UK: Does The Triggering Of Article 50 Impact My IP Rights?

While there have been plenty of headlines about the triggering of Article 50 by the UK's Prime Minister, Theresa May, the situation surrounding IP rights remains stable. The final outcome of the negotiations around Brexit, which will now begin in earnest, is uncertain. However, no change is envisaged until March 2019 – the earliest date at which the UK would leave the EU. In some key areas of IP, no changes are envisaged at all.

No changes to European patent protection

We have the certainty of no changes to patent prosecution at the European Patent Office or at the UK Intellectual Property Office. The European patent system is based on the European Patent Convention, which is a non-EU convention. The UK is a founding member of the European Patent Organisation, which started with seven countries in 1977 and has 38 member states today. Several of the member states are not part of the EU and Britain's departure from the EU will have no effect on membership of the European Patent Organisation.

This means that UK and other applicants will continue to be able to apply for patent protection at the European Patent Office and validate granted patents in the UK and other EPC-contracting states.

The UPC and Unitary Patent continue

The UK's departure from the EU has, however, created uncertainty around its participation in the Unitary Patent and Unified Patent Court (UPC). Initially there were concerns that the UK might not proceed with the UPCA at all but the UK Government has since stated its intention to ratify the UPC Agreement. Jo Johnson, the UK Minister for Innovation, recently reconfirmed that the UK Government is committed to finalising the national ratification of the UPC treaty such that the UPC will become operational on 1 December 2017. This was also reconfirmed by a UK IPO statement following the triggering of Article 50. A lease has also been taken out on the premises that will house the London Local division and branch of the Central Division of the Court and is taking steps to complete the legal ratification process. Assuming the UK Government does ratify the Agreement, and the German Government also ratifies, the UPC and Unitary Patent will come into effect long before the UK leaves the EU.

The further concern is whether the UK will continue to participate in the UPC Agreement following the UK's departure from the EU. The stated intention of the UK Government is to remove the UK from the jurisdiction of the Court of Justice of the EU, which could be seen as incompatible with the UK's continued participation post-Brexit. On the other hand, the UK Government has also stated that it wishes to facilitate the freest trade possible with the EU. Depending on the outcome of the negotiations between the UK Government and the EU and other Member States, in particular regarding trade and competition, the UK may well continue to play a full part in the UPC, especially if the UPC – and the divisions located in London – is busy and successful and popular with industry. More information on the Unitary Patent and Unified Patent Court is available in our guide to the Unitary Patent and Unified Patent Court.

EU Trade Marks and Registered Community Designs

Until the UK actually leaves the EU, EU Trade Mark registrations (EUTMs) and Registered Community Designs (RCDs), will continue to have effect and be enforceable in the UK. Once Brexit has been finalised and implemented, existing EUTMs and RCDs may no longer provide protection in the UK.

We will not know the full effect of Brexit on EUTMs registrations until the terms of the UK's departure from the EU have been finalised. We anticipate that appropriate legislation will be implemented to ensure that such rights continue to have effect in the UK and would expect that transitional arrangements are put in place prior to the UK's exit. However, we do not know what form such transitional arrangements would take. Possible scenarios for the transition of EU registered rights to ensure continued protection in the UK could include the 're-registration' of EUTMs and/or RCDs as UK trade mark and design registrations, or a conversion-like process with EUTMs and/or RCDs converted into UK applications and examined by the UK IPO.

For EUTMs this could mean that:

  • Existing EUTMs are automatically entered on to UK register; or
  • The EUTM is divided and the proprietor makes a decision whether to extend protection to the UK; or
  • An EUTM provides a seniority right to apply for a UK trade mark registration.

 For RCDs this could mean:

  • A mechanism whereby existing RCDs can be 'converted' into the equivalent UK Registered Designs and retain the original filing/priority date, resulting in the existing RCD offering protection in the EU and the new UK Registered Design offering protection in the UK. 

For unregistered Community Design Rights this could mean:

  • The position here is more complex. UK design law already provides for a UK unregistered design right, but the rights afforded do not mirror those afforded by an unregistered Community Design Right. There are also differences in the validity requirements and the qualification criteria which may result in some designs potentially only attracting unregistered Community design protection but not UK unregistered design protection. Again, it may well be the case that transitional measures are made so that current unregistered Community Design Right, which only lasts for three years in any event, is not lost on Brexit. 

Exhaustion of rights

The limits put in place by the "exhaustion of rights" doctrine are intended to promote free trade in the European Economic Area (EEA), which includes all EU Member States plus some other European countries. Whether these rights will continue to apply to the UK after Brexit will depend on whether or not the UK remains a member of the EEA. If it does, then they will be unaffected. If the UK is outside the EEA, then it is possible that rights holders may be able to restrict imports coming into the UK from the EEA and resold and trade mark/design rights in force in EU member states could be used to prevent goods first sold in the UK from being imported and resold into the EEA.

Now is the time to review

While the triggering of Article 50 has brought no immediate changes to IP rights, now is the right time to review existing IP rights, agreements and strategies to ensure that they will continue to serve their purpose once the UK has left the EU, whether in March 2019 or afterwards. As the terms of Britain's departure from the EU become clearer, we will continue to provide updates on what Brexit will mean for IP rights.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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