An update on the Unitary Patent
In March 2020, Germany’s Federal Constitutional Court partially agreed with a constitutional complaint that the Act establishing the Unified Patent Court Agreement (UPCA) was void, on the grounds that the German Parliament (Bundestag) did not vote with the required majority to ratify the Act.
That objection was overcome in November last year, after the draft ratification bill including the consent to the UPCA was adopted at the Bundestag with the necessary qualified majority. The German Senate (Bundesrat) gave its approval on 18 December. Does this mean the Unitary Patent could now be within reach?
First a quick recap...
What is the Unitary Patent?
The Unitary Patent promised to facilitate the process of obtaining patent protection in the EU by simplifying and reducing many of the administrative hurdles and costs associated with obtaining patent rights across the territory. Rather than replace existing systems, such as that of the European Patent (EP) however, the Unitary Patent was designed to sit alongside them, offering businesses greater choice in their patent protection strategies.
In general, where EU-wide coverage is required, the Unitary Patent aimed to considerably lower costs by removing the requirement to provide translations in languages of member states at the European Patent Office (EPO). The right was to come into force automatically on grant across participating member states and, unlike an EP, would not need to be validated or renewed by each member state’s patent office to enter or be kept in force.
What is the Unified Patent Court?
The Unified Patent Court seeks to eliminate the likelihood of parallel disputes involving the same patent rights in EU member states. It establishes a single patent court with the power to issue decisions on infringement (including preliminary injunctions) and validity of existing EP rights and the new Unitary Patent right. Their decisions will be binding across all contracting EU member states.
Under the proposed Unified Patent Court system, it will be possible to commence a single action for infringement covering all signatory member states. This will apply to all patents granted by the EPO; in other words, it can be used for patents filed under both the Unitary Patent and EP systems (where the EP has been validated in EPC countries that are part of the Unitary Patent system). The risk, of course, to the patentee would be a single revocation counterclaim, which would apply throughout the Unitary Patent territories.
When was it supposed to come into effect?
Initially, the target date for the introduction of the Unitary Patent was early 2014. This was an ambitious deadline given that judges still need to be appointed and trained, court premises still need to be found, and a great many administrative matters still needed to be undertaken before the Unitary Patent and accompanying Court system is in place. Delays have occurred as expected, and the current projection for its introduction is still to be determined, given the UK’s withdrawal (as a result of Brexit) and pending the challenge at Germany’s Federal Constitutional Court. In theory, once Germany ratifies, the system can enter into force, but now the UK has decided not to join, the UP/UPC system may have become much less attractive.
What happens next?
Before it can enter into force, the UPCA needs to be ratified by 13 of the 25 participating EU member states, including Germany, France and Italy (Italy replaces the UK). France and Italy have already ratified the agreement, and now the Bundesrat has approved the bill, the last step is for the agreement to be signed and formalised by the German President. In theory, this means that it could be possible for the final preparatory steps to set up the Unified Patent Court (UPC) this year, ready for it to start work in 2022.
For that process to begin, German’s ratification of the UPCA first needs to be deposited with the European Council. The UPCA would then enter into force on the first day of the fourth month following that deposit.
Following the protocol
Of course, before the UPC can truly open its doors, the preparatory phase must take place in line with the Protocol to the UPC Agreement on provisional application. This provides that the institutional, organisational and financial sections of the UPCA enter into force before the Agreement becomes effective in its entirety.
We estimate that the period of provisional application would take around 8-12 months, and could begin as early as February 2021, allowing time for the final practical preparations (eg employment of judges) to take place before the UPC system officially begins. To meet this timeline, Germany needs to consent to the Protocol on Provisional Application (PPA) soon. This consent does not require actual deposit of ratification of the UPCA. Indeed, Article 2 of the PPA provides for a variety of ways in which a country may consent to be bound by it, e.g. signature alone, signature followed by ratification, or a unilateral declaration.
As a result, Germany will likely not file its ratification of the UPCA immediately to enable the practical application of this protocol.
Indeed, the formal ratification of the UPCA may not be possible just yet, as on the day of ratification by the Bundestag, the German Federal Constitutional Court announced that it had received two new constitutional complaints against Germany's ratification of the UPCA. The content of these new complaints is not yet known. All we know so far is that constitutional complaints have been filed and been given the examination numbers 2 BvR 2216/20 and 2 BvR 2217/20 and that, according to the Federal Constitutional Court: “A decision date is currently not foreseeable.”
In any case, the examination of these new complaints, if they are indeed admissible, could lead to a further possible delay for the UPCA, putting the Unitary Patent back out of reach.
Robert Balsters is a European Patent Attorney and Director of the Electronics and Information Technologies Department at Novagraaf in Switzerland.