Louise AMAR, auteur sur UPC Blog by amar goussu staub

3 November 201722 March 2018

What are the consequences of an opt-out?

§. Once an opt-out has been notified to the UPC registry and registered:

If it was granted for a European patent application, the opt-out will automatically apply to the European patent in question.

The opt-out will be valid in all Contracting Member States where this patent produces legal effects. There is no need to notify the opt-out separately for the relevant Contracting Member States.

The opt-out will last for the whole life of the patent. It will not be limited to the length of the transitional period.

The proprietor can withdraw the opt-out at any time and decide to opt back in. This opt-in will then be definitive: the patent proprietor will not be able to opt out its European patent again.

It must be noted that opting out will not be possible if an action is already pending before the UPC.

31 October 201722 March 2018

What does it mean to Opt-out a European patent from the jurisdiction of the UPC?

§. What is an “Opt-out”?

The opt-out is the procedure by which proprietors or applicants for a European patent can withdraw their patents from the exclusive competence of the Unified Patent Court.

Only European patents granted or applied for before the end of the transitional period can be opted out. It will thus not be possible to opt-out European patents with unitary effect or Unitary patents.

§. What happens once the patent is opted out?

Once granted the opt-out will take effect in all participating Member States, and the opted out patent will be removed entirely from the jurisdiction of the UPC.

A European patent opted out will thus be under the exclusive competence of national courts. This means that national courts will be the sole jurisdiction before which -for example- actions for infringement or for revocation of the national part of a European patent can be brought.

However, during a 7 year transitional period after the entry into force of the UPC Agreement, the UPC will share jurisdiction with national courts over actions for infringement or revocation of a European patent. Hence, any holder of or applicant for a European patent will be able to initiate actions before national courts. This will be possible regardless of whether the European patent or application concerned has been the subject of an opt-out.

During this period, the UPC will indeed also have exclusive jurisdiction over Unitary patents.

§. When will the opt-out be allowed?

European patent owners will be allowed to opt-out from the start of the sunrise period up to the last month before the end of the transitional period. In other words it will be available from 3 months before the UPC Agreement entry into force to at least 6 years and 11 months after the entry into force of the UPC Agreement.

§. What are the provisional application phase and the sunrise period?

The Provisional Application Phase is scheduled to last for 6 months. The last 3 months, also known as the sunrise period, will specifically allow European patent proprietors to start opting out. The beginning of the Provisional Application Phase is not yet known but could start during the Autumn 2017.

§. What is the transitional period?

The transitional period is a renewable 7 year-period. During this time the UPC will share jurisdiction with national courts over actions for infringement or for revocation of a European patent.

If the UPC Administrative Committee does not extend the transitional period for a further seven years, the UPC will then have perpetual exclusive jurisdiction over Unitary patents and European patents. Opted out European patents will not come back in the UPC exclusive competence once the transitional period is over.

27 October 20173 November 2017

What does “good ratification progress” mean?

Brexit and the German constitutional challenge

The Preparatory Committee latest update:

The Preparatory Committee published a short update on the UPC’s latest developments and the good ratification progress.

The update highlights the consequences of the German constitutional court review of Germany’s legislation allowing the ratification of the UPC Agreement. This action has in fact led to the postponement of Germany’s ratification until further notice by the German constitutional court. In turn, this new uncertainty has seriously jeopardised the timetable for the start of operations of the UPC and made it difficult to predict a new timeline.

The Preparatory Committee on the other hand underlines the good progress made by participating Member States with the ratification of the UPC Agreement. In fact, 14 countries have so far deposited their instruments of ratification. Hence, according to the Preparatory Committee, it is likely that 20 countries will have ratified the UPC Agreement by the time the UPC starts operating.

Why is “good ratification progress” good news for patent users?

The number of countries that will have ratified the UPC Agreement will be higher than the original estimations . This is good news for patent owners.

The EU Directive 1257/2012 and the UPC Agreement in fact both state that the territorial scope of the unitary patent and the UPC’s decisions will correspond to the territory of the Member States participating to the unitary patent package and having ratified the UPC Agreement. Article 3 of EU Directive 1257/2012 more specifically states that “(a) European patent with unitary effect (…) shall provide uniform protection and shall have equal effect in all the participating Member States. It may only be limited, transferred or revoked, or lapse, in respect of all the participating Member States.” Similarly, article 54 of the UPC Agreement, provides that the territorial scope of the UPC’s decisions covers “the territory of those Contracting Member States for which the European patent has effect“.

