Category: Brexit

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More on Brexit from the AIPPI 2016:

Brexit and the German constitutional challenge

For want of anything better (ie, real concrete news about what the UK will do regarding the UPC), more discussions as to whether the UK should or will be a member of the UPC have taken place at the AIPPI 2016 congress this week.

The World Intellectual Property Review reports that Margot Fröhlinger, principal director of patent law and multilateral affairs at the EPO, reiterated the EPO’s commitment to the UPC and its desire to see the UK participate even after Brexit.

She highlighted that the “project is ready to be implemented” and, that considering the investment that has already been made as well as the momentum the UP and UPC project created, the UPC “will not been brought to a halt”.

It also appears that the EPO would prefer the UK to be a member of the UPC and unitary patent so that neither of them lose attractiveness. The UK was in fact in 2015 the third country of origin of patent filings and has highly regarded judges from who the UPC could benefit.

Finally, Margot Fröhlinger clarified the issue of the UK’s participation to the UPC after Brexit, and said it would be legally possible for the UK to join the UPC as long as it signed safeguards to ensure the supremacy of EU law. She pointed out that if the UK were to ratify before leaving the EU, it could count on the goodwill of other EU member states.

This obviously raised the question as to what will happen if the UK does not ratify the UPC Agreement.  Margot Fröhlinger appeared  to think that the UPC members will have to “find a way to go ahead without the UK”. This would require a re-ratification but could probably be expedited through a simplified procedure in most contracting member states.

Clemens Heusch, Nokia’s head of European litigation, on the other hand shared his skepticism as to the UK’s ratification of the UPC Agreement, and highlighted the legal uncertainty surrounding the UK’s participation to the UPC after it leaves the EU, despite the EPO’s reassurance on this question.

Lastly, yesterday’s session also heard from Thierry Sueur, vice-president of IP at Air Liquide, a French industrial gases and services provider who underscored that the UPC and the unitary patent are, despite Brexit, still considered by industries as central for innovation and economic growth…

 

 

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UK IPO’s update on Brexit:

Brexit and the German constitutional challenge

The UK’s Intellectual Property Office (IPO), the official government body responsible for intellectual property  rights, published a note entitled “IP and Brexit: The Facts” which intends to clarify  “the future of (UK) intellectual property laws following the recent Referendum decision“.

It succinctly highlights the different international IP agreements that UK right holders and businesses can make use of for trademarks, copyrights, patents, designs and enforcement. It also invites IP users to share their views on how to address some of the issues created by the Brexit such as the right of UK IP professionals to represent clients before the EU Intellectual Property Office, or the protection of designs in the UK.

Regarding patents, the IPO is keen to emphasise that “British exit from the EU will not affect the current European patent system as governed by the European Patent Convention” and that “the referendum result has no impact on UK businesses’ ability to apply to the European Patent Office for patent protection“. By contrast, the question of the UPC is addressed only very briefly in a paragraph which  stresses the UK’s continuing participation in the UPC in its capacity as Contracting Member State. However, although it specifically mentions that the UK will continue “to attend and participate in UPC meetings ” the IPO gives no indication as to the possible scenarios  which could allow the UK to take part in the UPC once it leaves the EU…

 

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The future of the Unitary Patent package as seen by the EPO:

Brexit and the German constitutional challenge

Benoît Batistelli, the EPO’s president published this week a communiqué on the future of the Unitary Patent package following a conference hosted by the EPO in Munich.

It appears that the participants were eager to find ways for the Unitary Patent package to go ahead and enter into operation as soon as possible. Benoit Batistelli highlighted in his communiqué that “at a time of economic challenges and significant budgetary constraints for companies, businesses should not be denied the economic advantages and cost savings offered by the Unitary Patent package”.

Another trend common to the event organised in Paris by the UJUB and the conference organised in Munich by the EPO was the  hope that “political leaders will listen to the pleas of the user community to go ahead with the Unitary Patent package”, especially as the UPC will be ready to begin operating once the necessary ratifications of the UPC Agreement are obtained.

