Unitary patent in Europe: planned to start on 1 june 2023 – 1/3

The entry into force of the Agreement on a Unified Patent Court (UPCA) of 20 June 2013¹ is now only subject to ratification by Germany (which has already signed the UPCA).

On 5 December 2022, the Unified Patent Court (UPC) announced² that it will start operating as of 1 June 2023, i.e., two months later than the originally scheduled date of 1 April 2023. In turns, implies that the “sunrise period” will start on 1 March 2023 instead of 1 January 2023.

On the other hand, the European Patent Office (EPO) has announced³ that the starting date of the EPO transitional measures remains 1 January 2023.

The establishment of the UPC will, in the short to medium term, lead to a major revolution in patent litigation in Europe and thus in European patent strategy.

The entry into force of the Agreement will also automatically entail the entry into force of Regulation (EU) No 1257/2012 of 17 December 2012, creating the so-called unitary patent⁴, in accordance with Article 18 of the Regulation.

To anticipate these important changes, we will devote three consecutive newsletters to this topic:

• The first, namely this one, is dedicated to the unitary patent, 1/3
• The second will focus on the opt-out, in particular to explore the strategies to be implemented during the sunrise period from 1 March to 31 May 2023, 2/3
• The third part will be devoted to the challenges, particularly from the procedural viewpoint, of the establishment of the UPC, which will lead to radical changes in the litigation process, particularly with regard to the (very short) time limits for judgment, damages, injunctions, etc. 3/3

1) What is a unitary patent?

As most of you know, the European patent is not, contrary to what its name might suggest, a legal right of European scope, unlike trademarks or EU designs. Indeed, while the examination procedure (including opposition) is unified before the EPO, in accordance with the European Patent Convention (EPC)⁵, the European patent must then undergo national validation in each EPC member country in which the patentee wishes to have protection, and each of the national validations constitutes a separate legal right.

This system has a number of practical consequences, particularly from the financial and administrative viewpoints (namely, each national validation is subject to fees and representation costs, and the renewal fees, once the examination procedure has been completed, must be paid in all the States in which a validation is to be maintained) and from the procedural viewpoint (legal actions must be brought before national courts and have effect only for the territory of the State in question, each validation of the same European patent may be independently licenced or assigned).

The unitary patent (i.e., the European patent with unitary effect) has been created to eliminate this complexity, by creating a genuine, unified legal right in all EU Member States participating in the enhanced cooperation⁶, which legal right will fall under the exclusive jurisdiction of a supranational court, namely the UPC.

¹ The agreement is available on this official link.
² The notice from the UPC is available on this official link.
³ The notice from the EPO is available on this official link.
⁴ Regulation 1257/2012 is available on this link. Please note that this regulation is accompanied by Regulation 1260/2012 on translation arrangements, available on this link.
⁵ The EPC of 5 October 1973, including its revisions, is available from this link.
⁶ Enhanced cooperation is a mechanism whereby a group of at least nine EU Member States is allowed to create legal instruments in a particular area within the EU, to enable it to make faster progress in that area than other Member States, which may decide to stay out or join at a different pace.

In other words, the unitary patent will be managed by a single patent office, i.e., the EPO. There will be no more validation formalities, and a single renewal fee will be need to be paid, to the EPO⁷. In addition, court decisions will be valid for the territory of all participating Member States and no longer only for the territory of one State. For example, a single ruling will be sufficient for deciding the validity of the unitary patent in all the participating States, while infringement can be recognised in the same way throughout the territory in question. In addition, it will finally be possible to obtain a transnational prohibition measure, like with European trademarks or designs⁸.

It is important to note that the unitary patent and the UPC are EU mechanisms, which is not the case for the European patent, which may cover up to 44 states (i.e., EPC member states, and extension or validation states), among which many non-EU states such as Switzerland, Turkey, and the UK:

⁷ The amount of the renewal fees for the unitary patent should correspond to the average amount of renewal fees for a classic European patent validated in 4 countries. See Article 12.2.c) of Regulation 1257/2012.
⁸ It should be pointed out that certain actions will remain within the jurisdiction of the national courts even for a unitary patent, namely those which do not fall within the substantive jurisdiction of the UPC: these include actions relating to a contract (e.g., a licence agreement), ownership or employee inventions. In this case, the action must be brought before the competent court under the Brussels 1bis Regulation.

Naturally, the unitary patent will not have effect in those states which are members of the EPC but not of the EU. Nor will it have unitary effect in the two EU Member States which do not participate in the enhanced cooperation which led to Regulation 1257/2012 (i.e., Croatia and Spain), or in the eight others which participate in the enhanced cooperation but have not yet ratified the UPCA (i.e., Poland, Cyprus, the Czech Republic, Greece, Hungary, Ireland, Romania, and Slovakia).

