Category: Overview

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How to get Unitary Patent protection?

The Steps to get a unitary patent protection?

This is a two steps procedure:

1/ First apply for a EP patent with the EPO
The filing procedure , examination and grant formalities are similar in any way to those of a regular EP patent.
Any person may file a patent application, in any language, provided that a translation into one of the three official languages of the EPO (french, german or english) is filed within two months of the date of filing. The language of the translation will be the language of the proceedings. The patent is published in the language of the proceedings and the claims are translated into the two other official languages.

2/Then, upon grant of the EP patent: the request for the unitary effect

Unitary patent protection will only be available for EP patent granted on or after the date of entry into force of the UPC Agreement (A. 18(6) of Reg. (EU) N° 1257/2012, and having the same set of claims in respect of all the participating Member States.

The patent proprietor shall apply with the EPO for  the unitary protection within one month from the publication of the mention of grant of the EP patent in the European Patent Bulletin . The request shall be filed in the language of proceedings of the EP patent (A.9(g) of Reg. (EU) 1257/2012).
The unitary effect will be indicated in the Register for unitary patent protection, administered by the EPO.

The EPO is currently developing machine translations of patent specifications into all of the official languages of the Union. Therefore, no further translations of the EP patent will be required from the patent proprietor after the end of the transitional period of 6 years (up to 12 years), except in the event of a dispute.
During the transitional period, if the patent is in english, the specification must be translated into any other official language of the Union; if however the patent is in french or german, it shall be translated into english.

The EPO will also administer a compensation scheme for the reimbursement of translation costs for some applicants filing the EP application in one of the official languages of the Union that is not an official language of the EPO. Applicants eligible for the compensation scheme include SMEs, non-profit organisations, universities, individual having their residence or principal place of business within a Member State.

 

Renewals in respect of the years following the year in which the mention of the grant is published in the European Bulletin will have to be paid with the EPO. There will be a 6 months period for late payment of the renewal and corresponding additional fees.
Can software be patented under the new rules? Will the rules governing patent ability for software change?

No. The unitary patent package will not change the rules on granting a patent, but only the geographic extent of the legal protection that a patent affords, once it has been granted.

 

(G) Fees

The fees for the Unitary Patent are yet to be decided. The criteria for setting the fees can be found at Article 12 of the Unitary Patent regulation. The process will need to take into account administration costs, the size of the market and the level of fees paid for current European bundle patents.

According to the European Parliament, today, a European patent issued by EPO providing protection in the 27 EU Member States can cost up to €36,000, including up to €23,000 in translation fees alone. According to the European Commission, the new unitary patent will cost a minimum of €4,725, when the new rules are fully implemented, up to a maximum of €6,425. The costs for translation will range from €680 to €2,380.

 

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Supplementary Protection Certificates, European Patents, and Unitary Patents: How is it going to work after the entry into force of the UPC?

Supplementary Protection Certificates ensure the recovery of high investments necessary over a long development period to bring a successful innovative product to the market. SPCs in particular are critical for the agrochemical, pharmaceutical and medical devices industries which rely heavily on industrial protection through patents and SPCs. Existing SPCs complement national or European patents to ensure an extra period – up to five years – of protection for patent holders, to offset the time required to obtain marketing authorisation for their patented products.

The entry into force of the UPC will however bring major changes to SPCs as well as European Patents.  This post therefore looks at the provisions in the UPCA and the Rules of Procedure which deal with SPCs; the impact of these provisions on SPCs, European Patents and Unitary Patents; the issues raised by these changes; and finally the project of a unitary SPC.

I. The provisions concerning the SPC in the Unified Patent Court Agreement (UPCA) and the Rules of Procedure: 

A.  The UPCA:

  • Article 2 (h) “Supplementary protection certificate” means a supplementary protection certificate granted under Regulation (EC) No 469/20091 or under Regulation (EC) No 1610/962“

 

  • Article 3 ” This Agreement shall apply to (b) supplementary protection certificate issued for a product protected by a patent“

 

  • Article 30  “A supplementary protection certificate shall confer the same rights as conferred by the patent and shall be subject to the same limitations and the same obligations“

 

  • Article 32 “The Court shall have exclusive competence in respect of:(a) actions for actual or threatened infringements of patents and supplementary protection certificates and related defences, including counterclaims concerning licences; (b) actions for declarations of non-infringement of patents and supplementary protection certificates; (d) actions for revocation of patents and for declaration of invalidity of supplementary protection certificates; (e) counterclaims for revocation of patents and for declaration of invalidity of supplementary protection certificates”.

