"Brexit" and Intellectual Property – what more do we know?

Dr Catherine M. Jewell & Duncan J. Morgan | December 2016

Immediately following the announcement of the result of the UK referendum on membership of the European Union (EU), there were a number of articles in the media relating to the possible implications for Intellectual Property Rights and Representatives, not all of them particularly accurate.  Nearly six months later, there are still misconceptions being propagated.

In an update to our June article, here we answer some questions that have been raised since the referendum result, and set out some of remaining potential issues regarding patents, trade marks and designs.  Please feel free to contact us for more information, or if you would like us to advise on a particular issue.

1) "Has the UK already left the European Union?"

At present the UK is still part of the EU.  The result of the referendum does not have any legal effect on membership of the EU unless and until the British government decides to act upon it, which they have indicated an intention to do by the end of March 2017.

If and when they act upon the result, the government would have to notify the European Council of its intention to leave, starting a 2 year negotiating period during which the framework of the future relationship between the UK and the EU would be drawn up.  This period is extendable if both parties want more time to discuss the matter. 

The UK would not leave the EU at least until this period expires, unless, which seems unlikely, an agreement is reached beforehand.  Until then, the UK is still part of the EU and the existing laws and systems in respect of Intellectual Property remain unchanged.

2) "Will businesses need to re-file their patents in the UK, once the UK leaves the EU?"

No – patent protection in respect of the UK is obtained either directly through the UK Intellectual Property Office (UKIPO), or through the European Patent Office (EPO) which is not an EU institution.  Therefore, the status of existing UK and European patents and pending applications will not be affected by the UK’s exit from the EU.

For future applications, it is also important to note that the existing systems for applying for patents in respect of the UK will not be affected.  This means that you can continue to pursue patent protection in respect of the UK by:

(i) applying for a UK patent through the UKIPO;

(ii) applying for a European Patent through the European Patent Office and then validating your European Patent in the UK after the European application grants; or

(iii) filing an International (PCT) Patent Application and then pursing this via the UKIPO or the EPO as in (i) and (ii) above, at the appropriate stage.

3)a) "I have heard that the EU is switching to the Unitary Patent Scheme next year, which enables any party to obtain a single patent effective in all EU member states…" 

Firstly, it should be made clear that the Unitary Patent Scheme (more commonly referred to as the "Unitary Patent Package") is a proposed new system which will provide an alternative to a specific part of the system that is currently in operation at the European Patent Office.  It is not a replacement for the existing system.

At present, when a European patent application is granted by the EPO, the Proprietor then selects the Contracting States in which to "validate" the granted patent, resulting in a "bundle" of rights, i.e. a number of independent national patents which stand or fall individually and are enforced or challenged through the relevant national court systems.

Once the Unitary Patent Package is in force, however, when a European Patent Application is granted the Proprietor will have a choice with regard to how they cover certain countries.  Specifically, they will be able to choose between:

(i) requesting “unitary effect” in order to obtain one, single, indivisible patent which covers all of the EU-countries which are also Contracting States of both the European Patent Convention and the Unified Patent Court Agreement (this "unitary patent" would be enforced or attacked in respect of all of those countries through a single court – the Unified Patent Court); or

(ii) selecting one or more of these countries in which to individually "validate" their patent under the existing system, providing a number of independent patents which are enforced or challenged individually through the relevant national court systems.

Not all EU member states are participating in the Unitary Patent Package – Spain, Poland and Croatia do not participate.  In addition, the European Patent Convention includes countries which are not at present members of the EU, for example Iceland and Norway, and these countries are not part of the Unitary Patent Package either.  Thus, for these countries, the existing "validation" process will remain in use for obtaining patent protection via a European Patent Application at the EPO.

3)b) "…and that barring some sort of deal between the UK and the EU, British designers and brands will likely be excluded from this unitary patent."

No – British individuals, companies, designers, etc. would not be excluded from the Unitary Patent Package.  We fully expect that British applicants and proprietors will be able to obtain a unitary patent by requesting unitary effect upon grant of their European patent application, the same as applicants and proprietors of any other nationality.

The UK Government has recently announced its intention to proceed with preparations to bring the Unitary Patent Package into effect, such that the UK will be part of the system as originally planned.  Thus it is expected that the system will not only be available for use by UK nationals, but also that a Unitary Patent will cover the UK. 

In other words, to obtain UK patent protection via a European patent application through the European Patent Office, the existing "validation" system will continue to be available as a route at grant, and in addition UK patent protection will be available via a unitary patent.

