We set out below our thoughts and predictions upon how protection and enforcement of IP in the UK may be impacted in 2 years' time, if and when the UK ceases to be a part of the EU, following Brexit. We have also suggested some immediate action points for consideration in the weeks or months to come, prior to Brexit, to ensure that your business is best protected prior to any changes.

  • English law will remain the dominant governing law for commercial contracts globally: English law will largely be unaffected by whether the UK remains part of the EU or not. It will continue to be selected by businesses for certainty as the choice of law for most commercial arrangements.
  • The English Courts will remain a centre of excellence for determining disputes governed by English law and will remain a popular forum for high value and complex patent disputes, particularly in the pharmaceuticals and telecoms fields. This is given the quality of the judges and robustness of the process, as well as the innovations the courts have been developing, such as: (i) trial within 12 months as part of the shorter trial scheme; (ii) costs are kept in check through budgeting; and (iii) recovery of costs from the losing party is increasingly assessed summarily after trial with a lump sum award. The UK will remain competitive on all fronts whether inside or outside of the EU. UK court judgments will remain readily enforceable within the EU or globally.
  • Pan-European enforcement strategies remain important. Current or future pan-European litigation strategy will still involve multiple courts and supra-national management of disputes, whether or not the UPC goes ahead and with or without the UK's participation. It will still be critical to have advisers who are expert in handling multiple cross-border disputes and managing local lawyers in jurisdictions within Europe or beyond.
  • Existing law is unchanged. We can expect that, whatever future relationship the UK has with the rest of the EU, the UK will provide for existing law to remain in place, save where there is a requirement for specific legislation to change something. That means that IP law will continue to contain all of the concepts implemented from EU Directives, whether to harmonise the law of Member States (e.g. copyright under the Information Society Directive) or to introduce novel rights (such as protection of databases through database rights).
  • European Patents, the Unitary Patent and the Unitary Patent Court: UK designated European patents will continue to apply in the UK and to be applied for at the EPO. However, the UK will no longer be able to participate in the new UP and is unlikely to be able to continue as part of the UPC system. It is worth noting that Spain already will not be part of the UPC. The establishment of the UP and UPC system will be delayed and further may now be in doubt with the loss of the UK jurisdiction making the regime significantly less attractive. At the very least the fee structure may need to be reconsidered. We can expect there to be concerted efforts to find a solution to these problems, given the perceived importance of the UPC to protecting innovation and R&D across Europe for business. Assuming that the UPC does go live, UK businesses with UPs and EPs will still be able to use the UPC for enforcement in other EU participating countries. However given these concerns and concerns at how the UPC will operate in the early years, some patent proprietors will choose to opt-out their European patents from the UPC system. As a result, business is still likely to pursue litigation in countries across Europe (including the UK) outside of the UPC system.
  • Trade marks: In order to maintain the status quo in relation to EU-wide rights such as EUTMs, it is expected that provision will be made to provide an equivalent right in the UK with the same specification, priority date and term as the EU level right previously. This would be a better solution than requiring proprietors to convert their EUTMs into a collection of national rights across the EU. Trade mark proprietors should consider in the meantime supplementing their protection, by applying for UK national trade marks for their key brands.
  • Designs: Design legislation was harmonised both at EU and national level when the EU design rights (registered and unregistered) were introduced, so the loss of the EU level rights will not have much impact on protection, especially since the UK already had its own unregistered design right (which persisted and which has a longer term than the EU equivalent). Where proprietors have EU level protection but not UK national protection for registered designs then again some transitional arrangements will need to be put in place by the UK government to ensure that these rights are not lost in relation to the UK.
  • Plant breeders' rights: whilst the UK system is similar in approach to the EU system, the EU Regulation will cease to apply to the UK. Like for EU trade marks, it would be desirable that express provision is made by UK legislation to provide an equivalent plant breeders' right in the UK for the variety, with the same priority date and term as the Community plant variety right.
  • Supplementary Protection Certificates and Geographical Indications: Where rights have been created via EU Regulations (e.g. SPCs or GIs) these will either need to be negotiated to continue until expiry (with no new applications) via a transitional period or will need fresh legislation to provide the equivalent right in the UK. New UK SPC legislation will be needed to support the pharmaceuticals sector into the future. Similarly, GIs will need further local protection in the UK (above and beyond passing off) and will require new legislation.
  • Data privacy: The General Data Protection Regulation will come into force on 25 May 2018, just at a time when the UK may cease to be a part of the EU. However, the ICO's view is that the GDPR will remain important for UK businesses operating across the EU and it is possible that many of the changes contemplated will be enacted at a national level, irrespective of the UK's future relationship with the EU.
  • Trade Secrets: the Trade Secrets Directive adopted recently is due to be implemented into national law across EU Member States by 5 July 2018. Although the proposed changes required are minimal for the UK, the UK may still decide to implement the Directive before 2018, to ensure a strong, harmonised playing field for protecting innovation and investment across Europe. This would ensure certainty and consistency of approach in the way businesses are able to respond to the challenges of safeguarding their critical trade secrets.
  • Labelling: products will still need to comply with CE-marking and other specific regulations, where their intended market is within the EU. We can expect UK regulations to continue to mirror EU-counterparts in order to ensure easy access to other EU markets.
  • Territory: Licences and other IP agreements using territory references such as EU or EEA will need review to ensure that the UK continues to be covered and future contracts being entered into will need thought as to their intended future coverage.
  • Definition of "intellectual property": This may need to be revisited to check that it covers all "new" provisions put in place to cover rights previously held on an EU-wide basis.
  • Exhaustion of rights: The rule that goods placed on the market on one part of the EU cannot be prevented from circulating freely within the EU and hence IP rights cannot be used to prevent the movement of goods across EU internal borders, would fall away in relation to the new UK/EU border and the use of seizure procedures via Customs and Excise may thus come to the forefront, unless such free movement of goods provisions are retained in any future relationship between the UK and rest of the EU. This may have a big impact upon parallel imports from the EU into the UK, particularly in the pharmaceuticals, technology and FMCG sectors where parallel imports are widespread.
  • Technology licences: The EU technology transfer block exemption legislation has been used as a framework to draft technology licences concerning licensing technology and other IP within the EU. This provides guidance on what restraints may be allowed by competition law and what may not. However, these will remain relevant to any business wishing to operate across Europe on a uniform basis. Equally, businesses will still be subject to EU competition law, whether they have operations within the EU or the effect of the licensing arrangement may impact EU trade.

What to do now:

  • Identify and review licences and other IP agreements which are intended to cover the EU, particularly for references to the EU and confirm that these will continue to be appropriate and cover the UK, post-Brexit.
  • Register national UK rights in parallel to your current EU-wide rights (e.g. UK trade marks, UK registered designs and UK plant breeders' rights).
  • Continue to file national or European patents designating the UK.
  • Review the decision ahead whether to opt-out EPs from the UPC system, if the UPC does go ahead.