 

  • Article 83 “(1) During a transitional period of seven years after the date of entry into force of this Agreement, an action for infringement or for revocation of a European patent or an action for infringement or for declaration of invalidity of a supplementary protection certificate issued for a product protected by a European patent may still be brought before national courts or other competent national authorities. (2) An action pending before a national court at the end of the transitional period shall not be affected by the expiry of this period. (3) Unless an action has already been brought before the Court, a proprietor of or an applicant for a European patent granted or applied for prior to the end of the transitional period under paragraph 1 and, where applicable, paragraph 5, as well as a holder of a supplementary protection certificate issued for a product protected by a European patent, shall have the possibility to opt out from the exclusive competence of the Court. To this end they shall notify their opt-out to the Registry by the latest one month before expiry of the transitional period. The opt-out shall take effect upon its entry into the register. (4) Unless an action has already been brought before a national court, proprietors of or applicants for European patents or holders of supplementary protection certificates issued for a product protected by a European patent who made use of the opt-out in accordance with paragraph 3 shall be entitled to withdraw their opt-out at any moment. In this event they shall notify the Registry accordingly. The withdrawal of the opt-out shall take effect upon its entry into the register. (5) Five years after the entry into force of this Agreement, the Administrative Committee shall carry out a broad consultation with the users of the patent system and a survey on the number of European patents and supplementary protection certificates issued for products protected by European patents with respect to which actions for infringement or for revocation or declaration of invalidity are still brought before the national courts pursuant to paragraph 1, the reasons for this and the implications thereof. On the basis of this consultation and an opinion of the Court, the Administrative Committee may decide to prolong the transitional period by up to seven years.“

 

B. The Rules of Procedure:

  • Rule 2:” 1. Subject to paragraph 2, in these Rules with the exception of Rule 5 the expression “patent” and “proprietor” shall whenever appropriate include, respectively, a supplementary protection certificate as defined in Article 2(h) of the Agreement and granted in respect of the patent and the holder of such certificate. 2. References in these Rules to the language in which the patent was granted shall mean that language and not the language in which a supplementary protection certificate in respect of the patent was granted.“

 

  • Rule 5: “Rule 5 – Lodging of an Application to opt out and withdrawal of an opt-out 1. The proprietor of a European patent (including a European patent that has expired) or the applicant for a published application for a European patent (hereinafter in this Rule 5 an “application”) who wishes to opt out that patent or application from the exclusive competence of the Court in accordance with Article 83(3) of the Agreement shall lodge an Application (hereinafter in this Rule 5 an “Application to opt out”) with the Registry. (a) Where the patent or application is owned by two or more proprietors or applicants, all proprietors or applicants shall lodge the Application to opt out. Where the person lodging an Application to opt out is not recorded as the proprietor or applicant in the registers referred to in Rule 8.5(a) and (b), respectively, the person shall lodge a declaration pursuant to paragraph 3(e). (b) The Application to opt out shall be made in respect of all of the Contracting Member States for which the European patent has been granted or which have been designated in the application. 2. An Application to opt out or an Application to withdraw an opt-out pursuant to paragraph 8 (hereinafter in this Rule 5 an “Application to withdraw”) shall extend to any supplementary protection certificate based on the European patent. (a) Where any such supplementary protection certificate has been granted at the date of lodging the Application to opt out or the Application to withdraw, the holder of the supplementary protection certificate shall, if different from the proprietor of the patent, lodge the Application to opt out or the Application to withdraw together with the proprietor. (b) Where any such supplementary protection certificate is granted subsequent to lodging the Application to opt out, the opt-out shall take effect automatically on grant of said supplementary protection certificate. (c) Paragraphs 7 and 9 shall apply mutatis mutandis. For the purposes of paragraphs 7 and 9, reference to actions (i) in respect of a European patent shall apply to all supplementary protection certificates based on that European patent, and (ii) in respect of a supplementary protection certificate shall apply to the European patent on which such supplementary protection certificate is based and (iii) in respect of a supplementary protection certificate shall apply to all other supplementary protection certificates based on the same European patent. (d) For the avoidance of doubt, it is not possible to opt out supplementary protection certificates, whether granted by the authorities of a Contracting Member State or otherwise, based on a European patent with unitary effect. 3. The Application to opt out shall contain: – 22 – (a) the name of the proprietor or applicant for the European patent or application and of the holder of any supplementary protection certificate based on the European patent in question, and all relevant postal and, where applicable, electronic addresses; (b) where such proprietor, applicant or holder have appointed a representative, the name and postal address and electronic address for service of the representative; (c) details of the patent and/or application including the number; (d) details of any supplementary protection certificate granted based on the patent concerned, including the number; and (e) for the purposes of paragraph 1(a), a Declaration of proprietorship that the person lodging the Application to opt out is the proprietor or applicant pursuant to Rule 8.5 and entitled to lodge the Application to opt out. 4. Rule 8 shall not apply to Applications to opt out and to Applications to withdraw made pursuant to this Rule 5. Where a representative is appointed, such a representative may include professional representatives and legal practitioners as defined in Article 134 EPC in addition to those referred to in Article 48 of the Agreement. 5. The applicant for an opt-out shall pay the fixed fee in accordance with Part 6. The Application to opt out shall not be entered in the register until the fixed fee has been paid. One fixed fee shall be payable in respect of each European patent or application for which an Application to opt out has been filed, including any supplementary protection certificate based on said patent or application. 6. Subject to paragraph 5 the Registrar shall as soon as practicable enter the Application to opt out in the register. Subject to paragraph 7, the opt-out which meets the requirements laid down in this Rule shall be regarded as effective from the date of entry in the register. If the requirements are missing or incorrectly recorded, a correction may be lodged with the Registry. The date of entry of the correction shall be noted in the register. The opt-out shall be effective from the date of correction. 7. In the event that an action has been commenced before the Court in respect of a patent and/or an application contained in an Application to opt out prior to the date of entry of the Application to opt out in the register or prior to the date of correction pursuant to paragraph 6, the Application to opt out shall be ineffective in respect of the patent and/or application in question, irrespective of whether the action is pending or has been concluded. 8. A proprietor of a patent or an application the subject of an opt-out pursuant to this Rule may lodge an Application to withdraw in respect of the patent or application, but not in respect of different Contracting Member States for which the European patent has been granted or which have been designated in the application. The Application to withdraw shall contain the particulars in accordance with paragraph 3 and shall be accompanied by the fixed fee in accordance with Part 6; paragraph 5 shall apply mutatis mutandis. Subject to the receipt of the fixed fee the Registrar shall as soon as practicable enter the Application to withdraw in the register and the withdrawal shall be regarded as effective from the date of entry in the register. Paragraphs 1(a) and 6 shall apply mutatis mutandis. 9. In the event that an action has been commenced before a court of a Contracting Member State in a matter over which the Court also has jurisdiction pursuant to Article 32 of the Agreement in respect of a patent or application contained in an Application to withdraw, prior – 23 – to the entry of the Application to withdraw in the register or any time before the date pursuant to paragraph 6, the Application to withdraw shall be ineffective in respect of the patent or application in question, irrespective of whether the action is pending or has been concluded. 10. Where an application for a European patent subject to an opt-out pursuant to this Rule proceeds to grant as a European patent with unitary effect, the proprietor shall notify the Registry. The opt-out shall be deemed to have been withdrawn in respect of the Contracting Member States covered by the European patent with unitary effect at the date of the registration of the unitary effect and the Registrar shall as soon as practicable enter the withdrawal in the register in respect of such Contracting Member States. No fee shall be payable pursuant to paragraph 8. 11. A patent or application the subject of an Application to withdraw which has been entered on the register may not thereafter be the subject of a further Application to opt out. 12. The Registrar shall as soon as practicable notify the European Patent Office and the national patent office of any Contracting Member States concerned of the entries in the register pursuant to paragraphs 6 and 8. 13. Applications accepted by the Registry before the entry into force of the Agreement shall be treated as entered on the register on the date of entry into force of the Agreement. Relation with Agreement: Article 83(3) and (4) “