This means that the more Member States ratify the UPC Agreement the larger the territorial scope of the Unitary Patent and the UPC is. Hence, from 2018, an inventor applying for a unitary patent or the owner of a non-opted out European patent will benefit from a protection extending to 20 countries . Likewise, a patent owner initiating an infringement action may be able to obtain a declaration of infringement in those 20 countries. The alleged infringer of that patent on the other hand may obtain its revocation in all those participating Member States.

Beyond the minimum required number of countries that must ratify the UPC Agreement for it to enter into force, the number of ratifications of the UPC Agreement will also importantly determine the territorial jurisdiction of the court and the territorial scope of the Unitary Patent.

So, which are the 14 countries that have ratified so far the UPC Agreement ?

Austria (2013), France (2014), Sweden (2014), Belgium (2014), Denmark (2014), Malta (2014), Luxembourg (2015), Portugal (2015), Finland (2016), Bulgaria (2016), Netherlands (2016), Italy (2017), Estonia (2017), Lithuania (2017).

The territorial scope of the UPC and the unitary Patent therefore looks like that:

(Green: Countries that have ratified / Pink: Countries that have not ratified yet / Brown: Countries not participating to the UPC)

Despite their ratification of the UPC Agreement, some of these countries however have not signed the protocols necessary for the entry into force of the UPC:

Austria, Malta, Portugal, and Lithuania have not signed the Protocol to the Agreement on a Unified Patent Court on provisional application;
Austria, Estonia, and Lithuania have not Protocol on Privileges and Immunities of the Unified Patent Court.

What about the 11 countries that still have not ratified the UPC Agreement?

The following countries have not ratified yet the UPC Agreement, however, most have made progress towards their participation to the UPC.

The UK: In October 2015 the UK signed the Protocol to the Agreement on a Unified Patent Court on provisional application. Since (on 26th October 2017) the Scottish Parliament debated and approved the draft International Organisations (Immunities and Privileges) (Scotland) Amendment (N°2) Order 2017 which will give effect to the Protocol on Privileges and Immunities of the Unified Patent Court. This Order amends the Scottish International Organisations (Immunities and Privileges) (Scotland) Order 2009 .

This is however only the first out of the two orders required for the UK to sign the Protocol on Privileges and Immunities. In fact both the UK and the Scottish Parliaments must review and amend their respective legislation. The UK Unitary patent Court (Immunities and Privileges) Order 2017 was laid before the UK Parliament on 26th June 2017 and is now awaiting debate before the UK Parliament.

The UK Parliament is on recess until 9th October 2017 and will thus only consider this statutory instrument from this date. As to ratification of the UPC Agreement the UK government undertook to ratify it before it leaves the European Union and reaffirmed its commitment to the UPC (see here). The UK Government has not however disclosed any date for ratification .

Germany: In March 2017 Germany passed a law to ratify the UPC Agreement. In April 2017 a challenge was brought before the German constitutional court arguing that the legislation passed by the German Parliament was unconstitutional. (See our posts on this issue here) This complaint has put a stop to Germany’s ratification process. The German constitutional court has not yet made public when it will consider the complaint. However, the court has extended (last week) its deadline for third parties comments on the issue to 31st December 2017. Germany has nonetheless signed the Protocol to the Agreement on a Unified Patent Court on provisional application in October 2015 and the Protocol on Privileges and Immunities of the Unified Patent Court in June 2016.

Ireland: In Ireland, although the Irish Prime Minister has announced seven referenda in September 2017, none will be on the ratification of the UPC Agreement. Ireland ratification of the UPC Agreement demands however that the Constitution be modified which can only be made through a referendum. The decision of the Irish Prime Minister to delay the organisation of this referendum therefore postpone Ireland’s ratification to an unknown date. Ireland has also neither signed the Protocol on Privileges and Immunities of the Unified Patent Court nor the Protocol to the Agreement on a Unified Patent Court on provisional application.

