Unified Patent Court and Unitary Patent finally to become reality

After Austria deposited its instrument of ratification of the PAP Protocol on 19 January 2022, the provisional application phase of the Unified Patent Court Agreement has started. This means that the Unitary Patent system will now gradually come into effect. As soon as the Unified Patent Court has become fully operational, Germany will cause the Unified Patent Court Agreement to enter into force, which is expected for the beginning of 2023.

For this reason, Taylor Wessing is launching a series of updates and a dedicated UPC website. We will explain the key aspects of both the Unified Patent Court and the Unitary Patent and highlight the associated action items, opportunities and risks for patent owners and potential patent users to be considered before and after the Unified Patent Court Agreement enters into force. Please register here for regular updates: sign-up here and visit our dedicated UPC website.

The Unitary Patent system is set up to create a common one-stop-shop patent protection and litigation system for all participating EU Member States: For the very first time, Europe will get one single patent with the Unitary Patent (“UP”) and one single litigation system for the major part of the European market - the Unified Patent Court (UPC). The decisions of the UPC will have effect in the whole territory of participating EU Member States, be it injunctions and damages for patent infringement or the revocation of patents. As a result, the UPC covers a market of about 350 million people that is comparable to the US.

Unitary Patent

The Unitary Patent allows applicants to obtain one uniform legal title for patent protection in all participating EU Member States by submitting a single request to the European Patent Office (EPO). The procedure for grant is identical to that for a European patent. In contrast to the European patent, the Unitary Patent will have unitary effect for all participating EU Member States after its grant.
Furthermore, Unitary Patents will extend to patents filed and granted as European patents, for which no opt-out is declared and which have the same claims in all participating EU Member States.

Unified Patent Court

The Unified Patent Court (UPC) is an international court set up by participating EU Member States to deal with the infringement and validity of both Unitary Patents and European patents with exclusive jurisdiction.
The decisions of the Unified Patent Court will apply in the participating EU Member States, specifically for actions for injunctions and damages for patent infringement as well as for the revocation of Unitary Patents and European patents.

The 17 EU Member States which have ratified the Agreement on a Unified Patent Court (UPCA) and which will participate in the Unitary Patent system when it starts are: Austria, Belgium, Bulgaria, Denmark, Estonia, Finland, France, Germany, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Portugal, Slovenia and Sweden. The seven EU Member States that have signed but not yet ratified the UPCA are: Cyprus, Czech Republic, Greece, Hungary, Ireland, Romania and Slovakia. 

Timeline

Almost all formalities have been fulfilled and the UPC is on the home stretch. Germany completed the final ratification of the UPCA in September 2021, but – as agreed by the participating EU Member States – has not yet deposited its instrument of ratification required to complete the process.

In order to ensure the immediate functioning of the UPC after the entry into force of the UPCA, certain parts of the UPCA are to be provisionally applied in advance, as regulated in the Protocol on the Provisional Application of the UPCA (PAP Protocol). On 19 January 2022, after the deposit of Austria’s instrument of ratification of the PAP Protocol, the provisional application phase of the UPCA (PAP) started. During this phase, which can last up to 8 months, the functioning of the Unified Patent Court is established: Judges are appointed, buildings and infrastructure are prepared, IT systems are set up.

Once the system is operational, Germany will deposit its instrument of ratification so that three months later the UPCA will enter into force, probably at the beginning of 2023.

Top-3 important action items in 2022

During the PAP, all patent owners should adapt their European patent strategy and prepare for the new system. The effects on existing European patents and the advantages and disadvantages of the Unitary Patent need to be considered. 

The following Top-3 important action items for companies in 2022 and the underlying aspects will be discussed in our regular updates: 

• Opt-out vs. opt-in
  The most important question for 2022 as a patent proprietor / applicant is to consider whether to remove (opt out) existing European patents from the jurisdiction of the Unified Patent Court before a third party is able to lodge an action against them (such as a revocation or declaration of non-infringement) having effect in all participating EU Member States.
• Strategy 
  Given that the UPC is a brand new court following a new procedural system, it seems to be worthwhile for patent proprietors and applicants to become familiar with the new system and its interaction with the existing national systems. Probably, the UPC will not become a one-stop solution, but instead an additional component within the established system. Patent proprietors should also consider that they now have the unique chance to shape a new court system and its case law.
• Analysis 
  Besides considering one’s own patent portfolio, it might be useful to monitor competitors for their UPC strategies in order to be prepared. For their defence strategies, patent proprietors should make every effort to anticipate not only the system as such but also its potential use by others and the strategic options it offers to competitors – e.g. by inspection orders, UPC-wide preliminary injunctions or even parallel actions outside the UPC territory. 

A thorough analysis of the patent portfolio might lead to different strategies for parent patents and divisionals, using the advantages of both systems and mitigating risks. We will guide you in taking these decisions.

For more information, please read our detailed Q&A list, register for our upcoming updates sign-up here and visit our dedicated UPC website