 

 

II. So how is it going to work?

A.  SPCs granted on top of European Patents:

As with European Patents (EP) themselves, SPCs referencing the European Patent as the basic patent will, under Article 3 of the UPC agreement, be subject to the UPC’s exclusive jurisdiction. Under article 83 UPCA, it will however be possible during the transitional period (currently 7 renewable years) to opt out of the UPC’s exclusive jurisdiction European Patents and their corresponding SPC.

 During the transitional period:

(i) SPCs granted on top of European Patents which are opted-out: 

  • If an EP has been opted out, and an SPC granted subsequently, the SPC is automatically opted out, and this opt out lasts for the whole life of the SPC. 
  • If an SPC has been granted before an application to opt out an EP is filed, the proprietor(s) of both the EP and (if different) the SPC must register the opt out.  In order for an opt out to be valid, all relevant proprietors must, in fact, participate in the opting out process.  In the 18th Draft Rules of Procedure, Rule 8.4 has been amended, and the proprietor is now defined as “the person shown in the Register for unitary patent protection as the proprietor shall be treated as such”.
  • If the EP has expired, and only the SPC remains in force at the time of the opt-out, the SPC proprietors and the expired EP proprietors will both need to register the opt-out.

Consequences of the Opt-out: if an SPC and its underlying EP are opted out, only national litigation in relation to those rights will be possible.

(ii). SPCs granted on top of European Patents which are not opted-out:

Under Article 83(1), if the European patent has not been opted-out, the patent and its corresponding SPC will be prima facie under the exclusive jurisdiction of the UPC. However actions for infringement or revocation may still be brought before national courts.

 

 After the transitional period:

(i) At the end of the transitional regime, the UPC will be the sole court to be competent in case of litigation concerning:

  • All European Patents not opted-out
  • All SPCs granted on top of European Patents not opted-out

(ii) National Jurisdictions will be competent in case of litigation concerning:

  • All European Patents opted-out
  • All SPCs granted on top of European Patents opted-out

 

B. SPCs granted on top of European Patent with unitary effect (or Unitary Patent):

European patents with unitary effect will not have the possibility to be opted-out. They will be under the exclusive jurisdiction of the UPC during and after the transitional period. This will therefore also be true for their corresponding SPCs.

However, despite being based on Unitary Patents, valid in 25 Member states, SPCs will not have the same territorial scope as Unitary Patents. Instead, the same system which exists at present for SPCs based on national or European Patents will apply, and individual national applications will have to be made.
III. Uncertainties: 

 There are quite a few grey areas concerning the interaction between the Unitary Patent, national patents and SPCs, notably:

  • For European Patents (opted-out or not), it is uncertain whether the corresponding SPCs, which are national titles, can benefit from Art. 34 UPCA, which states that the decisions of the Court shall cover the territory of those contracting Member States for which the European patent has effect, and be applied by the patentee in all 25 Member States.

