The Unified patent court and unitary patent – An introduction

17 February 2023 | Insight

Legal Briefings

The Unified Patent Court and unitary patent are now set to become a reality on 1 June 2023.

The Unified Patent Court (UPC) will have jurisdiction over
- all European patents (current and future) designated to participating EU Member States which have ratified the UPC Agreement (UPCA) (currently 17 states); Spain, Croatia and Poland are not participating, and neither is the UK, EU status aside, now it has withdrawn from the UPCA, and other EU member states that have signed the UPCA have yet to fully ratify) unless they have been opted out of the new court's jurisdiction; and
- all unitary patents.
The unitary patent right (UP) (also known as a European patent with unitary effect) established via enhanced cooperation under Regulation 1257/2012 of 17 December 2012, will provide a single supra-national patent right covering all the EU Member States which took part in the enhanced cooperation and have fully ratified the UPCA (currently 17 states – see above). This new right will become available as soon as the new court system, the UPC, set up to enforce it, comes into effect. Unitary effect can be selected within a month of grant (nb the EPO has established a procedure (in place since 1 January 2023) whereby patents coming currently nearing grant can delay grant in order to benefit from unitary effect once it is available on 1 June 2023). A particular UP will only cover the UPCA participating member states at the date that its unitary status was granted. It is not expected that unitary patents will ever Spain or Croatia which did not participate in the enhanced cooperation, but will also exclude Poland which, although it did participate, has not signed the UPCA, (and therefore there will be no means to enforce a UP in Poland). Read more on this hub on applying for UPs (including the EPO's procedure for delaying the grant of patents in order to benefit from unitary effect from 1 June 2023), EP opt-out, and EP, UP and patent portfolio strategy in the light of the new UPC & UP system.

UPC and UP system start date

The UPCA sets out that the UPC will come into effect on the first day of the fourth month after the month in which the last ratification required by the UPCA is deposited. The UPCA requires that 13 participating Member States ratify before it can come into force, these must include the “three States in which the highest number of European patents was in force in the year preceding the year in which the signature of the Agreement takes place”. With the UK having withdrawn, those three countries are France, Germany and Italy. Sufficient contracting Member States have ratified, including France and Italy (see the ratification table here), so Germany’s ratification (on 17 February 2023) was the last piece of the jigsaw for the run-up period to be triggered for the UPCA to come into force on 1 June 2023.

The UPC website has also announced that the start date for the sunrise opt-out period will be 1 March 2023.

For more on opt-out see the Jurisdiction and opt-out section of this hub.

The Jurisdiction of the UPC and national courts:

The UPC will have exclusive jurisdiction over UPs and EPs that have not been opted out of its jurisdiction.

However, for a transitional period, national courts will continue to have jurisdiction over non-opted out EPs, as well as the UPC having jurisdiction over them in relation to validity and infringement.

The transitional period will last at least 7 years but could be extended by up to another 7 years following an assessment at the 5 year point. At any time during this transitional period, EPs can be opted out of the UPC's jurisdiction (and have their opt-outs withdrawn, i.e. be opted back in). At the end of the transitional period, EPs granting after this point will not be able to be opted out of the UPC's jurisdiction; they, along with any EPs that had not been opted out during the transitional period (or EPs whose opt-outs had been withdrawn), will be under the exclusive jurisdiction of the UPC.

For more on this see the Jurisdiction and opt-out section of this hub.

The structure of the UPC court system:

The UPC will have three types of first instance court:

local divisions in participating states;
regional divisions; and
and a central division with three seats.

Regional divisions are a form of local division providing a UPC first instance court for several participating states at once where the number of patent cases a year would be too low to merit individual local divisions in those states.

Infringement actions can be brought in a local, regional or even central division court, but the central division has exclusive jurisdiction to decide applications for declarations of non-infringement and revocation (see the section of this hub on UPC structure).

The central division had been split between Paris (the main seat of the central division), Munich, and a third seat (previously assigned to London before the UK withdrew from the UPCA) the new location of which has yet to be confirmed, although Milan is a front runner.

Each seat of the central division will deal with cases dependent on the subject matter of the patents involved, based on IPC classifications.