There are still some points which will need to be resolved – for example, it is thought that for the UK to continue to participate in the unitary patent and Unified Patent Court after leaving the EU would require an international agreement with the EU and participating member states.  However, it is clear that European Patent Attorneys, including UK European Patent Attorneys, will be able to act before the Unified Patent Court irrespective of the UK’s participation, and the Unitary Patent package now looks almost certain to go ahead.

For more information on the Unitary Patent Package, see our summary article here.  Updates will be posted in our dedicated Unitary Patent Package section here.

4) "What about Trade Mark Registrations – will businesses need to re-file those in the UK, once the UK leaves the EU?"

UK Trade Mark Registrations will not be affected if the UK leaves the EU.  Likewise, rights accrued through use in the UK (such as goodwill which could be relied upon in an action for "passing off") which are based on English common law would not be affected.

The situation for EU Trade Mark Registrations is different, because these are single rights, covering the whole of the EU.  This means that, depending on the results of negotiations, following a UK exit from the EU, existing EU Trade Mark Registrations may no longer apply in the UK.

However, it seems highly likely that transitional provisions will be put in place so that proprietors of EU Trade Mark Registrations can avoid a loss of rights.  For example, arrangements for re-registration of an EU Trade Mark Registration at the UKIPO might be one solution, or partial conversion of the EU Trade Mark Registration to provide an additional UK Trade Mark Registration is another possible option.  It is fully expected that any such provision would carry the priority date of the EU registration across to the UK register. 

In such circumstances, we expect existing EU Trade Mark Registrations to continue to cover the other 27 EU Member States, but EU Registrations which had previously been used only in the UK would become vulnerable to non-use revocation unless they were put into use in other Member States, as "use" in the UK may no longer sustain a EU Trade Mark Registration.

The UK is a member of the International (Madrid) Trade Marks System, and use of this system by UK businesses and nationals would not be affected by the UK’s exit from the EU.

5) "And how about Design Rights?"

UK Design Rights, both registered and unregistered, will not be affected by the UK’s exit from the EU.

However, for Registered Community Designs (RCD), the position is expected to be very similar to that of EU Trade Mark Registrations outlined above.  In brief, pending the results of negotiations, existing RCD may cease to apply in the UK (subject to transitional arrangements) and applications for new RCDs may no longer cover the UK.

For those who currently are relying on Community Unregistered Design Rights, now would be a good time to consider obtaining registered protection.  

The UK government agreed in principle to become a member of the Hague International Design System in January 2016, and on the assumption that this is achieved before the UK exits the EU then there would be no change in relation to the ability of UK companies or citizens to apply for or own International Designs.

6) "Will I have to be an EU Citizen and/or Resident of an EU Country to apply for EU IP Rights?"

No – residence or nationality does not have any effect on whether or not an applicant is entitled to own European IP Rights.  This will not change.  UK citizens and residents will continue to be able to apply for European Patents and International (PCT) Patents, as well as applying for patents in the UK and elsewhere in the world.  Likewise UK citizens and residents will continue to be able to apply for EU Trade Mark Registrations and EU Registered Designs through the EUIPO.

7) "Will my British Patent or Trade Mark Attorneys still be able to represent me if the UK leaves the EU?"

Yes – Beck Greener will continue to represent its clients before the European Patent Office and the European Intellectual Property Office if and when a UK exit from the EU takes effect.  Beck Greener’s European Patent Attorneys will be able to act before the UPC, irrespective of the UK’s participation.

Summary

The UK is expected to remain in the EU for at least the next two years, during which the existing Intellectual Property provisions will be unchanged. 

After the UK has left the EU, the current patent systems via the UKIPO and EPO will remain unchanged.  The UK Government has announced its intention to proceed with bringing the new Unitary Patent Package into effect, and we fully expect that UK patentees will also be able to use this system when it comes into effect.

UK Trade Mark and Design rights will also remain unchanged, and the UK’s participation in the Madrid International Trade Mark System and the Hague International Design System is expected to be unaffected. 

With regard to EU Trade Mark Registrations and Registered Community Designs, which currently cover the UK, it is expected that there will be transitional arrangements put in place to avoid loss of rights in this regard if and when the UK leaves the EU.  New applications for EU Trade Mark Registrations and Registered Community Designs which are filed after the UK has left the EU may not cover the UK, but the national and international systems will be available to bridge this gap.

We will be monitoring developments and releasing further updates on the implications for Intellectual Property as the position becomes clearer.  In the meantime, if you would like advice or assistance, please contact us.