Richard Vary
Bird & Bird

Richard Vary, partner at Bird & Bird, explains the possible ramifications of Brexit on UK patenting

What are the potential consequences of the UK’s Brexit vote on both the UPC and the unitary patent in general?

The UK’s vote to leave the EU has thrown a bit of a spanner into the works. Just when the Unified Patent Court (UPC) appeared to be on track, and in a form that was largely accepted within the mobile telecoms industry, Brexit came as something of a surprise.

There seem to be three options from here. The first possibility is that the whole idea will collapse. The UPC Agreement was a compromise between different views across different industries, and re-opening the agreement in order to remove the UK’s participation might allow industry participants to seek to renegotiate the parts they liked least.

The result might be that no new agreement can be reached. That would be sad for those who have worked so hard over the last few years to make this reality, and it loses a chance for us to build a system that could be much more attractive than the US or other patent litigation systems.

Another option is that the UPC goes ahead without the UK being involved. A third option would be for the UPC Agreement to be amended to allow the UK to participate even after it has left the EU. That opens the exciting possibility of making the UPC accessible to all European Patent Convention (EPC) member states, not just those in the EU.

Much of the opinion heralds doom and gloom. Will there be any benefits for the UK in terms of patenting if it stands outside the unitary system?

One might expect the most pessimistic outcome for the UK to be having it go ahead without the UK involved. With a unitary patent system on our doorstep, and covering so much of the global market, some patent portfolio managers may take the decision not to incur the extra costs of covering the UK as well. And you might wonder why patent owners litigate in England and Wales when an action under the UPC could result in a quicker, cheaper decision applying to a much larger market.

But there is also an opportunity here. Our German colleagues have shown that the way to attract a lot of patent litigation in the high-tech industry is to conduct it efficiently. If a litigation system is fast, high-tech patent owners will file litigation in that country because they want to win the race to a remedy—they want cases against their opponent to reach trial before the opponent’s. And if a country’s litigation system is fast and efficient, portfolio managers will ensure that their portfolios cover that country.

So, if the UK does find itself left on the dockside when the UPC ship sales, the UK’s patenting profession has a very real opportunity to attract work. If we can make our system faster and more efficient than the UPC system, we have a very real prospect of increasing the levels of patenting business and patent litigation business in the UK. If our system is slower and more expensive than the UPC, yet covers a far smaller market, it will be unattractive for industry and the outlook for UK patenting will be bleak.

How far will intellectual property go when leveraging the ‘best deal’ for the UK?

I would like to think it will be the key point that drives the negotiations. But the reality is that it will be at the bottom of the pile. Free movement of goods, free movement of workers, fishing, farming and the financial services industry will all be higher on the agenda.

Given that the UK seems to be heading away from the CJEU, what systems will the UK put in place to account for this loss?

It is difficult to see how we could remain part of the UPC without accepting the Court of Justice of the EU (CJEU). It is harder still to see how that could be politically acceptable under the current government. I would like to see a UPC that covers all EPC countries, without being subject to the jurisdiction of the CJEU, although that also seems unlikely.

But if the UK goes it alone, then the loss of the CJEU is unlikely to be noticed or particularly significant. It might even be welcomed by the trademark profession.

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