The "London" central division was assigned cases on patents involving human necessities and pharmaceuticals/chemistry including genetic engineering and metallurgy (International Patent Classification of WIPO sections (A) and (C)).

Munich will hear cases involving patents in IPC class F, concerning mechanical engineering.
All other patent classifications will fall to be heard before the Paris central division. It is understood that Paris will deal with the caseload London would have taken, while decisions are being made about where to locate this third seat.

Choosing EPs, UPs or national patents?

Currently, EPs are applied for centrally, at the European Patent Office (EPO), and then on grant are converted into a bundle of national patent rights, designated to whichever European Patent Convention signatory states have been selected by the applicant. Although there is a central system for opposition before the EPO, post grant infringement and revocation actions must be brought in relation to individual designations and cannot be litigated centrally. This frequently leads to multiple actions across Europe in relation to EPs derived from the same initial application.

The Commission and the European Parliament have sought to resolve the multiplicity of actions based on the same EP bundle, by allowing the new UPC to enforce classical EPs (as described above) as well European patents with unitary effect (unitary patents (UPs)).

However, as mentioned above, for a transitional period, the proprietor of an EP may choose to "opt-out" of the UPC system and retain the right to solely litigate its EP's designations separately in national courts. Once this period has passed (after 7 years, although this may be extended to 14 years in total), all EPs which have not already been opted out will be litigated "centrally" using the UPC system. For more on the consequences of opting out or not doing so see the Jurisdiction and opt-out section of this hub and our feature articles for PLC Magazine.

Once the UPC & UP system has commenced, EPs will continue to be granted by the EPO as they now are, and in addition, application for unitary effect (UP status) for EPs will be an option for patentees to choose at grant. All UPs and non-opted out EPs will be under the jurisdiction of the UPC. Any EP can be opted out of the UPC jurisdiction (while the transitional period is still in place). It will also still be possible (as it is now) to apply for national patents (NPs) instead of EPs (or UPs) by lodging separate applications at each of the national patent offices. These national patents will not be under the jurisdiction of the UPC and actions relating to them will continue to be heard by national courts. National patents are therefore one way of avoiding the new UPC system (as is the opting out of EPs) if there are strategic reasons for doing so.

Unitary patents: Regulation 1257/2012 establishing the UP is already in force, but the grant of UPs is dependent on the enforcement mechanism, the UPC, being fully established, so the first UP will not be granted before 1 June 2023. After this date, any European patent (EP) application coming to grant can be converted into a UP at grant if the applicant so chooses within a month of grant. The EPO has also devised a system to allow applicants to delay grant in order to take advantage of the unitary status at Day 1 on the UPC – see our blog post on this here. This system has been in effect since 1 January 2023. As mentioned above, an individual UP will only have territorial coverage of the states fully participating at the date that unitary status is granted. Currently this covers 17 states (see here) but more may fully ratify in the run-up to 1 June 2023 or subsequently. This will not change the coverage provided by EPs already registered for unitary effect (unitary patents) but later EPs will be able to benefit from an expanded territory if more states have ratified by the time they grant. For more on how to get a unitary patent see here.

For coverage of non-UPC EU states (Spain, Poland, Croatia and, currently, Ireland, Greece several others – see here) and non-EU EPC states (eg Switzerland, Norway, the UK and Turkey), classical EP applications can still be made at the EPO – as well as for individual EU and UPC states if unitary patents are not preferred. Unitary patents will be solely under the jurisdiction of the UPC, so if this is a forum in which a patentee would prefer not to be involved in proceedings, selecting classical EPs and opting them out of the UPC's jurisdiction is the way to go. Whether or not a unitary patent is selected, it is likely that other non-UPC participating EPC states will be needed too (including the UK, Spain and currently Ireland and Greece for example inter alia) and so there will be a mosaic of coverage with both unitary patent and several classical EPs also.

The cost of a UP:

The EPO has adopted a "business friendly fee pattern" for the new UP equivalent to the current charges for the "top 4" most popular validation jurisdictions for EPs - see our e-bulletin "EPO adopts "business friendly" Top 4 approach to UP renewal fees".

For more on the UPC and unitary patent see our series of feature articles published in PLC Magazine's March and April editions 2022 and shared in pdf form on our IP Notes blog here.