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Unitary patent system may enter into force earlier than expected – new avenues for patent holders in Europe

17.12.2020
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The unitary patent system, which has been in the works for decades, comes closer to realisation as a bill allowing the ratification of the Agreement on a Unified Patent Court is passed by the Bundestag of the German Parliament. If the system enters into force at the beginning of 2022, it will require consideration from applicants and holders of European patents as early as next year, says European Patent Attorney Marjut Honkasalo.

According to the European Patent Office (EPO), the unitary patent system, a part of which is the Unified Patent Court, could enter into force as early as the beginning of 2022. The bill will next be considered by the Bundesrat of the German Parliament on 18 December. 

“The UPC system encountered its most recent speed bump in April 2020. Germany’s Constitutional Court rejected the previous act allowing the signing of the Agreement because it was not passed by a sufficient qualified majority in the Bundestag of the Parliament. If the unitary patent system finally enters into force, holders and applicants of European patents should update their patenting strategies”, European Patent Attorney Marjut Honkasalo says. 

After approval by the German Parliament, the bill will be submitted to the Federal Government and the President for signature. Germany can then finally ratify the Agreement on a Unified Patent Court. Following this ratification, the unitary patent system will enter into force in those countries of the European Union that have ratified the UPC Agreement. 

Options for European patent applicants 

If the unitary patent system enters into force at the beginning of 2022, already granted European patents will automatically come under the jurisdiction of the Unified Patent Court, unless they have been specifically opted out from the system or there are no ongoing disputes concerning them. 

“If European patent application is close to the granting phase, it may be possible to postpone the grant past the turn of the year into 2022 and then select the unitary patent instead of corresponding country-specific validations. The unitary patent covers Germany, France, Italy, Finland and several other countries. However, delaying the process is not always possible, and it is not necessary for everyone”, Honkasalo says. 

“The benefits of the unitary patent system are case-specific. It is a massive helping hand for a company that needs extensive country coverage, for example. A single unitary patent covers all the European countries under the unitary patent system at a significantly lower cost than if you were to validate a patent granted by the EPO separately in each country. The annual fees for a unitary patent are cheaper than, for example, the annual fees for patents validated separately just in Germany, France, Italy and the Netherlands.” 

The benefits also extend to litigation, as the Unified Patent Court issues decisions applying to all the EU countries participating in the system at once. 

“If a company sues another operator or is itself sued, there is no need for the company to fight over its rights separately in several countries. On the other hand, compared to the Finnish level, the fees paid to the court are nearly EUR 10,000 higher. Of course, small businesses are granted a discount. It is also not possible to save on annual fees by eliminating countries – the principle is all countries or none at all. With traditional country-specific validation, you can always eliminate individual countries and ultimately keep the patent valid in just one country”, Honkasalo says.  

Non-profit organisation as an obstacle to ratification 

In addition to Germany, two other EU countries still need to ratify the Protocol on the Provisional Application of the Agreement on a Unified Patent Court to allow judges and other staff to be selected as well as patents and patent applications to be opted out from the unified court even before the system enters into force.

However, the biggest potential roadblock to the implementation of the UPC system may be the German non-profit organisation Foundation for a Free Information Infrastructure (FFII). The FFII has announced that it will lodge a new appeal with Germany’s Constitutional Court. 

“The FFII is an organisation that opposes software patenting and apparently fears that the Unified Patent Court would be more sympathetic to software patents than national courts. The appeal to the Constitutional Court prevents the President of Germany from signing the act, and thus the ratification the UPC Agreement. Since the Constitutional Court did not rule on all the points of the previous appeal, the UPC system may be delayed for years to come”, Honkasalo says. 

Delays may also be caused by the as yet open third central court location. Following Brexit and especially the cancellation of the ratification of the UPC Agreement last summer, London as the originally planned seat written in the UPC Agreement is no longer a possible location for the central court division.

 “There are plans to divide the tasks earmarked for London between the Munich and Paris seats, or to set up a third seat in Milan. Consequently, it is possible that the President of Germany will withhold his signature until a solution is developed”, Honkasalo says.

Contact us

Marjut Honkasalo
Partner, European Patent Attorney
marjut.honkasalo@kolster.com
+358 50 524 2413

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