Greece: In June 2016, Greece altogether with 11 other Member States signed the Protocol on Privileges and Immunities. Since, the Ministry of Justice consulted in March 2017 the public on the draft legislation to ratify the UPC Agreement (see the consultation here). The same month Greece signed the Protocol to the Agreement on a Unified Patent Court on provisional application.

Hungary: It was reported that in July 2017, the Hungarian Minister of Justice, acting on behalf of the government, filed a motion with the Constitutional Court of Hungary (No. X / 01514/2017) requesting the Court’s opinion on the compatibility of the UPC Agreement with the Hungarian Constitution “and on the appropriate mechanism that must be used for its ratification“. The Hungarian government in fact wishes the Constitutional Court to determine whether the ratification of the UPC Agreement can be operated under the mechanism of transfer of sovereignty that must be used in relation with the EU and international agreements that Hungary sign as an EU member state. The nature of the UPC Agreement is in fact debated since the Brexit. Indeed if the UPC Agreement is an EU agreement, the UK’s participation to the UPC will be subject to amendments made to the UPC Agreement. If on the other hand the UPC Agreement is an international agreement the participation of the UK will be subject to, notably, its acceptance of the authority of the CJEU. Although for reasons related to the Hungarian constitutional order, the Hungarian constitutional court may thus determine this issue before the CJEU or Brexit negotiators reach a their own conclusion.

Slovenia: In October 2015 Slovenia signed the Protocol to the Agreement on a Unified Patent Court on provisional application, followed in July 2017 by the Protocol on Privileges and Immunities in July 2017. It also passed a law ratifying the UPC Agreement in October 2016. Slovenia however has still not deposited its ratification instrument to the Council of the European Union. This renders it ineffective. Finally, Slovenia will be hosting the Patent Arbitration and Mediation centre in Ljubljana. In that respect Slovenia has registered a declaration by the Council of the European Union stating that “(t)he Republic of Slovenia considers that the Patent Mediation and Arbitration Centre as established by the Agreement on a Unified Patent Court, done at Brussels on 19 February 2013, is part of the Unified Patent Court, and that consequently the provisions of the Protocol on Privileges and Immunities of the Unified Patent Court, done at Brussels on 29 June 2016, apply mutatis mutandis to the Centre.“

Latvia: Latvia has passed a law ratifying the UPC Agreement in April 2017. This law however will only come into force on 1st January 2018. Latvia is planning to take part in the Nordic-Baltic regional division of the UPC with Sweden, Lithuania and Estonia but must first pass a law allowing its participation to this regional division.

The Czech Republic, Cyprus, Slovakia and Romania have not initiated any development towards their participation to the UPC.

30 August 201730 August 2017

Ratification of the UPC Agreement: Lithuania becomes 14th country to ratify, but what about the UK and Germany?

14 countries have now ratified the UPC Agreement

Lithuania ratified the UPC Agreement on 24th August. This ratification arises after Estonia ratified the Agreement on 1st August. Lithuania therefore becomes the 14th country to ratify the UPC Agreement, which now only awaits the UK and Germany’s ratification to come into effect.

What about the UK’s ratification?

The UK is expected to progress towards ratification from September after summer recess. The Brexit talks may however in part determine when the UK will ratify the UPC Agreement. This makes it difficult to predict when the UK government will ratify the UPC Agreement. (See our section on Brexit and the UPC for more on the topic).

Why has Germany’s ratification been stopped?

Germany’s ratification was suspended in June after a complaint was filed before the German Constitutional Court. The Court subsequently asked the Federal President to suspend the signature of the legislation implementing the Unitary Patent Package voted on 31st March by the German Parliament .

In an article dated 16th August, the Kluwer Patent Blog published the following brief description of the complaint sent by the German Federal Constitutional Court in response to their enquiry: (as translated by Kluwer)

“In terms of substance, plaintiff is essentially asserting a breach of the limits to surrendering sovereignty that are derived from the right to democracy (Art. 38 (1), clause 1, Basic Law). Primarily the following violations are asserted:

• breach of the requirement for a qualified majority arising from Art. 23 (1), sentence 3, in conjunction with Art. 79 (2) Basic Law;

• democratic deficits and deficits in rule of law with regard to the regulatory powers of the organs of the UPC;

• the judges of the UPC are not independent nor do they have democratic legitimacy

• breach of the principle of openness towards European law owing to alleged irreconcilability of the UPC with Union law.

