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Again, and again: the UPC agreement is further challenged in Germany
Although the German Parliament («Bundesrat») recently voted in favor of the ratification of the Unified Patent Court Agreement (UPCA) (that we reported here), and despite the political will (see there), the German ratification of the UPCA is again put on hold.
The German Federal Constitutional Court (FCC) advised that that two new constitutional complaints were filed on the very same day on which the Bundesrat approved the ratification (18th December 2020).
One of the complaint, filed by Düsseldorf lawyer Ingve Stjerna, who already filed an earlier constitutional complaint in 2017, aims at obtaining an interim order to cease the ratification process until a decision on the merits.
The content of the complaints is not yet known.
In any case, and as a result of these complaints, the Federal Presidency already confirmed that the ratification process will be deferred until the case is cleared by the FCC.
The German Parliament (Bundestag) has already filed on 8 January 2021 a statement in the proceedings for the grant of an interim injunction. Further, on January 13, 2021 the German Committee on Legal Affairs and Consumer Protection has recommended that the Bundestag also takes part and files further statements in the main proceedings.
The FCC can dismiss the complaints as inadmissible or examine them on their merits. If interim injunction will be accepted and the decision will be taken only in the main proceedings, this would then severely delay the process. Indeed, the first FCC decision was issued three years after the filing of the first complaint.
This new hurdle together with the departure of the UK from the EU and the UPC opens a new chapter in the long story of the implementation of the unitary patent package in the EU.
The german federal government officially ratified the UPC act of approval on august 13th
The publication of the law in the Federal Law Gazette finally puts an end to the legal complications that have been blocking the german ratification process and, consequently, the establishment of the Unified Patent Court (UPC).
But this does not mean that the UPC can finally start to operate.
Before the UPC can actually open its doors, the period of the preparatory phase must begin.
Germany intends to ratify the Protocol on Provisional Application in early autumn.
According to this Protocol, some parts of the UPC Agreement will be provisionally applied before it becomes fully effective.
In order for this Protocol to enter into force, two more Member States of the UPC Agreement will have to sign it.
The enactment of this Protocol now relies on a prompt ratification process by the courts of the Member States.
According to Alexander Ramsay, head of the UPC Preparatory Committee, there could be a functioning UPC late in 2022, or possibly early 2023 « if everything runs smoothly ».
The protocol on the provisional application of the UPC agreement
The Protocol to the Agreement on a Unified Patent Court on provisional application (the PAP-Protocol) was initially signed on 1st October 2015 to establish a Phase of Provisional Application (PAP) to ensure « a smooth transition into the operational phase and ensure the proper functioning of the Unified Patent Court before the entry into force of the Agreement on a Unified Patent Court ».
This text is pivotal in the UPC for the practical preparation that is required to run the Court but also in terms of timing for anticipating the actual date of implementation of the Unified Patent Court Agreement (UPCA).
1. The preparatory work
The provisional application of the UPCA only concerns the institutional, oraganisational and financial provisions of the Agreement and is « limited to what is strictly necessary to ensure the smooth transition into the operational phase » (last Considering of the Protocol).
- Practically, the preparatory work includes a wide range of practical arrangements, such as :
- the set up of the IT system of the Court,
- the completion of the Case Management System,
- adoption of the Court’s budget ;
- the recruitment of the staff, including selection and appointment of the Judges, and,
- last but not least, the settlement of the premises for the Court of first instance (local, regional and central divisions in contracting states) and the Court of Appeal in Luxembourg.
The preparatory Committee reckoned that approximately 8 months are required to conclude the preparatory work needed to be done during the provisional phase.
2 . The entry into force of the Protocol
The mechanism is established in Article 3(1) of the Protocol which establishes that the Protocol will enter into force only after both the UPCA and the Protocol have been ratified by « 13 Signatory States of the UPCA including Germany, France and the United Kingdom ».
2.1 The conditions for ratification of the Protocol
The paragraphs a and b of Article 3(1) of the Protocol define two alternative conditions for the entry into force of the Protocol, and namely:
(a) either the Protocol can be « signed in accordance with Article 2(2)a. or signed, and ratified, accepted or approved this Protocol in accordance with Article 2(2)b.; or
(b) the Signatory States “declared by means of a unilateral declaration or in any other manner that they consider themselves bound by the provisional application of the articles of the Unified Patent Court Agreement mentioned under Article 1 of the Protocol.
As of today, 12 states have ratified the Protocol : France, Belgium, Bulgaria, Denmark, Estonia, Finland, Italy, Luxembourg, the Netherlands, Sweden, and lately Germany and Slovenia). Austria and Malta are expected to be the next ones and may be expected for the end of the year.
2.2 The situation of the United Kingdom
Following the Brexit and the withdrawal from the European Union, the UK withdrew from the UPCA in July 2020.
