UK: Brexit - What The Uk's Vote Leave Means For The Patents Ecosystem And UPC

On 23 June 2016, in a national referendum, the population of the UK by a narrow majority (52%) voted to leave the European Union (EU).

There is considerable uncertainty as to when (and, even, whether) the UK will exit the EU (a so-called "Brexit"). We also do not yet know the nature of the UK's ongoing relationship with the EU after any Brexit occurs, the specifics of which will impact some aspects of the intellectual property landscape in the UK. On the other hand, some areas of this landscape will not be affected.

We explain below what the UK's Leave vote means for the patents ecosystem:

  1. Vote Leave means nothing at the moment

    There has been no change to the law in the UK, which remains a member of the EU and is expected to do so for at least the next two years. Current EU (and incoming) legislation will continue to apply until the UK leaves. To the extent that EU law has been written into UK national law already it will remain in force indefinitely.
  2. The current European patent grant and enforcement system will continue to include the UK irrespective of any Brexit

    The existing system for the grant and enforcement of European patents, including European patents covering the UK, has been established by agreements made outside the remit of the EU. Consequently, irrespective of when and how any Brexit occurs, the existing system will not be impacted. A statement of the President of the European Patent Office (EPO) following the result of the UK's referendum confirmed this:
    "The Office underlines that the outcome of the referendum has no consequence on the membership of the UK to the European Patent Organisation, nor on the effect of the European Patents in the UK."

    The existing system provides for centralised application, prosecution and grant of European patents (as a bundle of national 'designations') in and by the EPO. The EPO can also hear oppositions filed within the first nine months of grant. Aside from this, questions of infringement and validity of each national designation is a matter for the courts of the relevant country.

    Companies and individuals from the UK, the EU and overseas will continue to be able to apply for and own European patents. All European Patent Attorneys, including those based in the UK, will continue to be able to represent their clients at the EPO. None of this will be altered by Brexit.
  3. The position regarding the new Unitary Patent (UP) and Unified Patent Court (UPC) system, which is in development but not yet operational, is less clear

    In recent years most member states of the European Union have been working together to introduce a new court system (the Unified Patent Court, or 'UPC') with jurisdiction to resolve patent disputes spanning much of the EU. The UPC, along with the new single patent right of equivalent scope (the Unitary Patent, or 'UP'), represents a fundamental change to the patents landscape in Europe. In various ways it supplements, complements and replaces aspects of the existing system.

    The UK's Leave vote is, in practice, likely to delay the introduction of the new UPC and UP system.

    This is because the treaty (the 'UPC Agreement') that establishes the system mandates (among other things) that participating countries must be members of the EU, that it will enter into force only following ratification by the UK, and that the location of a part of the Court of First Instance will be in London.

    It is theoretically possible that the UK could ratify the UPC Agreement before any Brexit takes effect, in order to get the new system operational. However, we consider this to be very unlikely. In any event, the location of part of the Central Division in London is likely to be considered by the other participating states to be an unsustainable oddity needing correction, by amendment to the UPC Agreement. Some countries could treat this as an opportunity to re-visit the wider negotiations. If the history in this area is anything to go by, agreement could take some time.

    Consequently, the UK's Leave vote is, in practice, likely to postpone any change to the current system for grant and enforcement of patents, not just for the UK, but for the whole of Europe. Whether the UK would be able to negotiate a way of remaining involved in the UPC and UP system in the circumstances of Brexit remains to be seen.

Concluding comment

The UK is home to many innovative sectors and businesses. It is also a key jurisdiction for high value and strategically important patent litigation. With the experience and standing of the UK's patent courts unaffected by any Brexit, there is every expectation that 'business as usual' will continue in the UK.

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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