Unitary Patent: a tale of two patents

Being a member of the EU, one would expect it to be easy and fast to register a patent and be given uniform protection throughout the member states. Being an inventor or businessman targeting the EU, one would expect it to be easy to file a single application and receive uniform protection without any further costs. But is this the case?

In December 2012, reforms were agreed by the European parliament and the European Council providing for a Unified Patent Court (UPC) and establishing a legal right to a patent with a unitary effect.

Following these reforms, in February 2013, an agreement was signed in Brussels by the EU member states establishing the single UPC and the Unitary Patent.

This new patent provides for a single EU right and thus allows for uniform protection throughout the EU members. The new Unitary Patent system will be initiated at the earliest during 2015 and will serve as a complement (an extra option) to the existing European patent system.

Procedure

Application and examination procedures for Unitary Patents will be the same as for European patents. The differences will come after the granting of the patent.

Specifically, once the reforms come into effect, an applicant will have three options when applying to the European Patent Office (EPO):

a) For a Unitary Patent;

b) For a traditional European patent; or

c) For the two combined. This third option will allow an applicant to have a single EU right for the countries that have agreed and are part of the Unitary Patent system and a European patent for any other country that can be designated. In all, 38 countries can be designated for a European patent.

If the applicant wishes to obtain a Unitary Patent, a request for one must be sent to the EPO within a month of the date of the publication of the grant in the European patent bulletin.

As the European patent is a collection of national rights, renewals, administration and so on has to be dealt with on a country-by-country basis.

By contrast, the Unitary Patent provides for a single EU right and thus the EPO will also be responsible for collecting, administering and remitting renewal fees for Unitary Patents. The EPO will also include legal status information such as licences, transfers, limitations, and revocations.

Costs

If one compares the amount needed to protect an invention in the US with the amount needed to protect one’s rights via a European patent, according to the European Commission it is nearly 15 times less.

With the current system, the applicant has to validate in each and every desired member state, out of the 38 contracting, in order to receive protection.

"The new patent system will comprise the Unitary Patent and a single jurisdiction, avoiding multiple court cases on the same patent in different countries."

A mere look at the costs an applicant may face—€36,000 ($50,000)—is enough to understand that this is a factor that prevents many applicants from protecting their rights. Certainly, not all applicants are multinationals with the deep pockets needed to apply and go through this validation process. These high costs might put innovation on hold and harm competitiveness.

It is also my belief that these costs are extra and unnecessary. I consider them unnecessary as the majority of them are linked to the validation process, with fees now necessary for translation, local patent offices and agents.

In the future, after the grant of the European patent, there will be no translation requirement for Unitary Patents once the necessary transitional period passes. This will automatically cause the fees to drop. Specifically, and as discussed in the European Commission, costs will go down to about €5,000 ($7,000) for all fees up to the grant of the patent, including the translation of the patent text into two of the other official languages of the EPO.

Court proceedings

The European Patent Organisation is not an EU agency and is not bound legally by the EU. The task of the European Patent Organisation is to grant European patents, which are carried out by the EPO.

Because European patents issued by the EPO are treated as domestic patents in member states, only the courts of the individual countries have the authority to enforce the rights of the patent holder.

The EPO has no authority to hear infringement actions or enforce a patent holder’s rights in any country. This, in turn, means that a patent owner currently needs to commence infringement proceedings in the courts of all 28 member states. This has led to duplication in litigation, and an unnecessary waste of money and time. Needless to say, patent owners, due to the costs involved, have chosen strategically the countries in which to file for infringement. In reality, the huge costs and the strategies they are forced to follow have made them give up the rights they have paid for.

Looking ahead, however, patent owners will enjoy the benefits of the UPC and the single infringement action the single EU right of the Unitary Patent offers.

UPC advantages

To examine the exact structure of the UPC is outside the scope of this article but here is a summary of the new system’s advantages:

•  Lower costs (it’s quicker, with no need for translations after the transitional period and no need for validation in each member state);

•  Uniformity (on being granted by the EPO, a Unitary Patent will automatically be valid for all participating EU states);

•  Centralised administration;

•  It’s easier and quicker; and

•  The new patent system will comprise the Unitary Patent and a single jurisdiction, avoiding multiple court cases on the same patent in different countries.

However, the new system will have disadvantages too:

•  It has not yet been implemented and thus remains untested; and

•  It remains to be seen whether the new system turns out to be a risky option that exposes patent holders to the threat of litigation and nullification of patent rights across all of Europe in one court procedure.

Conclusion

Let’s hope that this new system will help towards the promotion of innovation as well as the proper (full and effective) protection of inventors’ rights. There certainly appear to be significant advantages but we will know more only when it is finally implemented.

Ermioni Pavlidou is head of the IP department at Michael Kyprianou & Co LLC. She can be contacted at: ermioni@kyprianou.com.cy