The EU’s AI Act: Where Are We Now And What Could Its Impact Be On EU Companies?
6th July 2023
Under the current European patent system, European patents are granted centrally by the EPO but then, once validated, take the form of national patents. Such patents may only be revoked on a country-by-country basis through the national courts. This can result in a patent being revoked in one country and upheld in another.
In response to the above situation, the UPC Contracting Member States have attempted to improve legal certainty by setting up a Unified Patent Court (UPC) for litigation relating to the infringement and validity of patents. According to the preamble of the Unified Patent Court Agreement (UPCA), Member States particularly considered small and medium-sized enterprises which have difficulty defending themselves against unfounded claims and claims relating to patents which should be revoked when drawing up the UPCA.
In contrast to the system now operating, a single revocation action before the UPC may revoke the patent in all Contracting Member States.
Competence of the UPC
According to Art. 32(1) UPCA, the Unified Patent Court will have exclusive competence in respect of:
actions for declarations of non-infringement of patents and supplementary protection certificates;
actions for revocation of patents and for declaration of invalidity of SPCs;
counterclaims for revocation of patents and for declaration of invalidity of SPCs.
Divisions, Parallel Proceedings and Representation
It is not necessary to have opposed a European patent in order to start an action for revocation, however the court should be informed of any pending opposition or limitation proceedings before the EPO.
Actions for revocation of patents and for declaration of invalidity and actions for declarations of non-infringement will be brought before the central division. If, however, an action for infringement has already been brought before a local or a regional division, any revocation action must be brought before the same local or regional division.
An action for a declaration of non-infringement pending before the central division shall be stayed once an infringement action between the same parties or an exclusive licensee and the party requesting a declaration of non-infringement is brought before a local or regional division within three months of the date on which the action was initiated before the central division (Art. 33 UPCA).
Parties may be represented by European Patent Attorneys who have a European Patent Litigation Certificate or by lawyers authorised to practise before a national court (Art. 48 UPCA).
Decisions and Impact
The Court may revoke entirely or partly (i.e. limit) a patent only on the grounds referred to in Articles 138(1) and 139(2) of the EPC.
Once revoked it shall be deemed to never have had the effects specified in Articles 64 and 67 of the EPC.
The Court will send any revocation decision to the European Patent Office and to the national patent office of any Contracting Member State concerned (Art. 65 UPCA).
During the transitional period of seven years after the date of entry into force of this Agreement (expected to be 1 April 2023), an action for revocation of a European patent or for declaration of invalidity of an SPC may still be brought before national courts. Any action pending before a national court at the end of the period will be unaffected.
Applicants and proprietors of patents and SPCs may opt-out of the UPC system during the transitional period. Actions can then only be taken against them at the national courts.
The Administrative Committee may decide to prolong the transitional period by a further seven years (Art. 83 UPCA).
An action for declaration of non-infringement will have a fixed fee of €11,000, whereas a revocation action will have a fixed fee of €20,000. For more on UPC costs see here.
Take home line
While the Unitary Patent and Unified Patent Court may make patents cheaper to enforce in Europe and will reduce the administrative burden associated with traditional European patents, the fact that a single action can revoke the patent in each Contracting Member State may make the traditional system more attractive to some applicants in the short term. During the transitional period applicants and proprietors may opt-out of the UPC system if this is a concern.
This article continues FRKelly's series on the upcoming Unitary Patent and Unified Patent Court. For more details, check out the following articles:
8. UPC Opt-Out