After a delay of almost four years, the route to German ratification of the Unified Patent Court Agreement has been reopened by the decision of the Federal Constitutional Court of 23 June 2021, which was published yesterday. The FCC’s rejection of two applications for an interim injunction against the UPCA ratification bills means the German president can now sign them into law and Germany can complete all formalities. It brings a lot closer the start of the Unitary Patent system, although some hurdles must still be taken.

By Rainer Lück

The FCC’s decision concerns the requests for an interim injunction against ratification only, but the reasoning of the Court makes clear the main proceedings against the UPCA bills have no chance whatsoever to be successful.

“The Court rejects the applications for preliminary injunction on the grounds that the constitutional complaints lodged in the principal proceedings are inadmissible.

1) The complainants did not sufficiently substantiate the possibility that ratifying the UPC framework could indeed result in the rule-of-law principle, the fundamental right to effective legal protection or EU law being violated in the asserted manner.

2) The complainants in particular failed to demonstrate why and how the UPC Agreement, in its organisational structuring of the Unified Patent Court and in the legal status afforded judges, could violate the principle of the rule of law enshrined in Art. 20(3) GG in a manner that would also encroach upon the principle of democracy. Demonstrating an encroachment upon the principle of democracy would have been necessary given that it is this principle alone, enshrined in Art. 20(1) and (2) GG, that gives rise to the individual right of democratic self-determination that can be invoked by citizens through Art. 38(1) first sentence GG.”

Reaction Stjerna

Patent lawyer Dr. Ingve Stjerna, the complainant in matter 2 BvR 2217/20, acknowledged on his website that: “After the decision, also the main proceedings on the UPCA are now likely to be unsuccessful. The conclusion of the German UPCA ratification, which can now be expected shortly, will cause a binding effect under international law which cannot easily be removed. This also limits the possibilities of further legal action against the Agreement itself.”

Stjerna is critical of the FCC’s decision: “Already the first UPCA decision shows that its considerations are primarily politically dominated and that legal issues play at best a subordinate role. This is a necessary consequence of the close ties between the BVerfG judges and party politics. I had already pointed this out in 2018 in an article on the first UPCA constitutional complaint proceedings and raised the question how independent the examination by judges, who are appointed under political considerations, would be in this legislative project which was politically highly desired across party lines and passed with positive knowledge of all constitutional issues. With its decision, the BVerfG has once again made its contribution to the implementation of a legally questionable political agenda, and citizens’ trust in its function as “the guardian of the constitution” is likely to continue to dwindle.

There has not been a reaction from the complainants in the parallel case (2 BvR 2216/20), probably the Foundation for a Free Information Infrastructure (FFII) and its president Benjamin Henrion (and un unknown company).  Henrion published some tweets, in which he criticizes an element of the decision: “GFCC: ‘any transfer of sovereign powers to the European Union (or to an organisation that supplements or is otherwise closely tied to the European Union)’ UPC is not an EU institution”.

The FCC’s announcement came as a surprise to many. After a constitutional complaint had been filed against the German ratification bills for the first time in 2017, by Ingve Stjerna, it took the FCC three years to decide on the case (the complaints were partially upheld and the German parliamentary ratification procedure had to be repeated).

Still, in an interview with this blog last month, Kevin Mooney, one of the architects of the UPC system, explained this time it was different, as during the first case the Bundespräsident refrained from signing the UPCA bills into law at the request of the FCC. In the interview Mooney showed his frustration that the FCC had not yet made a decision on the requests for a preliminary injunction: “We had expected a decision very quickly, as soon as past January. (…) When there was no decision in January, there were many rumours it could come out anytime, but we’re in June now and we’re still waiting. I have to say I think it is disgraceful that it takes so long for the FCC to make a decision on the grant or refusal of preliminary measures.”

Late 2022

In a reaction to the publication of the FCC’s decision, Alexander Ramsey, Chairman of the UPC Preparatory Committee, welcomed “this positive development, with the way now being cleared for Germany’s deposit of its ratification Bill.”