Panel discussions among business representatives also  confirmed that “users are by and large happy with the envisaged implementation, including renewal fees, the Rules of Procedure of the Unified Patent Court, and other decisions of the UPC Preparatory Committee”, while a panel discussion among renowned patent judges showed that “future UPC judges will be well prepared for the challenges and that proceedings can be expected to be handled in the most efficient way”. It appears therefore that the expectations in Paris and in Munich for the UPC were very high and that users are eager to see the UPC in action.

Different scenarios for the best way to proceed with the Unitary Patent package were therefore addressed . According to the EPO,  the best case scenario would see the UK going ahead as soon as possible with the ratification of the UPC Agreement. This would allow the UK afterwards, in its EU exit negotiations, to obtain its continuous participation both in the Unified Patent Court and the Unitary Patent.  In fact, as discussed in Paris, “with the UK having brought the system into operation by ratification and having participated in the system from the beginning, it is possible that Member States may allow the continued participation of the UK , even after the ‘Brexit’ takes effect”. The EPO’s president noted however in his communiqué that, even if the UK were not to take part in the Unitary Patent package, there seems to be “a clear feeling in the international user community that the system would remain sufficiently attractive for many”.

Finally, the EPO expressed in its communiqué its support for the UPC, and “stands ready not only to register the first Unitary Patents, but also to assist as much as possible in finding appropriate solutions in the interest of our user community and our Contracting States.”

With Theresa May becoming the new UK Prime Minister today in the UK, one can hope that the UPC will be on her agenda in the coming months.

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What future for the UPC now that the UK has voted to leave the EU?

Encouraging steps by participating member states towards the entry into force of the UPC Agreement

On Wednesday (06/07/16) the Union pour la Juridiction Unifiée des Brevets (Union for the Unified Patent Jurisdiction) organised in Paris a conference on the consequences of the Brexit for the UPC. (See the recorded video below)  The participants,  Thierry Sueur, chairman of the IP Committee of the MEDEF -the French business federation- representing the European industry, Professor Winfried Tilmann from Hogan Lovells, Rowan Freeland from Simmons&Simmons, and Alexander Ramsay, chairman of the UPC Preparatory Committee, outlined  the legal and political consequences of the Brexit on the UPC and the immediate next steps for the Preparatory and Advisory Committee in this regard.

After an opening by Pierre Véron who reflected on the shock of the Brexit news (shared by the audience), Thierry Sueur highlighted the position of the European Industry which is demanding that the ratification process continues in order for the UPC to come live, and he thus pleaded for the UK to ratify the UPCA and its protocol. According to him, ratification by the UK would in fact allow the UPC to meet its opening deadline in Spring 2017 and would leave the door open for the UK to take part in the UPC and the Unitary Patent package.

Professor Winfried Tilmann then addressed the question of whether the UK can still take part in the UPC. First Professor Tilmann argued that there were strong political arguments to justify the UK’s ratification. In fact, the UK is still and until the end of the two-year period after its notification of withdrawal under article 50 of the Lisbon Treaty, a member of the EU and, as both houses of British parliament have already started working on ratifying the UPCA, the ratification could therefore be quite straightforward.  He also noted that the UPCA is an international treaty that does not derive from EU law, and that although the UPC shall be a court common to the Contracting Member States -and thus subject to the same obligations under Union law as any national court of the Contracting Member States- it is not a court of the EU -contrary to the ECJ. This would thus mean that the UK local and central divisions could remain in London, and that UK practitioners and judges could take part in the UPC.

