UP and UPC FAQ's 
Our specialist Unitary Patent team hopes the following frequently asked questions will provide insight into the new Unitary Patent and Unified Patent Court landscape.  Should you have further questions please contact your usual Potter Clarkson attorney directly. 
 
What is a Unitary Patent?
A Unitary Patent is a single patent right that will cover all Member States of the European Union except Croatia, Spain and Poland, although Croatia is expected to join the scheme later.

How does a Unitary Patent differ from a traditional European patent?
A traditional European patent, when granted, becomes a bundle of individual patent rights in the countries in which it is validated, i.e. in the countries in which it takes effect. Each of those individual patent rights must be maintained, i.e. renewed, individually and enforced individually. In contrast the Unitary Patent is a single right that will cover all participating Member States which have ratified the agreement that gives rise to the Unitary Patent, and for which only a single renewal fee will be payable. In addition, a single court decision, e.g. on infringement or validity, will apply across all participating Member States, not just in one country.

What do I need to do to obtain a Unitary Patent?
A Unitary Patent will be applied for using the existing European patent application procedure that is centrally administered by the European Patent Office, in the same way as at present.  However, the difference is that after grant it will be possible to request that the resulting European patent is converted into a Unitary Patent.

Will a Unitary Patent be the only way to secure patent protection in Europe?
No. The Unitary Patent will be an alternative option to validating a European patent in the traditional manner, choosing individual countries where protection is desired. Individual national patents will also still be available via respective national patent offices.

How will the cost of a Unitary Patent compare to a traditional European patent?
A traditional European patent application will be used to obtain a Unitary Patent, and so filing and prosecution costs will remain the same.

The main differences in cost will arise at the grant stage, particularly in relation to a reduced translation burden because a Unitary Patent will need to be translated into only one other language. Also, the requirements for local addresses for service and national validation which exist in many Member States will not apply to a Unitary Patent.

In addition, after grant cost savings could be made with a Unitary Patent in terms of renewal fees. A single renewal fee will be payable for a Unitary Patent and this has been set to match a ‘true top 4’ level, which means that it will be equivalent to the total sum of renewal fees for the countries in which traditional European patents are validated most, i.e. France, Germany, the United Kingdom and the Netherlands.

It is therefore expected that overall, if protection is required in more than around 4 Member States, a Unitary Patent is likely to be more cost effective.

What should I do if I only have operations in a small number of Member States?
For patentees operating in only a small number of Member States, it may be preferable to continue validating granted European patents in the traditional manner in those states.  However, because the alternative option of a Unitary Patent provides a relatively inexpensive way of securing wide geographic coverage it may become desirable. 

Will I still be able to obtain patent protection in Member States that are not participating in the Unitary Patent scheme?
Yes. Each of Croatia, Spain and Poland will remain a part of the European Patent Convention, and so it will still be possible to cover them by validating a granted European patent in the traditional manner in those states, as is presently the case. Such traditional validation of a European patent will also remain possible in the interim for participating Member States that are yet to ratify formally the legislation required for the Unitary Patent to come into being.

When is the Unitary Patent expected to become available?
The Unitary Patent will be available once the Unified Patent Court Agreement gives rise to the Unified Patent Court (UPC). This requires ratification of the Agreement by thirteen Member States, including the United Kingdom, France and Germany. Such ratification is expected to be completed by the first quarter of 2018 which will enable the new scheme to start in the second quarter 2018. Unitary Patent protection may be requested for any European patent granted after the Agreement comes into effect.

How will I enforce a Unitary Patent?
A Unitary Patent will be litigated exclusively in the Unified Patent Court (UPC).

What are the advantages of obtaining a Unitary Patent?
The following are likely to be key advantages of a Unitary Patent:
  • -Lower translation costs at the grant stage - only a single translation needed during a seven-year transitional period, and none at all after that)
  • -Lower renewal fees - typically less than 25% of the cost of maintaining individual patent rights in all participating Member States
  • -Easier European-wide enforcement using the Unified Patent Court (UPC)
  • -Simpler recordal of transfers and licences
  • -Single patent right covering over 400 million people and (when combined) the world’s second largest economy
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What are the disadvantages of obtaining a Unitary Patent?
The following are potential disadvantages of a Unitary Patent:
  • -Overall costs may be higher if protection in only a few participating Member States is of interest – likely cost saving compared to traditional validation of a European patent in around 4 Member States
  • -Revocation applies across all participating Member States throughout the life of a Unitary Patent
  • -No pruning of renewal costs by abandoning individual validations
  • -Uncertainty of using Unitary Patent Court (UPC) – although current European Union, International and National law will be taken into account
 
What is the Unified Patent Court (UPC)?
The Unified Patent Court (UPC) will be a single court system in which patent matters can be heard for all participating Member States, i.e. all European Union Members States except Croatia, Spain and Poland (although Croatia is expected to join the scheme later).