The proceedings are pending; a specific date for the decision is presently not foreseeable.”

The complaint therefore raises three issues:

The first issue concerns the quorum required by German law for the ratification of the UPC Agreement. The complaint in fact suggests that the law ratifying the UPC Agreement if implemented would amend the German constitution. However any amendment of the German constitution must be passed by a majority of two third of MPs. If the German Constitutional Court finds that this law actually amends the constitution then the German Parliament will have to reexamine it again. The first ratification law was in fact passed with a lesser threshold.

The complaint then raises the questions of the democratic deficit of the UPC and the independence of its judges. These grounds seem to refer to the recurrent criticisms made about the EU and EPO institutions, but it is hard to say more without access to the complaint.

Finally, the last ground points to a breach of EU law either by the legislation allowing the ratification of the UPC Agreement or the UPC Agreement itself. This would indeed render the UPC incompatible with EU law.

However, none of these grounds are self explanatory. A more detailed analysis of the complaint will thus only be possible once the complaint is available to the public.

So what is the impact of this constitutional challenge on Germany’s ratification?

In any case, the German publication “Juve.de” reckons that such a constitutional challenge is unlikely to be examined within less than 4 to 6 months. This complaint would thus postpone Germany’s ratification to January 2018. By a domino effect the start of operation of the UPC would then be postponed to the first quarter of 2018.

3 August 2017

Estonia ratifies the UPC Agreement

Thirteen countries have now ratified the UPC Agreement

Estonia has deposited its instrument of ratification of the UPC Agreement on 1st August 2017. Estonia’s ratification happens after it had notified its consent to the start of the UPC provisional application phase in July.

Estonia thus becomes the 13th country to ratify the Agreement. Austria, Belgium, Bulgaria, Denmark, Estonia, Finland, France, Italy, Luxembourg, Malta, Netherlands, Portugal, Sweden have also ratified the Agreement.

However, the UPC Agreement will only come into effect once 13 member states including France, Germany and the UK have completed their ratification.

So when will the UPC Agreement come into effect?

Ratification by Germany and the UK has been put on hold. This has thus caused delays in the coming into effect of the UPC Agreement.

Germany’s ratification was suspended by the German constitutional court, after it received a complaint challenging the constitutionality of the German legislation enabling the ratification of the UPC Agreement. As it could take up to six months for the Constitutional Court to examine the complaint, Germany’s ratification could be postponed to 2018.

Similarly, despite the UK ‘s declaration that it would apply the Protocol to the Agreement on a Unified Patent Court on provisional application in July, the UK’s ratification was postponed due to the general elections and summer recess. There are also two important uncertainties as to the UK’s participation to the UPC:

First, whether the UPC Agreement can be amended to allow a non-EU member state to participate in the UPC;
Second, whether the London section of the central division of the UPC will need to be relocated after Brexit. This was mentioned by Michel Barnier’s -the EU’s chief Brexit negotiator, and Commissioner for Internal Market and Services in charge of the Unified Patent Court (UPC) dossier at the time of signature in 2013 of the UPC Agreement- during the last round of Brexit talks.

Hence, although Estonia’s ratification is good news for the UPC, the timetable published by the Preparatory Committee announcing the entry into operation of the court in December 2017 seems unlikely.

13 July 201725 July 2017

Is the EU Considering the Relocation of the London UPC Central Division?

The EU is considering the relocation of the London UPC Central Division.

Could Michel Barnier push for relocation of the UPC Division based in London?

It is reported that in a meeting about the Brexit negotiations, Michel Barnier, current chief negotiator for the EU, mentioned that Brussels is reviewing whether London can keep its Central Division of the Unified Patent Court after Brexit.

This relocation could be motivated by the fact that the European Medicine Agency (as well as the European Banking Authority), whose mission is to evaluate European medicinal products will be relocated on the territory of the EU, as indicated by the European Council decision on the “Procedure leading up to a decision on the relocation of the European Medicines Agency and the European Banking Authority“.

As the third UPC central division will be competent for pharmaceuticals, chemistry and metallurgy, this potential relocation seems to indicate that the EU is trying to achieve a coherent EU framework for those industries.

