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. A Unitary Patent 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:
- National patents in selected European countries
- A ‘classical’ European patent which can be validated in up to 38 countries
- A Unitary Patent which automatically applies in all participating EU countries upon registration
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.
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 the requisite number of member states. One of the countries that is required to ratify the UPC Agreement is Germany. However, German ratification of the UPC Agreement has been significantly delayed by a successful challenge at the German Constitutional Court in early 2020. It is understood that the German ratification will be reattempted, but there are still objections of the original complaint outstanding regarding whether the UPC Agreement is compatible with German Law.
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
As of 31 January 2020, the UK is no longer a member of the EU. The current transitional arrangements will last until the end of 2020, and the UK will continue to be treated as an EU Member State until that time.
The UK had previously ratified the UPC Agreement in April 2018. However, on 20 July 2020, this ratification was withdrawn. As such, it is clear that the UK will not be participating in the Unified Patent Court. Given that certain elements of the UPC legislation were drafted under the assumption that the UK would be a member, at least some redrafting will be necessary for the Unified Patent Court to enter into force. This is likely to cause further delays in terms of implementation of the UPC.