Unitary Patent Court and Opting Out
The default position is that all European patents and European patent applications will be in the jurisdiction of the Unified Patent Court (UPC) at the date of formal commencement, i.e., 1st June 2023*. It is possible to opt-out, or remove, a European patent or patent application from the jurisdiction of the UPC from 1st March 2023.
What is the Unified Patent Court
The Unified Patent Court (UPC) is a new centralised International Court for patent litigation in participating contracting Members States, i.e., those EU Member States that have ratified the UPC Agreement.
Currently, the number of ratified Member States stands at 17. These countries are Austria, Belgium, Bulgaria, Denmark, Germany, Finland, France, Estonia, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Portugal, Sweden, and Slovenia. Ireland has not yet ratified the agreement but is expected to hold a referendum in 2023 or 2024 seeking ratification. Croatia, Poland, and Spain have indicated that they are not joining the UPC. The UK is not party to the agreement since Brexit.
The UPC has exclusive jurisdiction over Unitary Patents (UP).
Proceedings in relation to “classic” European Patents, i.e., European Patents validated in contracting states of interest, may be brought before either the UPC or the national courts (unless a patentee has opted-out of the jurisdiction of the UPC) for the transitional period (lasting at least 7 years). After the end of this transitional period, the UPC will have exclusive competence in these participating Member States for both “classic” European Patents and Unitary Patents (UP).
The main aim of the UPC is to reduce the cost of patent litigation and enhance legal certainty by having a single litigation action with one decision covering all contracting Member States.
The Sunrise Period and Opting-out
The “Sunrise Period” will begin on 1st March 2023* for a period of 3 months.
For proprietors of European Patents, or Supplementary Protection Certificates (SPCs), or applicants for European Patents, there is the possibility to “opt-out” of the jurisdiction of the UPC from the start of the Sunrise Period (1st January 2023) up to one month before the end of the transitional period (at least 7 years after the commencement of the UPC, which would be on 1st May 2030 based on current projections).
Opt-outs registered in the Sunrise Period will be effective at the formal commencement date of the UPC, i.e., 1st June 2023.
How to Opt-out and the consequences
An opt-out will keep a European Patent or application in the current system. This means that any litigation action(s) will take place before the national courts.
- The opt-out will be effective for the entire life of the European Patent concerned.
- A request to opt-out can be submitted online and there is no Official Fee to opt-out.
- An opt-out cannot be filed if an action has been brought before the UPC.
Therefore, opting out during the Sunrise Period removes the risk of entering the jurisdiction of the UPC against the will of the Applicant/Proprietor. This could occur if an action is taken once the UPC opens but before an Applicant/Proprietor has opted-out.
It will be possible to withdraw an opt-out at any time unless an action has been brought. It is not possible to opt-out for a second time.
Reasons to opt-out
The UPC comes with several advantages but, like any system, there are also some potential risks to these advantages.
The main reason to opt-out is to avoid central revocation, especially at the beginning when the court is untested.
You may decide to opt-out of the jurisdiction of the UPC if your patent is validated in a very small number of participating Member States.
Central enforcement is an advantage to staying in the jurisdiction of the UPC, particularly if a large number of participating Member States are concerned.
Who can opt-out
The opt-out can only be exercised by the true Proprietor or Applicant. The true proprietor or applicant may or may not be the party listed on the European Patent Register.
This means that a licensee will not be able to request to opt out. Therefore, if there is a licensee, the option to opt out needs to be discussed.If there are multiple proprietors/applicants, all must agree to opt out.
Therefore, if you wish to opt out, now is the time to check ownership and seek any consent that may be required.
As with most aspects of law, opting out should be assessed on a case-by-case basis. If you wish to discuss this in more detail, please contact your attorney at PurdyLucey.
*These dates are based on the updated publication date of January 24th, 2023 and are therefore subject to change.