The European Commission, despite declaring that the articulacy between the unitary patent and the current EU rules on SPCs is a “key challenge to get the end game right ” in its “Staff working document” on a “Single market strategy for Europe”, identifies further issues:

  • The Commission first fears that if SPC users wish to benefit from the unitary patent this “will require multiple administrative procedures in multiple jurisdictions, limiting the full benefits of a unitary system.“
  • The Commission also highlights the problem of  the”patent research exemption” and “Bolar exemption” which are applied by Member States differently. This exemption could lead with the entry into force of the Unitary Patent and UPC to forum shopping. In fact “on the one hand, some Member States do not allow the supply of active pharmaceutical ingredients (APIs) to EU-based generic manufacturers for the purpose of seeking marketing authorisation. On the other hand, in a number of Member States, it is not certain whether testing in the EU by originators and biosimilars can benefit from these exemptions for the purpose of seeking marketing authorisation in the EU and in non-EU countries, or for meeting emerging regulatory requirements such as those related to health technology assessment“.

The European Commission thus announced to be working on a project of Unitary SPC, and on the coherence between the upcoming unitary patent and current EU rules on SPC -in the absent of a unitary SPC title.

 

 

IV. Towards a Unitary SPC? 

The European Commission considers that applying the unitary patent system to SPCs would help optimising the legal framework for industry sectors whose products are subject to regulated market authorisations, and which currently “presents several features not fit for purpose in today’s global economy and in the light of new regulatory requirements“.  The European Commission therefore calls for a Unitary SPC to  “enhance the value, transparency and legal certainty of the protection of medicines and plant protection products; and provide a one stop shop for the granting of SPCs in Europe, and give enhanced certainty to European health authorities, to patients and to generic companies on the status of a regulated product’s IP protection.”

The European Commission’s project is supported notably by the European Crop Protection Association (ECPA), European Federation of Pharmaceutical Industries and Associations (EFPIA) and the International Federation of Animal Health (IFAH). These three organisations published in 2015 a letter in support of a Unitary SPC being granted on the basis of European Patent with unitary effect which they see as “a logical continuation of the Member States’ decision and agreement to create a European Patent with unitary effect“. In this letter the ECPA, EFPIA and the IFAH point out that it will be necessary to designate a body responsible for granting the Unitary SPC for the 25 Member States participating to the enhanced cooperation mechanism.

The Unitary SPC might however be a project for which a political compromise is quickly reached, following the positive valuation for the UPC of a gain of 0.25 % GDP in EU -“which represents the possible net productivity impact resulting from the reduction of validation and maintenance fees in the Member States for patents granted by the European Patent Office”- and a reduction of up to 80% in the cost in administrative costs.

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A new tender for the recalibration of SPCs

Last week, the EU Commission published a new call for tender for a legal study on the EU system of Supplementary Protection Certificates (SPCs), after the previous tender attracted a very limited number of bids.

This study will be used by the Commission for an overall evaluation of the SPC system in the EU and will inform the decision on whether to come forward with a new SPC title at European level or revise the existing SPC legislation.

A number of issues have in fact been raised regarding SPCs and their compatibility with the unitary patent and the unified patent court (see below for our existing posts on this issue). The pharmaceutical industry has for example highlighted the fact that while the unitary patent will be delivered for all the contracting member states by the EPO, SPCs will be granted in each Member State in which the basic patent was granted and the MA obtained, after filing at the national industrial property office. The SPC and its corresponding unitary patent will thus not have the same territorial scope. Similarly, the opt-out might be logistically complicated as all the proprietors of both the EP and  the SPC must register the opt-out for it to be valid.

The contracted study shall thus evaluate the legal efficiency of the current SPC framework “in meeting its stated objectives given the development of directly affected and related product markets” and whether a new European SPC title is required to meet the requirements of current and expected innovative market developments in the EU.

The results of this study are expected at the beginning of 2017.

If you are interested in this call, you can find here the complete tender documents.

You can find here our post detailing the changes that the unitary patent will bring with regard to SCPs, and our introduction to the topic here.

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Unitary Patent Renewal fees: New adjustments by the EPO

The EPO published at the beginning of May two new proposals for an adjusted level of renewal fees for the European Patent with Unitary Effect, which were examined at the 14th meeting of the Select Committee of EU Participating Member States in the enhanced cooperation on Unitary Patent Protection. (See our post on the EPO’s first draft of the renewal fees here)

The EPO describes these two proposals in the following terms:

“These proposals foresee fee levels of respectively the equivalent of the renewal fees which have to be paid for the four or five countries out of the twenty-five EU participating member states in which most European patents are currently validated (a “true” TOP 4 and a “true” TOP 5- in contrast to the previous approach, the EPO’s internal renewal fees are no longer taken into account). The “true” TOP 5 proposal in addition foresees a 25% fee reduction for the first ten years of the lifetime of the patent for specific entities such as SMEs, universities and public research institutions. Member States held an exchange of views with some Member States not yet able to take a concrete position on these proposals.”

