IP & Brexit: the draft agreement on UK withdrawal

In short, the draft provisions relating to unitary EU intellectual property rights following Brexit reflect, for the most part, the 'common sense’ and logical approach advocated by rights holders and practitioners since the 2016 Referendum, and will assuage concerns of a ‘Brexit Day cliff face’ as regards trade marks and designs. The transition period (which will last till December 2020, during which time nothing will change as regards EUTMs and designs being valid in the UK) appears, prima facie, to be a sensible and reasonable timeframe to enable IP owners and other stakeholders to prepare for Brexit and ensure that unitary IP portfolios remain robust and enforceable across both the UK and the remaining 27 member states.

Rights of representation before the EUIPO have been discussed in certain quarters, with concerns being raised that some UK practitioners may be unable to act before that Registry post-Brexit. This will not affect D Young & Co, who will be able to handle EU trade mark and design work before, during and after the Brexit process. With the opening of our Munich office before the Brexit Referendum, D Young & Co continues to be in a strong position to assist clients with intellectual property work across the UK and Europe, as well as before the EUIPO and other bodies.

A more detailed summary of the draft withdrawal agreement (focusing on the IP provisions) is set out below:

• The draft Agreement is just that: it is not yet finalised, with terms being conditional pending a final agreement (likely to be later in 2018).
• A ‘transition period’ has been agreed in principle to run from the date the UK officially ‘leaves’ the EU (currently 29 March 2019) until December 2020, during which time EU law will still apply in the UK (i.e. the law relating to EUTMs and registered EU designs will be unaffected and such rights will continue to cover the UK).
• Any EUTM/design validly registered at the end of the transition period will continue to be protected by an equivalent UK-specific right thereafter; filing/priority/seniority dates will be maintained, and the first renewal of the UK-specific right will be the same as the EUTM/design (which will continue to cover the remaining 27 Member States of the EU).
• The precise mechanics of how this will work (e.g. whether there will be a fee etc.) have not yet been finalised.
• If an EUTM/design is declared revoked or invalid following an attack that was pending at the end of the transition period, the corresponding UK-specific right will suffer the same fate, unless the grounds for invalidity/revocation do not apply in the UK (e.g. a mark could be deemed descriptive in Latvia and other countries, but not in the UK).
• A resulting UK-specific right will not be revocable for non-use on the basis that the ‘parent’ EUTM had not been put to genuine use in the UK before the end of the transition period. It will be for the UK government to decide how much longer after the transition period an owner has to commence use in the UK.
• EUTMs deemed to enjoy a reputation in the EU will be able to enforce equivalent rights in the UK in respect of the equivalent UK-specific mark as they exist at the end of the transition period, but thereafter will have to be based on use within the UK.
• EU designations of International trade marks or designs filed at WIPO under the Madrid/Hague systems will similarly continue to have effect in the UK (details to be confirmed by the UK government in due course).
• Any unregistered EU design right that arises before the end of the transition period will continue to be valid within the UK on identical terms for the remaining period of validity of the unregistered EU design (which is only three years in any event). It is to be hoped that the UK government will amend current UK unregistered design law so that it provides equivalent coverage to EU unregistered design law – there are currently major differences (e.g. 2D logos cannot be protected under current UK unregistered design law, but can be under EU unregistered design law).
• Pending EUTMs/designs that have been granted a filing date by the end of the transition period will enjoy a priority period of 9 months (not the usual 6) from the end of the transition period within which their owners can file an equivalent trade mark/design in the UK and enjoy the same filing/priority date as the ‘parent’ EUTM.
• Rights exhausted both in the EU and UK under EU law before the end of the transition period will remain exhausted both in the EU and UK thereafter. After the transition period any provisions relating to exhaustion of rights will likely depend on what trade deal is reached between the EU and UK, and also whether or not the UK government decides to recognise, for example, the principle of international (or UK-only) exhaustion of rights.
• Any sui generis database rights that arise before the end of the transition period will continue to be valid and enforceable within the UK on identical terms for the remaining period of validity of the database right (fifteen years), provided that the holder of the right continues to comply with the qualification requirements, namely those who are nationals or have habitual residence in the EU or UK, or undertakings established in the EU or UK.
• The holder of a Community plant variety right granted before the end of the transitional period will become the holder of a comparable registered right in the UK as of the end of that period. The new UK plant variety right will retain the same term of protection as the corresponding Community right and will retain the same filing or priority date.
• The jurisdiction provisions of the EUTM Regulation and Designs Regulation shall continue to apply to proceedings commenced prior to the end of the transition period, thereby allowing for the possibility of the UK courts to grant relief extending to countries of the EU, and vice versa.
• As regards patents, the provisions of the EU SPC Regulations will continue to apply to UK SPC applications that have been filed prior to the end of the transition period, either for medicines or plant protection products, and any SPC granted based on an application filed within this period will enjoy the same level of protection as under the current EU SPC Regulations.
• The provisions of the EU medicines SPC Regulation will also continue to apply to applications for the 6-month extension of term of UK SPCs for medicines on which paediatric studies have been carried out in accordance with an agreed paediatric extension plan, provided the paediatric extension application is filed prior to the end of the transition period. Any paediatric extension granted based on an application filed within this period will enjoy the same level of protection as under the current EU medicines SPC Regulation.

No mention is made in the draft agreement of the unitary patent (UP) or the Unified Patent Court, neither of which are yet in existence or have effect in the UK. The questions of the timing of commencement of both elements of this project, the implications of the UK’s ultimate departure from the EU, and the UK’s short- and long-term participation in the UP and/or the UPC, remain subject to uncertainty.