Regarding the legal factors involved in considering whether the UK could leave the EU but still be a contracting member state under the UPCA, article 84 of the UPCA appears to be an obstacle. In fact it provides that only EU member states may ratify the UPCA. According to Professor Tilmann, this condition implies, that countries which ratify the UPCA remain EU member states. Therefore if the UK leaves the EU pursuant to article 62, 65, and 67 of the Vienna Convention on the Law of Treaties, both the UK and the other signatories of the UPCA, would have the right to cancel the contractual relationship between the UK and themselves.  Article 84 would thus need to be amended to allow the UK to be a signatory to the UPCA even after leaving the EU. Such a change is possible for Contracting Member States on the basis of article 149a(1)(a) of the European Patent Convention and would not require them to re-ratify an amended UPCA. The amendments to the UPCA could in fact be included in the Brexit agreement which would in turn  have the quality of Union law and “pursuant to article 87(2) UPCA, the Administrative Committee has the power to change the UPCA in order to bring it in line with Union law”.

However it is important to note that, were the UK to leave the EU after ratifying the amended UPCA,  it would be bound by the ECJ’s decisions and by its interpretation of EU law as the UPC has the obligation to refer questions on EU law to the ECJ. The UK would also be jointly and severally liable for damages with other contracting member states as provided by the UPCA. Finally, during the transitional period, national UK courts would also be bound by the UPCA within the same remit as stated above.

The legal consequences of the UK leaving the EU would nonetheless be wider than those faced for the UK’s participation to the UPC. In fact the unitary effect would also need to be extended to the UK by agreement under article 142 (1) EPC. This would result into a Unitary patent deriving its effects from EU law when applying within the territory of the EU, and a Unitary patent deriving its effects from international law when applying to the UK.

Rowan Freeland then explored what would happen were the Contracting Member States to “exclude the UK of the UPCA” before it leaving the EU, in order to pursue the implementation of the UPC and Unitary Patent. According to him, re-negotiations of the UPCA to exclude the UK would be possible, but would require a new ratification of the newly amended UPCA. This would in turn require Denmark to organise a new referendum for the ratification of the new UPCA. Rowan Freeland however highlighted that 50% of all European Patents are validated in the UK, France and Germany. Therefore if the UK were not to take part in the UPC and the Unitary patent, a smaller number of users than expected might potentially be interested in the UPC and the Unitary patent. This reasoning would extend to the unitary patent “top 4” renewal fees which is based on the cost of renewal in the four EU countries that have registered the most patents. Indeed, if the Unitary patent effect is not extended to the UK, and if the latter is not part of the UPC the savings achieved by opting for the Unitary patent would decrease.

Finally, despite the general uncertainty, Alexander Ramsay tried to be reassuring and explained that for the moment the Preparatory Committee was working as normal and that the recruitment process was still ongoing. As the chairman of the Preparatory Committee, he emphasized that member states are encouraged to actively pursue their efforts for ratification in order not to delay the coming live of the court, whenever that may be. Alexander Ramsay explained that no contingency plan had yet been drafted as the political situation is very unclear. The Preparatory Committee will therefore need to have more elements of information on the position of the UK and on how the other contracting member states wish to proceed, before devising new options for the UPC and Unitary patent. Alexander Ramsay however was positive and seemed to believe that the project of the UPC and Unitary patent will survive Brexit and come live anyway.

Although the atmosphere cannot be described as joyful, the participants (including the UPC Blog) expressed their hopes to see the UPC and the Unitary Patent becoming a reality in the near future and for EU countries to seize this opportunity to bring the union closer through IP.

Below the recorded video of the conference available on YouTube:

https://www.youtube.com/watch?v=p5clCZXqgxk

The documents (presentation slides) of the conference can be found here.

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Will the UK ratify the UPCA before its referendum on the EU membership?

Brexit and the German constitutional challenge

In a statement sent to the magazine Managing IP the UK IPO declared that “the UK’s EU referendum will have no effect on UK ratification of the Unified Patent Court Agreement by the middle of 2016. This is in line with the timescale identified for the conclusion of the preparatory work necessary for the UPC to become operational.  Ratification will happen before the Court is expected to open, in early 2017.”