The question is therefore how do these new proposals differ from the first draft of renewal fees presented in March 2015 by the EPO. The first proposal had been criticized and judged inadequate for the ambitions of the Unitary Patent. The level of renewal fees for the first ten years of the unitary patent had in fact been established by reference to the EPO’s internal renewal fees payable to the EPO before grant while the application is pending, rather than by reference to the renewal fees payable to national patent offices for a similar patent. Renewal fees only matched the fees payable for 4 (TOP 4: Germany, France, Great Britain, and the Netherlands) or 5 (TOP 5: Germany, France, Great Britain, the Netherlands and Sweden) top validation countries for European Patents after year 10.

The new proposals took into consideration these criticisms, and national renewal fees for Top 4 and Top 5 thus now form the basis of the proposed Unitary Patent renewal fees from years 2 to 20. This created reduce fee levels for patent years 2 to 9.  In addition, in the true TOP 5, the 25% SME reduction in years 2 to 10 and the 15% licenses of right reduction remain.

So what are the new adjusted fees? (See SC/18/15)

For Top 4 level, over 20 years the sum total of the fees would be EUR 35, 555 divided as follow:

2nd year: 35 EUR

3rd year: 105 EUR

4th year: 145EUR

5th year: 315 EUR

6th year: 475 EUR

7th year: 630 EUR

8th year: 815 EUR

9th year: 990EUR

10th year:  1, 175 EUR

11th year: 1, 560 EUR

12th year: 1, 775 EUR

13th year: 2, 105 EUR

14th year: 2, 455 EUR

15th year: 2, 830 EUR

16th year: 3, 240 EUR

17th year: 3, 640 EUR

18th year: 4, 055 EUR

19th year: 4, 455 EUR

20th year: 4, 855 EUR

This is to be contrasted with the total of 37,995 EUR, which means that under the adjusted fees the patent owner would save 2,440 EUR. (See our post on the first version of Court fees here)

For Top 5 level, over 20 years the sum total of the fees would be 41, 955 EUR and 40, 403 EUR for the normal and reduced levels. The Reduced fees correspond to a 25% reduction from years 2 to 10 for SMEs, natural persons, NGOs, Universities and public research organisations. The fees would be divided as follows (the amounts after the 25% reduction for SMEs and other entities are shown in brackets, in italics):

2nd year: 85 EUR (63.75 EUR)

3rd year: 165 EUR (123.75 EUR)

 4th year: 255 EUR (191.25 EUR)

 5th year: 455 EUR (341.25 EUR)

 6th year: 645 EUR (483.75 EUR)

 7th year: 825 EUR (618.75 EUR)

 8th year: 1 050 EUR (787.50 EUR)

 9th year: 1 255 EUR (941.25 EUR)

 10th year: 1 475 EUR (1 106.25 EUR)

11th year: 1 790 EUR

12th year: 2 140 EUR

13th year: 2 510 EUR

14th year: 2 895 EUR

15th year: 3 300 EUR

16th year: 3 740 EUR

17th year: 4 175 EUR

18th year: 4 630 EUR

19th year: 5 065 EUR

20th year: 5 500 EUR

Therefore a patent owner would save 1,670 EUR (or 1, 252 EUR for the reduced fees) compared to the first version of the court fees established by the EPO.

The EPO also published a second document (SC/19/15) comparing the fees and external costs of a European Patent validated in 1 to 25 countries and a Unitary Patent (based on the adjusted fees). This document shows that the Unitary Patent is only financially interesting for patentees who wish to register their patent in more than 3 countries for TOP 4 and 4 countries for TOP 5.

Paradoxically however 64% of European Patents are only validated for a maximum of 3 countries, while only 0.4% of European Patents are validated for 25 countries. It is nonetheless impossible to know from these figures whether the overall cost of the Unitary Patent will encourage patentees to choose the Unitary Patent above the European Patent or whether there is a genuine majority of patents, which only require a validation in 3 or less countries.

These adjusted fees have already been criticised by the American Intellectual Property Law Association and the EUROCHAMBRES. The AIPLA in fact wrote to the EPO to express concerns about the adjusted fees that it considers to be still to high in comparison with costs in the Americas and in Asia. AIPLA argues for example that “the current TOP 4 proposal would cost at least 3 times more over the life of a Unitary Patent than renewals of a U.S patent, an the UP will not cover all EPO countries or even all EU states.”

The Euro Chambres of Commerce and Industry notes that the fee for the “True TOP 5 with reduced fees” only equals a 4% reduction from the first draft of the Unitary Patent Court fees. These adjustments therefore do not represent a real economy for the SME that the EUROCHAMBRES represent, especially compared to the U.S where a 50% reduced fee is applied at renewal. The EUROCHAMBRES president Arnaldo Abruzzini defends the idea –shared by others, see notably this post– that the renewal fees are set up in accordance with the needs of the national patent offices in mind rather than in accordance with the principles of competitiveness and attractiveness., and therefore at the detriment of businesses.

Finally, as highlighted by the IPKat, when looking at the distribution of the reductions of the renewal fees, it can be noted that these reductions apply disproportionately to the early years of the patent. This means that these reductions benefit in particular industries with short product lifecycles where patents are less likely to be maintained after the first ten years.

It is now to the Select Committee to decide the exact level of renewal fees which will apply and the UPC Blog by LAVOIX will keep a close eye on this topic.

