Update on Brexit Negotiations Between the UK and the EU in the field of IP rights

By: Francesca Giovannini

On July 12th, 2018, the United Kingdom (UK) Government issued a White Paper on the Future Relationship between the UK and the European Union (EU). Since the White Paper is just a proposal advanced by the UK Prime Minister, it is unknown whether and to which extent the EU may find such a proposal acceptable. Nevertheless, the document may at least be considered a general indication of the goals the UK intends to achieve in its new relationship with the EU after Brexit.

Among several aspects mentioned in the proposal are those related to Intellectual Property (IP). Despite the declared wish of ending the jurisdiction of the European Court of Justice in the UK, the White Paper recalls the UK ratification of the Unified Patent Court (UPC) Agreement and declares its intention “to explore staying in the Court and unitary patent system after the UK leaves the EU” and to “work with other contracting states to make sure the UPC Agreement can continue on a firm legal basis”. It is unclear how the UK intends to achieve both goals based on the current version thereof (i.e., ending the jurisdiction of the European Court of Justice while staying in the UPC and unitary patent system) since members of the UPC Agreement are subject to the jurisdiction of the European Court of Justice.

For the time being, continued participation in the UPC appears to be possible only if:

  • the UK accepts judicial review of the European Court of Justice for the settlement of disputes relating to European patents and European patents with unitary effect and
  • the UPC Agreement is amended to include a statement explicitly allowing a EU member state that has ratified the UPC Agreement to remain in the Agreement when it is no longer a EU member state.

According to a possible scenario, the UK Government might be ready to at least partly recognize, perhaps in specific fields, the jurisdiction of the European Court of Justice even when the UK leaves the EU. The UK Prime Minister’s announcement given on July 24, 2018 that the 1972 European Communities Act, the primary legislation which took the UK into the EU, will not be fully repealed until the end of 2020 (as opposed to March 2019) appears to be compatible with this scenario. It is still unclear whether a possible will to retain parts of the 1972 European Communities Act, including the continued jurisdiction of the European Court of Justice, may be concretized and result in the adoption of a legislative act.

In more general terms, the White Paper also announces “arrangements on future cooperation on IP”, which appears to be directed to all IP rights, including trademarks, designs, copyright, and exhaustion of rights. However, no further detail was provided in this regard. Only the final version of the Withdrawal Agreement will provide such details. For the time being, according to the Draft Withdrawal Agreement of last March, the EU Commission declared that the EU is prepared to agree to continuous protection in the UK, by way of a corresponding UK right, for owners of EU trademarks, registered Community designs or plant variety rights, without the need for re-examination.

Since March 2018, the EU Commission has announced that provisions on IP have been partly agreed by both parties. It confirmed that before the end of the transition period, an IP right owner in the EU will, without re-examination, become the holder of a comparable and enforceable IP right in the UK under UK law (e.g. trademarks, registered designs, and Community plant variety rights). The transition period will start on the date of entry into force of the final Withdrawal Agreement and end on December 31, 2020, assuming the Withdrawal Agreement is ratified. Otherwise, there will be no transition period. Provisions on the protection of unregistered Community design and of databases have also been agreed, as well as provisions on how to deal with pending applications for EU trademarks and for Community plant variety rights. Particularly for EU trademarks and Community plant variety rights, applicants will have a right to file an application in the UK during a period of nine months from the end of the transition period.

In June 2018, negotiators also reached an agreement on the provisions of the Withdrawal Agreement regarding pending applications for supplementary protection certificates in the UK.  However, the provisions on geographical indications, designations of origin, traditional specialities guaranteed, or traditional terms have not yet been agreed. Further negotiations are also needed to set the final version of the provisions on the registration or grant procedure in the UK of the IP rights, such as those deriving from applications for EU trademarks and for Community plant variety rights, which still need an action to be taken by applicants to be kept alive in the UK after the UK leaves the EU.