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PREPARATION OF INTELLECTUAL PROPERTY LEGISLATION AND APPLICATION OF LAW

1. PREPARATION OF LEGISLATION

In 2003, the first result of the legislative activity was the adoption of Act VI of 2003 on the amendment to Act XXXII of 1995 on Patent Attorneys. An important step in harmonisation and modernisation was the preparation and enactment of Decree No. 9/2003 (II. 28.) GKM of the Minister of Economy and Transport on the support to obtain and maintain industrial property protection from a budget allocated for patenting Hungarian inventions abroad.

The aim of codification in the Hungarian Patent Office (HPO) was furthermore to bring industrial property and copyright legislation into full conformity with European Community law by the time of Hungary’s accession to the European Union – taking into account the changes in European Community law since the creation of the said legislation – and to create all the rules that are necessary for operation as a Member State and for the application of Community law.

This aim was achieved by Act CII of 2003 amending certain industrial property and copyright legislation (furthermore: Act) adopted on the basis of the joint submission of the Minister of Justice, the Minister of National Cultural Heritage and the President of the Hungarian Patent Office. It contains amendments to Act XI of 1997 on the Protection of Trademarks and Geographical Indications (furthermore: Trademark Act), Act LXXVI of 1999 on Copyright (furthermore: Act on Copyright) and Act XLVIII of 2001 on the Legal Protection of Designs (furthermore: Design Act). The Act was adopted by the Parliament at its session on 17 November 2003; it entered into force on the entry into force of the Act promulgating the international treaty on the accession of the Republic of Hungary to the European Union.

The amendment to the Act on Copyright is aimed first of all at harmony with Directive 2001/29/EC on the harmonisation of certain aspects of copyright and related rights in the information society (INFOSOC) that was adopted after the enactment of the Act on Copyright. In addition, the Law provides for amendments required by conformity with other Community directives (i.e. Council Directive 91/250/EEC on the legal protection of computer programs, Council Directive 93/83/EEC on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission, Council Directive 93/98/EEC harmonizing the term of protection of copyright and certain related rights, and Directive 96/9/EC of the European Parliament and of the Council on the legal protection of databases).

The amendment brings about changes in the field of the collective management of rights in order to create alignment with international treaties that have also become part of Community law. Moreover, it reflects the first experience of the application of the basic Act of 1999.
Due to the amendments referred to, the Act on Copyright is in full conformity with the relevant international and Community provisions. Directive 2001/84/EC of the European Parliament and of the Council on the resale right for the benefit of the author of an original work of art is, however, worth mentioning. Since the time limit for Member States to implement this Directive is 1 January 2006, the necessary legislative amendments are scheduled by the legal harmonisation programme of the Government for 2005.

The preparation of a draft Government decree necessary for the application of Council Regulation (EEC) No 1768/92 concerning the creation of a supplementary protection certificate for medicinal products and of Regulation (EC) No 1610/96 of the European Parliament and of the Council concerning the creation of a supplementary protection certificate for plant protection products was also aimed at creating the conditions for accession to the European Union.

2. OPERATION OF INTELLECTUAL PROPERTY PROFESSIONAL BODIES ATTACHED TO THE HUNGARIAN PATENT OFFICE

In 2003, the Hungarian Council for the Protection of Intellectual Property held five meetings. It elaborated a position on the amendments to intellectual property legislation relating to EU accession (amendment to Act LXXVI of 1990 on Copyright, Act XI of 1997 on the Protection of Trademarks and Geographical Indications and Act XLVIII of 2001 on the Legal Protection of Designs) and on the draft of the Government Decree relating to the introduction of a supplementary protection certificate for medicinal products and for plant protection products. The Council also elaborated a proposal on the industrial property-related issues of the conception and draft of the Act on the general rules of administrative procedure, as well as on the comprehensive measures aimed at strengthening the industrial property activity of small and medium-sized enterprises.

