An uncertain future for IP

UK politics are dominated by competing factions in the planned referendum on EU membership, but business continues as usual in the day-to-day legislation and administration of European-wide law.

Such items include two regulations, the first of which entered into force on 20 January 2013 creating a unitary patent. The second, signed on 19 February 2013, and to enter into force as soon as 13 signatory states, including France, Germany and the UK, ratified it, created the jurisdiction of the Unified Patent Court.  

The court regime differs from that of the European Patent Office – created under the terms of the European Patent Convention (EPC) – which confers a single priority date upon patents filed within any one of 38 states, but under which success or failure of an attack on the patent in one state has no effect on the others.

However, 25 of the 38 EPC member states can participate in the unitary patent system. The latter permits the grant of one patent for all 25 participating states. The community trade mark system has worked in this way since 1996. Further, a patentee who has been granted an EPC patent for all signatory states of the unitary patent system can apply to have them unified into one unitary patent.

But there will be key differences with the unitary patent. The first is the location of the courts where disputes over unitary patents might be decided. Under the trademark system each individual state is conferred the right to designate certain courts ‘Community Trade Mark Courts’. So all 28 member states have a fair slice of legal pie.

By contrast, disputes concerning unified patents will only be heard in four of the 25 signatory countries. The seat of the Court of Appeal will be in Luxembourg and the courts of first instance will be in Paris, Munich and, thankfully, London.

Nor has the concept of forum shopping disappeared for unified patents. For example, as things stand, a patent owner looking for the most cost-effective forum for patent infringement might consider Germany. An impecunious defendant on the other hand might bring the action here, the most expensive territory from the defendant’s perspective.

But there are commercial advantages associated with the grant of a unitary patent. One thing which has dogged EPC patent owners since EPC patents were established is the need to translate a patent into the many different languages of the signatory EPC states as part of what is known as validation of the patent in each of the EPC states concerned.

For a simple mechanical patent with more diagrams than text, that might not create too much of a financial burden when contrasted with a pharmaceutical patent, which can run to a hundred pages of text.

The ‘London agreement’ was designed to reduce the number of translations by obtaining the agreement of EPC signatory states to waive their requirement for translations, but 12 countries still require a translation into their national language of either the patent specification or claims. Unitary patents do not require translations that are computer generated. It is also expected that the cost of applying for a unitary patent will be lower than that for applying for a bundle of patents for each of the 25 member states concerned.

As of the beginning of October, eight of the required 13 member states – including France, Germany and the UK – signed up to the protocol, which will now permit the appointment of judges for the Unified Patent Court and for the 19 February 2013 agreement to formally enter into force (now expected to be towards the end of 2016). Several more member states are said to be about to ratify.

And so to our UK referendum, promised by the end of 2017, in which an ‘out’ vote would mean any continuing UK participation in the system would end. With exit, the UK’s engagement in a unitary patent system would likewise cease, as the system is open only to members of the EU.

Mark Engelman is head of intellectual property at Hardwicke