09.18.11

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Cablegate: More Sensitive Diplomatic Cables About “Community Patent” or “EU Patent”

Posted in Cablegate, Europe, Patents at 2:27 am by Dr. Roy Schestowitz

Cablegate

Summary: A couple more transmissions between embassies/consulates regarding “SENSITIVE” details from Brussels

According to the more recent Cablegate cables, harmonising patent laws — a process now known as “Community Patent” or “EU Patent” — is rather abrasive as a whole. Countries in Europe would benefit almost in no shape or form from it. Politicians worry that people will find out who benefits from this, mostly patent lawyers and multinationals to be specific.

To quote the cable from the Government of Italy (GOI), as it was posted yesterday morning, “THE GOI, MOREOVER, DOES NOT/NOT SUPPORT THE CREATION OF A SEPARATE GROUP TO PURSUE PATENT HARMONIZATION DISCUSSIONS. PRIGIONI NOTED THAT, IN THE GOI VIEW, THE CREATION OF A SEPARATE GROUP WOULD CREATE THE IMPRESSION OF A DEAL BEING STRUCK BEHIND CLOSED DOORS, POTENTIALLY UNDERMINING THE LEGITIMACY OF AN AGREEMENT. HE PROPOSED INSTEAD THAT BILATERAL EXCHANGES BE USED TO SUPPLEMENT STANDING COMMITTEE DISCUSSIONS.”

In the following latest two cables from Brussels (2009), cable 1 states in ¶3 that: “Speaking at the post-Social Summit press conference, Dutch PM/European Council chair Balkenende said participants all agreed that “if we want a social Europe we need a strong economy in Europe.” Commission President Prodi underlined the need to actually implement the Lisbon agenda. With a reference to the persisting deadlock on the draft legislation concerning the Community patent, Prodi stated: “If we continue to decide by unanimity, the Lisbon agenda has no chance of being implemented.” Prodi also called for Member State budgets to reflect the commitments taken under the Lisbon strategy. Balkenende and Prodi underlined the role of social dialogue as being “at the heart of the European Social model.”

“Politicians worry that people will find out who benefits from this, mostly patent lawyers and multinationals to be specific.”The “Lisbon strategy” need not depend on the so-called ‘Community’ patent (a euphemism), which would only increase the aftermath of lawsuits. Cable 2 says in ¶4: “The Communication cites a number of problems for the shortcomings. It notes barriers to ICT business growth, wherein sub-optimal conditions for SME access to markets, innovation and finance, plus excessive regulatory burdens, prevent SMEs from expanding and growing their market shares more rapidly. The Communication highlights how fragmentation of EU ICT markets is also a key limiting factor for SME growth and innovation. The EU’s failure to achieve a real internal market in telecoms, and to standardize ICT regulation and IPR regimes, limit the ability of firms to grow rapidly. The Communication calls for creation of a Community patent to help remedy this situation. The lack of collaboration between public procurement authorities and those overseeing R&D and innovation results in many missed opportunities for innovative products to flourish.”

The logic here is very flawed. What they are trying to insinuate is that in order for businesses to thrive in Europe they might need a broader market like that in the United States. But to suggest that SMEs suing or threatening more competitors in more parts of Europe would somehow spur innovation is to ignore all the good academic studies (including empirical evidence) from the US — ones that suggest patents have only harmed innovation and continue to do so. The sacred cow which is patents is simply the wrong thing to blame here and to portray it as a gateway to success is simply to spin or lie for an agenda. Here are the two cables in question:


UNCLAS SECTION 01 OF 02 BRUSSELS 004741 
 
SIPDIS 
 
DEPT FOR DRL/IL 
DOL FOR ILAB 
 
E.O. 12958: N/A 
TAGS: PREL [External Political Relations], ELAB [Labor Sector Affairs], 
ECON [Economic Conditions], EUN [European Union], USEU BRUSSELS 
SUBJECT:  EU SOCIAL SUMMIT RENEWS COMMITMENT TO 
LISBON STRATEGY; LABOR AND EMPLOYERS SPLIT ON 
PRIORITIES 
 
 
¶1.  SUMMARY.  EU-level organizations of labor and 
employers at a pre-European Council meeting with EU 
leaders on November 4 reaffirmed their commitment to 
the "Lisbon strategy" for turning the EU into the 
most competitive economy by the year 2010.  The 
employers and unions not surprisingly continue to 
have different priorities for reactivating the 
Lisbon agenda.  END SUMMARY. 
 
