A big change in the European patent landscape will happen soon with the coming into force of the Agreement on the Unified Patent Court (UPCA) and the establishment of a Unified Patent Court (UPC) of the European Union (EU). As announced on December 5, the UPC will begin its operation on 1 June 2023, with a 2-months delay to the originally expected date of 1 April 2023. This change will permit patentees to maintain a single Unified Patent (UP) across most of the EU and, hence, covering one of the three largest economic regions of the world. The European Patent Office (EPO) will act as the patent grant and maintenance authority of the UP. There are various issues that patentees and patent applicants alike need to consider that are summarized below.
For a more extensive discussion, you're invited to review our longer read that may be found here.
- Coming Into Force and Effect
The UPC will open its doors on 1 June 2023. From this date onwards, a newly granted European patent may be converted into a single patent that covers all UP-member states[1]. Non-EU states, such as the UK and Switzerland, and other EU states that have decided to not join the UPC at this point, notably Spain and Poland, will require separate validation.
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The current, “classical” patent system will continue to exist for a transitional period of at least 7 years (extendible by another period of 7 years), meaning that patentees will also have the option, during this period, to follow the “classical” route and obtain a bundle of individual patents in different states (each falling under the jurisdiction of the respective national court)[2]. Additionally, for existing European patents, patentees will have the choice to yield these patents to the jurisdiction of the UPC or opt out and be under the jurisdiction of the relevant national courts, as before.
- Effect of the UPC
The UPC will have exclusive jurisdiction over issues of validity, enforcement, and other legal actions concerning European patents. These patents will include European patents that were validated as a UP, as well as existing national European patents that were not opted out of the UPC during the transitional period.
- Opting Out
Existing European patents will automatically fall under the jurisdiction of the UPC, but patent owners have the option to file an “opt-out” request to remove their patent out of the UPC system. Once opted out, the patents will remain under the jurisdiction of the national courts. The opting out procedure is relatively simple, although there are some important issues to carefully consider and follow for such opting out to have a legal effect.
Adopting a cautious, wait-and-see approach, by initially submitting an opt-out request, may be a good strategy, particularly for important patents. This, among other reasons, is owing to the yet unknown judicial standards by which the UPC will operate; albeit there are also good considerations for deciding to stay within the new UPC system.
- Sunrise Period
There will be a so-called “sunrise period”, that is scheduled to begin on 1 March 2023, during which owners of existing patents may start filing opting-out requests with the UPC.
Additionally, the EPO has introduced transitional measures, as of 1 January 2023, permitting owners of existing European applications that are in advanced prosecution[3] to file a request that the patent, once issued, will be a UP and that the grant procedure will be delayed until the UPCA comes into effect (likely 1 June 2023) to permit that.
- Patent Grant
After grant, an EP patent may be validated as a UP, currently covering 17 EU states that may expand to 25 in the future. In addition, the granted EP patent may also be validated as national patents in some non-EU states, notably the UK and Switzerland, and in those EU states that are not UP member states, notably Spain and Poland.
In some instances, validating the granted European patent as a UP in addition to national patents in one or more non-UP states, notably the UK, may be the prudent approach. In other instances, where patent protection in a limited number of states may meet business needs, the “classical” validation approach, ending up with a bundle of individual patents, may be the proper route.
- Maintenance
Maintenance of a UP will require payment of annuities. The annuities are set at a rate that is less than current accumulated annuities in 4 states. There are also cost and administrative benefits to UP over maintenance of a bundle of EP patents in individual states.
It should be noted that for all exiting EP patents, the exiting bundle annuity scheme will continue to exist even for those that are not opted out of the UPC.
The coming into force of the UP/UPC requires some careful consideration of owners of EP patents. The above summary is meant to highlight some issues but is not a substitute to seeking professional advice on this matter.
- Matters to Consider
- As of 1 January 2023: filing a request with the EPO to delay the grant procedure of relevant European patent application to be able to obtain a UP once the UPCA comes into effect.
- With immediate effect: review portfolio of existing European patents to decide on those that are to be opted out of the UPC’s jurisdiction (if any).
- As of 1 March 2023: Submit opt-out requests to the UPC for the selected European patents.
[1] There are currently 17 member states that have ratified the UPC Agreement: Austria, Belgium, Bulgaria, Denmark, Estonia, Finland, France, Germany, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Portugal, Slovenia, Sweden. More are expected to join later.
[2] Both the “classical” system involving a bundle of patents and the new UP may, at times, be used in tandem for optimal effect.
[3] After the EPO’s communication under Rule 71(3) has been dispatched
