The United Kingdom government announced on 26 April 2018 that it had ratified the United Patent Court Agreement. The Unified Patent Court (UPC) will allow European patents to be litigated in a single court proceeding, rather than in multiple cases in the various countries in which it is validated, as it currently the case. The proposed new system will also allow patent applicants to elect for future European patents to take effect in the participating European countries as a unitary patent.
For the UPC Agreement to come into effect it must be ratified by at least 13 participating countries, including the UK, France and Germany. French ratification took place fairly early on and the 13 country threshold has also been passed. There was considerable uncertainty, following the UK’s “Brexit” referendum on EU membership and the decision to leave the EU, whether the UK would ratify the UPC Agreement at all, given that, although the UPC Agreement itself is an international agreement, the project has been an EU initiative and the unitary patent itself is established by an EU Regulation. That uncertainty has now been dispelled by the UK’s confirmation that it has ratified the Agreement. All eyes will now be on Germany, where ratification has been held up by a constitutional complaint, due to be heard in the course of 2018.
If the German Constitutional Court rejects the complaint, as many commentators expect, and Germany completes its ratification process, the UPC will come into operation four months later. It will be the biggest development in the European patent sphere for over 40 years. The UPC is largely supported by industry and promises to boost the IP and legal sectors in the UK, as the UK will be hosting the branch of the UPC Central Division that will have jurisdiction over cases concerning patents in the life sciences, medical device and chemical sectors.
There is a further question as to whether the UK will continue to participate in the UPC following Brexit. The prevailing mood amongst the participating countries is that it would be preferable for the UK to remain in the system. Some amendment to the UPC Agreement will be necessary to enable this.
Now that it is looking likely that the UPC will become a reality, subject only to the German constitutional complaint, holders of European patents should review their patent portfolios and determine whether they wish to opt their European patents out of the jurisdiction of the new court, as they will be entitled to do for a transitional period. Litigation concerning those opted-out patents would then be conducted, as now, in the national courts of the participating countries. Holders of pending European patent applications should also consider whether they would ideally want any granted patents to take effect as unitary patents and, if so, whether any steps can be taken to delay grant until after the UPC system comes into operation.