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The “Enhanced European Patent” or some long-waited-for answers on the Unified Patent Court and the Unitary Patent by the Select and Preparatory Committees.

The Unified Patent Court Preparatory Committee and Select Committee recently released an explanatory note on the “Enhanced European Patent System” detailing the purpose of the future Unified Patent Court and Unitary Patent and the key points on how this major patent reform will articulate itself with the existing European and National patents and existing jurisdictions.

 

The UPC Blog has extensively posted on the Unified Patent Court competence and procedure, on the nature of the unitary effect and the general overview and background of both the UPC (Unified Patent Court) and the UP (Unitary Patent). It is however the first time that the committees (see our posts on the Select committee and the Preparatory Committee) involved in the setting up of the UPC release an explanatory note.  It is thus the first time that clarifications rather than interpretations are made about the UPC agreement. This post will focus on three key points of the UPC explanatory note, which bring some explanations to the cacophony of information published so far, without nonetheless answering all the questions.

 

Before looking at these three substantial points, it is important to start with the reassertion from the Select and Preparatory Committees that the Unitary Patent directly derives entirely from the European patent, which provides the shell onto which the unitary effect hooks up. So to obtain a Unitary patent an applicant must first apply for a European patent at the European Patent Organisation, which will handle the application in accordance with the European Convention. It is only after grant that the proprietor of a European patent will have the opportunity to apply for unitary effect.  However if for a European patent it is necessary for the patent holder to validate the patent in each Member state where protection is required, for a unitary patent a single request will give protection in 25 Member States of the European union. (More information on the unitary effect here)

 

The rest of the explanatory note is divided between the UPC and UP, and deals with important questions such as the geographical extension, the general competence of the UPC and the transitional period. The UPC Blog by Lavoix raised in previous posts the problems of legal uncertainty attached to these three topics, we will thus look here at the response of the Select and preparatory Committees. (See Discussion posts on “Opt-out and legal certainty” “The impact of Article 83 UPCA on the applicable law” and “UPC and Infringement actions”)

 

The Geographical extension of the Unitary Patent:

The unitary effect of a European patent will cover the territories of the contracting member states that have ratified the UPC Agreement at the date of the registration of the unitary effect of the individual patent. The explanatory note however makes clear that the geographical perimeter of validity of the unitary effect will not extend following the progressive ratification of the UPC Agreement after the registration. Rather, it will stay the same until all the contracting member states ratify the UPC Agreement. It is only then that European patents registered thereafter will enjoy unitary effect in all participating member states. As for Spain, Italy and Croatia which are not participating in the UP and Poland which is participating but has not signed yet the UPC Agreement, it will be possible for the proprietor of a European patent with unitary effect to choose to validate the patent as a classical European patent.  In addition, it will also be possible to validate the same patent as a European Patent in the ten contracting states of the European Patent Organisation that are not EU Member States. (For more information on the contracting member states and Italy and Spain’s positions).

 

The UPC general competence:

On the general competence of the UPC, the explanatory note makes clear that the UPC has exclusive competence “in respect of civil litigation on matters relating to classical European patents, European patents with unitary effect, supplementary protection certificates issued for a product covered by such a patent and European patent applications”. The UPC will not however have any competence for national patents or supplementary protection certificates granted for a national patent (see our post on supplementary protection patents).

The UPC’s rulings will have effect in the territory of the contracting member states that will have ratified the UPC Agreement.  The exclusive competence of the UPC will also apply to the decisions of the European Patent Office in “carrying out the tasks of administering the Unitary patent set out in the Unitary patent regulations”.

 

The Transitional period: (For background information on the transitional period see here) 

The UPC Agreement provides for European patents a period of seven years, renewable for another seven years, during which they will co-exist with UP’s. However, as it is made clear in the explanatory note, the transitional rules will not apply for European Patents with unitary effect.  The transitional period will only apply to European patents or Supplementary Protection Certificates issued for products protected by European patents. For those European patents, the competent forum during the transitional period will be either the UPC or the existing national courts. So unless an action has already been brought before the UPC, actions for infringement or for revocation concerning European patents or for a Supplementary Protection Certificate issued for a product protected by a European patent may thus still be brought before national courts.

 

The Opt-out is, too, detailed and explained. Hence, “during the transitional period, a proprietor –or an applicant for- a European patent granted or applied for prior to the end of the transitional period or a SPC issued for a product protected by such a patent will also have the possibility to opt out the patent/application/SPC, from the jurisdiction of the UPC unless an action has already been brought before the UPC. To this end they shall notify their opt-out to the Registry. The opt-out shall take effect upon its entry into register. It will be possible to withdraw such an opt-out at any time. There will be no possibility to opt-out European patents with unitary effect.”  In respect of the opt-out the Select and Preparatory Committees list three benefits of the UPC justifying not opting-out: “a unified jurisprudence resulting in increased predictability and the avoidance of panel litigation; judgments (injunctions, damages) with effect in 25 Member states of the EU; the expectation of speedier procedures than in many of the individual Member States”.