A change occurred in the management of the Council, since on the proposal of the President of the HPO, the Minister of Economy and Transport appointed Erik Bogsch, General Manager of Richter Gedeon Chemical Factory Corp., as President of the Council with effect from 1 September 2003.

The Body of Experts on Industrial Property received 14 new cases in 2003. During the year 13 cases were completed, 1 remained pending. At the same time the backlog from 2002 was also processed (in 2002, 17 new cases were received and 8 were completed). As part of the Body’s renewal, the Minister of Justice appointed Márta Posteiner-Toldi, Vice-President for Technical Affairs of the HPO, as President of the Body.

Industrial property expert licenses were issued or renewed in six cases. During the year under review, 11 candidates passed the patent attorney examination, one candidate failed it.

The Body of Experts on Copyright received 40 requests and expert opinions were prepared in 33 cases. (In 2002, 42 requests were received and expert opinions were prepared in 36 cases). The Body gave additional expert opinion on supplementary questions filed in connection with earlier cases, and oral information and advice (by phone or personally) was given in numerous cases.

OFFICIAL EXAMINATION AND PROCEDURES IN INDUSTRIAL PROPERTY MATTERS

1. NATIONAL AND INTERNATIONAL APPLICATIONS

The growth in industrial property applications filed via the national and international routes experienced over the past few years slowed in 2003. The number of applications filed in the national way decreased, while that of applications via the international route slightly increased.
The decline may be attributed first of all to the fact that due to our accession to the European Patent Convention the number of patent applications filed by foreign applicants with the HPO either in the national way or within the framework of the PCT system decreased according to the forecasts.

Table 1.: Figures of national and international applications (1999–2003)

In 2003, the number of applications filed in the national way was less by 1363 than in the previous year – due first of all to the fact that the number of patent applications filed by foreign applicants with the HPO either in the national way or within the framework of the PCT system decreased. The number of applications filed in the national way slightly decreased with respect to almost all titles of protection (patents, utility models, trademarks, designs), with the exception of geographical indications.

Table 2.: Breakdown of national industrial property applications by titles of protection (1999–2003)

More than 51% of applications filed in the national way are of Hungarian origin. One third of them came from individuals and two thirds from enterprises. As far as the titles of protection are concerned, the origin of applications – Hungarian or foreign – is quite varied. In the case of patent applications, the ratio of domestic applicants to foreign applicants is 1:6, while domestic applicants are dominant in the case of trademark applications (77%), utility model applications (96%) and design applications (77%).

The number of applications designating Hungary under international treaties has shown an increasing tendency in the 90s.

Hungary was designated as a possible target country in 7000 to 9000 international patent applications every month (EURO-PCT) and the number of applications filed directly with the European Patent Office (EPO) in which Hungary was designated as a Member State of the European Patent Convention amounted to 3000 to 4000 per month.

The decline of patent applications seemed to be an international phenomenon in 2003. A 4% decrease in international patent applications was forecast by WIPO for 2003. No considerable decrease was experienced in the number of the entries into the Hungarian national phase of international patent applications, although this was previously forecast as a consequence of our accession to the EPC. In 2003, the HPO processed 3251 international patent applications entering the national phase and further 686 international applications are expected to enter the national phase. The HPO performs the tasks of a receiving office within the prescribed time limit.

Table 3.: Breakdown of applications filed under international treaties (1999–2003)

In the first year after our accession to the European Patent Convention, Hungarian applicants filed 5 European patent applications through the intermediary of the HPO, while further 9 applications were filed directly with the EPO. In 124 cases Hungarian applicants chose the EURO-PCT way to file their international applications through the intermediary of the International Bureau of WIPO. In 2003, of the proprietors of European patents 61 were of Hungarian origin.

2. PATENTS

The increase in the number of applications filed in the national way experienced in the past five years came to a halt in 2003; the decline on the previous year was 18.6% or 1096 applications. In the year under review, not only the number of domestic applications decreased but also that of foreign applications filed via the national route. This may be explained by Hungary’s accession to the European Patent Convention, since after 1 January 2003 foreign applicants have claimed protection for the territory of Hungary by designating our country in their European patent application.

