Category: Ratification & Brexit

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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:

Ratification progress map

(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:

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. 

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Estonia ratifies the UPC Agreement

UK 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. 

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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.

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

Brexit and the German constitutional challenge

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.

 

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German Federal Constitutional Court stops German ratification bill

Germany's constitutional court

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.

 

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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.

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Ratification and amendment bills adopted by both houses of German Parliament

Ratification and amendment bill adopted by German Parliament

The ratification bill allowing the German government to ratify the Unified Patent Court Agreement and the bill amending German law to accommodate the Unitary Patent Package were adopted by both houses of German Parliament.

On 31st March, the German Bundesrat adopted, without any modification, the bill approved and sent by the Bundestag on 9th March 2017 for the ratification of the Unified Patent Court Agreement.  The Bundesrat’s decision states:

“Law resolution Of the German Bundestag

At its 956th meeting on 31 March 2017, the Federal Council (Bundesrat) adopted the Act adopted by the German Bundestag on 9 March 2017 in accordance with Article 23 (1), second sentence, Article 74 (2) in conjunction with paragraph 1 number 25 and 105 (3) of the Basic Law.”

This bill provides for the ratification of the Unified Patent Court. It describes the purpose and functioning of the UPC. It also sets out the cost to be borne by Germany and the anticipated budget of the UPC.

The Bundesrat also examined the second bill which will modify German patent law to accommodate the Unitary Patent Package.  The Bundesrat first examined this bill on 8 July 2017 and decided not to raise objections. It was then adopted by the Bundestag on 9 March 2017 without amendments. The Bundesrat therefore notes that there is no reason to submit the bill to the mediation committee.

This bill provides for the new European Patent with unitary effect to be incorporated into the German legal order:

  • It defines the situations which allow for the protection of an invention by a national patent and a European patent or a European patent with unitary effect.
  • It sets “a new compulsory enforcement rule (…) to enable the decisions and orders of the Unified Patent Court to be enforced without difficulty in Germany“.
  • A new compulsory enforcement rule will be introduced to enable the decisions and orders of the Unified Patent Court to be enforced without difficulty.
  • Finally, the German Patent and Trademark Office will be required to indicate in its register whether the patent has unitary effect of not.

Now that both Parliament houses have adopted the bills, the German executive and President must sign them. The bills must then be published in the German Federal Law Gazette to become legislation.

 

For a quick overview of the bills and official texts click on the following links:

Gesetzesbeschluss des Deutschen Bundestages  (dated 10/03/17)

Beschluss des Bundesrates (dated 31/03/17)

Explanatory note (dated 31/03/17)

Official page of the Federal Council meeting n°956

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The European Parliament Legal Affairs Committee on the UPC state of affairs

EU Parliament legal affairs committee UPC

The European Parliament Committee on legal affairs organised a session last week on the Unitary Patent Package. Benoit Batistelli the President of the EPO, Mr Tokarski from the EU Commission Directorate-General for “Internal Market, Industry, Entrepreneurship and SMEs”, and Mr Bernhard Rapkay EU MP of the Socialist and Democrats group, presented the UPC state of affairs.

Ratification of the Unified Patent Court Agreement and Protocol for the provisional application of the Agreement for the Unified Patent Court Agreement: 

Mr Batistelli gave an update on the state of ratification. He indicated that:

  • Germany should be ratifying the UPCA in the coming weeks.
  • the UK has publicly committed itself to ratifying the UPCA before leaving the EU. In fact, Jo Johnson, the new UK Intellectual Property minister confirmed to President Batistelli that the UK government is committed “to finalize the national ratification of the UPC treaty in order for the Court to be operational on 1st December 2017”. This will enable the EPO to deliver the first Unitary Patent at the same time.

The EPO’s President also clarified the impact of Brexit on the UPC. He explained that the Unified Patent Court Agreement cannot come into force unless it is ratified by 13 states. These 13 states must include France, Germany, and the United Kingdom. Therefore for the UPC to come live at the date announced by the Preparatory Committee, the UK must ratify the UPCA before it leaves the EU. If it does not, Italy could become the third state upon whose ratification the UPC would become operational. Italy is in fact ranked fourth in the EU for patent filings, just after the UK.