He pointed out that: “In addition to this, in order for the project to move into its final phase, a further two signatory states must agree to be bound by the Protocol on Provisional Application [regulating the practical preparations for the UPC]. In the meantime, the work of the Preparatory Committee and its interim team continues. A timeline and a more detailed plan for the start and execution of the Provisional Application Period will be published in due course (…). ”

The idea is that after the phase of practical preparations, about 12 months, Germany will formally deposit its instrument of ratification with the European Council, thereby launching (three months later, art 89 UPCA) the Unitary Patent system.

Kevin Mooney doesn’t expect any progress before September: “In addition to Germany ratifying the protocol for the PAP period two other Member States are also required and that may mean further delay. I am sure the Preparatory Committee will now be lobbying hard the other Member States.”

Alexander Ramsay told JUVE Patent: “we expect Germany to ratify the protocol on provisional application in early autumn. (…) If everything runs smoothly, we can expect a functioning UPC late in 2022, or possibly early 2023.”

Before that time however, a solution will have to be found among others for complications resulting from the Brexit and the UK’s decision to withdraw from the Unitary Patent system. Italy and Milan have since long claimed the pharma branch of the UPC’s central division, which was meant to be located in London but will now have to go somewhere else. But other member states are interested as well and there are also proposals to leave all central division decisions to Munich and Paris, at least during an interim period.


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8 comments

  1. Thank you for demonstrating once again the psychological and intellectual condition of some ‘Team UPC’ members.

  2. Top3 countries where the most patents where filed were UK, France, Germany.

    Replacing UK with Italy is a gross illegal way to put the treaty into force in order to avoid renegociations.

    The VCLT do not allow for such creative interpretation.

  3. The new decision of the FCC does not really come as a surprise as the political atmosphere has changed at the FCC.

    For a start, the FCC is engaged in a battle about the supremacy of the EU law whereby the EU Commission is about to launch an action against Germany on its first decision relative to the Euro-Bonds in which the FCC was not satisfied with the guarantees against a mutualisation of debts between EU contracting states.

    Secondly the President of the FCC has changed and it is well know that the new president is a lawyer and whilst MP he made it abundantly clear that he was in favour of the UPC. He was MP just before his appointment to the FCC.

    Thirdly, it seems that minority of members of the 2d Chamber in the first decision have become the majority and the complaints were rejected for reasons which were evoked in that minority opinion: the Basic Law does not confer a right upon citizens that would allow them to subject all majority decisions taken by Parliament to a review of lawfulness.

    The decision of the FCC is nevertheless surprising when it states that Art. 20 UPCA simply aims to clear up any doubts as to the Agreement’s compatibility with EU law and has no bearing on the status quo in the relationship between EU law and national constitutions. Art 20 UPCA states that “The Court shall apply Union law in its entirety and shall respect its primacy.

    If the UPC shall accept primacy of EU law, how can it be on a par with national law and not prevail over the latter, and thus also over the German Constitution? Are we here in presence of a kind of “dynamic interpretation” in order to satisfy political reasons?

    It remains, as stated in the blog, that the problem with Art 7(2) UPCA is by no means resolved. We have already contenders for transferring the duties of the London Section to other member states of the UPCA. It is more than doubtful that the other countries will allow France and Germany to take over the “gift” offered by Brexit as a well-known French lawyer, proponent of the UPC, has constantly claimed.

    If France and Germany dispose of the duties of the London section, I could see a constitutional problem. In Germany and in the most contracting states of the UPCA, the notion of the legal/correct judge is a very important constitutional principle. Nobody can in principle manoeuver in order for a case to be attributed to a given judge. How is this principle guaranteed when instead of a judge which would have been sitting in London and meant to deal with cases in IPC classes A and C will be replaced by a judge sitting in Paris or Munich which is not meant to deal with those two classes? I do not have a reply, but simply raise the question. This problem does not occur in the UK which has a different system of designating judges, and since the UK is not any longer participating, it is not relevant.

    According to Annex 1 of the UPCA, IPC classes A and C shall be dealt with in London. IPC class F is foreseen for Munich and the IPC classes B, D, E, G and H to Paris. Is such a transfer of IPC classes possible without amendment of Art 7(2) UPCA and of Annex 1? Any interpretation one wants to give to Art 87(2) this Art is not a legal basis for agreeing subsequently of the transfer of the duties of the London Section to another contracting state and certainly not for the provisional transfer to Paris or Munich.

