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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. 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 Unified Patent Court cannot come into existence until the UPC Agreement has been ratified by thirteen member states including the UK, France and Germany. The UK and France have already ratified the UPC Agreement, along with the requisite number of other European countries. However, German ratification of the UPC Agreement has been significantly delayed by a pending case at the German Constitutional Court which is scheduled for decision later in 2019. Even if the decision of the German Constitutional Court permits German ratification of the UPC Agreement, the German Federal Government has indicated that it does not intend to ratify until the consequences of Brexit are understood.

This leads to considerable uncertainty for the Unified Patent Court, both in terms of timescales and at a more fundamental level.

The Impact of Brexit on the UPC

In March 2017, the UK indicated its intention to leave the EU. It is possible that the UK will leave the EU on 31 October 2019, or even before this date if the EU withdrawal agreement is ratified by both sides before then. Until then, the UK will remain a member of the EU.

In April 2018 the UK ratified the UPC Agreement, indicating an intention to be part of the Unified Patent Court and Unitary Patent system when it comes into force.  However, signatories to the UPC Agreement are required to be EU member states, so it is unclear how the UK’s participation could be achieved after Brexit without requiring revisions to the UPC Agreement.  Therefore, if the UK does indeed leave the EU as planned, there are likely to be significant delays in terms of implementation of the UPC.