By: Ruth Hoy and James Tighe

On 6 September 2017, the EU Commission published its position paper setting out the main principles that will govern its attitude to Brexit negotiations with the UK on intellectual property (the “Paper”).  The Paper sets out 5 General Principles:

Principle 1:  European IP rights should continue to retain comparable protection in the UK post Brexit

The First Principle proposes that the holder of any IP “rights with unitary character” (ie. pan European rights such as European Trade Marks, Community design rights and protected geographical indications (but not patents[1])) should continue to retain comparable protection in the UK post Brexit.

The Commission proposes that this should be automatic, and should not result in any financial costs to rightsholders and that any administrative burden for rightsholders should be kept to an absolute minimum.

The Commission advocates that UK domestic legislation should be put in place to ensure that this principle is observed, including new national rules to ensure:

  • The determination of renewal dates;
  • The respect of priority and seniority principles and
  • The adaptation of ‘genuine use’ requirements and ‘reputation’ rules. It has been suggested that this will mean that there would be no requirement to prove use in the UK for a European right which has not been used in the UK for a continuous period of 5 years.

Principle 2:  Pending applications for protection on Brexit day should retain their (European) priority date

Brexit should not prejudice any pending applications for IP rights with unitary character.  Where an application for an IP right having unitary character has been made before Brexit, and is still pending on the date of withdrawal, the applicant should be entitled to keep the benefit of any priority date of the application when applying after the withdrawal date for an equivalent intellectual property right in the United Kingdom.

Principle 3:  Supplementary Protection Certificate (“SPC”) applications

An SPC is an intellectual property right which serves as an extension of a patent right in the case of certain pharmaceutical products authorised by regulatory authorities.   It offsets the loss of patent protection that occurs as a result of time taken in conducting tests and clinical trials, and can extend the life of a patent for a maximum of 5 years.  The Commission wants to ensure that where an applicant applies for an SPC in the UK before Brexit, and the administrative procedure is still ongoing at Brexit, the SPC granted should provide for protection equivalent to that provided by EU law.

Principle 4:  Continued protection for database rightsholders

Makers or rightholders of ‘sui generis’ databases protected under EU law before Brexit should continue to enjoy protection after that date in the EU27 Member States and the UK in relation to those databases.

Principle 5:  Principles of exhaustion should be retained

Rights conferred by IP rights which were exhausted in the EU before Brexit should remain exhausted in both the EU27 Member States and the UK post Brexit.  The applicable conditions for determining whether exhaustion has occurred should be those defined by EU law.

What does this mean?

The Paper represents the Commission’s view, and is only one side of the ‘negotiation’ story.  It remains to be seen how the UK will respond to the Paper and the Principles set out therein.

In theory, for rightsholders, the Paper is exactly what they have been looking for –  that they will not have to re-register their EU rights in the UK or pay additional fees to secure the same protection after Brexit than they do currently.   The administrative process of  obtaining protection in the UK post-Brexit will be as smooth as possible.

However, clearly there will be an administrative cost in achieving this and the question will be whether the UK is prepared to foot the bill for that.  There are a number of issues which will need to be resolved in future negotiations and we await the UK Government’s position on this.

[1] The Paper does not address the EU’s position on patents post-Brexit. However, this is because the Paper only deals with existing IP rights and current patent rights are either issued by national IP offices or by the European Patent Office (neither of which are EU institutions). Furthermore, the Unified Patent Court (which is set to offer EU-wide patents) has not yet been established and, due to a recent court challenge in Germany, is unlikely to be established soon (but in any event it is not an EU institution).