‘Brexit’: EU lawyers discuss UPC options and harmonisation fears

Lawyers across the EU have agreed that the UK’s decision to leave the EU will almost certainly delay the implementation of the unitary patent and Unified Patent Court (UPC), but many say the system will still be an attractive option for rights owners.

Speaking to WIPR, lawyers from France, Germany, the Netherlands and Denmark agreed that the system will be delayed, with the most likely result being the UK dropping out of the agreement.

Lawyers also said the reduction of a harmonised IP system across all EU states would not be beneficial to rights owners.

David Por, partner at law firm Allen & Overy in Paris, said “everyone was in agreement” that the vote to leave would “certainly delay the UPC”.

“There are two theories about what shape the system may take now,” he said.

“One is the idea of going ahead with the UK remaining part of the agreement,” though he added that that option would be doubtful because it would require changing the rules to allow the system to proceed with non-EU member states.

“Option two would see the UK withdraw from the UPC completely,” he added.

“When it does, the mechanics of putting in place a UPC without the UK would be fairly simple.”

Por added that Italy, as the country with the third highest number of European patents validated in 2012 (when the unitary patent deal was agreed), would likely take the UK’s place.

“Because the agreement has been so hard to adopt in the first place, I don’t think anyone will want to open a Pandora’s Box that would involve new agreements with new ratifications.”

Por added that a UPC with no UK option for protection and enforcement may “diminish its attractiveness” somewhat, but that the market remains huge nevertheless.

In a national referendum held yesterday, June 23, British citizens voted to leave the EU. The final result was 52% in favour of leaving and 48% in favour of staying.

Stefan Abel, partner at law firm Klaka Rechtsanwälte in Münich, added it was “common sense” that ‘Brexit’ will lead to a significant delay in the implementation of the UPC.

Ben Grzimek, partner at law firm EIP in Düsseldorf, said Brexit was “not good” for clients because “the UK is, and will remain, an important market” for international companies.

He added that while there may be a solution to the UK’s relationship with the UPC, the UK’s absence from the system means it may not work as well.

“How valuable will the enforcement of the unitary patent be if one valuable market is not covered? The unitary patent will be less important, not substantially less important, but it’s a big blow for the system if a big country is missing.”

He added: “If UPC will be a reality, then I think Germany will play a big role because the UK and Germany were the countries with the most important patent litigation cluster.”

Abel said that some of the business lost by UK practitioners working in Europe will be taken up by large US and UK law firms that also have offices in Europe, and some of it may head to German firms, “but it’s difficult to say”.

Nicolai Lindgreen, partner at law firm Kromann Reumert in Copenhagen, said the decision is likely to have significant impact on IP and enforcement in Europe, and thereby for Danish businesses.

On the UPC, he added: “All of this is likely to lead to further delay and uncertainty as to when the UPC will start its function. Danish businesses that have looked forward to this new opportunity of enforcement in Europe will have to continue waiting for quite some time to see that happen.”

Wouter Pors, partner at law firm Bird & Bird in The Hague, said the decision was “very unfortunate”. Pors stressed the benefits of IP harmonisation across EU as a benefit to rights owners that could be affected by the vote to leave.

“I was planning to do a lot of UPC-related work and the perceived attractiveness of the UPC may affect my day to day work. On the other hand, the territory covered by the UPC [even without the UK] is still larger than the population of the US.”

Discussing the possible relocation of the London part of the UPC central division, he added: “Of course there is the discussion of what will happen to the central division. We would be happy to host one in the Netherlands and we, along with Italy, are the two most likely candidates.”