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The Unified Patent Court – Overview and Background.

(A) The current situation:

Currently, national courts and authorities of the contracting states of the European Patent Convention are competent to decide on the infringement and validity of European patents.

In practice, this gives rise to a number of difficulties when a patent proprietor wishes to enforce a European patent – or when a third-party seeks the revocation of a European patent – in several countries: high costs, risk of diverging decisions and lack of legal certainty. Forum shopping is also inevitable as parties seek to take advantage of differences in national courts’ interpretation of harmonized European patent law and in procedural laws, as well as differences in speed (between “slow” and “quick” courts) and in the level of damages awarded.

The Unified Patent Court Agreement addresses the above problems by creating a specialized patent court, the “Unified Patent Court”, or UPC, with exclusive jurisdiction for litigation relating to European patents and European patents with unitary effect (unitary patents).

 

(B) The UPC Structure:

The UPC will comprise a Court of First Instance, a Court of Appeal and a Registry. The Court of First Instance will be composed of a central division (with seat in Paris and two sections in London and Munich) and by several local and regional divisions in the Contracting Member States to the Agreement. The Court of Appeal will be located in Luxembourg.

 

(C) Panel Composition:

The UPC panels will have both legally and technically qualified judges from all over Europe.

Panels in the local/regional divisions will be made up of three legally qualified judges. In addition it will be possible to appoint a technically qualified judge from a pool of judges, either on request of one of the parties or on the panel’s own initiative. For local divisions, two of the three legally qualified judges must be nationals of the contracting state in which the division is set up if this state has 50 or more patent cases per year. Otherwise, only one judge from this state will be required. For regional divisions the same rule applies with the condition that two judges come from the region.

Panels in the central division will be made up of two legally qualified judges who are nationals of different contracting member states and one technically qualified judge with qualifications and experience in the relevant technological field.  When hearing actions concerning certain EPO decisions, the panel will be composed of three legally qualified judges.

Panels in the court of appeal will be made up of three legally qualified judges who are nationals of different contracting member states and two technically qualified judges with qualifications and experience in the relevant technological field.

 

(D) Entry into force

The UPC will come into existence and start its operations immediately after the UPC Agreement enters into force.

As explained by the UPC Preparatory commitment, “the Agreement will enter into force on the first day of the fourth month after the fulfillment of the following two requirements (whichever is the latest):

1. The deposit of the thirteenth instrument of ratification, including Germany, the United Kingdom and France (the three Contracting Member States in which the highest number of European patents had effect in 2012).

2. The date of entry into force of the amendments to Regulation (EU) No 1215/2012 (Brussels I Regulation) concerning its relationship with the Agreement.[4]” The European Commission is expected to present a proposal during 2013. The necessary amendments can then be adopted and enter into force before the target date of the entering into force of the UPC in early 2015.

The Preparatory Committee is officially working towards early 2015 as a target date for the UPC to be set up.

 

(E) Implementation

The signatory states of the UPC Agreement are working together to ensure that the UPC is fully operational by the time the Agreement comes into force. To this end the Preparatory Committee oversees work in five main areas:

  • Legal framework of the UPC,
  • Financial aspects of the court,
  • IT,
  • Facilities,
  • HR & Judicial Training.

Each area has been assigned to a working group with the responsibility to develop proposals. The details and the target dates are established in the roadmap of the Preparatory Committee which is published on the official website of the Committee and can be found here.

 

(F) Enforcement of UPC decisions

Any ruling by the court on a patent will be simultaneously valid in all countries in which that patent has been validated and will be enforced under procedures governed by the law of the country(ies) where enforcement takes place.

 

 (G) Fees

The fee system for the court is yet to be finalized, but will be agreed upon by the participating Member States according to Article 36 (3) of the Agreement. In setting the fees Member States will need to balance the need to ensure the Court is accessible for users, especially SME’s, with the requirement in the Agreement that the system will eventually self financing.

 

 

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French Prime Minister submits bill for the Ratification of the UPC Agreement:

On October 23rd, the French Prime Minister Jean-Marc Ayrault submitted to the French Senate a bill authorizing the ratification of the UPC Agreement. It now needs to be discussed by the National Assembly (French House of Representatives) before being finally adopted. The Bill was however introduced under the “Procedure Accélérée” (expedited procedure), which limits the number of times a Bill passes between the two chambers (the Assemblée Nationale and the Sénat) and is usually used to speed up a bill’s progress. This is particularly noteworthy as France is one of the three mandatory ratification countries for the implementation of the UPC regime.

 

The bill can be found on the French Senate website.

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The Preparatory Committee has now launched expression of interest of Candidates Judges:

Brexit and the German constitutional challenge

On September 20th 2013 the Preparatory Committee launched a call for expression of interest for legally as well as technically qualified judges for the UPC. One of the priorities identified in the Preparatory Committee roadmap is in fact to contribute to the nomination process of the first group of candidate judges and to ensure the organisation of the training of candidate judges in the preparatory phase.  The closing date is 15 November 20.

 

For more information see the UPC website.

 

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Denmark might be joining the Unified Patent Court within the next few months:

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

According to the newspaper Berlingske Tidende the Danish Government has included a bill in its legislative proposals to join the Unified Patent Court. The Minister for Trade and European Affairs, Nick Hækkerup declared about the bill that “(the) roadmap is to publish (the government’s proposals) and argue why the parliament should support this. It’s so obviously in our interest because it would also protect the inventions that are being made in Denmark”. It will not however be straightforward for Denmark to join the UPC. In fact because Denmark has an opt-out from EU legislation on Justice, if more than 80% of its MPs decide to vote against the bill, the Danish government will need to call for a referendum.

 

More information here.

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Austria is the first Member state country to ratify the Agreement on the Unified Patent Court:

Protocol to the Agreement on a Unified Patent Court on provisional application

On 7th August 2013, Austria became the first country to ratify the Agreement on the Unified Patent Court. However for the UPC Agreement to enter into force, thirteen instrument of ratification, including Germany, France and the United Kingdom are deposited.

 

France introduced a bill for the ratification of the UPC Agreement on 23rd October in the French Senate. For more information see “News: Ratification of the UPC Agreement by the French Prime Minister”

 

In the United Kingdom, the UPC Agreement was laid before Parliament on 14 June 2013. The Agreement must also be given effect in UK law before it can be ratified. This will mean making changes to UK law to ensure that it complies with the provisions of the UPC Agreement. The first step of this process is provided for in the Intellectual Property Bill introduced into Parliament on 9 May 2013. Clause 17 of the IP Bill will enable the Government to make the detailed changes to UK law at a later date using secondary legislation which will be considered by both Houses of Parliament.


[1] Hyperlink

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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.