09 Dec European Unitary Patent

A streamlined system of management when it comes to patent holding and its renewals within Europe may come in to effect as early as January 2016 alongside a Unified Patent Court in order to enforce legal action or injunctions within all of the E.U as opposed to patentees having to take separate actions in each individual country a patent is held within. If fully effective and well stabilised, this move could prove to be a cost effective option for patent holders which offers a more simplistic approach to the management of their intellectual property rights – a welcome progression.

The Unified Patent Court is a system intent on specialising in intellectual property disputes: infringement, injunctions, revocation, compensation etc with exclusive jurisdiction for Unitary Patents, so on the one hand the only place a Unitary Patent dispute can be heard will be in a Unified Patent Court with a pan-Eurpoean ruling over those countries which the patent operates within but on the other hand, it will not hear a national validation case, meaning if you want to launch or defend an infringement claim regarding a patent filed outside of this new system, you will have to attend a court within the country the claim is filed within – although European patents granted to date will fall under the jurisdiction of the new Unified Patent Court through default for the first seven years of this roll out (during which time patent holders can opt out all together or extend for a further seven years).  The good news for patentees is that using the Unified Patent Court system will mean the action granted will have a blanket effect across each of the E.U countries your patent operates within but at the same time, a patentee might find a single revocation ruling completely obliterating all security the patent once enjoyed across the E.U.

The anxiety with regards to trusting such a new court is how effective it will prove to be in protecting a patent holder when a ruling affects a blanket of areas as opposed to national rulings in individual countries? How can we gauge the quality of this new Unified Court? So the ‘opt out’ choice is some security for those of us who might be a bit more cautious. Although it seems likely there will be an opt out fee in place for patent holders, it is worth paying this fee if you decide the choice is right for you, because within the space of time it takes you to make that decision, action could be taken against you and as soon as legal action is taken, you are no longer in a position to withdraw from the Unified Patent Court ruling process.  The court, although ruling with a unified set of procedures, will be broken up into a number of premises spread out across Europe with the central locations being London, Paris and Munich (the legal action subject matter dictating which court hears which case) with local division courts expected to be set up in individual EU countries. Within the central court hearings of the Unified Court model, proceedings will be heard in the language the patent in question is filed.

As of now, the EPO – an entity handling applications for around 38 different countries is in place, but with the introduction of the European Unitary Patent filings, comes a definition of ‘Europe’ which more closely resembles the European Union itself (comprised of 27 countries and completely isolating countries such as Norway and Switzerland). The EPO has done an amazing job in pilfering through laws in each country; creating a single system of patent management with mere subtleties in individual legislations and delivering that new ease of in-sync action to patent holders. Cost; however, begins to creep up with current European Patent application grants in the form of ‘national validations’ where a patent holder having received a grant by the EPO now has to validate that patent in each country they want it to hold protection within (subject to translation fees and alternate patent numbers). Also when considering current cost, we have to acknowledge potential court proceedings, although a patentee might have a European Patent being validated within chosen European countries, if legal action has to be taken, you still have to bring that action to each individual national court where infringement might occur.

With this new system, applications will of course be made in the same tried and trusted way – through the European Patent Office. The application system we are familiar with right now will undergo no real change, it won’t be until a grant has been awarded that we see a difference whereby holders will be invited to select a Unitary Patent status with only one validation fee for their granted application (in lieu of approaching a possible string of national patent offices for validation) and making only one translation into any other European language alongside an English copy (instead of having translated copies in each individual language of the countries the patent moves within). Although national validations will still require renewals in those countries not included in the new system, costs may very well work out much smaller e.g a country like Spain which isn’t opting in to the new system will still mean a translation saving if you choose Spanish as the ‘one other European language’ you make your initial filling with.

Although we know we can expect a savings with the implementation of the European Unitary Patent scheme, instead of paying annual renewal fees in each country of validation, we will only be required to make one unitary renewal payment – we don’t as of yet have any figures which will show us just how cost effective this change may be.  We do anticipate lower renewal fees for smaller entities, some speeches and articles already published anticipate the cost coming in as being equivalent to about five renewal fees, the average a patent holder’s portfolio consists of.  Holders with three patents for example, won’t actually have to opt in to using the Unitary Patent system if they find it more expensive than the conventional national validation system.

However, there are some concerns with regards to this new system, some of which have been raised by both Spain and Italy (who, some might remember, chose not to be a part of The London Agreement which came into effect in 2008) alongside Poland.  Fears that have been aired stem from all sorts of concerns regarding a Unitary Patent system, one of which, most sensibly is economic – whereby a particular country generating large business from foreign companies who need a European base to manufacture or export goods from – could be threatened or even put in legal danger by conflicting patent holders who own the intellectual property rights in other European countries.

With a single Unitary Patent, the hope is that costs come down for holders whilst protection improves, obviously one patent which offers the same protection as a group of separate national filings is a smart concept, cutting out the cost of translations and finicky renewal fees due on different dates for different amounts in each different country it seeks protection within.

It is estimated that it will be late 2015- early 2016 before the Unitary Court System is rolled out, with Unitary Patents following on three months from the date.

If you have any personal views on the matter which you’d like to share, please feel free to leave us a comment, we’d absolutely love to consider personal views on this new system.