While a draft Brexit deal is now on the table, question marks remain over whether it can be delivered. As such, the sensible course of action for intellectual property rights owners remains to plan for a potential 'no-deal' Brexit. The UK government recently published a number of technical guidance notes covering the economic consequences of a no-deal Brexit, that is, a departure of the UK from the EU on 29 March 2019 without an agreement on the terms of the withdrawal being concluded with the EU. The UK government stresses that it expects to conclude a deal, in which case there will be a transitional period lasting to 31 December 2020 during which nothing significant will change, so far as intellectual property rights are concerned. The guidance includes notes concerning the intellectual property regime that will apply in a no-deal scenario.
Basic patent law will not change following Brexit. However, EU law governs the regime for supplementary protection certificates (SPCs) for pharmaceutical products and agrochemicals in the UK. If there is 'no deal', the relevant EU legislation will be retained in UK law. Further, any existing rights and licences currently in force in the UK will remain in force post-Brexit. It is not anticipated that there will be any significant changes to the legal requirements or the application process concerning SPCs. The UK's SPC regime might over time vary from that in the EU but that would require new legislation that would presumably be preceded with full consultation of stakeholders.
The Unified Patent Court (UPC) is not yet established and is dependent on ratification of the Unified Patent Court Agreement by Germany (which itself is dependent on the outcome of an ongoing constitutional challenge). It is currently unknown whether the UPC will be operational before Brexit day, i.e. 29 March 2019. Even in a 'no deal' situation, the UK is committed to exploring whether it will be possible to participate in the UPC and unitary patent system. It is worth noting that the UK ratified the Unified Patent Court Agreement in April of this year, i.e. after having started with EU withdrawal process, which indicates that continued participation in the UPC is considered by the UK government to be politically acceptable, notwithstanding the fact that the UPC is required to apply relevant EU law in its decisions. If the UK is prevented from being involved with the UPC and unitary patent then patent protection and enforcement in the UK will continue just as it does now.
Trade Marks & Designs
EU Trade Marks (EUTMs) and Registered Community Designs (RCDs) are governed by EU Regulations. In the event that there is 'no deal', the Government will ensure that the rights in existing EUTMs and RCDs will continue to be protected and enforceable in the UK. This shall be achieved by providing an equivalent trade mark or design right registered in the UK.
Unregistered Community Designs (UCDs) are also governed by EU Regulations. Similarly, if there is 'no deal' the government will ensure that all UCDs which exist at the point of exit will continue to be protected and enforceable in the UK. Additionally, the UK plans to create a new 'supplementary unregistered design right' which will be the equivalent of the UCD in the EU.
Much of the UK's copyright law has its roots in international treaties and is not dependent on membership of the EU.
However, there are certain aspects of current UK copyright law which are derived from EU directives. These will be incorporated into UK law on Brexit so will not change, at least in the short term. One exception is sui generis database rights – following a no-deal Brexit, databases created in the UK are unlikely to qualify for database right protection under EU law. Certain broadcasting rights will be affected too. With the exception of such aspects, copyright law in the UK will be largely unchanged post-Brexit if there is 'no deal'.
Geographical food & drink names
Currently, food and drink manufacturers can protect the names of their products under EU Geographical Indication (GI) Regulations (Stilton cheese for example). Following Brexit, the Government shall set up its own GI scheme which will mirror the existing EU system. The precise details of the new UK scheme will be explored through a public consultation. It is currently anticipated that all current UK GIs will continue to be protected under the EU schemes. If this is not the case, UK producers will need to submit applications to the European Commission as 'third country' producers.
Exhaustion of intellectual property rights
The current position is that intellectual property rights are considered to be 'exhausted' once a product has been placed on the market in the European Economic Area (EEA) with the right-holder's consent. In a 'no deal' scenario the UK will provisionally and unilaterally continue to recognise the EEA exhaustion scheme. The Government will then consider options for and consult on the long-term future for the exhaustion of intellectual property rights in the UK. Accordingly, we do not anticipate any changes to the position for the importation of goods into the UK post-Brexit in the short term. However, it should be noted that this is an asymmetric arrangement. For the remaining EU/EEA members, the UK will have left the EEA (in a 'no deal' scenario) on 29 March 2019, meaning that goods placed on the market in the UK will not be treated as having exhausted intellectual property rights in the EEA. There may therefore be restrictions on exporting goods from the UK to the EEA. (GBH/TT)
Regarding the life-sciences sector, the Government's notices include updates on the regulation of medicines, medical devices and clinical trials, submitting regulatory information on medical products and batch testing medicines in the event of a no-deal Brexit.
The notice outlines how the UK plans to deal with Marketing Authorisations (MAs). Current granted EU Centralised MAs will be converted into UK MAs via a grandfathering procedure. Centralised MAs which have been submitted but have not yet been granted will need to be resubmitted as a UK MA, but the UK has suggested the MHRA will take EU Committee for Medicinal Products for Human Use (CHMP) opinions into account.
The notice states that the UK is not proposing any changes to the data and market exclusivity periods for UK MAs. Importantly, it states that under a no-deal scenario the start of data or market exclusivity will be the date of authorisation in the EU or UK, whichever is earlier. This may have an important impact on the term of data and market exclusivity available in the UK because in the event that a pharmaceutical company receives EU MA approval faster than UK MA approval, it appears the earlier EU MA will trigger data and market exclusivity in the UK, irrespective of when the later UK MA is granted. Such an approach may be designed to incentivise pharmaceutical companies to apply for a UK MA early.
In relation to paediatric medicines and orphan medicines, the technical notice states these provisions will be subject to consultation. As such, it is possible that the current paediatric extensions and orphan market exclusivity regimes available in the UK may be affected.