However, if it actually takes place, this relocation will be particularly significant. Indeed, the United Kingdom accounts for 11% of extra-EU exports of medicinal and pharmaceutical products and is thus considered as one of the European leaders in this industry. Furthermore, it should be considered against the fact that the UK is currently taking the final steps towards the ratification of the UPC Agreement and has notified its approval to the Protocol to the Agreement on the Unified Patent Court on provisional application a few days ago. This potential relocation project therefore begs the question of whether it could jeopardise the UK’s participation to the Unitary patent package and its ability to contribute to the UPC case law on issues of particular interests for its economy.

11 July 20173 November 2017

Update on the Opt-out Process and the Case Management System: a Letter from the UPC Chairman

The UPC Chairman answers the questions of the British IP Federation about the opt-out proceedings.

On June 13^th, the British IP Federation, which represents the view of UK industry in IP policy and practice, wrote an open letter to the Chairman of the Preparatory Committee of the Unified Patent Court (UPC) Mr Alexander Ramsay asking him to clarify the opt-out process during the sunrise period (3 months before the entry into force of the UPC Agreement).

Six days ago, the IP Federation published on its website the reply from the chairman. In his response, Mr Ramsay addressed the following points:

The Chairman clarified the meaning of rule 12 of the Draft Rules on the European Patent Litigation Certificate. This rule does not prevent a European Patent Attorney (EPA) with an existing alternative qualification to register during the sunrise period as a UPC Representative.

The IP Federation had concerns that the massive influx of registrations as UPC representatives at the start of the sunrise period could create delay. But, the chairman stated that arrangements had been made to manage the expected large number of applications.

All users, including staff members, will have to register on the Case Management System (CMS) if they want to make applications to opt out. There will be a two-stage authentication procedure to register, first as a user, then as a UPC representative on the CMS. The details of this procedure will be published in the near future on the UPC Website.

The formalities staff will be able to prepare the opt-out applications for EPAs or representatives to file. However, the formalities staff will have to use their own user ID if they want to register the opt-out on behalf of the EPA or representative. Any user that lodges the application will be responsible for its content and must provide her user identity. Besides, a mandate will be required for any user that is not a qualifying EPA or a UPC representative.

The proprietor of a patent will not need a mandate to opt it out. If the proprietor is a company, any member of the staff who is not a UPC representative will need to file a mandate. This is why the Preparatory Committee is considering the creation of a general mandate to authorize multiple opt-out applications by a particular user over a period.

Application Programming Interfaces (APIs) are provided by the UPC IT team in the developer section of the UPC website to enable companies to integrate the CMS to their IT systems. Also, a user-friendly guidance through the APIs and a list of third-party companies specialized in services for integration with the CMS will be published on the UPC website as soon as possible.

The Chairman did not specify any date for the start of the sunrise period.

Changes coming to the Case Management System.

On a side note, on July 5^th the UPC IT team released an update to the CMS. The goal is to fine-tune different processes on the site like the opt-out application process or the procedure of patent selection. A new API was also made public on the UPC website.

A few days later, the UPC IT Working Group Coordinator Dario Pizzolante announced in a statement that a new version of the CMS specifically designed for the opt-out procedure during the sunrise period will be released in August. He also added that in the future the changes made to the CMS will not be released continuously but instead in larger updates. The IT team is currently working on the adaptation of the CMS to the rules of procedure and on the authentication mechanism. Besides, the team has been receiving feedbacks from multiple workshops since the creation of the temporary website.

28 June 201715 May 2020

Update on the UPC timetable: a message from UPC Preparatory Committee Chairman

On 7th June 2017 the Preparatory Committee announced through a statement a delay in the start of the Period of provisional application and in the entry into force of the UPC Agreement. No new timetable was announced, but the committee expressed its will to publish one in the foreseeable future.

Yesterday the chairman of the Preparatory Committee Alexander Ramsay released a message on the UPC website.

The Preparatory Committee is still waiting on two different national procedures:

The ratification of the UPC Agreement, which requires the deposit of 13 instruments of ratification, including Germany, France and the United Kingdom.

The approval of the Protocol on Provisional Application (PPA) by 13 Member States that have already signed the UPC Agreement and whose Governments have received Parliamentary approval to ratify the UPC Agreement.

