Laura and Anne attended a webinar on the Unitary Patent (UP) and Unified Patent Court (UPC) held by D Young & Co http://www.dyoung.com/
Solicitor Richard Willoughby and patent attorney Rachel Bateman presented, and the session was chaired by Kirk Gallagher, also a patent attorney – the mix of professional specialisations reflecting the expected blend of expertise required for representation before the Unified Patent Court. The webinar introduced the UP and UPC and aimed to dispel some of the myths surrounding the new system.
So what is the unitary patent, or European patent with unitary effect?
The unitary patent is intended to remove the need for separate patent validation in different member states of the European Union (EU), and will provide a single patent right to be chosen after grant. The conventional European patent application process will remain the same up to this point. If chosen, the unitary patent will then be valid over all of the 25 participating member states of the EU. Initially, as a result of ratification at different times by different countries, fewer countries will be available. Not all EP contracting states will be covered: those that are not EU members (Iceland, Norway, Switzerland); also Spain (for language reasons) and Poland (cost-effectiveness considerations) are not included. The unitary patent will be in addition to, and will not replace, the present European patent system. National patents will remain unaffected by the UP/UPC.
What is the Unified Patent Court?
With the exception of opposition and limitation proceedings, which will still be held at the European Patent Office (EPO), litigation involving all unitary patents and those conventional European patents (EP) that have not been opted out will take place through the Unified Patent Court. The UPC will have a Court of First Instance (CFI) and a Court of Appeal. The CFI will be formed by local and regional divisions, mainly hearing infringement cases, and a central division, which will hear invalidity cases. The seat of the Central Division will be in Paris, with specialist sections in London (chemistry, pharmaceuticals and life sciences) and Munich (mechanical engineering).
Preparing for the UP and UPC
It is expected that the UP and UPC system may commence in the first half of 2017 (although a vote by the UK to leave the EU in the upcoming referendum would cause delay). By autumn 2016 a sufficient number of participating states will probably have ratified to allow a provisional application period to begin, during which registrations and opt-outs can be made before the Court officially opens. So patent proprietors need to be reviewing their patent portfolios and making some decisions with this in mind. For the present, issues to be decided include, in the case of new patent grants, whether to choose a unitary patent at grant; and whether to opt-out existing European patents from the jurisdiction of the UPC. Where there is co-ownership or licences are in place there may be implications as regards the UP.
This refers to a patent proprietor removing their conventional European patent(s) from the jurisdiction of the UPC, in which case these will be dealt with as before the UP/UPC system came into force. Unitary patents themselves cannot be opted out. Some proprietors may wish to see how the UPC develops before potentially become involved in it, in which case they will want to opt-out their patents before the UPC system begins. The UPC system will mean that patents (unless opted out) will be enforceable in a single action; however they could also be subject to a single revocation action in an as-yet untried system. In principle, the ability to “opt out” EPs will remain for 7 years after the commencement of the UP/UPC system. There will be no fee for opting out. Opt-out also applies to Supplementary Protection Certificates (SPCs).
Of course, relative costs, together with convenience, are at the heart of the success of the UP/UPC. Initial filing and prosecution costs are expected to be similar to those for a current EP, and no fee is involved for the choice of a unitary patent at grant. Separate fees payable to different countries’ patent offices and associated translation costs will not be payable under the UP. As for the renewal fees, these are based on a “top 4” comparison: i.e. the cumulative renewal fees for a conventional EP validated in Germany, France, UK and the Netherlands. When compared with current practice, the downside of the UP is its “all or nothing” character – it is not possible to “drop” countries as the life of the patent advances, so that fewer renewal fees are paid toward the end of the patent protection lifespan. Nor is it possible to pay a lower fee for filing in fewer countries. Depending on circumstances, this might mean that UP protection would be more expensive (and arguably less flexible) than the current EP system.
Comparative fee scale:
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A new kind of court
The UPC will have jurisdiction over both unitary patents and conventional European patents that have not been opted out. It will provide a single central forum for litigation, and is a completely new structure. UPC procedures are international, and are new. The Court will base its decisions on EU law, the UPC Agreement, other international agreements relating to patents that are binding in all the participating states (e.g. TRIPS, PCT) and national law. Representation is granted to attorneys-at-law and EU patent attorneys, since issues to be considered will include a wide range of legal areas such as jurisdiction as well as technical matters pertaining to the patent subject-matter itself. Judges will be a mix of legally-qualified and technically-qualified persons. As arguments will mainly be put in writing, technical writing skills will be important, for which patent attorney input will be needed. As regards fees, the UPC has a “loser pays” system, subject to a cap deemed “quite high” by D Young. The basis is a fixed fee, with additional “value-based” fees applicable to higher-value infringement claims or counterclaims. Small and medium enterprises (SMEs) can be given a discount of up to 40%. A scale of fees is available here:
One of the stated advantages of the UP system is that it would reduce the perceived burden of translation costs involved in the conventional EP system at grant. It is intended that after a transitional period of 12 years, during which it is hoped that the current machine translation system run by Google at the EPO (Patent Translate) will have a sufficient, and sufficiently accurate, language coverage, there will be no further requirement for “human” translation. In the case of dispute, translations may be required. During the transitional period, where the language of proceedings at the EPO is French or German, a translation into English will be required. Where it is English, a translation into any language of the EU will have to be provided. Translation costs will be reimbursed for non-profits filing in an official EU language other than English, French or German. As regards the UPC, local or regional divisions will normally use the local language plus the EPO languages. Most, if not all, will probably opt for English as one of these. The language of proceedings in the Central Division will normally be the language in which the patent was granted, although other arrangements are possible.
Our thanks to D Young for a very clear and informative webinar on this rather confusing topic! Any errors or omissions are ours alone.