Unitary Patent Vs. Traditional EP “bundle” patents- Time limit for making a decision will be short

 The most important question

As discussed in our previous post, the single most important question to be considered is “Do I want my granted patents in Europe to fall under the jurisdiction of the new Unified Patent Court?” If not, the only way to avoid this during the first 7 years of operation of the UPC, is (1) not to request a Unitary Patent, and (2) register an “opt-out” at the UPC Registry, while validating in EU countries via the classical European Patent Bundle.

After the agreement comes into force, all patents granted by the EPO which cover EU Member States participating in the Unitary Patent system will be subject to the exclusive jurisdiction of the Unified Patent Court, unless the applicant registers an “opt-out” at the UPC Registry. For more information, see our separate Briefing Note on the Unified Patent Court.

Sunrise period for Opt outs

A “Provisional Application Phase” will begin three months before the UPCA comes into effect after the UK and Germany will have completed the ratification process. This “Provisional Application Phase” includes a “sunrise period” for accepting opt outs for existing European patents and applications. This sunrise period may start at the beginning of 2018 assuming a Spring 2018 start date for the UPC system, when it will be possible to file opt outs at the UPC Registry, prior to the UPC system coming into force.

Unitary Patents will be granted by the EPO

A Unitary Patent will still be a European patent granted by the EPO, under the present system, with no change in the present process of search, examination and grant. The applicant must however request that a granted European patent be given unitary effect for the territory of all EU Member States participating in the Unitary Patent system at the time of grant of a European patent. It therefore should be viewed simply as a new option for applicants at the grant and validation stage of European patent applications.
All Unitary Patents will fall under the automatic jurisdiction of the new Unified Patent Court.

The time for making a decision on Unitary Patent Vs. traditional European “Bundle” Patents” will be short

A request for a Unitary Patent must be made to the EPO within one month of the decision to grant a European patent. This is a very short time window, which cannot be extended. “Further processing” will not apply. There is no official fee.

At the same time, for a transitional period of 12 years, if the European patent application is granted in English, a complete translation into another EU language must be filed at the EPO. If the European patent application is granted in German or French, then the complete translation must be into English. This virtually precludes last minute requests for Unitary Patents, so a decision should be made around the time of allowance of the application.

There will be no way to convert European patents that have been granted as a “Bundle” of separate national patents into a Unitary Patent at a later stage after this one month period has expired.

European “Bundle” Patents and Unitary Patents

It will still be possible for EPO applicants to validate their granted European patents separately in any EPC country of their choice as a “Bundle” of national patents; at present the majority of European patents are validated in no more than 6 countries. This option of the “classical” European Patent Bundle will remain.
EPO applicants will be able to choose to validate European patents in various combinations of classical European patents and a Unitary patent, for example:

• A Unitary Patent for all of the EU Member States that participate in the Unitary Patent system at the time of European patent grant;

• Validation as a classical European patent “Bundle” in any combination of EU Member States that are not participating in the Unitary Patent (e.g. Croatia, Poland and possibly Spain) at that time;

• Validation as a classical European patent “Bundle” covering non-EU EPC Contracting States, which cannot participate in the Unitary Patent (e.g. Switzerland, Liechtenstein, Norway, Turkey, Monaco, Iceland, Macedonia, San Marino, Albania and Serbia).

Classical European patents in EU countries that have ratified the agreement and a Unitary Patent covering the participating EU Member States cannot co-exist. It is all or nothing; all of the countries participating in the Unitary Patent must be selected for grant either as a Unitary Patent, or via traditional validations as a Bundle. All traditional European “Bundle” Patents will fall under the automatic jurisdiction of the new Unified patent Court, unless the patentee registers an “opt out” at the UPC Registry.

Translation Cost Advantages

The huge cost of obtaining patents in Europe via the classical European “Bundle” Patents is the cost of multiple translations at the validation stage. Eventually, when 25 countries will be covered by a Unitary Patent, only one translation will be required versus the present 12 full translations and 7 additional claims translations. After the 12 year transitional period, no translations will be required, except in the case of litigation.

No retroactive effect

Initially, Unitary Patents will only cover the 14 EU Member States, being the first to ratify the agreement. Countries that have yet to ratify can only be covered by a classical European patent as part of a Bundle. As more countries complete their ratification of the agreement, more countries will then be covered by a Unitary Patent, up to the stage when the final 25th country has ratified. However, the ratification process will stretch over several years to complete, great care will have to be taken to check in individual cases, in the register to be kept by the EPO, in what countries the first Unitary Patents are actually effective.

The EPO will administer Unitary Patents

Up to grant of a European patent, the EPO will have the same role it has now. When the new Unitary Patent becomes available, if an applicant elects validation as a Unitary Patent, the EPO will have additional tasks that would be performed by national patent offices in connection with classical European patents and national patents. The following tasks will be administered by the EPO;

• Receiving and examining requests for unitary effect;
• Registering unitary effect;
• Publishing any required translations during the transitional period;
• Setting up and maintaining a new “Register for Unitary Patent protection,” containing entries on assignment, transfer, lapse, licensing, limitation or revocation of Unitary Patents;
• Collecting annual maintenance fees for Unitary Patents;
• Distributing part of the annual fees to the participating Member States; and
• Administering a compensation scheme for reimbursement of translation costs (up to a ceiling) for certain applicants filing applications in an official language of the European Union other than the official EPO languages (English, French and German).

Maintenance Cost Advantages

Once the Unitary Patent covers 25 participating Member States of the EU, there will be very significant cost advantages as compared to the classical European patent Bundle. For a start, one renewal fee to maintain a Unitary Patent in force, which will cost roughly the same as the present cost of renewal of European Bundle patents in UK, France Germany and Netherlands combined. Further significant cost advantages arise, as assignments post grant can be recorded centrally in the register of Unitary Patents administered by the EPO, rather than separately in each national register as at present.

Pending European Patent Applications

A Unitary Patent will only be available in respect of European patent applications filed after 1st March 2007 that are pending and go to grant when the agreement has come into force. The agreement will come into force four months after the later of the respective ratification dates of the UK and Germany. We advise that clients consider adopting a strategy of delaying any imminent grant of a European patent so that a Unitary Patent becomes an additional option.

Pros and Cons of the Unitary Patent in the beginning

While there are obvious cost advantages in terms of reduced numbers of translations and the cost of maintenance post grant, as the London Agreement already provides elimination or reduced translation costs for all but 4 of the first group of 14 countries that will be covered by a Unitary Patent, the big savings in translation costs will only come when all 25 signatories of the agreement have ratified.

Marie Walsh and Elizabeth Jennings

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