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The UK's future eligibility to participate in the Unified Patent
Court (UPC) and unitary patent system rests on a highly uncertain
and untested set of assumptions. Membership of the EU-wide patent
court is restricted to EU member states. Nevertheless, the UK
government has declared its intention to participate in the UPC
framework after the country leaves the bloc in March 2019.
If UK and EU negotiators are unable to conclude a withdrawal and
transition agreement in coming months, then the likelihood of the
UK participating in the UPC and unitary patent system plummets. A
comprehensive deal on the main tenets of withdrawal and transition
arrangements may create the necessary goodwill in the EU toward the
UK to break-down the barriers blocking UPC involvement.
Ratification of the Unified Patent Court Agreement (UPCA) was
completed by the UK in April 2018. However, the EU initiative for
collective rulings and the enforcement of intellectual property
rights (IPR) across 25 EU countries hit a roadblock pending the
outcome of legal challenges in Germany. Late November is the final
date for Germany to ratify the UPCA, and operationalise the court,
while the UK is still a full EU member, since the UPCA is intended
to come into force four months after a sufficient quorum of
countries have finalised the ratification process.
It is virtually certain that the UK will miss this
window of opportunity.
The next reasonable occasion when the UPCA could enter into
force is some time in 2019. This assumes German courts dismiss
legal challenges next year and that there are no further delays on
that end, something which is by no means guaranteed. At that point,
the UK could potentially petition for its inclusion in the UPC
system on the basis of a provisional understanding between the UK
and the EU, whereby the UK is treated as an EU member state for
some international agreements (including the UPCA) until December
2020, when the as yet unsigned transition agreement is scheduled to
end. That is not a tenable position for the UK to pin great hopes
on.
Moreover, even those prospects could be undermined if German
Federal Court hearings drag on, as that would postpone any chance
of implementing the UPCA by several years. The entry into force of
UPCA beyond the 21-month EU/UK transition period would inevitably
weaken the UK's political leverage and legal case for continued
involvement as a non-EU member state.
Proponents of the UKs continuing inclusion have suggested
amending the UPCA wording. This has received a certain amount of
pushback from EU policymakers. Taking this route potentially
entails re-negotiating and re-ratifying aspects of the
intergovernmental treaty. Secondly, this idea still rests on the
assumption that there is an appetite among EU countries to
negotiate a bespoke arrangement which recognises the UK as having
some sort of unique special status. Presumably, other European but
non-EU countries (such as Switzerland and Norway) would soon be
knocking on the EU door requesting their own special provisions. In
that scenario, the danger is that the UPC quickly loses its
standing as a common court to EU member states. Despite drawbacks,
amending the text of the agreement is still considered the most
feasible way of keeping the UK involved.
A great deal can potentially go wrong for the UK joining the UPC
initiative, let alone maintaining its membership. But European
policymakers have had the ambition to establish a common court for
patents for decades. That driving force is not going to be
diminished by the UKs potential non-involvement. In the unlikely
case that German courts upheld legal challenges against the UPCA,
it is entirely possible that the tenets of the agreement could fall
apart. But the non-participation of the post-Brexit UK - although
not ideal - is not considered an intractable problem for the EU to
handle.
Certainly, however, for pharmaceutical companies this creates an
additional layer of complexity and uncertainty over precisely what
kind of intellectual property protection they can expect across
Europe going forward.