On one hand, the chairman noted that the ratification process has progressed in both Estonia and the United Kingdom. Estonia indeed passed the necessary legislation to ratify the UPC Agreement and the UPC Order on Privileges and Immunities was placed before the British Parliament on 26th June.

But on the other hand, three Member States, including Germany and the UK, still need to approve the PPA to start the provisional application period.

The chairman insisted on the recent delay of the German ratification bill by the Federal Constitutional Court due to a recently complaint. In fact, the German Constitutional Court received a complaint in April 2017 challenging the constitutionality of the legislation enabling the ratification of the UPC Agreement. The grounds and the source of the complaint remain unknown to the public. However, the Court considered this complaint justified enough to request the Federal President not to sign the bill and examine the complaint before ratification.

Considering the above, the chairman concluded it is currently difficult to maintain a definitive starting date for the period of provisional application. According to him, the provisional application period should start during the autumn 2017 followed by the sunrise period for the opt-out procedure in early 2018. Around three months later, the UPC Agreement should enter into force and the UPC should become operational.

This announcement is consistent with the timetable that was expected by most experts. The UPCBlog team will follow any update on a more detailed timetable.

14 June 201725 October 2021

German Federal Constitutional Court stops German ratification bill

The ratification of the UPC Agreement might be facing another delay.

According to a report from a German newspaper (the Frankfurter Allgemeine Zeitung), the German Federal Constitutional Court (the Bundesverfassungsgericht) asked the Federal President to suspend the signature of the legislation implementing the Unitary Patent Package voted on 31st March by the German Parliament necessary -together with the German executive’s and its publication in the German Federal Law Gazette- for it to become legislation.

The German Constitutional Court in fact received a complaint in April 2017 (2 BvR 739/17), from a currently unknown source, challenging the constitutionality of the legislation enabling the ratification of the UPC agreement. Although the grounds remain unknown to the public, the Court considered this complaint justified enough to request the Federal President not to sign the bill and examine the complaint before ratification.

The Constitutional Court spokesperson confirmed that the President had indeed agreed, as a preliminary measure, to delay signing the bill.

It is however difficult to say whether this unexpected event will slow down, again, the ratification process of the UPC agreement. In fact, Germany still has time to deposit its instruments of ratification by September 2017, thus allowing the UPC to be launched by the beginning of 2018.

31 May 20173 November 2017

EU Competitiveness Council call for the UPC to be brought into operation as quickly as possible

EU commissioner Elżbieta Bieńkowska at EU competitiveness Council 29-05-17

EU Commission calls on contracting member states to intensify efforts:

During the EU Competitiveness Council that took place on 29th and 30th May “(s)everal delegations and the Commission called on member states to intensify their efforts so as to bring this major reform into operation as quickly as possible.”

Similarly, in anticipation of this meeting the Association of European Chambers of Commerce and Industry and the British Chambers of Commerce had addressed a letter to the UK government and a press release to this effect. In both communications the chambers urge the Government to “do everything within its powers to facilitate the completion of the complex and lengthy ratification process, regardless of the general election and Article 50 negotiations”. The chambers also encouraged the UK government “to continue to play a constructive and active role in ensuring that the Unitary Patent becomes a reality as soon as possible.”

The provisional application phase start date originally planned for “end of spring 2017”:

Indeed, the Preparatory Committee had recently set the end of May as its target date for the beginning of the provisional application phase. However, as highlighted by the EU commissioner Elżbieta Bieńkowska at the last EU competitiveness council, this target date has not been met. This means that the possibility for the UPC to become operational by the end of 2017 is looking bleak.

The EU Commissioner pointed out that even the protocol on provisional application could not be implemented yet. In fact, it still lacks the ratification of three contracting member states having already ratified the UPC Agreement. This means that the provisional application phase is being delayed. In the Commissioner’s view this is particularly troublesome. She argues that if the provisional application phase is delayed beyond the summer break the UPC will not become operational in 2017.

The Commissioner however also specifically pointed out that the UK has still not ratified the UPCA. This is of course due to the general elections that will take place in June 2017. The UK minister has nonetheless declared that the UK still wished to participate in the UPC and will ratify the UPCA.