European Union: Demystifying The UPC And The Unitary Patent – Answers To Some Common Questions

The Unified Patent Court (UPC) and the unitary patent system are expected to commence on 1 June 2023. Until early December 2022, the UPC was advocating 1 April 2023 as the date of entry into force of the Agreement on a Unified Patent Court (UPCA) with the Sunrise Period commencing on 1 January 2023. The two-month postponement has been implemented to allow users to prepare for "strong authentication" required to access the court's Case Management System and to sign documents. In this publication, we demystify confusing terminology and misconceptions by providing answers to common questions on the UPC and the unitary patent system.

1. What is a Unitary Patent?

A 'European patent with unitary effect' (colloquially referred to as a Unitary Patent (UP)) is a European Patent (EP) granted by the European Patent Office (EPO) under the rules and procedures of the European Patent Convention (EPC), where after grant and at the patentee's request, the EP goes through a separate post-grant procedure to obtain unitary effect and thereby become a UP.

2. What is the procedure for the request for unitary effect for an EP?

The patentee must file a 'request for unitary effect' at the EPO. The request must be filed in writing, in the language of the proceedings, no later than one month after the date of publication of the mention of the grant of the EP in the European Patent Bulletin.

The request for unitary effect must also contain a translation of the EP:

• where the language of the proceedings is French or German, a full translation of the specification of the EP into English; or
• where the language of the proceedings is English, a full translation of the specification of the EP into any other official language of the EU.

3. Can a national patent become a UP?

There are no circumstances in which a national patent can become a UP.

4. What is the territorial scope of a UP?

A UP takes effect in all EU member states that participate in the unitary patent system. At the time of writing (December 2022), although there are 25 EU Member States that are signatories to Regulation (EU) 1257/2012 implementing enhanced cooperation to bring about the unitary patent system, only 17 of those member states have ratified the UPCA and are able to participate in the unitary patent system. The number of participating member states may increase over time.

Current participating member states:

Austria, Belgium, Bulgaria, Denmark, Estonia, Finland, France, Germany, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Portugal, Slovenia and Sweden.

5. What is the effect of a UP?

A UP has equal effect in all the participating member states, which means that it may only be limited, transferred or revoked, or lapse, in respect of all of the participating member states. A UP may be licensed in respect of the whole or part of the territories of the participating member states.

6. When will the unitary patent system commence?

The system will commence when the UPCA comes into force – the first day of the fourth month after the deposit by Germany of its instrument of ratification with the EU Council – with the commencement date currently expected to fall on 1 June 2023.

7. Can the grant of current applications for EPs be deferred until after the commencement of the unitary patent system, if the patent applicant is interested in obtaining a UP?

The EPO has decided to introduce two transitional measures from 1 January 2023 for EP applications for which a notification of intention to grant has been dispatched. An applicant of an EP will be able to:

8. Is a UP more cost effective than an EP?

This will depend on the number of member states participating in the unitary patent system in which the patentee requires protection. The EPO has provided informal guidance comparing the cost of a UP with the cost associated with the validation and maintenance of a classic EP. Based on their estimates, the overall costs for an EP validated in the four countries where patents are currently most often validated and maintained for 12 years are slightly higher (5%) than the renewal fees for a UP. This saving increases to 8% for patents maintained for 15 years.

9. What is the Unified Patent Court (UPC)?

The UPC is a common court for all the member states which are parties to the UPCA. It is a supranational court subject to the same obligations under EU law as any national court of a participating member state.

10. When will the UPC commence?

The UPC will commence on the first day of the fourth month after Germany deposits its instrument of ratification of the UPCA with the European Council. The current expected commencement date of the UPC (as of December 2022) is 1 June 2023, with a Sunrise Period to begin on 1 March 2023.

11. Where is the UPC?

The UPC comprises the Court of First Instance, the Court of Appeal and the Registry. The Court of First Instance is decentralised with a Central Division and Local Divisions. The seat of the Central Division is located in Paris, with a section of the Central Division also located in Germany. The Court of Appeal is centralised and is located in Luxembourg. The Registry is located at the Court of Appeal with sub-registries at every division of the Court of First Instance.

12. What is the UPC's jurisdiction?

The UPC will have jurisdiction on civil litigation matters relating to EPs, EP applications, UPs and SPCs (supplementary protection certificates)¹. However, during the transition period (initially seven years after the UPC commences), EPs and SPCs may be opted out of the UPC's jurisdiction (see further below on opting-out).