 

It is important to observe however that this explanatory note does not answer central questions such as the possible dual competence between the UPC and national jurisdiction under articles 32 (1) and 83 (1) of the UPC Agreement, the types of actions that would stop a patent proprietor to opt-out or the risk of lis pendens. The UPC Blog will deal with each of these issues in posts to come.

 

You can of course look at the UPCA here and the draft rules of procedures here.

 

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EU Legislation and Unitary Patent

 Which EU legislation provides for Unitary protection?

The European patent with unitary effect relies upon three separate pieces of legislation (unitary patent, language regime and unified patent court).

 

More related EU legislation can be found in the Sources pages.

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The Unitary Patent: The unitary effect, its construction, legal nature and conditions of obtaining.

(A)  The construction of the unitary effect:

As Professors Jean Christophe Galloux and Bertrand Warusfel explain in their article  “The Unitary Patent and the future Unified Jurisdiction[1]”, the UP is a “unionist graft transplanted on the European patent”. The legal mechanism is in fact quite simple: the Convention on the European Patent governs the acquisition of the European patent until it is delivered. The European regulations adopted on 17th December 2012 and published on 31st December 2012 then govern the unitary patent.

Regulation 1257/2012 describes and explains the unitary protection and unitary effect in the following words[2]:

“Unitary patent protection should be achieved by attributing unitary effect to European patents in the post-grant phase by virtue of this Regulation and in respect of all the participating Member States. The main feature of a European patent with unitary effect should be its unitary character, i.e. providing uniform protection and having equal effect in all the participating Member States. Consequently, a European patent with unitary effect should only be limited, transferred or revoked, or lapse, in respect of all the participating Member States. It should be possible for a European patent with unitary effect to be licensed in respect of the whole or part of the territories of the participating Member States. To ensure the uniform substantive scope of protection conferred by unitary patent protection, only European patents that have been granted for all the participating Member States with the same set of claims should benefit from unitary effect.” (Emphasis added)

The temporary protection of the European patent is given to this patent until the publication of the European patent and the delivery of the unitary effect.

 

 

 (B) The legal nature of the unitary patent:

As explained in Regulation 1257/2012, the UP is not a new intellectual property title but a new legal attribute given to an already existing title, the European patent:

“The unitary effect attributed to a European patent should have an accessory nature and should be deemed not to have arisen to the extent that the basic European patent has been revoked or limited.[3]”

It is in fact not the result of a specific procedure of delivery and does not have a specific time limit. The condition of its annulation and its revocation moreover, derive entirely from the Convention on the European Patent and national laws, ant not from EU law.

The unitary effect delivered to a patent has hence « an accessory character [4]», i.e. the unitary effect can be extinguished without the European patent disappearing, and the European patent can be granted without the unitary effect.

 

 

(C) The conditions of obtaining the unitary effect:

The deliverance of the unitary effect necessitates three cumulative conditions:

The unitary effect must be asked by the patent owner within a month from the patent publication in the Bulletin Européen des brevets.

The unitary effect must be registered in a special register: the “register of patent protection by unitary patent”.

The European patent must offer the same protection for the different states participating to the Unitary Patent. Article 3.1 of regulation 1257/2012 in fact states: “A European patent granted with different sets of claims for different participating Member


[1] J-C. Galloux, B. Warusfel, « Le brevet unitaire et la future jurisdiction unifiée », Propriétés Intelectuelles, Avril 2013 n°47.

 

[4] Jean Christophe Galloux and Bertrand Warusfel

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The EU Unitary Patent: Its Background and Overview.

 

After over 30 years of trying, the European Parliament and the Council have agreed on how to create a EU-wide patent regime to protect inventions better, cut costs and boost competitiveness.

 

The idea of a unitary patent valid throughout the European Economic Community was already being aired when the EEC was founded in 1957. In 1973 a “unified Community patent” was to be created by the Munich Convention, but the agreement never entered into force. After another unsuccessful attempt was the Luxembourg Agreement of 1989. In 1997, the European Commission published a Green Paper on the “Community patent”, followed by a proposal in 2000. A revised proposal was then put forward in 2004, but sunk by disagreement on language issues. The unitary patent proposal was finally tabled in 2011.

(A) The current system:

Currently in Europe it is possible to apply for a patent through three routes:

  • The National route
  • The European route
  • The international route

Under the National route, applicants can apply for a patent in one or just a few countries within Europe. It is then necessary to file the application at the IP offices in the countries for which the protection is sought. The national route leads to national rights and confer protection at national level.

Under the International route, the Patent Cooperation Treaty (PCT) provides a unified procedure for 137 different contracting states. A PCT application is a “placeholder application” for national filings in individual countries, which is often referred to as an international application.

Under the European route, applicants are granted European Patents for some or all of the contracting states to the European Patent Convention (EPC). They can also be extended to the current extension states[1]. A European Patent is a bundle of national patents. Under Article 2(2) EPC a European patent shall, in each of the contracting states for which it is granted, have the effect of and be subject to the same conditions as a national patent granted by all that state, unless otherwise provided by the EPC. Each of these national patents may be subject to national translation and validation requirements and legal proceedings, and must be renewed individually in each country. The European Patent Convention established a centralized procedure for granting European patents. This procedure is used to process a single patent application in English, French or German, which are the three official languages of the European Patent Organization (EPO), a non-EU body. The European Patent Office (EPO) is able to search, examine and grant patents in a single procedure for up to 38 European states under the European Patent Convention (EPC).