Table 4.: Breakdown of national patent applications by origin (1999–2003)

The breakdown of patent applications by technical field continued to be characterised by a keen activity in the “chemical fields”. (Of the 4810 applications filed in 2003, 3953 could be assessed, since the applications’ classification according to IPC takes place after the fulfilment of all prescribed conditions which usually requires 2 months.)

Granted patents represented about 30% of the total number of completed applications, which was about 6% down on the previous year. The majority of lapses may be attributed to non-payment of annual fees, which shows the loss of interest of applicants and can hardly be influenced by official means. The decrease in the willingness to pay annual fees is particularly apparent in the fields of pharmaceutics and electricity. In the case of the former it is presumably in connection with the keen competition and long pendency time in this field, while in the case of the latter with the fact that improvements are introduced and become obsolete very rapidly.

Table 5.: Patents granted in Hungary (1999–2003)

Table 6.: Valid patents (1999–2003)

Patent examination work in the so-called BEST system (“search+examination”) became dominant in 2003. 3575 searches were performed by the patent examiners of the HPO, the number and proportion of outsourced novelty searches further diminished.

Table 7.: Novelty search

There was no hindrance in the settlement of cases to be decided by a board. 8 cases were completed and 8 new cases commenced. 15 cases to be decided by a board remained pending.

3. MODELS

In the year under review, 316 utility model applications were received, representing a slight decrease compared with the previous year. The breakdown of applications by origin practically did not change, 95% of this title of protection is used by domestic applicants and only 14 applications were received from foreigners. In 2003, 342 applications were completed, of which 217 ended with grant, 4 with rejection and 121 were withdrawn or considered withdrawn.

In 2003, the HPO received 13 requests for nullity and 1 request for a decision on lack of infringement. The procedure ended in 11 cases of nullity and in 1 case of lack of infringement.

Table 8.: Breakdown of utility model applications by origin (1999–2003)

Table 9.: Valid utility models (1999–2003)


4. NATIONAL REGISTERS

Valid patents

On 31 December 2003, the number of patents valid in Hungary was 10,385. Foreign patentees account for 82% of them. 1866 patents are owned by Hungarians; of this total 40% belong to individual inventors.

Table 10.: Breakdown of patents valid in Hungary

Patent protection may be maintained for not more than 20 years if the patentee pays the die annual fee. The majority of patents valid on 31 December 2003 are “middle-aged” since 77.3% of them are more than 8 years old.

The breakdown of valid patents by country of origin shows that the proprietors of 90% of them belong to only 10 countries. 21% of the valid patents are owned by German patentees, 20% by patentees from the USA and 18% by Hungarian patentees.

5768 patents making up 55.5% of patents valid on 31 December 2003 are concentrated in five technical fields. Most valid patents belong to the fields of organic chemistry, pharmaceutical industry and chemical compounds concerned with these.

Table 11.: Five technical fields with the largest number of valid patents


Valid utility models

On 31 December 2003, the number of valid utility models amounted to 1123. Of these, 90% belong to Hungarian right holders, mainly to individual inventors.

Table 12.: Breakdown of utility models by lifetime

90% of the valid utility models are owned by Hungarians, they are followed by German and Austrian right holders.

Table 13.: Top six countries having the largest number of valid utility models

Most valid utility models belong to the field of building industry (191), this is followed by medical and veterinary sciences, life-saving, fire-fighting, sports, games and amusements (121), as well as by conveying, packing, storing, lifting, bottles and saddlery (114).

