How could EU Patent Protection be impacted by a potential Brexit?

29 Mar, 2016

While the UK is set to vote on a possible farewell from the European Union, a new EU patent system is in its final stages, but the timing of such changes could have a nudge effect on SMEs looking to protect their intellectual property.

 

The European Patent Office (EPO) has been undergoing a lengthy process to ratify a new unitary patent scheme in Europe, and now faces a potential Brexit, which for UK based SME patent applicants would mean a lengthier process than for SMEs in the rest of Europe.

 

For the scheme to be approved and put into action however, the three EU member states with the highest number of successful European patent applications must ratify the agreement, and the UK just happens to be one of those three.

 

The unitary patent scheme, which would be valid in 26 EU countries, would have applicants answer to a centralized enforcing court, the Unified Patent Court (UPC). This was established to cut costs of issuing and enforcing patents across all European nations. Applicants would then file for a single EPO case, and if successful, be granted instant IP protection throughout the Union, with the ease of a single renewal charge.

 

Therefore, if the UK were to vote yes on a Brexit in June, UK SMEs would have to navigate the more drawn-out procedure of applying for EPO IP protection, and then if granted, asserting the validation of said patent protection at a UK level, through the Intellectual Property Office (IPO). UK based SMEs could still apply for European spread protection via the EPO, but would have to separately validate for the UK.

 

As to enforcement, the UPC would focus on all unitary patent cases, but also include any classic process patent claims, unless said patent holders were to opt out during the transition process.

 

On a side note, the difference in costs, if a Brexit were not to occur, could be impacting to UK SMEs, depending on the extent of their business in other European member states. The EPO has said that the average cost reduction would be around 70% via the unitary patent scheme, but in an interview with The Guardian, Andrew Bowler, a partner at London based law firm Bristows and an expert on IP matters, states that this would only apply to larger multinationals, whilst smaller businesses would only benefit in terms of the business they are looking to protect throughout Europe.

 

“The renewal fee for a unitary patent has been based on the equivalent of having four patents in four European territories: UK, Germany, France and Italy,” says Bowler. “But obviously if it was an SME with just a home market of the UK and a single foreign market of France, it would only need two patents, so it becomes a question of whether it’s cost effective or not to apply for a unitary patent, when it could just apply for those two.”

 

At this point, the two possible conclusions are that with a Brexit the UK would be excluded from the unitary patent scheme, or on the other hand that the scheme, with the UK being a chief asset in EU economy, would come to a halt.

 

According to The Guardian, the EPO President, Benoît Battistelli, said in an interview: “The legal conditions are now met for a positive vote for ratification of this treaty. Now it’s a question of timing and awaiting the result of the referendum which has arrived in the process.”

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