Still waiting for the pan-European patent? Get your business ready

On 6 March 2014, the 16th draft of the rules of Procedure of the Unified Patents Court were published. The roadmap of the Preparatory Committee had planned for the new pan-European Patents Court to be up and running at the beginning of 2015, providing patent portfolio owners with the possibility of obtaining pan-European patents and enforcing or defending them centrally. It now looks more likely to arrive in 2016. International businesses that have been waiting 40 years for this development will have to wait a little while longer. If you have a patent portfolio, the best thing you can do is to use this extra time wisely to understand the development and ensure your business is ready for it when it comes. We set out the key features of the new European patent and Court.

Currently, if you want to obtain patent protection for an invention, you can apply for a national patent in a particular country or you can make a European application which grants you a bundle of national rights in different European Member States. In December 2012, the European institutions agreed on two regulations to establish unitary patent protection across the EU (Regulation (EU) No 1257/2012 implementing enhanced cooperation in the area of the creation of unitary patent protection, Council Regulation (EU) No 1260/2012 implementing enhanced cooperation in the area of the creation of unitary patent protection with regard to the applicable translation arrangements). Once the unitary patent is established, there will be three forms of patent protection in the EU: national patent applications, the traditional European application that results in national patents, and the new unitary patent. The particular features of the new system will be as follows:

Geographical coverage of protection and enforcement: The majority of EU Member States have signed up to the Unitary Patent system, except for Italy and Spain who have refused plus Poland and Croatia who have yet to. The majority have also signed the Agreement on a Unified Patent Court including italy but excluding spain, poland and croatia. This may affect a company’s decision as to whether or not to seek the new patent if they require broad geographical coverage across the EU for their patent(s) or effectively seek patent border controls at the edges of the EU.

Applications: The application process will be the same as for the current European application, i.e. through the European Patent Office, but after grant the owner will have the opportunity to file a request for unitary effect that will give the patent uniform protection and equal effect in the Member States who have joined the system. This has the advantage of avoiding the current need to comply with formalities and pay fees in each Member State. Proprietors must designate all Member States and have the same set of claims for all states so it is not possible to pick and choose or amend claims for different states.

Translations: One of the huge contributory issues to the 40 years it has taken to establish a European patent is that of translations. With the new procedure, only one translation must be filed at the EPO, within a transitional period of 6 to 12 years. If the patent was filed in German or French, the translation must be in English. If it was filed in English, the translation can be in any of the official languages of the EU.

Renewals: Only one annual renewal fee will be payable. The level of fee has not yet been set but should be similar to the national renewal fees for the current European bundle of national patents.

The Unified Patents Court: A Unified Patents Court (UPC) with legally and technically qualified judges will be established and it will form part of the contracting Member States’ judicial systems. It will have a Court of First Instance, a Court of Appeal, and a Registry. The Court of First Instance (CFI) will have a Central Division in Paris and local divisions in London and Munich. London’s division will deal with the patent subject matter of human necessities, chemistry, and metallurgy, and Munich’s division will deal with mechanical engineering, lighting, heating, weapons, and blasting. Infringement actions or those relating to provisional and protective measures and injunctions, damages or compensation, and/or prior use need to be brought before the local division where the infringement has occurred or where the defendant has residence or a place of business. Revocation or non-infringement actions need to be brought before the Central Division unless an action for infringement between the same parties referring to the same patent has already commenced before a local or regional division in which circumstances these actions may only be brought before the same local/regional division. Actions concerning procedural decisions of the EPO must be brought in the Central Division.

As a general rule, the language of proceedings in the CFI will be the official language of the Contracting Member State of the local division. The Central Division proceedings will be in the language of the patent.

The UPC Court of Appeal will be in Luxembourg. The language of its proceedings will be the language of the proceedings in front of the CFI.

The UPC will be obliged to refer questions to the Court of Justice of the European Union on any issues of interpretation and application of EU law. This will add a new layer of complexity to patent proceedings that have not previously involved the CJEU in any routine way.

It is generally recognised that international businesses want this development and the judiciary and legal professionals in France, Germany and the UK are keen to implement it and make it work. They want Europe to rival the USA as a forum for patent disputes. Companies with significant patent portfolios will need to decide whether to join the unitary effect route and, if they wish to join, which patents they want to include. Do they wish to place their crown jewel patents in the unitary system or hold off until it has been up and running for a while? Developing strategy in advance will help make the most of the new system when it arrives.