In all these countries, the European patent will remain a classic European patent, without unitary effect, with the usual consequences (validation formalities country by country with possible translation, payment of annuities at national level, jurisdiction of national courts, etc.).

As of the date of writing this newsletter, the unitary patent will therefore cover 17 EU Member States⁹:

⁹ Portugal, France, Belgium, Luxembourg, Netherlands, Italy, Germany, Denmark, Austria, Slovenia, Sweden, Finland, Estonia, Latvia, Lithuania, Bulgaria, and Malta.

The 8 states already participating in enhanced cooperation will probably join the club of 17 soon, leading to a single territory of 25 states (and even Spain might decide to join enhanced cooperation during the Spanish Presidency of the EU, in the second semester of 2023):

However, the territorial scope of the unitary patent will be determined as of the date of registration of that unitary effect at the EPO¹⁰. In other words, it is not intended to extend the unitary effect of a previously granted patent to States which join the UPCA after such registration.

2) How to obtain a unitary patent?

Nothing changes in the filing and examination procedures before the European Patent Office (EPO). The unitary patent, or rather the unitary effect of the European patent, arrives as a new, optional option that can be activated for any European patent that will be granted after the date of entry into force (which is expected to be 1 June 2023, according to the latest announcements).

In practice, the request for unitary effect is a simple formality, which must be carried out by the applicant or his representative within one month¹¹ of the decision to grant the European patent. It will be sufficient to have the unitary effect recorded in the European Patent Register (the request is not subject to a fee¹²).

Article 6 of Regulation (UE) 1260/2012 provides for a transitional period of 6 years (renewable for two years) during which the request for unitary effect must  include a translation of the full text of the patent:

• either into English, if the patent is in French or German (this English translation will usually already be available, for example when equivalent patent applications have been filed outside Europe),
• or into any other official language of the EU, if the patent is in English.

¹⁰ Article 18.2 second paragraph of Regulation 1257/2012.
¹¹ Article 9.1.g) of Regulation 1257/2012 and Rule 6 of the Rules relating to Regulation 1257/2012, adopted on 15 December 2115, available at this link. Note that re-establishment of rights regarding the unitary effect is available in accordance with Rule 22 of the Implementing Regulation.
¹² Rule 5.II.5 of the above-mentioned Rules.

The aim is to achieve a reliable system of automatic translation of patent texts into all official EU languages by the end of this transitional period.

While the translation formalities are thus clearly reduced compared to a classic European patent with national validation¹³ , it should nevertheless be stressed that in the event of a trial (i.e., before the UPC), the patentee will be obliged to provide, at his own expense:

• In the case of infringement proceedings, a translation either into the language of the State where the alleged infringement took place or into the language of the State where the infringer is domiciled, at the infringer’s choice¹⁴,
• A translation into the official language of the court, upon request from the Court¹⁵. In practice, this will be limited to actions falling within the jurisdiction of the local and regional divisions of the UPC¹⁶, as the language of proceedings of the central division will be that of the patent¹⁷.

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Two other transitional measures should also be mentioned:

• Early requests for unitary effect, i.e., requests may be filed even before the entry into force of the UPCA, as from ratification by Germany¹⁸.

• Requests for delay in issuing the grant decision until the date of entry into force of the UPCA, for European patent applications under examination¹⁹. Again, this option will be available from the date of ratification of the UPCA by Germany.

The request for delay must be filed following the notification under Rule 71(3) EPC (notification of text and bibliographic data), but before or at the same time as the applicant’s agreement to the text of the patent.

Both possibilities will be available from 1 January 2023, until 31 May 2023²⁰.

In practice, it will be worthwhile to file the request for delay, in order to have enough time to decide, on a case-by-case basis, whether it is relevant (from a strategic viewpoint) to request unitary effect, or to retain the concurrent jurisdiction of the national courts and the UPC, or, alternatively, to opt-out, in order to escape the jurisdiction of the UPC. Therefore, an early request for unitary effect should only be considered after a strategic and opportunity study has been carried out.

¹³ As a reminder, despite the London Protocol whereby some countries have partially waived translation requirements, it is often still necessary to provide a translation in the official language of at least the claims (Albania, Croatia, Denmark, Finland, Hungary, Iceland, Latvia, Lithuania, Macedonia, the Netherlands, Norway, Slovenia and Sweden) or even of the whole patent (Austria, Bulgaria, Czech Republic, Greece, Estonia, Spain, Italy, Poland, Portugal, Romania, Serbia, Slovakia, Turkey). Details are available on this link. Note that the London Protocol does not apply to translation requirements in the event of litigation.
¹⁴ Article 4.1 of Regulation 1257/2012.
¹⁵ Article 4.2 of Regulation 1260/2012.
¹⁶ Articles 32 and 33 of the UPCA determine the competence of the different divisions.
¹⁷ Article 49.6 of the UPCA.
¹⁸ Notice from the EPO dated 22 December 2021 available on this link.
¹⁹ Decision of the President of the EPO dated 22 December 2021 available on this link.
²⁰ Notice from the EPO dated 6 December 2022 available on this link.

