One of the hot topics within the European IP community at present is the proposed new unified patent system which, some claim, may provide a simpler, more cost-effective, patent regime across most of the EU.
European patents – the current system
At present, innovations can be protected by national patents granted by individual countries’ patent offices, or European patents granted by the European Patent Office (EPO).
A “European patent” is nothing to do with the EU. It is a patent granted by the EPO under a convention – the European Patent Convention – which is separate from EU law. The member states of the European Patent Convention include not only the member states of the European Union but additionally Albania, Iceland, Liechtenstein, Macedonia, Monaco, Norway, San Marino, Serbia, Switzerland and Turkey (and further agreements in effect extend this list to also include Bosnia and Herzegovina, and Montenegro).
Furthermore, a European patent is not actually a single patent but rather a bundle of national rights. Whilst there is a single, centralised examination process through the EPO up to the point at which the patent is granted, from that point the national parts of the patent are subject mainly to national law, and therefore subject to attack or enforcement on a country-by-country basis rather than a European-wide basis (though for a short period a European patent can be attacked as a whole under an opposition procedure).
The cost of having patent protection in several countries can be significant. If a patent owner requires a European patent to take effect in a particular country then they will need to pay annual renewal fees to the patent office of that country, and may also need to have the patent, or part of it, translated.
An EU patent?
In contrast, a patent which can be enforced or revoked across the whole of the EU in a single action has been the dream of many for several decades, and fits with core European common market principles. The current system is not ideal, because disputes may require costly litigation in more than one country, national laws relating to patent infringement and validity can bring about different results in different countries, and complex inter-jurisdictional situations can arise. Many have argued that a single court system will make patent litigation simpler and less expensive, and result in a patent system which is more harmonised and better for business.
This dream has seen several false dawns, but it now seems likely that an imperfect unified patent system will become a reality over the next few years. This system will have two strands: the Unitary patent and the Unified Patent Court.
Unitary patents
A Unitary patent will be a single patent (in contrast to the current bundle of national rights) having effect across all countries of the EU except those which have chosen not to participate. It is likely that all EU countries will participate except Spain, though the dust has not yet settled.
A Unitary patent will be derived from a European patent. The system by which the EPO examines and grants European patents will remain the same. On grant, the patent owner will be able to request that the European patent acquires Unitary effect, i.e. becomes a Unitary patent.
It will still be possible to use the current system and therefore the patent owner could choose to keep the European patent as a bundle of national rights rather than as a single Unitary patent. In any event, the current European patent system will continue to apply to non-participating countries and to non-EU countries.
The Unified Patent Court (UPC)
Patent infringement and/or validity disputes in relation to a Unitary patent will be dealt with by a new Unified Patent Court (UPC).
An agreement to set up the UPC will come into force, and Unitary patent protection will become possible, approximately four months after ratification by thirteen EU countries including the UK, France and Germany. The indications are that this might occur in 2015.
Ultimately, the UPC is expected to also have exclusive jurisdiction over non-Unitary European patents in participating countries, though patent owners will be able to opt their European patents out of this on a case by case basis for a transitional period, meaning that national courts would remain competent.
The UPC will have seats in various locations. There will be local and regional divisions across the EU, a central division in Paris, Munich and London, and a court of appeal in Luxembourg. The complexities of the different activities of, and interactions between, the various seats of the UPC, are beyond the scope of this article. Suffice it to say that the structure of the UPC is far from ideal, and is based to a large extent on political compromise rather than on logic and efficiency.
A further complication is that it will still be possible to file an opposition within nine months from grant, and oppositions will continue to be dealt with by the EPO. It is not clear how European oppositions will interact with actions before the UPC.
Advantages and disadvantages of the new regime
The intentions behind the new regime were to make the patent system in Europe less expensive, simpler and more uniform.
Payment of a single annual renewal fee will keep a Unitary patent in force across all participating EU countries, so a Unitary patent may be attractive to patent owners who normally cover (or would like to cover) a large number of countries. In contrast, the existing European patent system, whereby individual annual renewal fees are payable to the patent offices of each country, may be a less expensive option where only a small number of countries are covered.
A Unitary patent may also reduce translation costs compared to a European patent, though this depends on which countries are covered by the European patent.
A single court action could result in a finding of infringement across most of the EU but likewise a finding of invalidity or a declaration of non-infringement across most of the EU. This could keep litigation simpler but there is no guarantee that it would be more straightforward than the current system where legal actions across several jurisdictions are not unusual but in practice not very common either.
The quality of the UPC will be observed keenly, particularly because of the near EU-wide ramifications of its decisions. There are many uncertainties and complexities, and it may be advisable for patentees to opt their European patents out of the UPC, at least initially until the workings and effects of the UPC become clearer.
Further complications arise because of legal challenges mounted by Spain and Italy against the use of a procedure to bring in the required legislation. The indications are that Italy may now wish to participate, but Spain has mounted a further legal challenge which could yet derail the whole process.
Those who wish to bypass the new regime altogether may choose to seek patents through national patent offices rather than through the EPO. Ultimately this will be the only way to avoid the jurisdiction of the UPC. Such national patents will remain under the sole jurisdiction of the national courts rather than under the UPC.
Dr Robert Gregory (rjg@wpt.co.uk), partner at WP Thompson, European and Chartered UK patent attorney.
