02.18.22

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FFII: In PL Holdings, European Court of Justice Confirms EU Law Cannot be Outsourced to International Courts Like Unified Patent Court (UPC)

Posted in Europe, Law, Patents at 7:05 pm by Guest Editorial Team

By Benjamin HENRION, originally posted February 15, 2022

CJEU

Brussels, 17th Feb 2022 — The European Court of Justice has confirmed that EU law cannot be outsourced to international courts in its “PL Holdings sarl Vs Poland” decision. It is problematic for the architecture of the Unified Patent Court (UPC), which is an international court outside of the judicial system of the European Union, despite the claims of its supporters.

The European Court of Justice (CJEU) has recalled in PL Holdings that Member States cannot remove disputes from the judicial system of the EU which deal with EU law:

Lastly, it follows both from the judgment in Achmea, and from the principles of the primacy of EU law and of sincere cooperation, not only that the Member States cannot undertake to remove from the judicial system of the European Union disputes which may concern the application and interpretation of EU law […].

— Court of Justice of the European Union, Press Release No 190/21, Luxembourg, 26 October 2021, Judgment in Case C-109/20, PL Holdings, https://curia.europa.eu/jcms/upload/docs/application/pdf/2021-10/cp210190en.pdf

Since EU law covering patents is the Biotech directive and the Enforcement directive (IPRED), the interpretation of EU law is removed from the judicial system of the European Union, which is composed of the CJEU and the National Courts.

The PL Holdings decision follow the same line of thought as the Achmea decision, where the European Court of Justice dissolved intra-EU investment courts (ISDS). In its Achmea decision (2018), the CJEU recalled the same functional link principle with the National Courts, as in Miles (2011):

However, the arbitral tribunal at issue in the main proceedings is not such a court common to a number of Member States, comparable to the Benelux Court of Justice. Whereas the Benelux Court has the task of ensuring that the legal rules common to the three Benelux States are applied uniformly, and the procedure before it is a step in the proceedings before the national courts leading to definitive interpretations of common Benelux legal rules, the arbitral tribunal at issue in the main proceedings does not have any such links with the judicial systems of the Member States (see, to that effect, judgment of 14 June 2011, Miles and Others, C‑196/09, EU:C:2011:388, paragraph 41).

— CJEU’s Case Case C-284/16, Achmea, https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A62016CJ0284&qid=1639573183575

Supporters of the UPC keep claiming it will be a Court Common to the Member States:

The Unified Patent Court (UPC) will be a court common to the Contracting Member States and thus part of their judicial system.

— Unified Patent Court website, About page, https://www.unified-patent-court.org/about

If the Unified Patent Court is really part of their judicial system, why does the staff of the court need diplomatic immunity via the Protocol on Privileges and Immunities (PPI) of the Unified Patent Court?

The European Court of Justice has allowed the Benelux Court of Justice to be part of the judicial system of the European Union, because it has a dialogue with National Courts, via a system of prejudicial questions. The UPC does not have any dialogue with the National Courts, it simply replaces them.

The European Court of Justice is very much attached to the concept of Autonomy of EU law, which is in danger each time an international court outside of the judicial system of the European Union is allowed to interpret EU law.

Member States which are no signatory of the UPC (because it is a super too-expensive court for SMEs) like Poland, Hungary, Spain or Czech Republic should use Art259 TFEU to ask the question to the European Court of Justice whether this construction is compatible with the architecture of the European Union:

A Member State which considers that another Member State has failed to fulfil an obligation under the Treaties may bring the matter before the Court of Justice of the European Union.

— Article 259 TFEU, EUR-Lex https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A12016E259

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