Risk & Economy » Brexit » 2017: Get ready for the new unitary patent

Dave Croston, partner and patent attorney at Withers & Rogers outlines his expectations of the upcoming unitary patent

Get ready for the new unitary patent coming in 2017

Despite the ongoing Brexit uncertainty, an important pan-European legal development is on schedule to bring important changes for innovation-led businesses in 2017. Some financial directors and CFOs may need to rethink their intellectual property (IP) strategies as a result.

The unitary patent system has been work in progress for several years. A recent decision by the UK government to proceed with ratification of the European legislation means it is now likely to take effect next year.

What is the unitary patent?

When it arrives, the unitary patent system will allow innovative companies to obtain a single patent right covering up to 26 European countries. It will be obtained from the European Patent Office and it will be enforced centrally via the Unified Patent Court – a new court for patent matters in Europe.

What difference will it make?

The new system will bring immediate and significant benefits for many businesses seeking to trade in Europe – those with existing patent portfolios and those seeking patent protection for the first time.

In particular, a new unitary patent will provide protection for a specific invention spanning almost the whole of the EU marketplace – a territory with a population of over half a billion people and a GDP valued at over $18 trillion. To achieve the same geographical scope using a traditional European patent would entail much greater expense.

The system will be much easier to use; doing away with the need to validate a granted European patent on a country-by-country basis. Once obtained, the new patent will be easier to maintain too via a central registry; making assignment of IP rights and other administration simpler and cheaper.

Businesses that are already familiar with the costs associated with traditional bundle European patents will also be pleased to know that the new unitary patent system is cost effective. In fact, it should provide a much cheaper alternative where protection is being sought in four or more countries.

The new system will also be more appealing to SMEs. Instead of taking two years or more to resolve any patent litigation – which can be costly – an outcome will be reached more quickly. For an SME defending its patent rights, it will be possible to secure an interim injunction against any infringing party, effectively blocking access to the EU marketplace. To avoid a pan-European injunction, infringers will be more inclined to settle out of court.

A CFO checklist

To prepare for the changes on the way, financial directors and CFOs should consider the following:

 

  1. Lead the way. It is not yet known exactly when the new legislation will take effect but it will probably do so in 2017. There is still time for businesses with an interest in IP to plan ahead to take advantage of the benefits. If patent managers or CIPOs are not yet aware of the changes, financial directors and CFOs can lead the way by actively supporting the internal education process and seeking specialist advice as needed.
  2. Review your IP strategy. Many businesses lack an effective IP strategy, which is aligned to its corporate goals. With legal changes on the way, now is a good time to reassess the role of intellectual property in driving value across the organisation and ensure this is understood at board level.
  3. Consider new market opportunities. Most existing patent portfolios will have been compiled based on a set of rules that balance the desire to bring products to market in certain EU countries against the costs associated with managing and maintaining IP assets. Due to its cost-effectiveness, the incoming legislation will bring an opportunity to rewrite the rules and in some cases could open up opportunities to trade in more countries.
  4. Take your time with pending patent applications. Patent applications that are being processed by the European Patent Office when the new legislation takes effect will be able to opt for unitary patent status when granted. With this in mind, and as the legal changes are imminent, it may be sensible to slow down any pending European applications.
  5. Understand the impact. Despite hitting a Brexit speedbump, the unitary patent system has been given the green light by the UK government and will take effect soon. Financial directors and CFOs of innovation-led businesses should be taking steps to understand its impact and the opportunities it could create.

 

Dave Croston is a partner and patent attorney at intellectual property firm, Withers & Rogers.