Deal on Setting Up Single European Patent

European Union governments on Monday broke a 30-year deadlock and agreed to set up a single European patent - a measure considered by business as crucial for boosting research and economic growth.

The deal, to be ratified by European leaders at a summit later this month, will enable companies to protect their inventions throughout the EU using a single document.

The issue, which had divided governments since 1973, had become a test of the EU's ability to put aside national differences and deliver business-friendly measures to meet its goal of becoming the world's most competitive economy by 2010.

"Today's agreement marks a welcome demonstration that Europe means business," said Frits Bolkestein, European single market commissioner.

According to the European Commission, applying for a "community patent" - which could be valid in up to 25 countries once the EU expands to 10 more members next year - will cost about €25,000 ($27,000, £17,000).

This will still be higher than in the US and Japan but it would be half the current cost of applying for a patent valid in eight EU states. The first community patents are expected to be issued within five years, once the new law has been approved by national parliaments.

UNICE, the European employers' organisation, welcomed the long-awaited agreement but urged the EU to do more to reduce costs especially for small businesses. However, the CBI, the UK employers' group, took a tougher line, saying the high cost of the community patent would deter businesses from protecting their inventions.

At a meeting in Brussels on Monday, EU governments struck a compromise on the two most controversial issues of the latest proposal for a community patent: the location of a patent court and the language of the new document.

After pressure from Germany, which wanted to protect its regional patent courts, ministers agreed that national courts will continue to rule on patent disputes until 2010, when an EU-wide court will be set up in Luxembourg.

On the language, companies applying for a patent will have to pay for the translation of the first three pages of the document, which define the legal scope of the patent, in all the EU languages. The rest of the patent will have to be in either English, French or German.

According to the CBI, the requirement to translate part of the patent in 11 EU languages - set to rise to 19 if 10 new members join in 2004 - would be too costly for small businesses.