UK: Brexit And Your IP As The Transition Period Ends

Brexit and your IP as the transition period ends

The Brexit transition period ends on 31 December 2020 and there will be changes to your trade mark and design rights from 1 January 2021.

Your patent rights are not affected by Brexit.

Appleyard Lees are ready for the changes and to assist you with your IP rights in the UK, EU and indeed the rest of the world so you can trust you are in safe hands. You may have questions though and if you do we would be happy to hear from you. If you would just like to know the key changes and things to be thinking about then those are set out below.

New UK rights post-Brexit

On 1 January 2021, all existing EU Trade Marks (EUTMs), Registered Community Designs (RCDs), Unregistered Community Designs (UCDs) and international design and trade mark registrations designating the EU will no longer provide any protection in the UK.

However, the Withdrawal Agreement contains provisions relating to IP rights that will ensure the continued protection of existing EU IP rights in the UK beyond 31 December 2020.

Existing EU trade mark and design registrations

All existing EUTMs and RCDs contained on the EUIPO database and international trade mark and design registrations covering the EU will automatically be cloned by the UKIPO to create 'UK comparable rights'.

These new 'comparable rights' will only apply to the UK and will:

• Be assigned a new unique registration number but not issued a new registration certificate;
• Be recorded on the UK register and retain the filing dates recorded against the corresponding EU right;
• Be fully independent UK trade marks and designs which can be enforced, challenged, licensed or renewed completely separately from the remaining EU right;
• Require an address for service.

The process of creating UK comparable rights is free of charge and owners of EUTMs, RCDs and international trade mark and design registrations covering the EU will not have to take any action.

For our clients we have already entered these new 'comparable rights' into our records systems ready for 1 January 2021. If you are not yet a client but would like Appleyard Lees to be responsible for new 'comparable rights' we would be happy to hear from you.

Pending EU trade mark and design applications

Any pending trade mark and design applications which are before the EUIPO on 31 December 2020 will need to be re-filed with the UKIPO to pursue UK protection and will require a UK address for service. The holder of such applications has a period of 9 months from the end of the transition period to make this re-filing at the UKIPO to maintain the filing date of the corresponding EU application.

For our clients we will be reviewing any EUIPO cases pending at 1 January 2021 and contacting you to advise regarding re-filing in the UK where applicable. If you are not yet a client but would like Appleyard Lees to attend to UK re-filings or advise on re-filing strategy we would be happy to hear from you. We have special discounted rates for re-filings.

Deferred publication of RCDs

Under new law post-Brexit, any RCDs that are currently deferred on 31 December 2020 will be treated as being equivalent to pending design applications. The holders of such deferred RCDs will also have 9 months after the end of the transition period to re-file the application in the UK with a UK address for service to maintain the earlier filing and priority dates of the corresponding EU right.

It would thus be possible to avoid UK re-filing costs by requesting an end to deferment before 31 December 2020. We are contacting our clients to discuss whether ending deferment early is appropriate. If you are not yet a client but would like to discuss strategy anyway we would be happy to talk.

Unregistered Community Designs

On 1 January 2021, the UK protection afforded by UCD rights will be immediately and automatically replaced by UK continuing unregistered design rights. These will be protected in the UK for the remainder of the 3-year term that was attached to the corresponding UCD.

Alongside UK continuing unregistered design rights, there are also other means to protect designs in the UK after the end of the transition period without a registration including the new Supplementary Unregistered Design (SUD). However, the interactions and qualifying requirements of the various unregistered rights are complex and we would always recommend you consider registering designs.

For a look into common FAQs regarding UK comparable rights post-Brexit please take a look at our recently published article at https://www.appleyardlees.com/new-uk-comparable-rights-post-brexit/.

Alternatively, if you wish to speak with one of our qualified attorneys regarding your UK comparable rights, please get in touch.

Genuine use and evidence of use post-Brexit

UK and EU trade mark registrations can become vulnerable to cancellation for non-use by third parties if they are not genuinely used as trade marks for a period of 5 years after registration or for an uninterrupted period of 5 years.

Currently, for EU marks evidence of use can come from any of the member states covered by an EUTM (which includes the UK). This has a number of implications when the transition period ends.

Evidence of use for EUTM's

Any use of the mark in the UK before 1 January 2021 (whilst it was in or treated as in the EU) will be taken into account by the EUIPO. However, any use of the mark in the UK after the end of the transition period will not be taken into account by the EUIPO.

Evidence of use for UK Comparable rights

For a standard UK trade mark only use in the UK counts to prove use but the position will be different for the new UK comparable rights. Any use of the mark in the EU, that was made before 1 January 2021, regardless of it being inside or outside the UK, will count as genuine use of the UK comparable right if it is challenged.

Therefore, any use of the mark anywhere in the EU before 1 January 2021 will be taken into account by the UKIPO. However, any use of the mark in the EU after the end of the transition period will not be taken into account by the UKIPO.

Parallel trade post-Brexit

At the end of the transition period, the current EU-wide (including the UK) exhaustion regime will no longer apply in the UK and instead, the Intellectual Property (Exhaustion of Rights) (EU Exit) Regulations 2019 will provide new rules.

The current exhaustion regime in the EU allows for parallel trade, that being the import and export of genuine goods across the EU and the EEA. Parallel trade will only occur once the intellectual property rights associated with those goods have been 'exhausted', that meaning that have already been placed on the market by, or with the permission of, the IP rights holder. Once these IP rights have been exhausted, this means that the IP rights in question cannot be used to stop the free trade of these goods across the EU/EEA.

From 1 January 2021, goods which are placed on the market in the UK by the rights holder or with their consent, may no longer be considered exhausted in the EEA/EU.

This means that businesses exporting goods which are IP-protected after 1 January 2021 from the UK to the EEA/EU might need the consent of the IP rights holder.

This position has not been mirrored for exports from the EU/EEA to the UK and those imports remain unaffected after the transition period and can be freely moved from the EU/EEA to the UK. This means that those who are exporting goods placed onto the market in the EU/EEA by, or with the rights holders consent, do not need further permission to export those goods into the UK.

This position does seem unfair to those exporting goods from the UK and there is still a sense of ambiguity around what the exact exhaustion regime will be with the UK government planning to publish a formal consultation in January 2021.

The UKIPO has issued some guidance for both the parallel exporter and the IP rights holder which can be found here.

If you would like further advice regarding your current export/trade agreements, or surrounding the changes to parallel trade after the end of the transition period, please contact us.

What you should do to get ready

Whilst UK comparable rights of EUTMs, RCDs and UCDs will be created automatically by the UKIPO at the end of the transition period, there are still a number of things to consider doing before 31 December with perhaps the most important being to:

• Review any current parallel trade arrangements;
• Consider ending any RCD deferments currently in place; and
• Review the status of any applications or actions pending at the EUIPO (EUTMs and RCDs).

As a firm, we have been busy making preparations ready for Brexit and Appleyard Lees is ready to ensure the smooth management of your trade mark and design portfolio.

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.