¶2.  The European Council meeting was preceded on 
November 4 by a "Tripartite Social Summit," in which 
the EU Troika (Dutch Presidency, Luxembourg, UK and 
European Commission) as well as representative 
organizations of the "social partners" (labor, 
employers, "cadres" and employees) reviewed the 
Lisbon strategy for turning the EU into the most 
competitive economy by the year 2010.  The Social 
Summit heard a presentation by former Dutch PM Wim 
Kok of the report drawn up by his high-level panel 
on the progress of the Lisbon Strategy.  The report 
takes a gloomy view on progress made over the past 
four years.  It explains the EU's disappointing 
delivery by the overloaded agenda, poor coordination 
and conflicting priorities, and blames the lack of 
political will by the Member States.  In order to 
ensure that Member States take up their 
responsibilities, the Kok report calls for a process- 
redesign along three lines: "more coherence and 
consistency between policies and participants, 
improving the process for delivery by involving 
national parliaments and social partners, and 
clearer communication on objectives and 
achievements."  The report rejects proposals for the 
2010 Lisbon target to be lifted.  It also states 
that the EU should not become a "copy-paste" of the 
US. 
 
¶3.  Speaking at the post-Social Summit press 
conference, Dutch PM/European Council chair 
Balkenende said participants all agreed that "if we 
want a social Europe we need a strong economy in 
Europe."  Commission President Prodi underlined the 
need to actually implement the Lisbon agenda.  With 
a reference to the persisting deadlock on the draft 
legislation concerning the Community patent, Prodi 
stated: "If we continue to decide by unanimity, the 
Lisbon agenda has no chance of being implemented." 
Prodi also called for Member State budgets to 
reflect the commitments taken under the Lisbon 
strategy.  Balkenende and Prodi underlined the role 
of social dialogue as being "at the heart of the 
European Social model." 
 
¶4.  The President of the European Employers' 
Federation (UNICE), Jurgen Strube, opined that the 
sense of urgency with the Lisbon agenda must be 
translated into implementation but called for the 
focus to be on competitiveness: "All (Lisbon) 
objectives are interrelated but it's important to 
focus on the key drivers: competitiveness and 
economic growth.  ETUC Secretary-General John Monks 
said his organization (the European Trade Union 
Confederation) supported the Kok report as a 
"realistic" and "balanced" document, adding:  "We 
know there are choices to be made, but the route is 
not the same as in the U.S.  What concerns us are 
the "delocalisations" (out-sourcing), working time 
related issues, etc.  There is an agenda there." 
 
¶5.  A statement released by the Dutch Presidency 
said the parties "reaffirmed their commitment to the 
Lisbon agenda" as "the most effective means by which 
to fulfill" the EU's economic and social objectives 
"and thereby underpin the role of social dialogue in 
European governance," adding: "All parties agreed on 
the need to add a new impetus to the implementation 
of the Lisbon strategy in order to bring about a 
balanced economic, social and environmental renewal 
in the EU."  The contribution of social partners was 
"essential in unleashing the potential for economic 
and employment growth by finding the balance between 
flexibility and security."  Balkenende and Prodi 
were said to have "expressed their readiness to 
continue the debate and stated that they were 
looking forward to a substantial joint contribution 
from the social partners with commitments relating 
to their area of competence in the context of the 
Mid-Term review of the Lisbon strategy next spring." 
 
¶6.  COMMENT.  Just like the members of the Kok panel 
were said to be divided on the remedies to the 
problems of the EU economy, the employers and unions 
not surprisingly continue to have conflicting 
demands on priorities to be addressed in the context 
of their "social dialogue" at the service of the 
Lisbon strategy:  the employers are calling for 
further liberalization, the removal of obstacles to 
cross-border provision of services, and for research 
policy to be tweaked toward boosting 
competitiveness.  In contrast, the ETUC calls for 
stronger social cohesion "as an essential part of 
Europe's competitive advantage" and insists that the 
Lisbon process should not amount to deregulation, 
weakening worker rights and protection, and cutbacks 
in living and social standards. 
 
SCHNABEL



VZCZCXRO5173
PP RUEHAG RUEHDF RUEHIK RUEHLZ RUEHROV RUEHSR
DE RUEHBS #0399/01 0790718
ZNR UUUUU ZZH
P 200718Z MAR 09
FM USEU BRUSSELS
TO RUEHC/SECSTATE WASHDC PRIORITY
RUCPDOC/USDOC WASHDC PRIORITY
RUEAFCC/FCC WASHDC PRIORITY
INFO RUCNMEM/EU MEMBER STATES COLLECTIVE

