2019/06 > Adoption of the PACTE Act

Act No. 2019-486 of May 22, 2019 on the growth and transformation of businesses, called the PACTE Act, was published in the French government’s Official Journal on May 23, 2019. Its purpose is to give companies the means to innovate, grow and create employment.

To this end and by the provisions adopted in articles 118, 121, 122 and 124, the legislature has shaken up the French patent system, creating an opposition procedure, and reviewing the conditions of infringement and invalidity actions in the courts for all intellectual property rights.

It will be possible to convert a utility certificate application into a patent application, whereas up to now only the conversion of a patent into a utility certificate was possible. Utility certificates will be issued for a 10 year period, instead of 6 years as from the day the application was filed. These new provisions will apply only after the publication of the implementing decree (article L. 611-2 of the French intellectual property code).

The right to a patent is now subject to a thorough substantive examination including a review of inventive step. It will be recalled that, according to the previous wording of article L.611-10, “Shall be patentable, inventions which are new, involving an inventive step and susceptible of industrial application”. However, pursuant to article L.612-12, a pending application could not be rejected even if the criteria of inventive step or industrial application were absent. With regard to the novelty criterion, it was only if the Examiner identified prior art resulting in a “manifest” absence of novelty of the subject-matter of an independent claim of the patent application that it could be rejected, if the applicant did not reply to the communication from the French Patent and Trademark Office (FPTO) requesting him to amend his application.

The adverb “manifestly” has been deleted. In addition, each patentability criterion will now need to be thoroughly examined. There is a one-year delay in implementing these new provisions, which will only apply to applications filed after this period.

It should be noted that the PACTE Act still does not allow for the possibility of designating France directly in an international PCT application.

Creation of a patent opposition procedure: Within 9 months after the enactment of the Act, the necessary measures will be taken, by order, to create a right to oppose patents granted by the FPTO in order to allow third parties to administratively request their removal or amendment, while ensuring that abusive opposition procedures are prevented (article 121 of the Act).

The forthcoming order will have to provide for rules of appeal applicable to FPTO decisions ruling on these oppositions.

No time limit for launching a nullity action for IP rights: A nullity action against a patent, a plant variety, a design or a trademark is no longer subject to any limitation period (articles L. 521-3-2, L. 615-8-1, L.623-29-1 and L. 714-3-1).

This much anticipated measure puts an end to heated debates and conflicting decisions regarding the statute of limitations applicable to nullity actions and the starting point for the 5 year limitation period that used to apply for these actions.

It applies as soon as the law is published and has no effect on decisions which have become final.

In addition, the provisions of the Order No. 2018-341 of May 9, 2018 on the European Patent with Unitary Effect and the JUB (United Patent Court), providing for identical limitation periods, are deleted.

It should be noted that provisions for creating the possibility to request the invalidation of a design before the FPTO have not been brought in. However, such an administrative procedure will be introduced for trademarks through the transposition of the 2015/2436/EU Directive.

New starting point for calculating the limitation period for bringing an  infringement action: Until now, the 5 year limitation period was deemed to begin with the commission of the infringing act, infringing acts being considered as successive acts.

It is now provided that the time limit for an infringement action will be counted from “the day the right holder knew or should have known the last fact enabling them to exercise their right” (articles L. 521-3, L. 615-8 and L. 716-5). This new method of calculation applies to every type of IP right. It parallels the method of calculating the limitation period for civil actions under article 2224 of the French Civil Code.

This provision came into force as soon as the law was enacted, with no transitional provision for pending cases.

Article L. 152-2 of the French Commercial Code is also amended, with immediate application, in regard to its provisions on trade secrets. “The limitation period for actions relating to a breach of a trade secret is five years from the day the rightful holder of the trade secret knew or should have known the last fact that is the cause of action“.

This new method of calculation will lead to difficulties of interpretation.

Referral to an order for the transposition of the provisions of the Trademark Directive (article 201): Within six months after the enactment of this PACTE Act it is expected that the Government will issue an order enacting legal provisions necessary for the transposition into French law of European Parliament Directive (EU) 2015/2436 of the European Parliament and of the Council of December 16, 2015 to approximate the laws of the Member States on trademarks, and for the compatibility of French trademark legislation with Regulation (EU) 2017/1001 of the European Parliament and of the Council of June 14, 2017 on the European Union trademark.

A ratification bill must be introduced in Parliament within six months of the publication of the order