    The problem of Art 7(2) UPCA has been belittled in the accompanying note of the German Ministry of Justice to the members of Bundestag and Bundesrat. Neither Art 31 nor Art 32 VCLT allow a different interpretation of said Art 7(2) UPCA which is, in my humble opinion, crystal clear.

    It is to be noted that appointment of the judges for 6 years with a renewal possible has been considered by the FCC as not affecting the rights of the complainants. The FCC has ruled that the complainants have fail to address the question on why and how this affects the principle of democracy.

    In this respect, it seems that the FCC has forgotten a preceding judgement in which it accepted that judges could be appointed for a length of time but under two conditions: they have to be appointed as civil servants for life and not be reappointed.

    This comment by the FCC does not look too good for the complaints against the boards of appeal of the EPO still pending before the FCC.

    That members of the “Team UPC” want the latter to come into function as soon as possible is plainly understandable but certainly not a compelling reason.

    I am certainly not a nationalist Europhobe, rather the contrary. I am in favour of harmonisation of IP within the EU, or at least part of it, but I am not sure that the UPCA is the best instrument to this effect. I just wish to be convinced, especially in view of the numerous problems created by the Brexit.

    As the preceding commenter have given their name, I will do the same.

  4. For me the only possible solution is to amend the Protocol by removing any reference to the UK and to agree that if a seat is not available (e.g. London and Budapest) at the date of entry into force of the Agreement, a local seat, which is already available (e.g. Milan), temporarily takes its place.

    I cannot avoid to remark that in five years the Agreement could have been amended, when the “team UPC” tried to square the circle…

  5. @ Patent robot
    In theory your proposal is nice, but the problem is less at the level of the protocols than at the level of the UPCA itself.
    Art 7(2) UPCA exists as well annex 1 which is part of the agreement.
    It is difficult to see that a statement which is as clear as such in the agreement can be ignored and a replacement be decided just like this, the more since the change would only be temporary.
    Art 87(2) UPCA which has been envisaged to allow the change from provisional to permanent is not fit for the purpose of sneaking in another country:
    Art 87(3) provides that “The Administrative Committee may amend this Agreement to bring it into line with an international treaty relating to patents or Union law.”
    It is difficult to see that the change proposed would indeed correspond bring the UPCA into line with an international treaty relating to patents or Union law.
    Art 87(3) UPCA is just there to align the UPCA with legislation adopted by all the contracting state or new Union law which is transformed in national law.
    Art 87(3) UPCA avoids having to ratify an amendment of the UPCA if the corresponding legislation is already part of the national legislation in the contracting states.
    Art 87(3) UPCA is not there to fundamentally amend the UPCA.
    The only way of doing this correctly is to amend the UPCA and start a new round of ratifications.
    This would mean that the UPCA would be delayed for quite a while and the interest for it could, and most probably would, vanish.
    That is why any means to start the UPC as soon as possible is good for its proponents and why they refuse to amend the UPCA.
    On the other hand, how could a representative suggest to a client not to opt-out which an agreement being on such wobbly feet.
    The first party losing at the UPC would make everything possible to have the UPCA screened by the CJEU.

  6. “The first party losing at the UPC would make everything possible to have the UPCA screened by the CJEU.”

    The previous project of 2009 had its controversial rules of procedure to be approved by the CJEU. It was replaced on the UPC by being reviewed by the European Commission.

    Just ti remember that the complete UPCA was never submitted to the CJEU for a complete review.

  7. One wonders why the UPC proponents never wanted to submit the UPCA and its annexes to the EUCJ?

    They only ever claimed that that the UPCA is conform with EU law without ever proving it.

    How can an agreement allowing removal of a UPC judge from its office (by the Presidium) without having any means of redress be compatible with EU law?. See Art 10 of the Statute.
    At the same time the Commission launches an action against a member states for lack of respect of the judicial order.

    Only the prior opinion of the European Commission on the compatibility of the Rules of Procedure, or their amendment, with Union law is necessary, cf Art 41(2) UPCA. I could not find any legal requiring that the UPCA should be reviewed by the European Commission.

    It is one of the particularity of the English legal system that there can be part-time-judges. This has been taken over in the UPCA. I am not sure that on the continent the notion of part-time judge even exists. Now the UK has left the EU why should this system be kept for the UPC.

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