UNCLAS SECTION 01 OF 03 BRUSSELS 000399 
 
SENSITIVE 
SIPDIS 
 
FCC FOR WEISLER 
DOC FOR ITA, NTIA - ALEXANDER, MAC - DEFALCO 
STATE FOR EUR/ERA, EB/CIP, EB/IPE 
PLEASE PASS TO USTR 
 
E.O. 12958:  N/A 
TAGS: ECPS [Communications and Postal Systems], 
ECIN [Economic Integration and Cooperation], 
EINV [Foreign Investments], EINT [Economic and Commercial Internet], 
ETRD [Foreign Trade], ECON [Economic Conditions], EUN [European Union] 
SUBJECT: EU SEEKS TO DOUBLE ICT RESEARCH AND INNOVATION FUNDING 
 
¶1. (SBU) SUMMARY.  The European Commission released a March 13 
Communication calling for doubling funding for information and 
communication technology (ICT) research and innovation and other 
steps to boost ICT in Europe.  "A Strategy for ICT R&D and 
Innovation in Europe: Raising the Game" emphasizes that ICT provides 
vital tools to promote economic recovery and address long-term 
aging, environmental and energy concerns and  lays out plans to make 
the EU the world leader in ICT development by 2020.  The Commission 
notes that the EU lags the U.S. and Japan in the proportion of R&D 
devoted to ICT and the economic value generated by ICT.  The report 
cites regulatory barriers to ICT business growth, fragmented 
markets, disjointed R&D efforts and inadequate funding for the 
shortcomings.  The Commission calls specifically for doubling ICT 
R&D investment by 2020, to be matched by member states.  The 
Communication also calls upon EU institutions and Member States to 
coordinate efforts to overcome fragmentation of ICT R&D efforts and 
markets, to raise the number of ICT "poles of excellence," and to 
set the right conditions to grow new innovative ICT businesses 
across Europe.  The new strategy forms part of preparations for an 
EU research and innovation plan as called for by the December 
European Council, and underpins EU efforts to promote greater 
emphasis on R&D and innovation as a critical factor to speed 
recovery from the global economic crisis.  END SUMMARY. 
 
COMMISSION PROPOSES ICT RESEARCH AND INNOVATION STRATEGY 
--------------------------------------------- -------- 
 
¶2. (U) The European Commission released a Communication on March 13 
calling for doubling funding for information and communication 
technologies (ICT) research and innovation and other steps to boost 
the ICT sector in Europe.  The report follows upon a public 
consultation, launched in September 2008, on an EU research and 
innovation strategy for ICT, and responds to the December 2008 
European Council call for an EU plan for innovation and research. 
The Communication, "A Strategy for ICT R&D and Innovation in Europe: 
Raising the Game," stresses the importance of deepening, rather than 
cutting R&D support during the current economic crisis, and lays out 
plans to make the EU the world leader in ICT development and use by 
2020.  The Communication underlines that Member States, EU 
institutions and industry must pool resources and better coordinate 
ICT research and innovation efforts to reach this goal. 
 
EU LAGS OTHERS IN ICT RESEARCH 
------------------------------ 
 
¶3. (U) The Communication notes that in the EU, ICT represents 34 
percent of the two trillion euro global ICT market, accounts for 12 
million jobs and generates six percent of EU GDP.  ICT R&D accounts 
for a quarter of all private R&D spending, a third of all R&D 
employment, and fifth of all patents in the EU.  Nevertheless, the 
EU ICT business sector spends less than half as much as its U.S. 
counterpart on R&D spending.  The EU also lags other OECD members in 
the proportion of R&D devoted to ICT, who on average devote more 
than 30 percent of total R&D to ICT.  The Communication notes a 
growing deficit of ICT skilled workers across the EU, resulting in 
"several hundreds of thousands" of unfilled jobs.  Value added by 
the EU ICT sector is only 23 pecent of total value added, which 
lags the U.S., Japan and advanced economies. 
 
¶4. (U) The Communication cites a number of problems for the 
shortcomings.  It notes barriers to ICT business growth, wherein 
sub-optimal conditions for SME access to markets, innovation and 
finance, plus excessive regulatory burdens, prevent SMEs from 
expanding and growing their market shares more rapidly.  The 
Communication highlights how fragmentation of EU ICT markets is also 
a key limiting factor for SME growth and innovation.  The EU's 
failure to achieve a real internal market in telecoms, and to 
standardize ICT regulation and IPR regimes, limit the ability of 
firms to grow rapidly.  The Communication calls for creation of a 
Community patent to help remedy this situation.  The lack of 
collaboration between public procurement authorities and those 
overseeing R&D and innovation results in many missed opportunities 
for innovative products to flourish. 
 
¶5. (U) In addition, the Communication outlines how Europe's ICT R&D 
landscape remains fragmented, despite new efforts under the seventh 
EU Framework Program for R&D (FP7).  Member State ministries 
continue to develop R&D, innovation and education policies in 
isolation, without adequate cross-ministerial consultation.  The 
plethora of varied EU, Member State and intergovernmental R&D 
funding mechanisms also lead to confusion for innovators. 
 
