connected with the legal drafting and other duties related to Hungary’s membership of the European Union, the European Patent Organisation and the World Intellectual Property Organization. Preparation for the Hungarian EU presidency in 2011 intensified, which, as a new challenge, imposed numerous tasks on the HPO.
On 15 December 2008 the Parliament adopted an amendment aimed at the legal harmonisation of Act LXXVI of 1999 on copyright (Copyright Act). In line with the HPO’s mid-term strategy, the amendment brought a change in the provisions on public lending rights, a new system for the authorisation of orphan works was developed, and the order of approval of the fee schedule of collective rights management organisations was also modified.
A package of three draft laws was prepared comprising of the proposal on the amendment to certain industrial property laws, that on the accession to the Agreement on the application of Article 65 of the Convention on the Grant of European Patents, adopted in London on 17 October 2000. The whole package will be submitted to the Government in 2009.
The proposal, also in accordance with the mid-term strategy of the HPO, on the one hand, provides for the accession to the Agreement on the application of Article 65 of the Convention on the Grant of European Patents, adopted in London on 17 October 2000 (hereinafter referred to as the “London Agreement”), and on the other hand, provides for the legislation necessary for the implementation of the London Agreement in Hungary by the amendment of Act XXXIII of 1995 on the protection of inventions by patents (hereinafter referred to as the “Patents Act”). The London Agreement aims at partly waiving the requirements for, and the costs of, translation of European patents. In the event of Hungary’s accession to the Agreement, it will suffice to provide the English translation of the whole text of a European patent to validate it in Hungary, while the claims defining the scope of protection will still be translated in each case into Hungarian. The whole Hungarian translation of a European patent would only be required in the event of a legal dispute.
The proposal, taking into account the social debate on the matter, schedules the entry into force of the London Agreement in Hungary’s respect on 1 January 2011.
By amending the Patents Act, the conditions of application of the so-called farmers’ privilege (a limitation of the rights deriving from plant variety protection) are renewed; and the industrial property laws in other matters are also modified. These changes include the transfer of the main rules on the fees payable for the maintenance of industrial property protection into the relevant industrial property acts, the extension of the range of documents that may be sent to the HPO electronically, and the amendment of rules on the secrecy of certain patent applications. The proposal sets out 1 August 2009 as the date of its entry into force.
Hungarian Council for the Protection of Intellectual Property
During the seven years since its establishment, the Hungarian Council for the Protection of Intellectual Property (hereinafter referred to as the “Council”) has grown into a body playing an orientating role in the intellectual property profession. Its activities have helped the work of central public administration and commanded keen international interest. The activities of the Council are regulated by Article 115/F of Act XXXIII of 1995 on the protection of inventions by patents.
In March 2008 the third volume of an intellectual property protection series, co-edited by the HPO and the Council, entitled White Paper on Intellectual Property Protection was launched in the framework of a press conference. The volume devoted to the current issues of intellectual property protection gives an insight into the strategic ideas of domestic and international intellectual property protection in a knowledge-based economy of the 21st century. It also contains the HPO’s mid-term strategy for institution development, offers an overview of the new Hungarian body, the National Board Against Counterfeiting facilitating the enforcement of IP rights; and it elaborates on the most important issues concerning the “hot topics” in copyright and their backgrounds.
It is the fifth year that the quarterly “Newsletter on intellectual property protection”, a joint publication of the HPO and the Council, is published. It summarises news and current information in the fields of industrial property and copyright. The aim of the publication is to acquaint responsible political and professional decision-makers and figures in the economic and cultural spherese with current national and international issues of intellectual property protection in a concise form.
Upon the agreement concluded with the professional and financial support of the Council, the Hungarian Central Statistical Office made available for the HPO data on gross added value, gross emission, employment and income from 2006 for the purposes of an analysis on the economic contribution of copyright-based industries in Hungary, in line with the methodological guide laid down by the WIPO.
In compliance with its operational rules, the Council held four meetings. It discussed and/or
adopted:
• the report on its activity in 2007 and its work plan for 2008;
• an information note on the National Body Against Counterfeiting (NBAC) ;
• the issues of the entry into force of, and the accession to, the London Agreement;
• the amendment of Act LXXVI of 1999 on copyright;
• the situation of book publishing and book trade;
• the present and future situation of the appellation of origin Tokaj as reflected in the Community
law;
• the copyright regulation in respect of uses by libraries;
• the situation of protection of geographical indications in Hungary and in the Community, and
the further development of regulation;
• the new developments in the international relations between collective rights management
and competition law;
• amendment of Directive 2006/115/EC of the European Parliament and of the Council of 12
December 2006 on rental right and lending right and on certain rights related to copyright in
the field of intellectual property;
• the draft of the new Civil Code and the regulation of intellectual property protection;
• the HPO’s participation in the calls for proposals of the European Union and in the bilateral
European co-operations;
• the draft of the next volume of the series White Paper on Intellectual Property Protection.
