The Unitary Patent and the UPC – change ahead for patent protection in Europe
Unitary Patent (UP)
Since the establishment of the European Patent Convention in 1973 applicants have had access to a centralised application, prosecution and grant procedure managed by the European Patent Office (EPO). The grant of a European patent as a bundle of national designations has meant that national law applies to each designation for elements such as licensing and assignment and renewal fees. For a long while the multiple expense of annual renewal fees in, what could be, every member state country of the European Patent Convention (EPC) has been a hot topic of discussion. There are currently 38 EPC members including countries such as Turkey and Norway, and while it is not common for companies to validate their European patent in all member states the costs can still mount up.
Under the proposed new Unitary Patent (UP) system a new designation will become available called a Unitary Patent or ‘European Patent (EP) with Unitary Effect’. Once available an applicant may request a UP within one month of the EP grant and in this case a UP will be granted instead of a series of national validations. The UP will grant for those states that are signatories of the new scheme.
The advantage of the UP scheme will be that the UP will create a unitary right covered by one law, for assignments and licensing for example, along with renewal fees at current rates for a UP of €35,555 over the 20-year life of the patent. In addition, Unitary Patents will be covered by one legislative regime with access to the Unitary Patent Court (UPC), more of which below.
Timetable and Signatories
The Unitary Patent is not yet available and it will only be available to cover those EPC member states that have, at the time of patent grant, signed the UPC Agreement and have agreed to participate in the legislative regime. Spain, Poland and Croatia are at present not participating and the scheme is available to EU member states only.
The UPC Agreement has not yet entered into force and there are are complex provisions surrounding when the Agreement will enter into force depending on approval (ratification) of the Agreement by the UK, France and Germany (the three EU member states with the highest number of European Patents in force).
Countries that have already signed up to the scheme ahead of the Agreement coming into force are Austria, Belgium, Bulgaria, Denmark, Finland, France, Italy, Luxembourg, Malta, Netherlands, Portugal and Sweden.
The UK has indicated its intent to ratify the UPC Agreement, likely in autumn 2017. Germany is expected to follow suit soon after. The scheme and the UPC could be operational in early 2018.
Unitary Patent Court
The UPC is governed by a new treaty and will be a pan-European court system for pan-European enforcement of Unitary Patents. The flip side is that the UPC will also preside over what could be pan-European revocation.
At present the EPO can hear post grant opposition within nine months of the grant of a European Patent but after that cases on disputes – for invalidity, revocation and infringement – are heard before national courts in the designated countries in which the European Patent is validated and takes effect. This can lead to discrepancies in decisions in some cases and expensive multi-jurisdiction litigation over a patent.
The UPC will have jurisdiction over UPs and national designations of European Patents but not national patents (national GB, DE etc patents).
It remains to be seen if the threat of pan-European revocation will be a significant deterrent to potential users of the UPC system or whether the certainty and reduced cost of UP renewal fees will make it the choice for protection in Europe.
Preparation and ‘Opt Out’
The UP scheme and the UPC represent a significant departure in the status quo that applicants have become used to for European patent protection and litigation over the past almost 45 years. For this reason there is a transitional period envisaged when for at least the first seven years of the UPC it will still be possible to bring an action in respect of a Unitary Patent or a European patent in national courts (as is the case now) or to choose the UP route.
It is also possible, during the transitional period, if it is certain that the UPC would not be required to ‘opt out’. The ‘opt out’ route will remove the pending EP or granted EP in question from the jurisdiction of the UPC.
There is provision for a ‘sunrise’ period to enable these opt out choices to be pre-registered. The start date for the sunrise period has not yet been set.
The message is that change is on the horizon … but not just yet! Our view is that the Unitary Patent option and UPC could be operational in early 2018, and in terms of European Patent Office prosecution times, this is relatively soon. Applicants might want to consider delaying grant of European Patents until next year in order to take advantage of the Unitary Patent package availability.
In addition, applicants might well consider now whether they would, in the event of litigation, prefer the UPC route to national courts.
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