The United Kingdom has voted to leave the European Union, triggering collapses in financial markets and prompting Prime Minister David Cameron to announce his forthcoming resignation. Amidst the uncertainty of this unprecedented situation, everyone wants to know what will happen next. While the exact mechanics of the “Brexit” are yet to be negotiated, this bulletin will clarify the impact for owners of patents and trade marks in Europe.
The European Patents Office (EPO) grants patents in up to 38 countries that are party to the European Patent Convention (EPC). Although there is a unified application process, once granted, a ‘European Patent’ provides protection in each designated country independent of the others. Participation in the EPC is distinct from membership in the EU and the UK is a party to the EPC independent of EU membership. Accordingly, the Brexit will not affect the protection of European Patents in the UK.
A planned ‘Unitary Patent’, to be granted under the EPC with modified regulations, will only apply to EU members ‒ excluding Croatia and Spain, which have explicitly opted out. This system is subject to the ratification of an agreement for a Unified Patent Court (UPC) by a number of countries ‒ including the UK as one of the EU’s most prolific patent jurisdictions. The EPO has announced that they will find a solution for implementing the Unitary Patent without the UK’s ratification. In any case, since the Unitary Patent is not yet in force, the Brexit will not affect any existing rights in this regard.
The European Union Intellectual Property Office (EUIPO) grants trade marks protected across all EU countries. These EU Trade Marks were known as Community Trade Marks (CTMs) until changes were introduced earlier this year.
As we foreshadowed in our previous bulletin, EU Trade Marks will no longer extend protection to the UK once the Brexit is implemented. It is widely expected that transitional arrangements will ensure EU Trade Mark owners can continue to enjoy protection in the UK.
Other implications may include:
- The value of EU Trade Marks will be reduced once they no longer include the UK;
- Businesses may have more difficulty maintaining and enforcing EU Trade Marks without being able to rely of evidence of use in the UK;
- There are renewed calls for Scotland to gain independence from the UK so that it can re-enter the EU in its own right ‒ 62% of Scots voted to remain in the EU and post-Brexit polls show a majority of Scots favour independence, with Scottish First Minister Nicola Sturgeon already announcing a likely new referendum on the issue. This move would further impact the scope of protection of trade marks registered in the EU and the UK.
Nothing dramatic is expected to happen in the short term and there is no need to take any immediate action. The UK and EU have two years to negotiate the mechanics of the Brexit and the world will be watching with interest how this will affect them.
For Australian businesses with international trade mark portfolios, this will mean following developments on the above issues and taking any necessary steps to maintain protection across all jurisdictions where they operate. We will continue monitoring these developments and advising clients on appropriate action to protect their rights.
In the meantime, the advice remains to watch this space.
This article was written by Nicholas Pullen, Partner and Scott La Rocca, Senior Associate.