Germany is Europe’s biggest and wealthiest market. According to the World Bank, in 2010 companies in the country received $14.384 billion in IP/intangible licensing royalties. The latest European Innovation Union Scorecard, meanwhile, describes Germany as an “innovation leader” with strong growth in licence and patent revenues from abroad. What’s more, German entities file and receive more European patents than those from any other European country. They also file and receive more Community trademarks. And when it comes to patent litigation there is more in Germany than in any other European country.

All in all, therefore, it would probably be fair to say that IP is pretty important to the German economy. So how do you explain the fact that it is also in Germany that the IP-sceptic Pirate Party has most electoral support and remains in line to make major gains in the country’s general election next year? The latest proof of the party’s following came yesterday in the Saarland regional elections. From a standing start, the Pirates received close to 8% of the votes and secured four parliamentary seats. This comes on the back of the breakthrough they made in the Berlin elections last September and national opinion poll ratings which give the party between 5% and 7% (the figure has been as high as 10% in recent months).

Reading the German press it is clear that the Pirate Party is now regarded as a serious grouping that has a national role to play. This is what the Süddeutsche Zeitung says:

These Pirates, who owe some of their image to their racy name, have now established themselves in provincial Saarland following their grandiose success in big city Berlin. Until recently, they didn't even have political platforms. Ahead of the general election, the other parties can now safely assume that the success of the Pirates is more than just hype. The Pirate Party evidently satisfies a trusting, impartial, heartfelt, grassroots desire for politics.

And this is from the Financial Times Deutschland:

The Pirates are continuing to seize fresh territory. They have proven for the first time that they can capture more than a big metropolis, and can also appeal to voters in the gentrified provinces. The newcomers will remain a force to be reckoned with in the upcoming state elections.

The way the German system works is that any party which secures over 5% of the vote in an election gets representation and a significant funding boost. With each success not only do the Pirates raise their profile, they also increase the amount of money in their coffers, so helping them to build their profile, and so on. And this, let us remember, is a party that is openly hostile to many forms of IP.

It is unlikely that the Pirates will ever be a huge party to challenge either the CDU or the SPD, but they certainly have the potential to be Germany’s third force (they outscored the Greens in Saarland). In a close election – which the next national one in Germany promises to be – they could easily end up playing a very significant role in the subsequent attempts to form a government, and they will have a price to charge for doing so. At the same time, it is not hard to see other parties adapting their stances on IP in order to try to win back support the Pirates are currently getting - indeed, they may already be having some influence, if reports on a potential German about-face on ACTA turn out to be accurate.

Should the Pirates start to have an impact on IP policy making in Germany, the effects will be felt not only there, but across the EU, given that so much IP law-making is done at the European level. I’d have thought that this might be something that IP owners in Europe would be worried about. But apart from a few of the savvier operators, the silence from that quarter is deafening. Whether it be complacency or political naivety, the longer the vast majority of the IP community fails to make an effective case for IP, the easier it becomes for the IP-sceptic message to spread. Once this enters the mainstream, it will be too late. The day that happens is getting closer.

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