Developments Shaping European Ip Law After a Multiyear Saga, UPC Nears Fruition

The winding path toward a European UPC took another turn in 2021. While the ambitions for the project seemed to peter out in the first half of 2021, preparations took up a surprising speed after clearing one of the biggest hurdles: the German Federal Constitutional Court’s decision to dismiss preliminary injunctions directed against the German Approval Act. Only a few months after Germany’s green light, Austria became the last of the 13 EU Member States required to join the protocol on a UPC on provisional application (PPA). The UPC Preparatory Committee (Committee) is now formally in charge to take further steps towards a functioning UPC, which is expected to open its doors as soon as the second half of 2022.

Practice Note: Entities doing business in the European Union should carefully review their patent portfolio to decide whether there is an interest in opting-out from the UPC regime for all or part of their existing European patents and whether they wish to file European patents with unitary effect rather than standard European patents moving forward, depending, inter alia, on the strength of their invention(s) and their materiality for their business.

As stated in a note published by the Presidency of the Council of the European Union on 24 September 2021, the preparatory stage includes the adoption of the secondary legislation of the UPC, including procedures, establishment of a budget, recruitment of judges and administrative staff, election of a president, final configuration and testing of the file management system and ensuring that all information technology (IT) infrastructure is properly set up and secured. Additionally, a working agreement with the European Patent Office (EPO) concerning patent application and patent validation remains to be completed. Many observers regard the envisaged timeline of 10 months to complete these preparations as challenging, noting that several of the above points will likely require significant discussion.

The exact start date of the UPC and Unitary Patent System depends on the duration of the initial provisional application stage and on Germany formally depositing its UPC Agreement ratification (which has been withheld so far to give time for the Committee’s work). Once the UPC member states agree that the initial provisional application stage is almost completed (which is expected during the next two to six months), Germany will deposit its UPC Agreement ratification. This will then trigger another four-month run-up until the UPC finally opens its doors, which could be as early as the second half of 2022. After that, European patents with unitary effect will be available at the EPO, and a transitional period of seven to 14 years will initiate, during which European patent holders can still opt-out of the UPC regime.

In contrast to the currently available European patents, European patents with unitary effect—if the patentee opts for the unitary effect—will not be a mere bundle of national patent rights but confer the same rights to a patentee in all participating EU Member States. Likewise, in case of invalidation, a European patent with unitary effect will be revoked in all countries at once.

Dominik Rissmann also contributed to this article.