The UPC will have exclusive jurisdiction from the outset over Unitary Patents and, after a seven-year transitional period (which may be extended to fourteen years), also over traditional European patents having effect in participating Members States. During the transitional period claimants will, however, be able to choose to take actions relating to such traditional European patents before either the UPC or a national court.

Where will the UPC be located?
The UPC will have a number of Courts of First Instance consisting of Central, Local and Regional Divisions in various locations, as well as a Court of Appeal in Luxembourg. The Central Division will be based in Paris, London and Munich, while Local Divisions are currently planned for London, Düsseldorf, Munich, Mannheim, Hamburg, Paris, The Hague, Brussels, Milan, Helsinki, Copenhagen, Dublin and Vienna. A Nordic-Baltic Regional Division is expected to cover Sweden, Lithuania, Estonia and Latvia.

Is it possible to choose where to initiate proceedings?
A patentee may bring an infringement action in the Local or Regional Division where infringement occurs, or where the defendant resides or has a place of business. If there is no Local or Regional Division in the relevant state, the action can be brought at the Central Division. Similarly, defendants from outside the European Union may also be sued for infringement at the Central Division.

In contrast, all revocation actions and declarations of non-infringement (other than counterclaims) must be dealt with by the Central Division, with the London seat handling chemistry and biotechnology cases, the Munich seat handling mechanical engineering cases, and the Paris seat handling other cases including electronics.

Are infringement and validity actions likely to be split, i.e. will bifurcation happen?
Prevailing opinion suggests that UPC judges would prefer to hear infringement and validity actions together, and so bifurcation is considered highly unlikely to occur.

If an infringement action is initiated before a Local or Regional Division and there is a counterclaim for revocation, the Local or Regional Division has four options:
-Hear both sides of the case
-Proceed with the infringement action and refer the counterclaim for revocation to the Central Division
-Refer the counterclaim for revocation to the Central Division and stay the infringement action (probably only when there is a “high likelihood” of the relevant claims being found invalid)  
-Refer the entire case to the Central Division, provided the parties agree.
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Is it possible to exclude existing traditional European patents from the jurisdiction of the UPC?
Yes, providing no action is or has been pending before the UPC. An opt-out request may be filed which excludes UPC jurisdiction completely for the traditional European patent that is the subject of the request. No official fee will be payable.

What benefit is there to opting out of the jurisdiction of the UPC?
Opting a traditional European patent having effect in participating Members States out of UPC jurisdiction prevents a central attack on the validity of the patent, i.e. prevents the initiation of a single request for revocation at the UPC.

Is it possible to opt back into the jurisdiction of the UPC?
An opt-out request can be withdrawn, i.e. it is possible to opt back in, at any time, provided that no action in a national court has ever been pending, including actions that were finished before the UPC came into effect.  However, once an opt-out has been withdrawn it will not be possible to opt out again.

Is there any reason not to opt traditional European patents out of the UPC?
On the face of it there appears to be little disadvantage to initially opting out a traditional European patent from UPC jurisdiction, particularly given that it can be opted back in later, e.g. to allow the launch of a single, centralised infringement action at the UPC. Nevertheless, there may be an administrative and cost burden associated with opting out, or an interest, e.g. in certain industries, in ensuring the development of good case law in the UPC.

Is there a deadline for opting out of the UPC?
Proprietors of traditional European patents having effect in participating Member States will be able to register an opt-out at any time up to one month before expiry of the seven-year transitional period (unless an action is or has been pending before the UPC), or during a sunrise period before the UPC becomes operational.

A benefit of registering an opt-out during the sunrise period is that it becomes effective immediately on commencement of the UPC’s operations.

When is the UPC expected to become operational?
The Unified Patent Court Agreement, which gives rise to the UPC, requires ratification by thirteen Member States, including the United Kingdom, France and Germany. Such ratification is expected to be completed by the first quarter of 2018 which will enable the UPC to become operational in the second quarter of 2018. In such circumstances the sunrise period is expected to start sometime in the first quarter 2018.

Who can help?
To supplement our existing skills and knowledge as one of the leading patent prosecution firms in Europe and our expanded dispute resolution provision, we have created a specialist Unitary Patent team to guide clients through the new Unitary Patent landscape and help them continue to obtain and enforce their intellectual property rights in this new environment.