The UK government quietly announced in a press release on Monday that it will proceed with ratifying the Unified Patent Court Agreement (UPCA), as the minister for intellectual property, Lucy Neville-Rolfe, informed her counterparts of the intention at a Competitiveness Council meeting in Brussels.
The decision to ratify is somewhat surprising given most experts believe that only EU member states may participate in the UPCA, whereas the UK is on a path to leave the EU after the Brexit vote in June. The decision to proceed with ratification may reflect a pragmatic approach to the current circumstances.
The release did not reflect the complex political context of the decision, saying vaguely that, “The decision to proceed with ratification should not be seen as pre-empting the UK’s objectives or position in the forthcoming negotiations with the EU” and adding the “UPC itself is not an EU institution, it is an international patent court”.
While it is true that with Spain deciding not to join, the UPCA will not give rise to a new EU agency, the latter statement omits to mention that the rulings of the Unified Patent Court (UPC) will be subject to review by the European Court of Justice, an unpopular tribunal among Brexit supporters.
The UPCA would implement a Unitary Patent (UP) and Unified Patent Court (UPC) providing a single patent with force across 25 EU member states. This is in contrast to the current position, which requires patents issued by the European Patent Office (EPO) to be separately validated in each member state to have any force, while any infringements must be contested in national courts.
A UP issued by the EPO would have force in all UPCA member states, and would be enforceable via a single lawsuit in a UPC court.
How to reconcile Brexit and ratification of UPC
There are at least three scenarios permitting the UK to be part of the UPCA. First, it is possible that Brexit may never happen. Second, the UPCA could be interpreted as allowing a non-EU member state to join. Third, the UPCA could be amended to allow the UK to participate as a non-EU member state.
There is a possibility that Brexit may never happen. A formal “hard” Brexit is at least two years away, given that the UK has not yet initiated the Article 50 process that would set a two-year negotiation for UK to exit the EU.
The UK government has announced plans to initiate the Article 50 process by March 2017, but needless to say anything may happen before then.
Some experts believe the language of the UPCA is flexible enough to allow a country that is not part of the EU to join, since it does not explicitly exclude non-EU member states. This scenario appears unlikely, because it would allow the UK to retain its current prominent position within the UPCA without any meaningful concessions for losing its status as an EU member state.
One might expect this would offend EU member states participating in the UPCA. It would also potentially open the door for other non-EU states to join the UPCA, which was certainly not contemplated.
In the case of a formal Brexit, a more likely scenario is that the UPCA is modified to retain the UK as non-EU member. A formal Brexit would mandate discussions to revise the UPCA to account for loss of the UK as member, because the UK currently plays a major role, with the UPCA naming the UK as host of a Central Division responsible for litigation relating to chemicals and pharmaceuticals.
Such discussions could presumably include a UK proposal to retain the UK as non-EU member state. Whether the UK proposes such a revision could depend on UK public reaction to participating in an international court under the ECJ, particularly given that Brexit supporters are very critical of the ECJ.
For now, the UK decision to ratify does not appear to have generated much mainstream press coverage. That may be a good sign for those in favor of a strong UPCA.
R. Frederic Henschel is a partner at the law firm Foley & Lardner LLP