Body of Experts on Industrial Property
The Body of Experts on Industrial Property acted in the matter of 11 requests and commissions. An expert opinion was prepared in 4 cases and 4 cases are ongoing. The Body issued an information note in two cases. The majority of commissions were initiated by economic entities, the Hungarian Customs and Finance Guard (HCFG), courts, individuals, and courts of arbitration.
Body of Experts on Copyright
The Body of Experts on Copyright received 31 requests; the number of requests received in 2007 and continued in 2008 was 11. Sixteen appointments were received from courts, 6 requests from the police and the HCFG, one request each from a mayor’s office and a chamber of commerce, 7 from private organisations (enterprises, law offices). The requests and commissions concerned a wide range of copyright and related rights issues, with a shift of emphasis towards book publishing, use of works on the Internet, architectural creations and their designs.
INDUSTRIAL PROPERTY OFFICIAL EXAMINATION AND PROCEDURES
OFFICIAL ACTIVITY
The estimated number of applications within the framework of the international patent cooperation treaty (PCT) designating Hungary, but not including those which request national procedure, was 163 800. This represents an increase of 2.5% compared with the previous year. In the years following the accession to the European Patent Convention on 1 January 2003, Hungary has been receiving a continuously increasing number of matters relating to granted European patents. In 2008 the number of European patents designating Hungary granted by the European Patent Office (EPO) was above 23 000, and the HPO received 2211 requests for validation of European patents.
As a result of Hungary’s accession to the Community and European protection systems, the total number of industrial property applications filed following the national route, domestically and directly with the HPO from abroad, decreased proportionally as expected. The decrease in the number of patent applications filed following the national route, as a result of the stagnating domestic patent activity, is due first of all to a decline in the number of foreign applications filed directly with the HPO. In the case of utility models the application activity stagnated.
The patent and utility model activity of domestic applicants remained on the level of the previous year. The number of patent applications filed by domestic applicants has been around 700 for years. The low patent activity is closely related to the insufficient intensity of Hungarian innovation and research and development, to the shortcomings of industrial property awareness and the property relations within the Hungarian economy.
The HPO has performed the tasks of a receiving office deriving from the Patent Cooperation Treaty (PCT), from the accession to the European Patent Convention on 1 January 2003 (including euro-PCT applications) and from the accession to the European Union on 1 May 2004. Hungarian applicants have been filing their foreign applications increasingly with the HPO as a receiving office. Domestic applicants filed 155 PCT applications, 11 European patent Applications, and 1 application for Community plant variety rights in 2008 via the HPO.
Although the number of applications filed by Hungarian applicants abroad continued to be extremely low, their international (PCT) activity (approx. 170), European patent activity (107) and their Community trademark and design activities (277 and 174) showed an upturn, the pace of which belongs to the European top-notch. The figures of the industrial property activity of foreign applicants in Hungary indicate the international interest in the Hungarian economy and market and also the integration of the Hungarian economy in Europe. Since the accession to the European Patent Convention on 1 January 2003 a growing number of foreign applicants have also requested protection for the territory of Hungary not directly but following the European route, that is, in a procedure before the EPO.
PATENTS
The number of applications within the framework of the international patent cooperation (PCT) designating Hungary further increased, exceeding 163 000. The number of requests for validation of European patents in Hungary increased by 34% compared with the previous year, and the fact that Hungary was designated in an increasing amount of applications for which the EPO granted a European patent projects a further growth.
The number of direct applications made by foreign applicants and the number of international (PCT) applications entering the national phase remained on a low level, in accordance with the forecasts, as these applications shifted over to the European route. The HPO received 682 patent applications filed by domestic applicants. 68% of the domestic applications were filed by individuals, 33% of them by enterprises. The number of applications filed by enterprises remained low; it surpassed that of the previous year by 5%, though.
The HPO received 2983 patent applications filed following the national route and requests for validation of European patents. The patent granting procedure was completed in 3872 cases, 10 426 cases were pending at the end of the year. The number of granted patents was 2212.
The patent applications filed following the national route and examined entirely by the HPO shows a similar concentration of technical field as to the previous year: 17% of the applications were received from a single technical field, namely mechanics, pushing the formerly leading pharmaceutical industry to third place, the share of which was 11%. Of the applications 55% were from five technical fields: mechanics, instruments, pharmacy, metal products, other industrial products.
Regarding countries of origin of requests for the validation of European patents in Hungary, German applicants ranked first (32%), followed by US (13%) and Swiss (10%) applicants. The concentration of requests for validation by technical field is very high: as much as 30% of the requests for validation came from a single technical field, namely pharmacy. 67% of the requests came from five technical fields: pharmacy, other machinery, metal products, chemistry and instruments.
The number of patents valid in Hungary has continuously increased since 2005, as a result of a growth in the number of validated European patents. At the end of 2008 the number of valid patents totalled 11 462, 1156 more than in the previous year. Valid patents granted following the national route amounted to 7204, and the number of validated European patents was 4258. The number of valid European patents surpassed that of the previous year by 67%.