5. INDUSTRIAL PROPERTY ADMINISTRATION

TASKS OF RECEIVING OFFICE

From Hungary’s accession to the European Patent Convention a new task has arisen for the HPO, i.e. to perform the tasks of a European receiving office. In the first year Hungarian applicants filed 5 European patent applications through the intermediary of the HPO, while further 9 applications were filed directly in Munich. In 124 cases Hungarian applicants chose the EURO-PCT way to file their international applications through the intermediary of the International Bureau of WIPO. In 2003, of the proprietors of the 56 415 European patents 61 were of Hungarian origin. In the course of the year the HPO prepared itself for the registration and publication of European patent applications in Hungary, for the administrative tasks concerning the granted European patents, for the necessary official information and for ensuring the access to, and inspection of, European applications and patents.

The tasks of a receiving office deriving from the Patent Cooperation Treaty (PCT) have been regularly performed by the HPO. In the patent field, foreign applicants continued to claim protection for the territory of Hungary within the framework of the PCT system. 85% of applicants wishing to obtain protection in Hungary filed their applications via the international route under the PCT. In 2003, the number of international patent applications filed by Hungarian applicants returned to the average quantity of the previous years, which was 110. As it was expected, the number of international applications entering the national phase also decreased. Following Hungary’s accession to the European Patent Convention on 1 January 2003, it was at the end of August 2003 that the transitional period, available to applicants to file their requests for the national phase entry still under the earlier – before 1 January 2003 – conditions, expired. From 1 September 2003 on, both the applicants and the staff of the HPO had to observe new administrative procedures deriving from the new legal provisions.

Due to development and professional policy considerations, the HPO has been testing the computerised international system of WIPO since August 2003. In the course of this, the HPO uses the versions of IMPACT (Information Management for the Patent Cooperation Treaty) and COR (Communication on Request) systems prepared by internal development to order and obtain the international documents of PCT applications entering the national phase. As a result of the continuous testing, the documents of the international patent applications, sent formerly on paper, are now forwarded to the HPO electronically.

COURT PROCEEDINGS IN INDUSTRIAL PROPERTY MATTERS

A summary of industrial property proceedings in industrial property matters follows, grouped according to titles of protection (the figures of 2002 are indicated in parentheses)

PATENTS, UTILITY MODELS, DESIGNS

Requests received for review of the HPO’s decision: 85 (97), of which 63 (72) related to patents, 11 (13) to utility models and 11 (12) to designs.
Requests for review forwarded to the Metropolitan Court: 43 (70), of which 25 (46) patents, 9 (13) utility models, 9 (1) designs.
Requests for review settled within the HPO’s own competence: 13 (27).

Number of cases returned by the Metropolitan Court with a final decision: 47 (77), of which
a) the request for review was rejected : 21 (54),
b) the decision of the HPO was changed: 5 (5),
c) the decision of the HPO was repealed and the HPO was ordered to start a new procedure: 12 (7),
d) termination of the proceedings: 5 (4),
e) the decision of the HPO was repealed and the request was referred to the HPO: 4 (7).

In the field of patents, utility models and designs, the number of requests for reviewing the HPO’s decision (85) slightly decreased compared with the figures of 2002. The number of cases returned by the Metropolitan Court with a final decision was down by almost 40% (47); in about half of these cases (21) the request was rejected.

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II. Matters concerning the generation, reproduction, distribution and use of primary and secondary sources of patent information

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INTERNATIONAL AND EUROPEAN COOPERATION IN THE FIELD OF INTELLECTUAL PROPERTY

In the year under review, international cooperation was influenced by two events: Hungary’s accession to the European Patent Convention on 1 January 2003 and the signature of the treaty, on 16 April 2003, on accession to the European Union. The latter entailed participation, as active observers, in the work of institutions and working parties of the EU.

CLOSE COOPERATION WITH THE EUROPEAN PATENT ORGANISATION

While in 2002 the representatives of the HPO attended the meetings of the Administrative Council and working parties of the European Patent Organisation as observers, last year they could participate in the work of these fora as full members having also the right to vote.

The HPO took part in the activity of the various committees of the European Patent Organisation. In particular, our active work in the Committee on Patent Law, the Budget and Finance Committee, the Working Party preparing agreements on the establishment of a uniform European patent litigation system and the Working Party on Technical Information can be mentioned.

