The UK government has just now made it clear that the UK will not be taking part in the Unified Patent Court (UPC) or Unitary Patent (UP) system. This is a volte face on its previously publicised position, but comes as no great surprise. The UK ratified the UPC Agreement in April 2018 under Theresa May’s government, a commitment that would mean the UK would continue to be subject to some EU law and the jurisdiction of the Court of Justice of the European Union (CJEU), if participation were to continue post-Brexit. However, the current Government confirmed last week that the UK will not be taking part in the UPC or UP in any form, perhaps reflecting its desire to avoid ceding power in any sphere, no matter how limited, to the CJEU.
What does this mean for the future of the UP/UPC?
Plans to implement the combined package of the UP and the UPC systems have been stalled for some time. A constitutional challenge to the UPC Agreement in Germany has held up its implementation, because the UPC Agreement must be passed by the three biggest countries in patent number (Germany, France and the UK), before the UPC can be introduced. The UP will also not be introduced until the UPC is up and running. Now that the UK has confirmed it will not be taking part, the future of the UPC and UP systems is very much in doubt, as the remaining UPC member states will need to decide if the system is still viable without UK, and possibly German involvement.
Plans for London to host the UPC life sciences court under the UPC Agreement will also need to be reframed.
What does this mean for you?
The UP and UPC system will still be open to patentees in the UK upon grant of a European patent (EP), but the scope of protection simply will not extend to the UK, such that a separate UK validation of the EP will be required. European Patent Attorneys based in the UK will still act before the EPO and will be able to obtain UPs for clients anywhere in the world.
Under current plans, the cost of maintaining a UP will be equivalent to renewing a European patent (EP) in four countries. As would always be the case, patentees will need to decide if the broad EU protection offered by the UP is worth that renewal cost, as opposed to continuing to validate a European patent in selected European states (including in the UK, which remains part of the European patent system). The value proposition of the UP is certainly made worse by non-participation of the UK, especially considering that many patentees only choose to validate in a limited number (e.g. 3-5) of EPC states in any case, and the cost of UP plus UK protection would now be equivalent to renewal fees in 5 EPC states. The UP could well be unsustainable without German participation.
In terms of litigation, as the UK is no longer taking part in the UP and UPC systems, it will not be possible to litigate UPs here, such that European patents validated in the UK will only be enforceable via the UK courts. Many patentees are planning to opt out of the UPC system in any case, given the inevitable uncertainty surrounding the UPC – its untested judges, with no precedent to follow, and where the risk of fighting and losing would be to lose the whole UP, in all participating countries. The speed of the English courts, the predictability of English Patents Court and IPEC decisions and the high regard in which they are held around the world, will mean the UK will continue to be an important country for patent litigation, perhaps even more so in the light of the above.