The new Unitary Patent (UP) is perhaps the biggest change in European patent legislation in recent history. It means huge changes to the way exclusivity can be maintained throughout Europe when enforcing and defending patent rights. Businesses will need to make considered choices about how to best protect and enforce rights as the new regime will sit alongside the existing patent systems.

Overview

What is a Unitary Patent?

The Unitary Patent is a pan-European patent obtained through a single registration and validation process at the European Patent Office. Unitary Patents will provide patent protection with unitary effect in every EU country that has chosen to participate in the new system. Therefore, this new type of patent will only apply in those territories that have adopted the Unitary Patent Regulations, and signed and ratified the Unified Patent Court Agreement. The Unitary Patent differs from current European patents (often referred to as ‘classical’ European patents) which are a bundle of separate national patents, effective only in the countries where they have been validated.

What is the Unified Patent Court?

A new court structure is being created to handle disputes over both Unitary Patents and classical European patents. The system will have exclusive jurisdiction over matters concerning the validity or infringement of Unitary Patents. However, businesses may actively choose to ‘opt out’ their classical European patents from litigation before the Unified Patent Court (UPC) for a transitional period of at least seven years. The UPC will have divisions right across Europe, with three central division courts located in London, Paris and Munich.

Patent filing options
The introduction of the new regime means businesses will have the option of:

Thus, the new Unitary Patent system will provide businesses with additional choice, with applicants being able to elect between the three registration options, or to mix and match between them, as best fits their business needs.

Choosing a litigation forum

The new Unitary Patent regime will bring implications for the way businesses enforce and defend their patent rights. If a business applies for a Unitary Patent then related disputes will be exclusively dealt with by the UPC.

Any disputes relating to ‘classical’ European patents that have not been opted out from the UPC’s jurisdiction, may be heard by either the UPC or national courts. The ‘opt out’ option is available during a transitional period of at least 7 years that will apply under the new regime.

For those that do opt out, disputes relating to classical European patents will be heard by the relevant national courts. Businesses that opt their classical European patents out of the UPC’s jurisdiction will have the option of withdrawing their opt outs so as to fall back within the jurisdiction of the UPC provided that no proceedings concerning those patents have been started before the national courts.

National courts will retain exclusive jurisdiction for handling cases concerning national patents regardless of the new court system.

The benefits and risks
Businesses operating in Europe need to ensure that they are prepared for the changes. The new system provides opportunities, but it is complicated and comes with issues which could bring unwanted surprises for those who are not prepared. Potential users of the system need to understand it before the Unified Patent Court is established in order that relevant and strategic choices can be made now.

Key considerations
Businesses must consider whether any granted ‘classical’ European patents should be opted out of the Unified Patent Court’s jurisdiction. If no action is taken, then by default classical European patents will be under the jurisdiction of the Unified Patent Court when it comes into existence and will, therefore, be at risk of central attack via an action brought before the new court.

Status update on the Unitary Patent and Unified Patent Court
It is intended that the EPO will issue the first European Unitary Patent as soon as the Unified Patent Court comes into existence. A provisional start date for the UPC had been set as 1 December 2017. However, the UPC Preparatory Committee announced in June 2017 that this start date could not be maintained. This announcement was likely related to delays in ratification of the UPC Agreement by the UK owing to the dissolution of Parliament and the UK general election. However, the issue of ratification by Germany (who also must ratify the UPC Agreement before it may come into effect) has also been put into question through the referral of the matter to the German Constitutional Court. Whether the Constitutional court will decide to hear the matter in full and, if so, how long that will take, is still unknown. Nonetheless, the earliest anticipated UPC start date is now in 2018. Prior to the commencement of the UPC, there will also be a ‘sunrise’ period of at least 3 months. This will allow patent proprietors to register early ‘opt outs’ for their classical European patents that they do not wish to subject to the Unified Patent Court’s jurisdiction.

