/ European Patent Court to come into force in June 2023

The European patent system has implemented a Unified Patent Court (UPC). We recommend to exclude yourself from the UPC, as the reaction terms are very short and in case of a nullity claim it could be a disadvantage to prepare an adequate defense.

Francisco Silva von Moltke
Associate Attorney
Alessandri

Many domestic companies with investments abroad, specifically in Europe, have registrations or applications for patents or utility models in order to protect their inventions against possible competitors. These companies are concerned with the decision of the European patent system to implement a Unified Patent Court or UPC, which will have jurisdiction, among other things, to review traditional European patents and applications.

The court’s jurisdiction will come into force in June 2023 and it will be empowered to hear a wide range of matters, such as claims for: patent infringement and related to licenses; injunctions and injunctive relief claims; patent revocation and declaration of nullity of supplementary protection certificates; counterclaims for patent revocation and declaration of nullity of supplementary protection certificates; damages arising from the interim protection granted by a published European patent application; claims relating to the use of the invention prior to the grant of the patent or the right based on the prior use of the invention; compensation for licenses; among others.

There is the possibility for patent holders to file an exclusion request or OPT-OUT so that the new court cannot rule on patents already applied under their name and/or granted in Europe. Such a request should ideally be filed before June 2023, otherwise it will be included under the jurisdiction of the new court.

In order to assess whether in any particular case it is convenient to file such an exclusion request, the positive and negative aspects of being subject to the jurisdiction of the new court must be weighed.

One of the advantages of relying on the UPC system is that, in the event that a third party infringes the patent, only one central claim will be required against the infringer, covering several jurisdictions. In theory, this could reduce costs. However, practical experience in infringement cases has shown that, when a process is initiated in one jurisdiction, e.g. Germany, and once a favorable decision has been obtained in that jurisdiction, infringers often cease the conduct, desisting from use throughout the continent. Thus, the advantage is only apparent. On the other hand, although the costs of a UPC proceeding are lower, the difference is not very great.

The disadvantage of the OPT-OUT from the jurisdiction of such court is that the UPC would not only cover the infringement, but also the invalidation or cancellation proceedings of the patents. This means that counterclaimants can obtain the revocation of a European patent through a single claim, whereas currently this must be done by jurisdiction where the patent is granted, i.e. by filing claims on a country-by-country basis. This can be risky, as it is completely unknown how the UPC will apply the patentability criteria. While there is some likelihood that the jurisprudence of the European Patent Office will be applied, it is also possible that certain deviations will develop over time, adopting its own criteria that would differentiate it.

Another disadvantage of the UPC rules is that the terms for reaction are very limited, so that in the face of a nullity action there could be unnecessary pressure that would make it impossible to prepare an adequate defense.

Therefore, although it is necessary to review on a case by case basis, in general terms and based on the above mentioned background, we recommend to opt out of the UPC in all your patents granted in Europe. If you have any questions please contact us at ip@alessandri.cl