However, a patent issued by EPO must be validated in all the countries where protection is sought. The validation procedure entails high costs, especially for translation services, and makes EU-wide patent protection thirteen times more expensive than in the US.

This current system will however remain available, though these European bundle patents may be subject to the jurisdiction of the Unified Patent Court (UPC) instead of the national courts of each member state. Applicants will also be able to continue to obtain national patents from the patent offices of each participating country, and go through the Patent Cooperation Treaty route.

(B) What is the aim of the Unitary Patent?

The aim of creating a EU patent with unitary effect is twofold.

First, to reduce current patenting costs. According to the European Parliament the cost could be cut by up to 80%[2].

This should improve the competitive position of EU firms vis-à-vis their counterparts in the US and Japan, where patents are much cheaper. Patenting an invention in Europe can be costly because once granted, a European patent can be enforced only at national level. This may well entail translating it into the official language of the country concerned. The patent holder must also pay national validation fees and annual renewal fees. Together, according to the European Parliament, these costs mean that maintaining a European patent for ten years in only six European countries can be four times more expensive than it would be in the US, Japan and many other advanced economies. The translation requirements for the Unitary Patent will be significantly simpler and cheaper, and it will be subject to a single set of renewal fees.

Second, to improve certainty as to the law and reduce litigation costs.

Patents on inventions with a high market value are frequently subject to litigation. Due to the lack of a unified litigation system, this leads to parallel lawsuits in different countries, sometimes with divergent outcomes. Currently, between 146 and 311 patent infringement cases are being duplicated annually in the EU member states. In 2013, this number is likely to rise to between 202 and 431 duplicated cases.

The Unitary Patent also offers savings for enforcement. A patentee will in fact only need to enforce their patent in one court, rather than in multiple national courts, avoiding duplicated litigation. Moreover, a Unitary Patent will be subject to a single set of rules, as opposed to the legislation of multiple countries. To enforce or to revoke today’s European Patent may entail multiple legal proceedings in various countries. The decisions of the new patent court, by contrast, will apply in all participating EU member states.

 

(C) Entry into force

Regulations 1257/2012 and 1260/2012 came into force on 20 January 2013. They will apply from 1 January 2014 or from the entry into force of the Agreement on a Unified Patent Court, whichever is the later date. However in order for the Unitary Patent to be available 13 member states including the UK, France and Germany must have ratified the UPC Agreement, which is not expected to occur before 2015. The status of ratification for each Member State can be found here.  The European Commission will report on how the new regime is working three years after it takes effect.

(D) Countries participating

The two EU Regulations establishing the Unitary Patent were agreed using the enhanced cooperation procedure, which enabled a smaller group of EU countries to make progress. Currently 25 EU countries are participating in the Unitary Patent. Spain and Italy have so far opted out of the unitary patent package, but could join in the decision-making process at any time.

In March 2011 the Council of the European Union issued a decision authorizing enhanced cooperation for the creation of a unitary patent protection. The enhanced co-operation mechanism was set out in the Lisbon Treaty and permits nine or more member states to use the EU’s processes and structures to make agreements that bind only those countries.

Spain and Italy applied before the Court of Justice of the European Union for the annulment of this decision on 30th May 2011 and 31st May 2011 respectively, on grounds of lack of competence, misuse of powers and infringement of the treaties. The CJEU however dismissed their actions on 16th April 2013 arguing that the Council’s decision was within the boundaries of article 118 TFEU and that the decision had been taken as a last resort after the multiple unsuccessful attempts. The Court moreover rejected Spain and Italy’s argument about the Unitary Patent undermining the internal market by creating a uniform protection in one part only of the European Union. It is in fact inherent to the procedure of enhanced cooperation to create a framework only binding to Members States who have cooperated.

On 22nd April 2013, Spain lodged an application before the CJEU against the European Parliament and the Council of the European Union for two actions. It asked first to annul Regulation EU 1257/2012 implementing enhanced cooperation in the area of the creation of unitary patent protection for lack of legal basis, and breach of the principle of autonomy and uniformity in the application of European Union law. It also asked for the annulment of Regulation EU 1260/2012 implementing enhanced cooperation regarding translation arrangements for the unitary patent. Spain argued that the Regulation lacks legal basis and infringes the principles of non-discrimination, legal certainty, and autonomy. The Advocate General, Yves Bot, however delivered his opinion on 18th November 2014 (see our post here), and  proposed that the Court of Justice of the European Union dismissed Spain’s challenge to Unitary Patent Regulations. Finally on 5th May 2015 the CJEU rejected all of Spain’s arguments regarding Regulations 1257 and 1260/2012 and dismissed both cases (see our post here for more details).

Italy has since signed the Unified Patent Agreement on 02nd  February 2013 and requested to take part in the enhanced cooperation on 07th July 2015. Its request was accepted by the European Commission on 30th September 2015.

 You can find all CJEU judgments in our final post on Spain v Council of the European Union.

 

[1] States recognising European patents upon request : Bosnia and Herzegovina, and Montenegro.