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Brexit and intellectual property - how will it affect your business?

As the impact of the momentous referendum decision by the British people to leave the European Union begins to sink in, businesses will need to review how they go about protecting their valuable intellectual property in this new landscape.

Changes will not happen overnight – there will now be a protracted period of detailed negotiations as to what Brexit truly looks like - and as with any divorce there are likely to be some heated debates.

There are a number of models which could be adopted upon exit, leaving the exact implications of this decision uncertain. However, holders of intellectual property rights should still begin to take stock of their current portfolios and review strategies to ensure that they are in a position to take action to exploit and enforce their rights promptly.

Registered Trade Marks and Designs

It is unlikely that EU trade marks (formerly Community Trade Marks) and registered and unregistered community designs will continue to have effect in the UK post-Brexit. Presently, many businesses choose to register their rights on a community-wide basis due to the convenience and value that this system affords. If the UK "portion" of these rights was to be taken away, this would impact on the value of these rights and leave owners and other right-holders without protection in the UK. Organisations that rely on community rights to protect their intellectual property in the UK must be prepared to take steps to obtain national protection if necessary. This could prove time-consuming and expensive, particularly for those with a large portfolio of rights to be registered.

Patents

Europe's current patent protection regime is governed by the European Patent Convention rather than legislation from the European Union. The European Patent Office provides a single patent grant procedure, but not a single patent for enforcement purposes. Rather, patent owners are granted a bundle of national patents which must be enforced nationally. A Brexit would therefore have a limited effect on this system.

However, a Brexit will most likely preclude UK participation EU Unitary Patent system. The EU Unitary Patent is the product of many years of discussions and negotiations. It aims to provide a single patent covering the whole EU and a unified system for enforcing patents, simplifying enforcement and reducing costs. This system, which is due to be launched in 2017, is only open to EU member states, meaning that businesses would need a separate enforcement strategy for the UK. This could necessitate a change in strategy for businesses that have planned to take advantage of the unitary system.   

A vote to leave could delay the implementation of the Unitary Patent for the whole of Europe, as ratification by the UK (as one of the three member states with the highest number of European patents in force) was one of the preconditions for the current UPC agreement to enter into force. As a current member state the UK can, in theory, still ratify the agreement, but it remains to be seen whether it will do so given the current political climate.

Interestingly, the UPC agreement specifies London as one of the three locations for the Central Division (along with Paris and Munich). London has jurisdiction over “Human Necessities” which covers amongst other things the chemistry and pharmaceutical sectors. As the Central Division’s locations are specified in the agreement, the UK exiting the EU would not alter the situation. It appears that the remaining EU countries would have a choice; either a) to amend the UPC agreement and specify another location for the Human Necessities seat of the Central Division (which would clearly be burdensome and cause further delay) or b) keep London as a seat for the Central Division even though it would have no jurisdiction over patents the UK and UK nationals would no longer be eligible to sit as judges in the new Court. Neither are particularly attractive options but as an interim measure at least (given that a lease has been signed on court premises in London) London may well remain as a seat for the UPC Central Division.

Copyright

Copyright in the UK is primarily governed by national law, so is unlikely to be affected by a Brexit. However, the EU Commission plans to tackle barriers to cross-border access to copyright-protected content as part of its Digital Single Market Strategy. This is likely to result in changes to the laws on copyright within the EU and it will be interesting to see if the UK will mirror this approach going forward.

Authors: Aisling McNally, Catherine Harrison and Brona Heenan

This information is intended as a general discussion surrounding the topics covered and is for guidance purposes only. It does not constitute legal advice and should not be regarded as a substitute for taking legal advice. DWF is not responsible for any activity undertaken based on this information.

Catherine Harrison

Senior Associate

I am a Senior Associate at DWF, specialising in working for clients across the retail, food, education, oil and gas and technology sectors.