Mr Tokarsky explained that everything is ready at technical level. However participating member states need to ratify the Protocol on the provisional application of the Agreement on the Unified Patent Court. Mr Tokarsky particularly insisted for the states that already have parliamentary approval to actually ratify the Protocol. He also highlighted that the necessary ratification must take place before the next Competitiveness Council meeting on 29th May. Indeed the UPC requires a minimum of six months to get ready and become operational.

Mr Tokarksy also expressed the Commission’s hopes all EU countries which participated to the enhanced cooperation ratify the UPCA. Similarly the EU commission wishes for most participating member states to ratify the Unified Patent Court Agreement by the end of 2017. To that effect, the EU Commissioner called all states to complete their ratification without further delays. Mr Tokarsky likewise appealed to all EU institutions, and more specifically the EU Parliament, to encourage states to work in that direction.

Mr Rapkay a contrario delivered a less optimistic speech and cast doubts as to a quick ratification by the UK.

The Unitary Patent Package and SMEs: 

This committee meeting was also an opportunity for the EPO and the EU Commission to underline their commitment to SMEs. Mr Batistelli insisted that the UPC would be very beneficial to SMEs across the EU. It will in fact simplify proceedings and allow for an EU wide enforcement of the court’s decisions, including injunctions. He also highlighted that the cost (around 5,000 euros for 10 years) and the increased legal certainty brought by the Unitary Patent will allow SMEs to better protect their intellectual property rights. Additionally, Mr Takarsky explained that the EU commission is now developing a specific strategy for SMEs to develop their IP rights as reflected in the EU annual report 2016.

The video of the Legal Affairs Committee:

http://www.europarl.europa.eu/news/en/news-room/20170317IPR67572/committee-on-legal-affairs-meeting-23032017-(am)

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German parliament approves the ratification of the UPCA:

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

The German parliament approves the ratification of the UPCA:

On 9th March 2017, the German Bundestag approved the bill for the ratification of the Unified Patent Court Agreement and the bill amending German patent law. The Bundesrat, the second chamber of the German Parliament, will now debate the bill between the end of March and mid-May. The German executive and President must sign it before it is published in the German Federal Law Gazette and becomes part of the German legislation.

In a parallel move, the Bundesrat approved on the same day the bill enabling Germany to ratify the Protocol on Privileges and Immunities.

Both were  on the agenda of the Legal Affairs Committee of the Bundesrat for 15th March 2017. The Bundesrat webpage does not however give any indication as to the outcome of the discussion.

What next?

Germany will probably postpone the deposit of its instrument of ratification with the EU Council, until August. This will trigger the sunrise period before the launch of the UPC and the Unitary Patent on 1st December 2017.

 

 

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Italy has signed the Protocol on the Provisional Application of the UPCA and other -good- news about ratification:

UK ratifies the UPC Agreement

On 20th February, at the EU Competitiveness Council, Italy signed the UPC Agreement on the Provisional Application. (See our post here on the Protocol). The Protocol on Provisional Application allows  “final decisions on the practical set up of the Court” to enter into application. This includes for example the “recruitment of judges and testing of IT systems“and  the registration of opt-out demands. So far 12 countries (including Italy) have signed it.

 

This was not the only  progress towards the UPC becoming operational that occurred recently:

  • On 8th February 2017 the German Parliament examined the draft legislation authorizing the ratification of the UPCA.
  • On 13th February 2017, the Spanish Socialist Worker’s party (PSOE)  called on the Spanish government to reconsider joining  the UPC.  It argues that not taking part in the Unitary Patent package is detrimental to the competitiveness and innovation of Spanish companies.  It notes that, regarding the language requirements, Spanish companies would not be in a different position than before the EPO.  The PSOE finally contends that Spain should asks for the transfer of the London seat of the UPC central division to Spain.

 

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