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Since the beginning of the 21st century, Europe has been losing ground in the battle for productivity and competitiveness—first to the United States, and more recently to China. Much of this widening gap stems from lower levels of investment in research and development (R&D), particularly from the private sector. Today, technology is the decisive factor—whether the aim is to boost traditional industries or support the emergence of disruptive start-ups and scale-ups. Computer technology, electrical machinery and energy, and digital communication are at the top of the investment priority list.
The recently published EPO Patent Index 2024 underscores this trend. Whilst Europe leads in important fields such as hydrogen, plastics recycling, and power grids, it continues to lag behind in areas like batteries, pharmaceuticals, and artificial intelligence (AI).
To reverse this trend, Europe needs more and better-targeted investments. This includes stronger incentives for private investment—possibly through publicly backed de-risking mechanisms—as well as increased public funding in strategic technological areas. Ultimately, what is invented in Europe, or by European companies, should also be produced in Europe.
In this context, intellectual property rights—particularly patents—play a crucial role. Beyond their legal function, patents serve as tools to protect and incentivise R&D investments in new products and processes. They also facilitate the monetisation of innovation through licencing agreements and strategic partnerships. It is no surprise that patent-intensive industries contribute over 17% of EU GDP and account for nearly 19% of employment. These sectors also demonstrate greater potential for growth, higher resilience during economic downturns, and increased success in securing funding.
Nonetheless, challenges remain. Patents are often perceived as too expensive or too complex. This helps explain why, although SMEs, research centres, and universities make up the majority of EPO applicants, they account for only around 20% of annual filings at the Office.
There is, however, good news. In April 2024, the EPO expanded its fee-reduction policy to offer a 30% across-the-board discount for micro-entities, research centres, and universities. In addition, and to promote greater market transparency, the EPO launched the freely accessible Deep Tech Finder tool. This powerful platform maps over 11,000 start-ups and spin-outs, providing insights into their technical fields, funding history, and patent protection status. It can also identify potential venture capital investors with a proven track record in relevant sectors. The goal is to give high-potential start-ups and spin-outs increased visibility and greater opportunities for commercialisation, scale-up, and strategic partnerships.
The most transformative development, however, is undoubtedly the launch of the Unitary Patent (UP) system and the Unified Patent Court in June 2023. This new system radically simplifies patent protection across participating EU countries through a single application procedure. It also substantially reduces costs by eliminating the expenses associated with maintaining a patent in multiple jurisdictions. Cost savings could increase further by up to 82% if all 27 EU Member States follow the Draghi Report’s recommendation to join the Unitary Patent system. Additional efficiencies are gained by avoiding multiple national patent office fees, translation costs, and legal expenses. Unsurprisingly, while SMEs make up 35% of Unitary Patent requests, they convert 60% of their granted European patents into Unitary Patents—indicating a very high uptake of the system among SMEs—indicating a very high uptake of the Unitary Patent among SMEs. Meanwhile, the Unified Patent Court—a core component of the system—has already issued over 1,000 decisions and orders since becoming operational.
To fully unlock Europe’s economic potential, patent quality is paramount. A valid patent must protect a genuinely new and inventive technology and include an innovative step that is not obvious to experts in the field. The EPO is particularly well-equipped to assess these criteria, with 4,000 highly qualified engineers and scientists, the world’s largest technological and scientific databases—including Espacenet, which provides access to 2.2 billion records, including over 150 million patent documents—and state-of-the-art, AI-assisted search engines to support rigorous examination.
Patents that go beyond protecting the truly novel components of an invention are vulnerable to legal challenges and can distort innovation and competition. The EPO’s role is to prevent this from happening. The accuracy of our quality examination process may explain why we consistently rank among the world’s top patent offices—if not the very best. Indeed, despite being a second-filing office—handling applications typically first filed elsewhere—only 55–60% of applications are granted, underscoring the rigour of the EPO’s examination process
A key challenge lies in balancing the need to reward innovation with the imperative of ensuring fair access to technology. In Europe, holders of Standard Essential Patents (SEPs)—such as those for Bluetooth, Wi-Fi, and 5G—must provide competitors with Fair, Reasonable and Non-Discriminatory (FRAND) licences to enable market access.
The widespread global availability of mobile phones, 5G, video streaming, cloud computing, smart devices, and other technologies demonstrates that the system is accessible to the wider public and not merely reserved for a privileged few. However, even greater transparency would be beneficial—especially for SMEs. We need more clarity around which patents are essential to a standard, who determines essentiality, who owns the technology, and at what cost. Legal redress and the high cost of litigation are also persistent concerns.
The European Commission recently announced its intention to launch a six-month consultation following the withdrawal of the proposed Standard Essential Patents regulation. The European Patent Office welcomes this approach, as it offers a timely opportunity to contribute market evidence, deep patent and standards knowledge, and broad dispute-resolution experience. Because for innovation to scale up, Europe must gear up. We all stand to gain from greater transparency and the sharing of our experiences and processes.
We hope that the EPO’s study on standards and the European Patent system—developed in collaboration with 21 national patent offices—along with the upcoming conference on Patents, Standards and Innovation, co-organised with the French Intellectual Property Office, will provide meaningful contributions to this fact-finding and evidence-gathering effort.
António Campinos is the President of the EPO.
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