24 August 2018Trademarks

IP lawyers react to Brexit ‘no deal’ guidance

The UK government yesterday published its guidance on a “no deal” Brexit, providing limited but useful information on IP post-Brexit, according to lawyers.  

Hiroshi Sheraton, partner and IP Brexit lead at Baker McKenzie, said the “biggest news” in the guidance in relation to IP is the UK’s assurance that it will unilaterally adopt EU/European Economic Area (EEA) principles of exhaustion of rights as a short-term measure in a no deal scenario.

“This means that genuine goods sold in the EU/EEA could be imported into the UK without infringing the manufacturer’s IP rights,” he explained.

Sheraton added: “Although the statement was made in the context of the pharmaceutical sector, it is much broader in its implications and would apply across all industries.”

Tristan Sherliker, associate at Bird & Bird, agreed with Sheraton that the reassurance that parallel imports into the UK from the EU will be allowed “for some time” is a “useful new detail”.

He similarly noted that, while the information is contained within the context of medicines, “from the way it’s worded the temporary fix seems to apply to all industries”.

Sheraton added the caveat that the longer term position on how exhaustion principles will be applied post-Brexit remains “uncertain”.

Leighton Cassidy, partner at Fieldfisher, said that given the “slow progress” made in relation to a Brexit deal, it is “prudent” to prepare for a no deal scenario.

One specific area addressed by the government’s guidance is that of tobacco labelling.

There will need to be a change to health warning imagery for UK products, as the copyright of the existing images used is owned by the European Commission, Sheraton said.

He said: “The potential implications of such a change could be significant, causing manufacturers to have different packaging for EU member state and UK products.”

However, Sheraton believes it is unlikely that the two sides will not reach an agreement on this point, “given that the imagery is educational and for public health purposes rather than for commercial exploitation”.

Cassidy agreed that the licensing of the pictures should be agreed “relatively easily”, and would be in everyone’s interest “given the public health benefits”.

Sherliker noted that the government’s guidance comes shortly after the UK Intellectual Property Office (IPO) assured IP owners that EU trademarks (EUTMs) and designs will continue to be protected in the UK after Brexit.

He suggested that the IPO’s reassurance on the future of EUTMs has been “the most useful piece of information to date”, as it gave businesses more certainty on how to move forward from a registered rights perspective.

Leigh Martin, partner at DLA Piper, similarly said that the fate of EUTMs is important for the “thousands of right owners” who rely on them.

However, Cassidy noted that this assurance is not yet embodied in legislation, and “there remains uncertainty over how Brexit will eventually turn out”.

He said that he is advising IP owners to consider filing new trademarks in the UK to eliminate the “small” risk that the UK’s assurances in relation to EUTMs are not realised.

Sherliker added that whether new UK rights will be interpreted as being identical to the EUTM they stem from needs clarity.

“Many businesses and overseas IP colleagues are already asking what they should be doing in relation to their EU IP portfolios in preparation for March 29, 2019, and unfortunately we are unable at present to give them any firm steer with certainty.”

Martin agreed that more clarity is needed in relation to Brexit and IP.

Although the government’s latest guidance is “IP light” overall, Cassidy said, more technical notices are expected to be published next month.

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More on this story

25 September 2018   The UK government’s latest guidance on a no-deal Brexit fails to clarify the future of IP rights exhaustion surrounding the European Economic Area, according to lawyers.
25 September 2018   The UK government announced yesterday that all existing EU trademarks and registered Community designs will still be protected in the UK in a no-deal Brexit scenario.
15 November 2018   Last night, UK Prime Minister Theresa May announced that a Brexit deal had been agreed between the European Commission and the UK’s negotiators, in a step towards clarifying the future of the UK following its exit from the EU.