Intellectual property briefing: with the UK likely to ratify the Unitary Patent Agreement this spring, patent holders need to consider to what extent they will participate in the new regime

The UK has indicated that it will ratify the EU’s Unitary Patent and Unified Patent Court system in spring 2017. It is likely that patent holders will soon have to make important decisions about the extent to which they will participate in the new regime.

Timetable for commencement

Signed in February 2013, the UPC Agreement will come into force as soon as it has been ratified by 13 of the 25 member states participating in the UPC system (“contracting member states”), including France, Germany and the UK.

France has already ratified, and the UPC Preparatory Committee has advised that the UK and Germany are expected to ratify this spring. If so, it envisages that provisional applications for unitary patents will be possible as early as May 2017, and the UPC will open its doors in December 2017.

Effect on European patents

The unitary patent will be a single patent providing protection in all contracting member states. This will supplement the existing national, European and supplementary protection certificate (SPC) patent regimes, which will remain in effect.

However, the UPC regime will impact on litigation relating to European patents and SPCs, as the UPC will have jurisdiction over such disputes.

For the first seven years of the new regime, the UPC will share jurisdiction over European patent disputes with the national courts of contracting member states.

Holders of European patents will be able to opt out these patents from the new regime during a three-month sunrise period before the UPC opens, and then at any time during the first seven years. However, an opt-out cannot be filed after an action in relation to that specific patent has started at the UPC.

UPC and European patent litigations

Once granted, European patents convert to separate national patents in each country in which they are validated. Thus, at present, infringement and validity proceedings must be brought in the national courts of the countries in which the patent is validated. To challenge validity, separate proceedings must be raised in each jurisdiction, and different outcomes are possible; similarly with infringement proceedings.

If litigation relating to a European patent is brought in the UPC, the UPC’s decision will take effect in all contracting member states in which the patent is validated. Thus, the outcome of one court action may be to invalidate the European patent, or to find that a product infringes it, in multiple jurisdictions.

As the sunrise period is scheduled to start soon, European patent holders should carefully review their existing portfolios to determine their opt-out strategy.

Considerations in play

A number of factors will influence whether each European patent/SPC should be opted out of the UPC regime, including:

  • Competitors may be more likely to challenge valuable European patents in the UPC, as it will avoid the need for multiple litigations. It may be beneficial for holders to opt out European patents likely to face such challenges, so that if an invalidity challenge succeeds in one national court, the patent may yet remain alive in other jurisdictions.
  • In contrast, if the European patent is being infringed, or likely to be infringed, in multiple jurisdictions, it may be advantageous to remain opted in, to allow for multi-jurisdictional litigation.
  • Careful consideration will require to be given to litigation costs at the UPC and in relevant national courts, to assess which option is likely to be most cost-effective.
  • Patent holders may wish to consider opting out some, but not all, patents from a “patent family”, to keep open the option of bringing proceedings in the UPC or national courts.

Filing an opt-out will not preclude patent holders from opting back in to the jurisdiction of the UPC in future (although a subsequent opt-out will not be possible).

Implications post-Brexit

It is not yet known how Brexit will impact on the UPC. The UK’s continued participation post-Brexit would require amendments to the UPC Agreement.

The UPC is subject to EU law and there is a right of appeal to the CJEU in some circumstances. Given that one of the UK Government’s 12 priorities stated in the Brexit white paper is “Taking control of our own laws”, the decision to ratify and participate seems surprising.

However, another priority is “Ensuring the United Kingdom remains the best place for science and innovation”, which may explain its decision.

In the online Journal article “The UPC post-Brexit: unified, ‘emmental-ed’, or dead?” (October 2016), suggestions were made as to how the UPC Agreement could be amended to allow the UK’s participation post-Brexit. Thus, if there is political will on both sides, it seems there may be a way to do so.

The Author
Susan Snedden, director, IP & Technology, Maclay Murray & Spens LLP 
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