THE SOLUTIONS - GREATER AND MORE COORDINATED ICT R&D INVESTMENT 
--------------------------------------------- ------- 
 
 
BRUSSELS 00000399  002 OF 003 
 
 
¶6. (U) In response to these shortcomings, the Commission says Europe 
"needs to raise its game."  The Commission calls for a systematic 
ICT R&D strategy that mobilizes resources and stakeholders along 
three paths: raising public and private ICT research and innovation; 
prioritizing ICT research and innovation into key areas and reducing 
fragmentation; and facilitating the emergence of new public and 
private markets of ICT-based innovations. 
 
¶7. (U) In specific terms, the Commission calls for doubling ICT R&D 
investment by 2020, beginning with a boost in EU-level spending 
under FP7 from 1.1 billion Euros in 2010 to 1.7 billion in 2013, to 
be matched by Member States.  This could be accompanied by direction 
of additional regional/cohesion funding toward ICT innovation and 
research.  The Commission urges Member States to develop more 
public-private partnerships, to boost public procurement of 
innovative ICT products, and to explore pre-commercial procurement. 
 
OVERCOMING FRAGMENTATION 
------------------------ 
 
¶8. (U) The Communication calls for a series of actions to better 
coordinate its R&D and innovation policies and specialize its 
resources.  It urges Member States to work with EU institutions to 
develop shared strategies and policies, to enhance the dialogue 
within the National ICT Research Directors Forum and to work more 
closely with ICT advisory groups.  The Commission commits to 
strengthen stakeholder groups and use instruments such as the ICT 
Knowledge and Innovation Communities (KICs) to bring industries, 
entrepreneurs and academics together.  Member States and regions are 
urged to redouble efforts to develop knowledge-based innovation 
clusters, and increase sharing of R&D infrastructures for sectors 
that require large investments, such as nanotechnology and 
high-performance computing. 
 
FACILITATING MARKETS FOR INNOVATION 
----------------------------------- 
 
¶9. (U) The Communication discusses ways to facilitate the emergence 
of markets for innovation, so that the EU can "produce and 
commercialize the equivalent of its share in the global ICT market." 
 The Commission calls for both general policy measures and targeted 
procurement as means to create more favorable conditions for EU-wide 
innovation markets.  Member States and regions should promote closer 
collaboration between innovation users and producers across the 
public sector.  Governments should ensure interoperability and work 
harder to promote common standards, and the Commission will work to 
revise the ICT standardization process. 
 
¶10. (U) Also, the Commission plans to support a series of 
substantial pilot projects to deploy innovation ICT products and 
develop new pan-European ICT-based service infrastructures.  Among 
these may be projects to focus on innovative ICT solutions for 
sustainable healthcare or for energy efficiency, as well as an 
effort to develop an electronic identity management (eID) 
infrastructure, to increase the trustworthiness of e-government and 
e-commerce services. 
 
¶11. (U) Finally, the Communication calls for simplification and 
streamlining of R&D administrative procedures, to cut red tape and 
allow for greater flexibility in program procedures.  The Commission 
notes it will expand international cooperation on the largest-scale 
ICT challenges, such as the Future Internet and quantum computing. 
 
CONCLUSION AND COMMENT 
---------------------- 
 
¶12. (U) The Commission's new proposed ICT R&D and innovation 
strategy projects that if fully adopted, by 2020 the EU will have: 
doubled its private and public investment in ICT R&D, doubled 
venture capital investment in high growth ICT SMEs, developed an 
additional five ICT poles of world-class excellence, to make ICT 
research careers more attractive to bridge the current skills gap; 
grown new innovative ICT businesses so that one third of all ICT R&D 
business expense comes from new firms; and ensured that the EU ICT 
sector supplies at least the equivalent of its share in the global 
market. 
 
¶13. (SBU) The proposed strategy is part of a larger series of EU 
initiatives to boost the EU's innovative capacity across sectors. 
These were triggered by the seminal 2005 Aho report detailing the 
EU's R&D and innovation shortcomings.  The new ICT strategy is 
designed to build on the EU i2010 ICT policy framework, the 
broad-based EU innovation strategy and ICT-related initiatives under 
the European Research Area framework.  The effort will need approval 
by the European Council, which is likely.  It is unclear whether 
 
BRUSSELS 00000399  003 OF 003 
 
 
this and other EU innovation promotion initiatives will allow the EU 
to overcome the persistent innovation gap remaining versus the U.S., 
and in any case, will take time to show measurable results. 
 
MURRAY


If there are any Cablegate areas we should explore more urgently, please leave a comment.

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