The Impact of Brexit on the UPC

The UK’s decision to leave the EU previously raised questions over the implementation of the Unitary Patent (UP) and the Unified Patent Court (UPC). However, in November 2016, the UK government confirmed that the preparations to ratify the Unified Patent Court agreement were going ahead.

Article 50 of the Lisbon Treaty, which governs the procedure by which the UK will leave the EU, ensures that there will be a minimum of two years of negotiations between the UK government and the EU on the terms of the UK’s departure from the EU. Thus, the UK will not leave the EU until 2019 at the earliest. Until then, the UK will remain a member of the EU. The question of whether the UK could remain a part of the UPC and/or UP after having left the EU is being mooted.

 

 

FAQs

A Unitary Patent is a pan-European patent obtained through a single registration and validation process at the European Patent Office (EPO). The list of EU countries covered by a Unitary Patent will depend on which countries have ratified the UPC Agreement at the date of grant of the patent.

The Unified Patent Court (UPC) is a new court which will have exclusive jurisdiction concerning enforcement of Unitary Patents and related supplementary protection certificates through a single court action.  The UPC will also have jurisdiction over ‘classical’ European patents that have not been opted-out of the new system.

The previously envisaged UPC start date of 1 December 2017 cannot be maintained. The earliest anticipated UPC start date is now in 2018. The UPC timetable is dependent on multiple factors including the ratification of the UPC Agreement by the UK and Germany, and accession to the Protocol on Provisional Application.

Prior to the commencement of the UPC, there will also be a ‘sunrise’ period of at least 3 months.  This will allow patentees time to opt patents out of the jurisdiction of the UPC if desired.

Contrary to the current system where the ‘classical’ European patent is a bundle of national patents and only effective in the countries in which it is validated, the Unitary Patent will automatically apply in every participating EU country on registration. Furthermore, classical European patents are today enforced and invalidated in each country separately but under the new system rights will be enforceable across almost all of Europe with just one action before the Unified Patent Court.

It will only apply in those countries that adopt both the Unitary Patent Regulations and Unified Patent Court Agreement. Currently, 25 countries are expected to take part.

When the Unitary Patent becomes effective, businesses with allowable patent applications at the European Patent Office (EPO) will have the option of:

  • registering a classical European patent which they can then validate in up to 38 EPO member state countries and/or,
  • electing to obtain a Unitary Patent which will have automatic application in every participating EU country upon registration

Opting out refers to the possibility of opting out of the jurisdiction of the Unified Patent Court (UPC). It will not be possible to opt a Unitary Patent out of the competence of the UPC. However, for a transitional period of at least seven years it will be possible to opt out a ‘classical’ European patent. The patentee can later withdraw their opt out as long as no national court proceedings have been launched.

 

When no formal opt out exists, a classical European patent can be litigated during the transitional period in either the national courts or the UPC. Should national court proceedings occur first, potentially, the patent cannot be litigated in the UPC and the patent has been opted out of the system without the formal process. This may cause problems such as transparency issues or initiating actions against a subsidiary which could then be withdrawn.

For further information or if you would like an attorney to contact you, please email: up@boult.com. We know we have the knowledge and expertise to help you.

How can Boult Wade Tennant help?

We understand that there are many different reasons that make it difficult to prepare for this change. For some clients the culture of the company delays the decision making process. For others clarity is needed regarding how the system will work and what the business implications are in terms of opting in or out. We understand that internal resourcing issues can delay patent audits and reviews. Clients also tell us that having the right level of expertise and understanding of the new system within the team in order to analyse and inform decision-making is difficult; as is keeping-up with Unitary Patent developments. For others a key difficulty is engaging management with the Unitary Patent issue and helping them realise its importance for the business.

We know our patent experts have the solutions to these challenges. Our experienced team can help you prepare for the Unitary Patent system. They understand it, are up-to-date on all the latest developments, can engage with the most senior business personnel and help you navigate this new area in patent law to maximise your future opportunities.

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