“Brexit” – Implications for IP owners
The first thing is that Britain won’t officially leave for at least two years, so nothing is going to happen overnight. That said, IP owners need to be prepared and have strategies in place now.
We therefore propose to set out the main points of impact for trade marks, patents and designs. We are focusing on the actual impact and most likely scenarios.
Trade Marks and Designs
The UK would no longer be covered by the EU trade mark and EU design systems.
The UK court system would no longer have EU trade mark Courts and no longer have the ability to grant EU-wide injunctions or be subject to decisions of EU courts.
Brand owners seeking to protect new trade marks in the UK would need to obtain a UK trade mark registration. There will be transitional provisions of some kind, probably allowing for the ‘re-registration’ of EU Trade Mark and EU Design registrations in the UK.
- Representation by UK Attorneys:
Options are being looked at whereby UK attorneys will retain the ability to represent clients before the EU IPO.
- Cost implications:
There would inevitably be an increased cost to brand owners as protection may be needed in the EU and the UK separately to achieve the same geographical coverage (in the same way as Norway, Liechtenstein and Switzerland are not covered by the EUTM or RCD regime).
There would also be an uncertainty over what will happen to seniority claims made in European Union Trade Marks based on an old UK trade mark registration.
There are likely to be trade mark ‘use’ issues that need to be considered. Currently use in a substantial part of the EU is required to maintain a registration. Use which heavily relied on the UK in the past may become vulnerable to non-use revocation unless used in a substantial part of the remaining EU member states.
- Exhaustion of rights:
Currently, a trade mark owner cannot object to the further dealing of goods it has placed on the market within the European Economic Area (EEA) (unless it has legitimate reasons to do so), as the trade mark rights in those goods will have been “exhausted”. In future EU TM and European design rights holders could prevent imports into the EU from the UK, as “exhaustion” rules would no longer apply to goods placed on the market in the UK. Likewise, UK rights would not be exhausted by sales elsewhere in Europe and could be used to prevent parallel imports into the UK from the EU.
- European Patent System:
The European Patent system is unlikely to be substantially affected provided the UK remains a signatory to the European Patent Convention. European Patents are administered, examined and granted by the European Patent Office, which is not an EU institution. Once granted, European Patents take effect as national rights in the designated countries, so any EP (UK) patents granted would be unaffected. Applicants would continue to obtain UK patent protection through the EPO process or through UK national filings.
The Unified Patent Court (UPC) is only open to EU Member States. As a non-EU member, the UK would no longer be eligible to participate in the UPC and proceedings relating to the UK part of European Patents granted under the EPC would need to be brought in the UK courts. However, the English Statutory Instrument required to amend the Patents Act to give effect to the UPC Agreement has already been passed and the UKIPO has indicated that the UK is pushing ahead with the project as planned, despite the referendum.
- Unitary Patents:
Post-Brexit these would not cover the UK, and those already granted would be subject to transitional arrangements to allow patentees to preserve their rights in the UK.
- The UK and pan-European systems do not allow for the registration of copyright as such, so there are no re-registration issues like Trade Marks and Designs.
- Copyright is the least harmonised with EU laws, so the law and procedure is unlikely to change as much as the other areas of IP.
Co-existence agreements, franchise agreements or other IP contracts which cover the EU as a defined territory, or which concern EU-wide IP rights, or are subject to EU law or jurisdiction should be reviewed to ascertain how they apply in the UK.
Agreements which intended to cover European Union were presumably intended to cover countries that are/were members at the date of the agreement. These would need to be reviewed for implications post Brexit.
What should brand owners do now?
Trade mark and design owners who continue to file new applications, there is a choice:
- apply EU-wide and “convert” those rights into UK rights later;
- file both UK and EU-wide applications now, to avoid having to rely on the conversion mechanism.
What is clear is that a review of your portfolio management and strategy is essential.
For more information contact Manish Joshi at firstname.lastname@example.org