Update on the Unitary Patent

On June 1, 2023, the Agreement on a Unified Patent Court finally comes into force: This is what patent applicants and owners should consider in connection with the new Unified Patent Court and the European patent with unitary effect.

We had previously informed you that the Unitary Patent System was expected to enter into force by the turn of the year. However, due to technical difficulties encountered by the new Unified Patent Court, the launch of the Unitary Patent System was delayed by several months. In the meantime, these barriers seem to have been overcome and the last formal act required for the entry into force, i.e. the deposition of the instrument of ratification with the new court by the Federal Republic of Germany, acting as gatekeeper, has been fulfilled. The three-month “sunrise period” began on March 1, 2023, and ends on June 1, 2023, when the Unitary Patent will officially be launched.

How to obtain a European Unitary Patent

Just like the regular European Patent, the European Unitary Patent – in technical terms, the European patent with unitary effect – will be granted by the European Patent Office (EPO). Instead of validating a European patent in individual European member states, patent owners can file a request for unitary effect within one month of the grant of a European patent, which must be accompanied by a translation of the patent specification into English, or, if the European patent was granted in English, into German or any other official language of the European Union. 

The Unitary Patent is then automatically valid, but only for those EU countries that are a party to the underlying EU regulation and the court agreement at the time of grant. There are 17 participating EU countries so far: Germany, Belgium, Bulgaria, Denmark, Estonia, Finland, France, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Austria, Portugal, Sweden and Slovenia. 

Poland, the Czech Republic, Ireland, Greece, Cyprus, Hungary, Romania and Slovakia have not yet ratified the agreement, but are likely to follow gradually. Spain and Croatia are currently not participating in the enhanced cooperation which is the basis for the Unitary Patent but may still join later. Therefore, until further notice, if protection is sought in one of these countries, it is necessary to carry out a validation with the corresponding national office as before and to submit the nationally required translation. Non-EU member states such as Switzerland, the UK, Norway and Turkey are excluded from the European Unitary Patent, so that a validation remains the only possibility to extend protection to these countries.

When can European Unitary Patents be obtained?

As of January 1, 2023, a Unitary Patent can be obtained for all European patent applications pending grant, in other words, not only for European patent applications filed after the UPC Agreement enters into force but also for already pending applications which are still in the examination phase by then. 

Hence, after receipt of a communication from the European Patent Office on the intention to grant (so-called communication under Rule 71(3) EPC), patent applicants do not only have to decide to which countries they wish to extend the protection of their patent (so-called “validation”) but also if they want to request unitary effect. In case of the latter, there is only a short one-month deadline starting from the date of publication of European patent grant for filing the required full translation of the specification. Thus, the decision on whether or not to request a Unitary Patent needs to be made rather quickly. It is strongly recommended to prepare the translation of the specification required for the Unitary Patent together with the claim translations required for the grant of the European patent. 

Which courts will have jurisdiction over the Unitary Patent?

The Unified Patent Court (UPC) will have jurisdiction over patent infringement actions and revocation actions concerning Unitary Patents. This court has central chambers in Paris and Munich, various local and regional chambers in the member states and a central appeal court in Luxembourg.

With a single procedure, a Unitary Patent can be enforced before the UPC in all EU states for which the Unitary Patent is registered. However, Unitary Patents can also be destroyed in a single central invalidity proceeding for all participating EU states.

Bundle patent as an alternative

For the next 7 years, as an alternative to the Unitary Patent, patent owners have the choice to continue to validate in selected member states and exclude the jurisdiction of the Unified Patent Court for their patents (“opt-out”). In this case, the status quo does not change for European patents: Patent owners get, as before, a bundle of national protection rights for which the national courts in the respective member states continue to have jurisdiction – both national jurisdiction applies to the enforcement of the patent against patent infringers as well as to attacks on the validity of the respective national parts of the European patent, for example, through revocation proceedings.

What does the Unitary Patent cost?

Renewal fees for the Unitary Patent are payable to the European Patent Office. The fee structure has been chosen in a way that the maintenance costs are roughly the same as in the so-called top four countries Germany, France, Italy and the Netherlands. There are no national translation requirements as it is the case for validations; instead, a full English translation must be submitted to the European Patent Office. Therefore, as a general rule, a Unitary Patent will be cheaper than a bundle patent from about 5 countries upwards and will provide uniform protection in all participating (currently 17) EU countries.

However, unlike the bundle patent, it is not possible to abandon the Unitary Patent in individual countries one day and to renew it for selected countries only in order to save costs. Here, the all or none principle applies!

Unitary Patent or bundle patent?

The Unitary Patent and the current bundle patent are mutually exclusive for the participating EU countries. Care must be taken when deciding whether to apply for a Unitary Patent or a bundle patent as before. It is important to weigh the possible cost advantages during the granting stage against the considerably higher litigation costs which are to be expected for infringement and revocation proceedings.

Moreover, there is still no well-established, predictable case law practice for the Unified Patent Court (UPC), so that parties opting for the UPC enter infringement proceedings with a higher degree of uncertainty. Moreover, with a single procedure, the Unitary Patent could be destroyed throughout the EU, which, considering the still unestablished case law practice, may pose an increased risk for patent owners. Especially for very important patents, it may be worth  refraining from a Unitary Patent for the time being. We will be pleased to advise you on this.

On the other hand, the previously applicable prohibition of double patenting does not apply to Unitary Patents: a patent granted nationally, e.g. by the German Patent and Trademark Office, can be effective and enforced in parallel with a European Unitary Patent. A further consideration could therefore be to allow a German parent application to proceed to grant in parallel with a subsequently filed European application. This could make sense at least in cases where the German examiner has already deemed subject matter eligible for protection, so that a quick grant is in prospect and the risk of conflicting decisions by the German and European patent offices is avoided. With a Unitary Patent and a parallel national German patent, the patentee retains the choice of whether to enforce the Unitary Patent before the UPC or to start proceedings before a national court based on the German patent.

What about European patents granted in the past?

It may come as a surprise, but the Court Agreement also applies to all older European patents! This means that the Unified Patent Court will, without any further precautions, also have jurisdiction for European patents already granted and that an infringement action can be enforced uniformly for all member states for which the European patent is still in force. 

If someone wishes to avoid this jurisdiction for the above reasons and maintain the status quo for individual or all European patents, it is possible to opt out of the jurisdiction of the Unified Patent Court (UPC) (“Opt-Out”). Such an opt-out can already be declared as a precautionary measure during the “sunrise period” or also at a later point in time, as long as, however, no revocation action against a patent is pending before the UPC. Please note that declaring an opt-out for individual important European patents or even for all of them as a precautionary measure does not mean that  the UPC will never again have jurisdiction: As long as no action is pending before a national court, the patent owner can declare an opt-in at any time and thus “re-arm” the court agreement for their patent.

In our view, for the foreseeable future, patent infringement proceedings before national German courts are likely to be the more cost-effective, more simple and, above all, less risky way for patent owners to enforce their patents. We therefore recommend considering a precautionary opt-out for existing European patents, or to at least consider an opt-out before a patent is asserted against competitors.

We will be happy to advise you on the advantages and disadvantages of an opt-out as well as on the costs associated therewith.

If you have any questions about the European Unitary Patent and the impact of the Court Agreement on your IP rights, please do not hesitate to contact us.