Deriving from our membership of the European Patent Convention, the HPO has several joint programmes with the EPO. The ultimate aim of this cooperation is to promote full integration of the Hungarian patent system into the European one and to create the still missing conditions thereof. In this spirit, a three-year bilateral cooperation agreement was concluded in 2003 between the EPO and the HPO, covering, among others, the procurement of technical equipment, exchange of patent documents, professional training and information technology-related missions to Hungary.

The intense relations between the EPO and the HPO are also characterised by the fact that the HPO could welcome Ingo Kober, president of the EPO, as speaker at the conference entitled “Hungary in the European patent system”. Curt Edjfäll, vice-president of the EPO and Roland Grossenbacher, chairman of the Administrative Council of the European Patent Organisation also paid a visit to the HPO.

PARTICIPATION IN THE INTELLECTUAL PROPERTY WORK OF THE EUROPEAN COMMISSION

The latest Progress Report of the European Commission gave again a favourable evaluation of the preparedness of Hungary, and within this of the HPO, in the field of the protection of intellectual property. The HPO gave its comments on the draft of the industrial property-related text of the Accession Treaty and on the Hungarian translation thereof. The representatives of the HPO participated in consultations organised by the European Commission and after the signature of the Accession Treaty they joined the work, in an observer capacity, of the European Council’s Working Party on Intellectual Property.

The intensive cooperation, commenced between the HPO and the European Union’s “Trademark and Design Office” (Office for Harmonization in the Internal Market, OHIM) in the spring of 2000 on the basis of a Memorandum of Understanding, continued in 2003, too. The representatives of the HPO took part in the liaison meetings held also for the offices of candidate countries both in trademark and design issues.

At the invitation of the president of the HPO, it was for the first time that Wubbo de Boer, president of OHIM visited the HPO in the spring of 2003.

COOPERATION WITHIN THE FRAMEWORK OF THE WORLD INTELLECTUAL PROPERTY ORGANIZATION AND THE WORLD TRADE ORGANIZATION

Out of the events of international cooperation within the framework of the World Intellectual Property Organization (WIPO), the 39th series of meetings of the Assemblies of WIPO was the most significant. Hungary continues to be a member of the Coordination Committee and it retained its position in the Program and Budget Committee. The president of the HPO was elected chairman of the Assembly of the Madrid Union Concerning the International Registration of Marks and the vice-president for legal affairs will hold office as vice chairman of the Executive Committee of the Berne Union for the Protection of Literary and Artistic Works.

In the interest of a more effective representation of Hungary in WIPO and in the World Trade Organization (WTO), a representative of the HPO began working at the Permanent Mission of Hungary to the WTO in a diplomatic post. By means of this measure, participation in all meetings of both organizations, more direct information on their activities and a more effective representation of the Government’s professional policy have become possible.

PROFITABLE BILATERAL RELATIONS

In March 2003, the French-Hungarian mixed committee held its meeting in Paris. In June, a presidential meeting took place in the National Board of Patents and Registration of Finland. In October, a delegation of the State Intellectual Property Office of China visited the HPO. At the end of the year, the president of the HPO paid a professional visit to the State Agency on Industrial Property Protection of the Republic of Moldova.

Bilateral and regional cooperation continued in 2003. The president of the German Patent and Trade Mark Office paid a visit to the HPO that further deepened the well-established professional relations between the two offices. The Director General of the Swedish Patent and Registration Office was also a guest of the HPO. In August, a meeting of the presidents of the Hungarian and Estonian offices took place in Hungary. There were several meetings with the Gábor Varga, director general of the Romanian State Office for Inventions and Trademarks. The Hungarian-Romanian cooperation at the level of experts also continued.

In 2003, the presidents of the industrial property offices of the “Visegrad countries” held their annual meeting in Bratislava. On that occasion, they discussed new tasks and challenges arising from the forthcoming accession to the European Union, as well as timely issues of cooperation at the main international fora.

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