The proposed European Unitary Patent aims to provide a patent proprietor with uniform protection across Europe and is provisionally expected to come into effect from 1st April 2023.
It is worth noting that the term “unitary” patent is rather a misnomer as it will not extend to all 39 Contracting States of the EPC but will instead be a single patent covering those EU member states which have ratified the UPC Agreement.
Currently 16 of the 27 EU member states have done so – Austria, Belgium, Bulgaria, Denmark, Estonia, Finland, France, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Portugal, Slovenia, and Sweden, with Germany expected to ratify next month.
The Unitary Patent
A Unitary Patent will only require a single validated application and one annual renewal fee payable to the European Patent Office.
From 2nd January 2023, it will become possible to request the delay of grant, that is, to request that the issue of the decision to grant be delayed so that the mention of the grant in the European Patent Bulletin will be published on or immediately after the date of entry into force of the UPC Agreement in order to allow for registration of unitary effect for that European patent.
Whilst the current system allows for the lapse of a European patent in countries that become unimportant over life of patent, thereby saving renewals over the complete lifetime of the patent, this will not be possible with a Unitary Patent.
Instead, the full single renewal fee will have to be paid each year and the patent will remain in force in all 17 States for its lifetime.
The Unified Patent Court (UPC)
The UPC is a new international court common to 17 EU. With the entry into force of the Unified Patent Court agreement currently planned for 1st April 2023, the Court is due to open its doors and start to receive cases as from that date.
All European patents granted before this date, and validated in any of the 17 member states, will be under the jurisdiction of the Unified Patent Court unless opted out.
If no action is taken with regard to opting out in respect of a European patent, the patent will be under the jurisdiction of the Unified Patent Court and patentees will be able to sue an infringer across multiple states at once.
Similarly, a third party may apply for revocation of a patent in multiple states at once.
In particular, if a patent is not opted-out, the UPC will have exclusive competence in respect of that European patent validated in any of the 17 member states.
However, the exclusive competence will be subject to exceptions during a transitional period of at least seven years and actions may also still be brought at national courts for such patents.
If a European patent is opted-out, the status quo is effectively maintained.
Opting out of the European Unitary Patent
The period for opting out is currently expected to begin on 2nd January 2023, i.e., three months before the European Unitary Patent becomes operational, and patent and patent applications can be opted out from that date.
This allows the risk of an infringement action being brought across multiple states at once to be avoided. Once the Unified Patent Court becomes operational, patents may only be opted out provided no action has been brought before the Unified Patent Court.
It will be possible to withdraw a decision to opt out should the patentee change their mind. However, once an opt out is withdrawn, there is no further opportunity to opt out again.
Please note that opting-out requires the consent of all actual proprietors of the patent. It is thus important to know who effectively owns the patent in the 17 member states of relevance, including their names and addresses. All co-owners must agree with the opt-out.
If the actual proprietors differ from those currently recorded in national patent registers, for example because one or more transfers were not recorded, an additional declaration will be needed.
It will be necessary for you to check your licensing contracts to evaluate to what extent your licensees may need to be consulted on, or may even control, the decision to opt-out a licensed patent.
General advantages of not opting out of Unified Patent Court (for patentees):
- One single proceedings, also for preliminary injunctions, immediately enforceable in all 17 participating Member States
- UPC is set up to deliver decisions in roughly 1 year whereas some national jurisdictions take much longer
- compared to parallel enforcement actions in multiple jurisdictions before national Courts, litigation costs will usually be lower in UPC (only one representative for those 17 member states)
Disadvantage of Unified Patent Court and thus of not opting out (for patentees):
- patent can be invalidated with one single decision for all 17
The decision whether to opt out or not should be made on a case-by-case basis noting that the UPC is a new and untested court and we would err on the side of caution and advise opting out.
Questions to consider include:
- How likely is it that the patent will become subject of patent enforcement or revocation litigation?
- How many of the contracting member states will likely be affected?
- How important will it be to obtain immediately enforceable quick decisions for multiple jurisdictions?
Please note opt-out is only applicable to published European patent applications, granted and expired European patents. It will not be possible to opt-out Unitary Patents.
– Isabel Meenan