Similarly the UK’s Chartered  Institute of Patent Attorneys confirms that “the Government is proceeding on the basis that the UK will remain in the European Union. The UK Intellectual Property Office is working actively to establish the Unified Patent Court (UPC) and is preparing for ratification of the UPC Agreement.” It also published a table which highlights the major consequences on the intellectual property system the UK will face if choosing to leave the EU.

This issue was also raised in UK Parliament before the Fourth Delegated Legislation Committee on Monday 01/03/16 when Mr Edward Vaizey,  the UK Minister for Culture and the Digital Economy, introduced the Draft Patents (European Patent with Unitary Effect and Unified Patent Court) Order 2016 to the committee, meeting which is reported  in the hansard published by Parliament.

Mr Vaizey therefore explains to the Committee that it would  be “clearly, were we to leave the European Union, we would no longer be members of the unified patent court. It would then be a matter for  ​the UK Government to ask the European Union whether we could be a member, if we thought that was a good thing. I suspect the European Union would have something to say about that. For people whose lives are dominated by thoughts of having a European patent, it would be a bad thing if we were not a member of the European Union. I hope that that is clear.” The Minister reminded the Committee at this occasion that the aim of the creation of the UPC and Unitary Patent was to “boost competitiveness and drive growth, and for a target to cut the burden on business.“

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What is the impact of the UK’s referendum on its EU membership on the UPCA?

Encouraging steps by participating member states towards the entry into force of the UPC Agreement

WIPR published on its blog last week an update about the UK’s ratification of the UPCA, as it appears that it might only take place after the referendum on the country’s EU membership.

The European Union Referendum Bill was passed by the House of Commons on 9th June and if passed by the House of Lords, the referendum will be held before the end of 2017. The WIPR however notes that the UPCA ratification by the UK is unlikely to happen before the EU referendum, which means that the UK’s ratification might be postponed to the very end of 2017 or beginning of 2018. This late ratification will of course have a direct impact on the entry into force of the UPC as it requires the ratification of ten countries plus the ratification of France, Germany and the UK for the court to come into existence. The 2016 ambitious entry into force of the UPCA is thus very likely to be once again postponed.

If the UK were to leave the EU this would however not mean the end of the UPC. In fact, article 89 of the UPCA states that:

“This Agreement shall enter into force … on the first day of the fourth month after the deposit of the thirteenth instrument of ratification or accession in accordance with Article 84, including the three Member States in which the highest number of European patents had effect in the year preceding the year in which the signature of the Agreement takes place …”

A“Member State” is in turn defined in Article 2(b) as “a Member State of the European Union”. Therefore if the UK decides that it does not want to take part anymore in the European Union,  the Netherlands would become the third mandatory ratification country, as it is the country with the highest number of European patents after the UK.

If the end of the UK’s membership in the European Union does not mean the end of the Unified Patent Court Agreement, it would however have other practical consequences. In fact the UK is in in charge of various responsibilities within the UPC preparatory committee and notably the IT system. This major part of the UPC would thus need to be allocated to a country which has the capacity to put together an IT system within a short period of time. Another issue is the fact that one of the central division will be located in London. It would not make sense for the UK to host one entity of the central division if it does not ratify the UPCA and takes part in the Unified Patent Court. Article 7(2) of the UPCA however states that “The central division shall have its seat in Paris, with sections in London and Munich …” and Annex II to the Agreement specifies the functions of the London branch. An amendment of the UPCA would therefore be necessary in order to relocate the London central division. This amendment could of course be quite complicated to set up and might necessitate the countries who have already ratified the UPCA to ratify this amendment too.

Finally it must be noted that the most obvious consequence of the UK exiting the EU is the fact that the scope of protection offered by the unitary patent will not include the UK, and will therefore be narrower than it is now. The question is therefore whether this will make the unitary patent less attractive for patentees.

The issue of the UK’s referendum on its participation to the European Union will thus have direct consequences for the UPC, whether the UK stays within the EU or leaves the Union, and the UPC Blog by LAVOIX is keen to know what you think about this new development.