In relation to parallel imports, the technical notice states that in the event of a no-deal Brexit, the UK will unilaterally align to the EU/EEA exhaustion regime on exit day to provide continuity in the immediate term for businesses and consumers. The notice flags, however, that the UK has not decided how to manage exhaustion of rights longer term but states that any substantial changes to the exhaustion regime will occur only after a full research programme and consultation.
Currently, the rules which govern the collection and use of personal data are set at an EU-level by the General Data Protection Regulation (GDPR). In the UK, the Data Protection Act 2018 (which came into force on 25 May 2018) incorporates and supplements the standards set out in the GDPR and ultimately provides for a comprehensive data protection framework.
The GDPR itself states that organisations are free to transfer personal data within the EU however are only permitted to transfer personal data outside of the EU if there is a legal basis for doing so.
At the beginning of this year, the House of Commons Digital, Culture, Media and Sport (DCMS) Committee highlighted in its report that retaining the ability to transfer data across EU borders is a fundamental issue to many UK technology businesses.
The report stated: "The success of the UK's digital economy is underpinned by ongoing data transfer across the globe and particularly within the EU [...] It is important to recognise that Brexit creates a potential risk that the UK's ability to transfer data across borders will be limited".
Bearing this in mind, what would all of this mean for the UK should there be no deal?
The UK government has confirmed that should the UK leave the EU with no agreement in place regarding future arrangements for data protection, there would be no immediate change in the UK's own data protection standards. This is because the Data Protection Act 2018 would remain in place and the EU Withdrawal Act would incorporate the GDPR into UK law to sit alongside it.
The UK government has confirmed that should the UK leave the EU in March 2019 with no agreement in place regarding future arrangements for data protection, there would be no immediate change in the UK's own data protection standards. This is because the Data Protection Act 2018 would remain in place and the EU Withdrawal Act would incorporate the GDPR into UK law to sit alongside it.
Albeit the free flow of personal data from the UK to the EU would largely be unaffected following a no deal scenario, the issue arises in the converse; where personal data is transferred from organisations established in the EU to those established in the UK, as the legal framework governing such would change on exit.
The EU already has a mechanism which allows for the free flow of personal data to and from countries outside of the EU. The European Commission has previously stated that if the UK's level of personal data protection is deemed to be effectively equivalent to that of the EU (i.e. the GDPR), it would allow the transfer of personal data to and from the UK without restriction.
The UK government notes in its July 2018 White Paper "The future relationship between the UK and the EU" that it believes the EU's adequacy framework provides the right starting point for data protection arrangements between the UK and the EU after Brexit. The White Paper emphasises that the UK and the EU start their extensive agreement on the exchange of personal data from a unique position of trust in each other's standards and regulatory alignment on data protection. It also supports the ongoing cooperation between the UK's Information Commissioner's Office and EU Data Protection Authorities.
However, given that the granting of any such "adequacy decision" is not certain, the DCMS suggests in its guidance published on 13 September 2018 that it is worth considering an alternative legal basis for the processing of personal data; namely, the use of standard contractual clauses. In short, this means that by including any model European Commission pre-approved data protection clauses within your contracts with EU customers (and ensuring that their respective customers enter into the same) you would have the required lawful basis to transfer personal data to and from the EU following Brexit.
Community Plant Variety Rights (CPVR)
In the event of a no-deal Brexit, granted CPVRs held by UK businesses in March 2019 will continue to have effect in the remaining 27 EU member states, and will be automatically recognised and protected under the UK Plant Varieties Act. The guidance stresses that no action will be required by CPVR owners to convert this right.
Any pending CPVR applications that are not granted by 29 March 2019 will not be extended to cover the UK. As such, any breeders wanting coverage in the UK will need to make a separate application for a UK PVR to be examined under UK legislation. The UK application must be filed with the Plant Variety Rights Office (PVRO) and will be subject to the usual criteria – that is, the variety must be new and must also pass the DUS (distinct, uniform and stable) testing, which will be carried out by NIAB. It is unclear how the PVRO will deal with existing CPVR applications where the variety has already been sold post CPVR application but before application for a UK PVR. It would make sense for the application date of the CPVR to be treated as the UK PVR application to avoid any potential novelty issues, yet the guidance makes no comment on this point. As such, it may be wise for rights holders to start reviewing their current filing strategy and consider concurrently filing for CPVR and UK PVRs going forward.
Post March 2019, to obtain the same geographical coverage as pre-Brexit two separate applications will be required – a CPVR and a UK PVR application. While this carries an obvious cost implication for breeders, the guidance sets out that APHA are reviewing their processes with the aim of reducing their fees. One suggestion appears to be to accept DUS results from EU member states. On the flip side, it seems that the Community Plant Varieties Office will not accept the results of UK DUS testing.
Breeders wishing to market their new variety in both the EU and the UK will need to separately apply for listing in the EU Common Catalogue and the UK National Listing. In terms of certification, the guidance discusses that the UK would apply for its certification processes to be considered as a "third country recognised by the EU as equivalent for seed certification".
For varieties that are however already registered on the EU Common Catalogue but are not on the UK National Listing, the UK government will automatically add these to the UK list for a period of two years after a no-deal Brexit.
While this notice sets out the bare bones of the implications of a no-deal Brexit on plant breeders rights, the finer details have yet to be considered. If, on the other hand, agreement is reached between the UK and the EU regarding the terms of the UK's withdrawal from the EU, then CPVRs will continue to operate in the UK just as they do know, at least until the end of the transitional period that is proposed to operate until 31 December 2020.
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.