3) Why consider requesting unitary effect ?

Since this is an optional choice, the question arises as to whether an applicant should make use of the unitary patent.

Multiple benefits can be expected from the unitary patent:

• Less administrative workload, by eliminating the currently existing formalities (notably representation) before the national patent offices, and therefore the corresponding costs, which typically amount to a few hundred euros per country.
• Decreased translation costs, by doing away with the currently required translations of the European patent into the national languages, of the full text (Italy, Portugal, Austria) or of the claims only (Netherlands, Sweden, Denmark, etc.).
• Possibly lower renewal fee costs: the cost of the flat rate renewal fee is equivalent to about 4 national renewal fees, for a territorial coverage equal to 17 countries.
• Double protection is possible by means of a national patent, in those states which allow it (i.e., France²¹, Germany, Denmark, Hungary, Austria, Estonia, Finland, and Sweden²²).

The map below summarises the situation on double patenting.

²¹ Article L. 614-13 of the French Intellectual Property Code, as currently in force; provides that a French patent ceases to have effect from the expiry of the opposition period on a European patent covering the same invention: this is the classic prohibition of double patenting.
The future amended Article L. 614-13-II of the French Intellectual Property Code, which will come into force at the same time as the UPCA, provides, on the other hand, that a French patent covering the same invention as a ”classic” European patent will continue to produce its effects, in the absence of an opt-out.
Similarly, Article L. 614-16-3, applicable only to unitary patents, also allows a French patent covering the same invention as a unitary patent to continue to have effect.
In France (and in Germany, which has the same rules), double patenting is therefore a benefit granted to European patent holders who accept the jurisdiction of the UPCA.
²² According to the questionnaire SC/3/22 Corr 1 published by the EPO on 21 March 2022 available on this link.
It should be noted that Estonia will only allow dual protection for the unitary patent, to the exclusion of the classic European patent even in the absence of an opt-out.
In contrast, Denmark, Hungary, Austria, and Sweden allow double protection for a classical European patent even in case of an opt-out.

Position of the States participating in the enhanced cooperation regarding double patenting (i.e., cumulation of European and national patents)

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Meanwhile, the main disadvantages of the unitary patent (during the 7-year transitional period²³ of the entry into force of the UPCA) are:

• Opt-out cannot be requested (including for the 10 other Member States not yet participating, which would join the UPC at a later date, as a European patent can only be opted out for all the countries²⁴), and therefore it is not possible to escape the jurisdiction of the UPC, in particular to escape a central invalidity attack beyond the opposition period (9 months after grant);
• It is not possible to benefit from the concurrent jurisdiction of the national courts and the UPC. Indeed, small disputes confined to one country could be more efficiently pursued before a national court.

²³ According to Article 83 UPCA, this transitional period can be extended for up to 7 more years.
²⁴ Article 44 of the UPCA and Rule 5(1)(b) of the Rules of Procedure of the UPC.

Opt-out and the issues related to the UPC litigation will be explored in our next two newsletters on the subject.

4) Link between unitary patent and SPC

As the unitary patent is a patent which has effect in the territory of at least one Member State, it may constitute a basic patent within the meaning of Article 2 of Regulation (EC) No 469/2009 on Supplementary Protection Certificates (SPCs) for medicinal products. The same applies to Regulation (EC) No 1610/96 on plant protection products.

In fact, SPCs are explicitly referred to in the UPCA²⁵.

However, it is not currently possible to obtain unitary effect for an SPC in the same way as for a European patent, as there is no regulation providing for this. The European Commission is currently working on draft provisions for a unitary SPC²⁶, but no concrete proposal has yet been made. This means that SPCs will still be national legal rights granted by the offices of each state when the unitary patent and the UPCA come into force.

However, the UPC does have jurisdiction over SPCs²⁷ in the same way as for any European patent. More specifically, the SPC follows the fate of the basic patent: if the latter is the subject of an opt-out, then this opt-out extends de jure to all national SPCs based on this patent²⁸. Conversely, opt-out is not possible for an SPC based on a unitary patent²⁹ or on a European patent which has already been the subject of an action before the UPC³⁰. Similarly, opt-out limited to the SPC is not possible, irrespective of the situation of the basic patent (e.g., in the case where the basic patent has already expired at the date of entry into force of the UPCA).