In addition to the issue of the location of the Central division to replace the London section (A.7 and Annex II of the UPCA), this withdrawal is also problematic for the interpretation of Art. 3(1) of the Protocol which mentions the ratification of the United Kingdom, although it is now out of the system.
The UPC Preparatory Committee established an authentic interpretation of Art. 3 of the Protocol, where « Art. 3 of the Protocol is to be interpreted as mirroring Art. 89 of the UPCA » (Declaration on the authentic interpretation of Art. 3 of the Protocol, yet to be signed).
A.89 UPCA defines the date of entry into force of the Agreement, based on 13 ratifications including « the three Member States in which the highest number of European patents had effect in the year preceding the year in which the signature of the Agreement takes place ».
Replacing the UK under this construction, Italy has already ratified both the Agreement and the Protocol allowing reconciliation of the wording of the Protocol with the withdrawal of the UK.
2.3 The situation of Germany
Following the action that was introduced before the German Federal Constitutional Court, an order (dated 23 June 2021) eventually cleared the way for Germany to participate in the UPCA.
Germany thus ratified the Protocol on 27 September 2021. However, Germany has not yet ratified the UPCA : It has been agreed that Germany will act as a « gatekeeper » and will only ratify the Agreement when it is clear that the UPC will be operational upon the entry into force of the UPCA.
3. The entry into force of the UPC
Assuming the Protocol enters into force early 2022, the preparatory work should be completed for fall 2022.
Before the actual running of the UPC, a three months period is first allocated for allowing patentees to opt out their European patents from the UPC jurisdiction (« sunrise period »).
Under this tentative timeline, the UPC could then be opened for business by end 2022.
Entry into force of the protocol on provisional application of the UPC Agreement (PAP)
The European Council has just indicated on its website that the Protocol to the Agreement on a Unified Patent Court on provisional application (also called PAP) has entered into force yesterday, January 19, 2022.
This follows the deposition of the ratification instruments of said protocol by Austria, which was effective January 18, 2022, making the PAP being ratified by its thirteenth member state.
As explained in a previous post, the PAP ratification triggers the existence of the Unified Patent Court (UPC) as an international organization, which is a historic landmark in the field of European IP, after so many back and forth developments.
A lot of work remains to be done before the effective operation of the UPC can start. This includes in particular obtaining budgets, selecting judges, setting in place the administrative bodies and tuning the fully paperless case management system. According to a notice published by the UPC, at least 8 months will be necessary to be able to trigger the system.
Germany will have the final word to start the system, which will occur four months after it deposits its ratification instruments of the Unified Patent Court Agreement.
The European Patent Office has simultaneously announced it will also be ready to set up the Unitary Patent which is due to start on the same day as the operation of the UPC (https://www.epo.org/news-events/news/2022/20220117.html).
New opportunities will arise with the birth of these new tools. New strategies will have to be defined for future patent protection and patent litigation in Europe.
In the upcoming months, the professional integrated teams of LAVOIX, including fully qualified European Patent Attorneys and Attorneys at Law, will be committed to develop or refresh your knowledge of the new procedures, and to help you prepare your organizations for the effective start of the UPC and of the Unitary Patent (UP), so that you are able to use the new system at its best.
LAVOIX teams will be ready to act on day one, taking advantage of our geographic position at the heart of the UPC in Paris and Munich.
We will continue to regularly update the blog with news about the progress of the UPC and UP preparations. We will also provide substantive articles about crucial subject matters such as opt-out or stay in, and various details of UP and UPC procedures.
Stay in contact with us, as a historic new era in European IP starts…
How to select the european patent with the unitary effect (Unitary Patent)
Unitary Patent a unique protection for 17 states in Europe
With the recent ratification of Austria, the European Patent with unitary effect (“Unitary Patent”) will be introduced soon.
This title enables to get a patent protection by many European states. Presently 17 states have ratified the agreement and will participate with the Unitary Patent, namely Austria, Belgium, Bulgaria, Denmark, Estonia, Finland, France, Germany, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Portugal, Slovenia, Sweden, see https://www.epo.org/law-practice/unitary/unitary-patent.html.
The Council Regulation No 1257/2012 (hereafter “Unitary Patent Regulation”) sets out the details of the unitary patent. In particular it states that only a European patents having the same set of claims in respect of all the participating Member Sates shall be able to be selected as a Unitary Patent (Art. 3 of the Unitary Patent Regulation).
Before deciding whether to apply for the Unitary Patent it should be kept in mind that it is not possible to opt-out from the exclusive competence of the Unified Patent Court (UPC) for the Unitary Patents according to §83(3) of the UPC Agreement.