Regarding valid patents broken down by technical field, both in respect of the patents granted following the national route and the validated European patents, it is the pharmaceutical industry that ranks first: 35% of all patents valid in Hungary are concentrated in this field of technology. It is followed by mechanics with a 10.5% share, and chemistry with a 9% share.
Not more than 9% of the right-holders of valid patents were Hungarian (12% in the previous year), thus, only 1073 patents were owned by Hungarians. 91% of the right-holders were foreigners, of which the German (26%) and the US (15%) right-holders were in the lead. Of the European patents validated to the territory of Hungary, 32% belonged to German, 12% to US, 10% to French and 9% to Swiss right-holders.
The highest number of valid patents granted following the national route are owned by large pharmaceutical companies: Gedeon Richter Plc., EGIS Pharmaceutical Company, Sanofi- Aventis Pharma S.A., a BASF AG., Hoechst AG., Ciba-Geigy AG., American Cyanamid Co., Bayer AG., Eli Lilly and Co., Pfizer Inc., Syngenta Participations AG., Novartis AG., ZENECA Ltd. The right-holders of the European patents validated in Hungary are also the largest pharmaceutical companies: BASF AG., AstraZeneca AB., F. Hoffmann-La Roche AG., Sanofi-Aventis Pharma S.A. and Bayer AG.
The breakdown of valid patents by lifetime shows two peaks as a result of the accession to the EPC on 1 January 2003: 35% of the patents are “middle-aged”, 10-15-years old, 37% are “young”, 4-6-years old.
Eleven board cases were completed in the HPO, 11 new procedures commenced. The number of cases pending before a board was 14 (11 revocation and 3 non-infringement procedures).
In September 2008, as an important step towards developing a new official role, in the spirit of intense cooperation, the Hungarian and the Austrian offices signed a cooperation agreement on works to be done under the Patent Cooperation Treaty (PCT). In accordance with the agreement the Austrian Patent Office (ÖPA), as an ISA/IPEA involves the HPO in its international search and international preliminary examination work, and the HPO, in line with the Regulations under the PCT, establishes international search reports and international preliminary reports. With the involvement of the HPO the range of languages accepted by the ÖPA has been extended, that is, the Austrian office has become capable of receiving not only English, German and French language international applications used by both parties previously, but also Hungarian and Russian language ones. It was justified to notify both the International Bureau of WIPO and the Administrative Council of the European Patent Organisation of the content of the cooperation, which was positively welcomed. It was agreed that the cooperation fully fitted with the idea of the European Patent Network, and respected the relevant international legislation in effect. Under the cooperation the HPO established search reports related to 150 PCT
applications in the fourth quarter alone. In the framework of the agreement concluded with the National Office for Research and Technology in September 2008, the HPO carried out novelty searches with preliminary patentability reports related to 160 R&D applications submitted to the autumn round of the National Technology Programme. The examiners of the HPO carried out 547 patent searches and 1234 examinations related to the cooperation agreements and services.
As a component of an office providing quality services and participating in international patent co-operation, the HPO has performed a substantial amount of examinations and novelty searches of patent applications in the quality management system since 1 January 2007, observing the requirements laid down in the European Quality Management System (EQMS).
Since 2004 a new title of protection, the certificate on supplementary protection (SPC) in respect of medicinal or plant protection products has been available to applicants. Seven new applications were received, 11 certificates were granted, 6 were rejected and 3 lapsed in 2008. The number of pending cases was 79.
PLANT VARIETY PROTECTION
The HPO received 11 new applications for plant variety protection. Protection was granted in 20 cases, 5 cases ended with a lapse, thus 109 cases were pending at the end of the year. The number of valid national plant variety protections and plant variety patents was 291 at the end of the year, of which the number of plant variety protections was 54. Together with Hungary’s accession to the European Union, the effect of Community plant variety rights extended to Hungary as well. In 2008 the Community Plant Variety Office received altogether 3013 applications for Community plant variety rights; Hungarian applicants filed only 4 applications for community plant variety rights.
UTILITY MODELS
In 2008, only 221 utility model applications were filed with the HPO. 90 % of the applications were received from domestic applicants. 81% of utility model applications filed following the national route came from individuals. In 2008, altogether 268 utility model procedures were completed: protection was granted in 165 cases, there were 16 rejections and 87 withdrawals. The HPO received 2 new requests for revocation. The procedure was completed in 7 revocation and 2 non-infringement cases. At the end of the year, 3 cases were pending.
COURT REVIEW OF THE DECISIONS OF THE HUNGARIAN PATENT OFFICE
With respect to patents, the number of requests for review decreased significantly compared with the previous year’s figure. As to utility models, the amount of requests also decreased.
2008 saw a considerable, almost 30% decrease in the number of cases returned by the courts, with a final decision. As regards patent matters, the number of orders rejecting the request for review increased.
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