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UK post-Brexit participation in unified patent court poses plenty of questions

28 September 2018 Eoin Ryan

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.

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