The situation of SPCs is therefore special:

• They are national legal rights, granted and managed by the national offices. In the event of a decision to refuse an application for a SPC, the courts of the Member States will continue to have jurisdiction to hear an appeal.
• But SPCs are subject to the jurisdiction of the UPC, except in the case of an opt-out of the basic patent, which is impossible in the case of a unitary patent.

The question arises whether the territorial scope of a SPC based on a unitary patent might differ from that of an SPC based on a classical European patent. Indeed, some authors have invoked Article 30 of the UPCA³¹ as well as Article 5 of the SPC Regulation³² to argue that an SPC based on a unitary patent should also have unitary scope.

²⁵ See in particular Articles 2h) and 30.
²⁶ In particular, it issued a call for evidence in March 2022 available on this link which could lead to a proposal for a regulation in the near future.
²⁷ Article 3b) of the UPCA.
²⁸ Rule 5.2 of the UPC Rules of Procedure available at this link.
²⁹ Rule 5.2(d) of the UPC Rules of Procedure.
³⁰ Rule 5.6 of the UPC Rules of Procedure, together with Rule 5.2 c).
³¹ “A supplementary protection certificate shall confer the same rights as conferred by the patent and shall be subject to the same limitations and the same obligations.”
³² “Subject to the provisions of Article 4, the certificate shall confer the same rights as conferred by the basic patent and shall be subject to the same limitations and the same obligations.”

However, this interpretation seems difficult to reconcile with the SPC’s status as a national legal right. Moreover, an SPC is by nature dependent on a marketing authorisation (MA), which may be a purely national MA. Such a unitary effect would create a significant legal risk for third parties, who would then have to verify the existence of national SPCs in all UPC member states, as well as potentially their national MA, which may be in many different languages. It seems more reasonable to us to consider, as the majority opinion does, that an SPC will only have an effect limited to the territory of the issuing State, even when it is based on a unitary SPC.

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The disadvantages of a SPC based on a unitary patent include:

• It falls within the exclusive competence of the UPC,
• It cannot be the subject of an opt-out,
• An invalidation of a national SPC due to the invalidity of the unitary patent (or of the European patent without opt-out) on which it is based is likely to lead to the invalidity of other SPCs granted on the same basis in the other UPC participating States, by way of consequence, because a decision of invalidity handed down by the UPC extends to the territory of all UPC participating States³³

The advantages of a SPC based on a unitary patent (or a European patent without an opt-out) include:

• An action may be brought before the UPC on the basis of all national SPCs issued in the UPC participating states simultaneously (provided that the owners of the SPCs are the same).
• The possibility of basing the national SPC on a national patent and/or the unitary patent, in a number of participating countries.

5) The challenges of filing strategies

Given its imminent entry into force, the unitary patent is an option to be considered now for all pending European patent applications.

Indeed, several protection strategies are possible at the end of the European procedure:

³³ Article 34 of the UPCA.
³⁴ It should be noted that there are no changes to the costs and to the formalities for validation in non-participating countries.
³⁵ Provided that no action before the UPC has already been brought (Article 83.3 UPCA). The opt-out may be withdrawn (the so-called “opt-in”) is possible, provided that no action before a national court has already been brought (Article 83.4 UPCA).

TO REMEMBER:

– The unitary patent is an option not subject to any fees, which is available for any European patent application, and which will then have unitary effect in the 17 EU Member States that have ratified the UPCA (and soon up to 25 or even 27 EU Member States)

– It will enter into force at the same time as the UPC Agreement, i.e., on 1 June 2023

– As soon as 1 January 2023, it will be possible to request a delay in issuing the grant of the patent until the date of entry into force of the UPCA, in order to have time to decide, on a case-by-case basis, whether or not to request unitary effect.

– The formalities associated with the unitary patent will be simpler, and the costs will be lower, compared to a classic European patent.

– The unitary patent will be subject to the exclusive jurisdiction of a supranational court, the Unified Patent Court, without the possibility of seeking an opt-out.

– It will be possible to double the protection by national patents, especially in France and Germany, for your most important patents, in case of filing a unitary patent or a European patent without an opt-out.

– A SPC can be based on a national patent and/or a unitary patent (or a non-opted-out European patent) in participating countries that allow dual patenting.

GUILLAUME DUBOS
Partner – Lawyer at the Paris Bar
Deputy Head of Litigation Department
guillaume.dubos@abello_ip.com

THOMAS LECONTE
European Patent Attorney
thomas.leconte@abello-ip.com

JEAN-BAPTISTE THIBAUD
Partner – European Patent Attorney
Head of Patent Department
jean-baptiste.thibaud@abello-ip.com