How to save the Unitary Patent project? As soon as the outcome of the UK referendum on a Brexit was known, discussions started behind the scenes about ways to adapt the Unitary Patent system so the UK can stay in.
According to Wouter Pors of Bird & Bird, a new scenario has come up to enable the UK to participate in the Unified Patent Court and even in the Unitary Patent: ‘If the UK ratifies the UPC Agreement, they can continue to be a participant even if they leave the EU. This only requires a small change of the Agreement by the Administrative Committee to open up accession for former EU Member States, being the UK.
The obligation to apply Union law, which is in the Agreement, needs to be met by the Court, but is not imposed on a non-EU Member State. The UK wants to participate in some kind of European Economic Area Agreement anyway, and in that case the CJEU would also have jurisdiction over legal issues relating to the internal market, so this is not much different. Besides, during the first 14 years the UK Courts would of course have jurisdiction over traditional European patents anyway, next to the UPC.
A further idea is that participation in the Unitary Patent could be achieved through an extension agreement based on article 142 EPC. This agreement would extend the uniform protection to the UK.
For now, the UK would just need to ratify the UPC Agreement, so that the Court and the Unitary Patent can start as planned. There will be a two-year time interval to negotiate the UK withdrawal agreement under article 50 of the Lisbon Treaty (Treaty on European Union) anyway, so that provides for enough time to also develop the necessary provisions for access to the UPC and the Unitary Patent. This would be crucial for effective protection of innovation in Europe, so let’s make every effort to make this a success.’
The Preparatory Committee of the UPC has not yet reacted to the Brexit vote. EPO president Benoît Battistelli issued a statement last Friday: ‘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. Concerning the Unitary Patent and the Unified Patent Court, the Office expects that the UK and the participating Member States will find a solution as soon as possible which will allow a full implementation of these so-long awaited achievements.’
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While I would love to have GB on board, I am afraid that this is not as simple as suggested in the above post.
To address the problems highlighted in CJEU Opinion 1/09, the then discussed Draft Agreement on the European and Community Patents Court (ECPC) was fundamentally changed by removing the possibility for non-EU states to participate. As a result, the current UPC Agreement is only open for participation by EU Member States.
It would be rather odd to now believe that this fundamental change, triggered by CJEU Opinion 1/09, was in fact completely unnecessary.
Also, it should not be overlooked that one of the entry into force conditions of the UPC Agreement is a change of Regulation (EU) No 1215/2012. It is clear from the amendment regulation No 542/2014 that the UPC is characterized as a court common to EU Member States, just like the Benelux court.
So, not only the UPC Agreement, but also Regulation (EU) No 1215/2012 would have to be changed to enable UPC participation by non-EU states as GB will be in the near future, assuming that this is possible notwithstanding CJEU Opinion 1/09 (which I really doubt).
Importantly, because the ECPC Agreement was meant to cover non-EU states as well, while its content overlapped with EU law such as the IPR Enforcement Directive, the EU itself would also be a party to the ECPC Agreement as the EU Member States have no competence to enter into international agreements with non-EU states in matters governed by EU law. This explains why the EU itself rather its Member States is a party to the Lugano Convention which matches Regulation (EU) No 1215/2012.
As the UPC Agreement does not allow for participation by non-EU states, the EU itself will not be a party to the UPC Agreement.
However, if things are changed so as to again allow participation by non-EU states, then again, the EU itself should also become a party to the UPC Agreement. This clearly is a rather fundamental change, which also has the rather fundamental consequence that the CJEU would see itself as competent to interpret the UPC Agreement (see e.g. paragraph 38 of CJEU Opinion 1/91). This would completely undo the effects of removing provisions on substantive patent law from the unitary patent regulation, and take the speed out of UPC procedures because many referrals to the CJEU will appear necessary.
I am also puzzled how GB participation in the UPC Agreement would respect the outcome of the Brexit referendum. Clearly, the unitary patent and the Unified Patent Court are both steps towards an ever closer Union, while the GB voters have just said that they do not want to participate anymore in our ever closer Union.
So, while I would have loved to have GB on board, I am afraid that the only practical way forward is formed by
– 2 minor amendments to the UPC Agreement, which can easily be adopted at a next EU Council meeting, viz. a removal of the need for GB to participate to allow the UPC Agreement to enter into force, and a change of the location of the chemical branch of the Central Division; and
– reducing the unitary patent renewal fees by the amounts of the GB national renewal fees, which is a neutral operation as GB will not longer be covered and as GB will not participate in the proceeds anymore. This step is necessary as if the difference between the unitary renewal fees and the sum of the DE+FR renewal fees becomes too large, too few European patents will become unitary patents, so that the new system will fail to contribute to the Internal Market without internal borders. The review of the unitary patent renewal fees can easily be done by the Select Committee of the Administrative Council of the European Patent Organization.
BREXIT, the Unitary patent and the Unified court
In my opinion the Unitary patent and Unified court were going ahead based on a number of poor compromises reached as a result of political wrangling in which the Brits had an important influence. If all this is held up now because of the Brexit vote, that’s a good thing because it gives time for a re-appraisal.
Is it too much to hope for that Brexit could lead to a positive re-thinking of the Unitary/Uniified arrangements that could now go ahead in a reformulated and simplified version without the UK?
For example, the following points spring to mind:
• No more clumsy three-headed monster for the Unified court. The proposed London branch was created to appease the Brits as a historic compromise. As of a UK exit, the London branch has no raison d’être. There is no need to transfer this branch somewhere else. The Unified court can have one central branch. Period.
• Under the present arrangement, for an English-language European patent to have unitary effect requires an arbitrary translation that serves no useful purpose. Also, is there any need for the translations from FR or DE? This counter-measure could and should be cancelled.
• The Rules of procedure for the Unified court could possibly be trimmed to remove no-longer-needed common law influence.
• It should (perhaps?) be possible to now come to an agreement on a common definition of infringement (like the former Community patent draft) and remove the references to national law.
• Last but not least, a Brexit version of the Unitary patent will have much less value. The proposed renewal fees must be drastically reduced.