The UPC will have exclusive competence in particular for:

• actions for actual or threatened infringement and related defences;
• declarations of non-infringement;
• actions for provisional and protective measures and injunctions;
• revocations/declarations of invalidity; and
• counterclaims for revocation/declarations of invalidity.

Disputes relating to patent entitlement and patent licensing are not within the competence of the UPC.

In the early stages of the UPC, we anticipate disputes as to the exact scope of jurisdiction for the UPC versus national courts and the outcome will turn on the specific facts of each case until precedent case law develops sufficiently to provide more certainty.

13. What happens to EPs during and after the UPC transitional period?

There is an initial seven-year transitional period for the UPC, extendable by up to a further seven years. During the transitional period, the UPC has shared jurisdiction with national courts over infringement and revocation actions for EPs that are not opted-out from the UPC. After the end of the transitional period, the UPC will have exclusive jurisdiction over any EPs designated to participating EU member states that are:

As stated in the previous section, jurisdictional issues are not straightforward and should be revisited each time a new matter or issue is considered.

14. Can an EP be opted-out from the UPC's jurisdiction?

A patentee or applicant of an EP that is granted or applied for (as applicable) before the end of the transitional period can opt-out from the UPC's jurisdiction by notifying the UPC Registry, unless an action has already been brought before the UPC in respect of the relevant EP or EP application. The request for opting-out EPs can be made from the UPC's Sunrise Period onwards (currently expected to commence on 1 March 2023). The opt-out can be withdrawn subsequently at any time to restore the UPC's jurisdiction, unless an action has already been brought before a national court in respect of that EP.

15. Can a UP be opted-out from the UPC's jurisdiction?

It is not possible to opt-out a UP from the UPC's jurisdiction.

16. Can a national patent be opted-in to the UPC's jurisdiction?

It is not possible to opt-in any national patent, including national patents from UPCA participating member states, into the UPC's jurisdiction.

17. Who has rights of representation before the UPC?

Rights of representation before the UPC is mainly limited to:

• Lawyers authorised to practice before a court of a participating member state; and
• European patent attorneys entitled to act before the EPO and who have appropriate litigation qualifications (this includes UK based European patent attorneys with appropriate qualifications).

18. What are some relevant factors when deciding whether to opt-out from the UPC's jurisdiction?

There are various factors to consider in deciding whether to request a UP or whether to opt-out an EP from the UPC's jurisdiction before the end of the transitional period including:

• the likelihood and impact of central revocation. An EP can be centrally revoked if an opposition is filed before the EPO within 9 months of grant. In contrast, a UP or an EP that is subject to the jurisdiction of the UPC are at risk of central revocation throughout their lifetime;
• the ability to enforce a single patent and seek provisional measures (e.g. injunctions, seizure of products, freezing of assets) covering many countries in single proceedings;
• the appetite for litigating before a court which has yet to develop precedents, not only as to its rules of procedure and jurisdiction, but also in relation to substantive patent law;
• the cost of litigating before the UPC as contrasted to EPO oppositions and national revocation actions.

19. What is the UK's position in the unitary patent system?

The UK initially signed and ratified the UPCA, but it withdrew its ratification in July 2020. The UK will therefore not participate in the UPC or the unitary patent system.

20. Given that the UK will not participate in the UPC or unitary patent system, is the UPC or UP still relevant to UK businesses?

The UPC and the UP are still relevant to UK businesses, despite the UK not participating in either the UPC or the unitary patent system. UK businesses may:

• request that an EP have unitary effect;
• consider whether to opt-out EPs from the UPC during the transitional period;
• enforce any UPs and EPs that are not opted out from the exclusive jurisdiction of the UPC; and
• seek to revoke third party patents and SPCs that are subject to the exclusive jurisdiction of the UPC.

21. How can Arnold & Porter assist?

Whether it relate to a complex matter, multinational litigation or spurious enforcement actions, our IP team, with extensive experience and knowledge of patent litigation in Europe and the USA is well equipped to help clients navigate the complex matrix of European patent ligation venue selection choices (including in the UPC) and to formulate appropriate and proportionate strategies.

Footnote

1. References to EPs in subsequent sections should be deemed to also apply to SPCs deriving from an EP.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.