Richard Bruton, the Minister for Jobs Enterprise and Innovation, has recently announced that Ireland has elected to establish a local division of the Court of First Instance of the Unified Patent Court (“UPC”) in Ireland. Ireland’s decision is significant in that the majority of Member States of the European Union may facilitate infringement cases through a regional division where a number of Member States collaborate to service such cases on a joint basis. In the case of smaller Member States, such infringement proceedings will have to take place in the central division of the UPC in Paris, London or Munich.
The business impact of this development is as follows:
- Once established, the Irish local division of the UPC will permit unitary and/or European patent proprietors to bring pan-European infringement proceedings in Ireland rather than abroad in appropriate circumstances thereby eliminating the need for multiple Member State proceedings and thereby reducing time and legal costs;
- Similarly, an Irish company that is in a patent infringement dispute with a unitary or European patent holder will be proceeded against in Ireland in respect of such infringement and not abroad, again potentially reducing time and legal costs;
- An injunction obtained in the local division of the UPC in Ireland will be effective in all participating Member States;
- Parties will also benefit from the increased expertise of the dedicated judicial panel to the UPC.
The UPC has been created as a constituent element of an international agreement establishing a pan-European patent system with unitary protection across all EU Member States that have signed up to the agreement. It seeks to enhance the current regime of designating states under the European Patent Convention, which forms a bundle of national patent rights across European countries. The UPC is expected to commence hearings in 2016.
The UPC will consist of a Court of First Instance and a Court of Appeal. The Court of First Instance will comprise 3 divisions:
- A Central Division, based in Paris, with branches in London, for pharmaceutical type cases, and Munich, for mechanical engineering type cases;
- Local Divisions which may be established by participating Member States; and
- Regional Divisions where two or more Member States elect to join together and establish a division.
The type of patent litigation will dictate whether the case should be commenced in a particular central division or in a local / regional division. Infringement actions must be taken in the local or regional division for the country where the infringement occurred or where the defendant has its principal place of business, or failing that where it has a place of business. Infringement cases can also be taken in the central division where a country does not have a local or regional division or by agreement of the parties. Revocation actions and actions seeking declarations of non-infringement must be taken in the relevant central division for the technology concerned. Revocation actions taken as a counterclaim to infringement proceedings can remain at the local division if that Court decides it appropriate and that it should not be referred to the relevant central division. Otherwise, the entire case, infringement and revocation, can go to the relevant central division if both parties agree.
Once the Agreement is ratified by 13 of the 25 of the signatory Member States, which must include the three Member States where most European patents are registered: France, Germany and the United Kingdom, the UPC will have exclusive competence to deal with all disputes relating to infringement and revocation of European Patents under the European Patent Convention and the new unitary patents in participating Member States. As part of the framework, there will also be transitional opt out provisions. For the first seven years of the UPC’s operations, which may be subject to a further 7 year extension, proprietors of European patents may elect to opt out of the jurisdiction of the new Court.
However, before the Irish local division of the UPC can commence operations, it will be subject to a referendum by the Irish people on the ratification of the UPC Agreement by Ireland. The Irish government has indicated in its legislative programme that it plans to publish the required bill during the course of 2015, which will amend Article 29 (International Relations) of the Irish Constitution to recognise the Agreement on the UPC. Following parliamentary approval the proposed constitutional amendment will be put to a referendum of the people.
While there is still a process to go through before the UPC is a reality, in that the Agreement must be firstly ratified at both an EU level and an Irish level (through referendum), the intention of the government to establish a local division of the Court is a very positive development for patent proprietors and businesses located in Ireland. The move should greatly assist Ireland in its attractiveness as a location for R&D and foreign direct investment with a strong emphasis on the protection of intellectual property.