European Union: Brexit

Last Updated: 1 February 2018
Article by Nina O'Sullivan and David Rose

The impact on patents and SPCs

Of all the IP rights, Brexit has the most limited impact on the existing system of patent protection and enforcement, albeit of course the referendum vote (and the subsequent General Election) has led to delay and uncertainty in respect of the UK's involvement in the proposed Unitary Patent and Unified Patent Court.

The European Union (Withdrawal) Bill provides that EU laws will be implemented as UK laws on Brexit day. Existing decisions of the European Court of Justice will have the force of Supreme Court decisions – this means that they can only be overruled by the Supreme Court or through new legislation. Once the UK has fully disentangled from the EU, however, it is not clear what status will be given to future CJEU decisions. The Bill states that "a court or tribunal need not have regard to anything done on or after exit day by the [CJEU] ... but may do so if it considers it appropriate to do so". Judges have called for more guidance with Lord Neuberger noting that: "if [the Government] doesn't express clearly what the judges should do about decisions of the [CJEU] after Brexit, or indeed any other topic after Brexit, then the judges will simply have to do their best ... But to blame the judges for making the law when Parliament has failed to do so would be unfair".

This may be particularly apposite in relation to the future treatment of supplementary protection certificates and CJEU decisions relating to SPCs. Under the Withdrawal Bill, the existing requirements relating to the obtaining of SPCs in the UK will continue, but agreement is needed to deal with issues of reciprocity and recognition. Further, the impact on issues of interpretation of the SPC Regulation will be studied closely. In recent years, the UK courts have made a number of referrals to the CJEU seeking interpretations of the SPC Regulation, with Arnold J, in particular, being heavily critical of the CJEU's decisions.

UPC: What next?

The ongoing uncertainty over when, or indeed if, the new Unified Patent Court and Unitary Patent regime will get off the ground shows no signs of abating. Following the hiatus caused by the UK referendum result, indications had been that plans were on track for a start date of December 2017. However, in March 2017, a new hurdle arose in the form of a challenge in the German Constitutional Court. Whilst the UK is continuing to press ahead with its plans for ratification (expected to be completed in early 2018), it is not yet clear what the timelines in Germany may be.

In the meantime, 14 Member States have ratified the UPC Agreement at the time of writing and so, assuming that the UK and Germany do proceed to ratification, the system will then be up and running. The UPC Preparatory Committee has issued an end of year update reporting on developments relating to the functionality of the court but recognising that, given the challenge in Germany, it is difficult to predict a new roadmap through to the court opening its doors.

The timing is crucial – depending upon when the German court reaches a decision, the UK's involvement in the project may be a distant memory. Of course, it is possible that the German complaint is dealt with fairly quickly and the UPC is able to open its doors for business later in 2018, with a three month 'sunrise period' for opting existing European patents out of the UPC before that. Whilst it's no surprise that many businesses will be putting their UPC plans on ice for now, it remains sensible to be finalising opt out strategies and procedures.

We do not want any cliff edges. We want minimum disruption for businesses, and we want to minimise threats to stability as we develop the deep and special relationship with the rest of the EU that we have set out as our objective for the negotiation...our future relationship with the UPC will be a matter for negotiation. It would not be appropriate for me to set out unilaterally what the UK's position will be in advance of those negotiations...the Government will continue to work with signatory states to bring the UPC into operation as soon as possible...

Jo Johnson, Minister for Universities, Science, Research and Innovation, Sixth Delegated Legislation Committee, 29 November 2017

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