Request has to be filed one months after publication of mention of grant
The Unitary Patents will be managed by the European Patent Office (EPO). For that purpose a request for obtaining a Unitary Patent has to be filed within no later than one month after the mention of the grant published in the European Patent Bulletin, see Art. 9 (g) of the Unitary Patent Regulation.
Within the same period, during a transitional period, a translation has to be filed, either an English translation for patents having the language of proceedings in French or German, or a translation into any other official language of the European Union where the language of the proceedings is English (see Article 6 of Council Regulation 1260/2012).
Definite enter into force of the Unitary Patent depends on the deposit of the UPC Agreement by Germany
Entry into force of the Unitary Patent Regulation depends on the entry into force of the UPC Agreement, see Art 18 of Unitary Patent Regulation. The UPC Agreement will enter into force on the first day of the fourth month after the deposit the final ratification, here the German ratification.
Even though Germany has already ratified the UPC Agreement, it has not yet deposited the ratification in order to enable the Unified Patent Court enough time for the preparation and the recruitment of the judges in the phase of the provisional application period, which has started mid of January.
When the State Parties are confident that the Court is functional, Germany will deposit its instrument of ratification of the UPC Agreement, which will trigger the countdown until this Agreement’s entry into force and set the date for the start of the UPC’s operations.
Thus, the definite enter into force of the Unitary Patent Regulation is unknown.
However, it is expected that it will enter into force mid 2022 to begin of 2023.
EPO proposes to delay proceedings and early request for the Unitary Patent after the deposit of the ratification of Germany
In order to give applicants the possibility to request the Unitary Patent for EP applications that are scheduled for grant between the deposit of the ratification of Germany of the UPC Agreement and the entering into effect of the Unified Patent, the EPO has just published in the Official Journal January 2022 decisions providing the Applicant with several new options.
a) For applications for which a pre-grant notification under Rule 71(3) of the European Patent Convention (EPC) has been issued, in which communication the EPO communicates to the applicant the text intended for grant, the applicant may file a request for delay of grant until the entry into effect of the Unitary Patent.
The request for delay of grant must meet several formal requirements: a corresponding form must be used and no prior agreement on the text proposed for grant must have been given yet by the applicant.
However, the applicant must still file a reply to the pre-grant communication according to Rule 71(3) EPC, i.e. pay the fees and file the translations of the claims. A request for delay filed on the same day as the approval of the text intended for grant will be considered to have been validly filed.
b) In order to facilitate obtaining the Unitary Patent, during the same period, the EPO will accept early requests for unitary effects, thus giving applicants the possibility to shift administrative work for unitary protection to before the effective date of entry of the Unitary Patent Regulation. The EPO will inform about formal deficiencies already before the entry into force of entering into effect of the Unified Patent, giving an opportunity to make corrections in due time.
Although the EPO has already communicated about these procedural measures, both possibilities are not yet in force and will be only available until the entry force of the Unitary Patent Regulation (i.e. when Germany triggers the system).
In order to reach the period from which on the EPO proposes to delay the proceedings, the applicant may request, for applications that are still in examination and a response to an Office Action has to be filed, a request for extension of the time limit to the maximum time limit.
For communications according to Rule 71(3) EPC providing with the text intended for grant, this option is unfortunately not available, the four month time limit being non extendible (except through further processing which implies costs and risks).
However, if the applicant does not agree with the proposed text, or if minor corrections are still to be made, he can file a disagreement with EPO including the respective new proposal. The EPO will then issue a new communication according to Rule 71(3) EPC, provided that the new text complies with the provisions of the EPC, so that a new four months period according to Rule 71(3) EPC starts.
Depending on the time the EPO takes to emit the new communication and on the actual date of triggering of the unitary patent system by Germany, the applicant may then be able to use the new procedures to delay the grant and request the unitary effect.
German Federal Constitutionnal Court’s decision
By order of June 23, 2021, the German Federal Constitutional Court (FCC) rejected two applications for preliminary injunction against the Act of Approval that was adopted on December 18, 2020, for the purposes of ratifying the Agreement of 19 February 2013 on a Unified Patent Court (UPC Act of Approval).
This decision was highly expected because the process of ratification of the UPC Act of Approval and thus, the establishment of the UPC has been delayed until the ruling of the Court.
The violation of fundamental rights alleged by the plaintiffs is considered by the FFC insufficiently asserted and motivated.
The plaintiffs failed to demonstrate why and how the Act of Approval, in its organisational structuring of the Unified Patent Court and in the legal status granted to the judges, could violate the principle of the rule of law established in Article 20(3) of the German Constitutional Law in a way that would interfere with the principle of democracy.
This decision seems to clear the way for the deposit of the German instruments of ratification.
The many hurdles against the implementation of the UPC and the Unitary Patent seem to be slowly overcome.
Some say that the new system could be in force no later than 2022.