'If there's no deal' Brexit IP guidance from UK Government

25 September 2018

On 24 September 2018, the UK Government published a series of guidance papers explaining arrangements in progress to manage Brexit in the event of a 'no deal' scenario (on 29 March 2019). Five papers have been published in respect of intellectual property. This article explains the most notable take-homes from those five papers.



(Please note, however, that in the event a deal is reached between the UK and the EU on the terms of the UK's withdrawal, it has been indicated that it will include a transition period lasting from 29 March 2019 until 31 December 2020. During such a transition period, the status quo would largely remain in place for intellectual property. The Government's 24 September 2018 guidance does not address this scenario).

Exhaustion

At present, the UK is part of the single market's regional exhaustion scheme for intellectual property. Broadly speaking, this means that when goods are placed on the market anywhere in the EEA by or with the permission of the owner of the intellectual property, the owner's rights in that intellectual property are exhausted.

The UK Government's 24 September 2018 Brexit exhaustion guidance states that in a no deal Brexit scenario, "the UK will continue to recognise the EEA regional exhaustion scheme" in the immediate term. This will facilitate continuity in respect of parallel imports into the country; for example, of medicines placed on the market in the remaining single market being imported into the UK.

Looking beyond this immediate or temporary period, the Government has said that it is undertaking a research programme and considering all options for how the exhaustion regime should work.

However, from the perspective of the countries in the remaining single market, following Brexit in a no deal scenario, the UK would be outside their regional exhaustion scheme. Parallel imports from the UK into the EEA therefore may no longer be possible or may need the right holder's consent.

Patents and Supplementary Protection Certificates

The UK Government's 24 September 2018 Brexit patents guidance contains no real surprises. Both of the existing patent systems - the national patent system and the European patent system - are largely outside the remit of EU law and will not be impacted by Brexit. European Patent Attorneys based in the UK will continue to be able to represent applicants before the European Patent Office.

Further, while the system for patent term extension in qualifying circumstances (supplementary protection certificates (SPCs)) derives from EU law, this has long been implemented into UK national law. Combined with the planned preservation of the acquis by the UK's EU Withdrawal Act 2018, the system for grant and enforcement of SPCs in the UK will not be impacted by Brexit.

The most notable take-home from the 24 September 2018 guidance is that there will be no immediate change to the current system of requiring an applicant for a UK national patent to supply an address for service which is in the UK, another EEA state or the Channel Islands.

Although this is not noted in the 24 September 2018 Brexit patents guidance, in a no deal scenario the present regimes governing service, jurisdiction and enforcement in the EU and the EEA will cease to cover the UK. Such matters will instead be governed, from the perspective of the UK courts, by the common law. These well-established rules and procedures presently govern matters of this nature in UK proceedings in respect of parties in non-EU/EEA countries, such as the US.

Whether the UK will be able to remain within the new Unified Patent Court and Unitary patent systems following a no deal Brexit remains unresolved.

Trademarks and designs

Registered EU-wide trademarks and designs

The UK Government's 24 September 2018 Brexit guidance for trademarks and designs reiterates the Government's plans, in a no deal scenario, to extract UK registrations from EU trade mark and ("Community") design registrations existing on the date of Brexit. The extracted UK right will be provided with "minimal administrative burden" for the owner of the EU right, who will be notified that a new UK right has been granted.

Such extracted UK trademark and design registrations will then be subject to renewal in the UK, may form the basis for proceedings before the UK Courts and the UK Intellectual Property Office's (IPO) Tribunal, and may be assigned and licensed independently from the remaining EU right.

Further, applicants for EU trademark and design registrations, which are ongoing at the date of Brexit, will have a period of nine months to apply in the UK for the same protections, retaining the date of the EU application for priority purposes. The UK Government will recognise filing dates and claims to earlier priority and seniority recorded on the corresponding EU application. Right holders taking this step will, however, need to meet the cost of refiling the application in accordance with the UK application fee structure.

The UK Government is working with the World Intellectual Property Organisation to provide continued protection in the UK for trademarks and registered designs filed through the international systems (Madrid and Hague respectively) and designating the EU. This includes practical solutions for pending applications.

As with patents, the UK Government plans no immediate change to the current address for service rules, which permit addresses in the UK, EEA or the Channel Islands.

In the European Union Intellectual Property Office (EUIPO), natural or legal persons that are domiciled or have a seat only in the UK will continue to be able to file an application for registration of an EU trademark. However where representation is necessary, applicants and owners of EU trademark and design registrations must comply with Article 120(1) of Regulation 2017/1001 (trademarks) and Article 78(1) of Regulation 6/2002 (designs).

Unregistered EU-wide design right

EU-wide unregistered Community design right protects slightly different aspects of a design than is protected under the UK national unregistered design right system (which will not be affected by Brexit).

The 24 September 2018 guidance reiterates that all unregistered Community designs which exist at Brexit will continue to be protected and enforceable in the UK for the remaining period of protection of the right, with no action required by the right holder. In addition to this, the UK will create a new unregistered design right in UK law which mirrors the characteristics of the unregistered Community design.

UK proceedings concerning trademarks and designs

The UK Government has also indicated that provision will be made regarding the status of legal disputes involving EU trademarks or registered designs ongoing at the point of Brexit.

The change of regimes governing service, jurisdiction and enforcement in respect of the UK and the EU/EEA noted above will apply also in the context of litigation concerning trademarks and designs (and civil litigation generally).

Copyright

The UK Government's 24 September 2018 Brexit copyright guidance is similarly broadly in line with stakeholders' expectations.

The UK’s continued membership of the main international treaties on copyright will ensure that the scope of protection for copyright works in the UK and for UK works abroad will remain largely unchanged.

Further, the EU's harmonising Directives and Regulations on copyright and related rights will be preserved in UK law as part of the acquis by the UK's EU Withdrawal Act 2018. The government will make adjustments under the powers of the Act to ensure the retained law can operate effectively.

However, the EU's cross-border copyright mechanisms extend only to member states of the EU or EEA. Accordingly, in a no deal Brexit scenario -

  • Sui generis database rights: There will be no obligation for EEA states to provide database rights to UK nationals, residents, and businesses. UK owners of UK database rights may find that their rights are unenforceable in the EEA. (EEA nationals, residents and businesses will continue to be able to enforce sui generis database right in the UK).
  • Portability of online content service: The Portability Regulation will cease to apply to UK nationals when they travel to the EU. This means online content service providers will not be required or able to offer cross-border access to UK consumers under the EU Regulation. UK consumers may see restrictions to their online content services when they temporarily visit the EU.
  • Country-of-origin principle for copyright clearance in satellite broadcasting: UK-based satellite broadcasters that currently rely on the country-of-origin copyright clearance rule when broadcasting into the EEA may need to clear copyright in each member state to which they broadcast.
  • Orphan works copyright exception: UK-based Cultural Heritage Institutions that make works available online in the EEA under the exception may be infringing copyright.
  • Collective management of copyright: UK Collective Management Organisations will not be able to mandate EEA Collective Management Organisations to provide multi-territorial licensing of the online rights in their musical works.
  • Cross-border transfer of accessible format copies of copyright works: The UK intends to ratify the Marrakesh Treaty after exit but ratification will not have taken place before 29 March 2019. Between exit and the point of ratification, businesses, organisations or individuals transferring accessible format copies between the EU and UK may not be able to rely on the EU Regulation.

Geographical indications

At present in the UK, food producers can obtain 'geographical indication' (GI) protection under the EU's quality schemes for agricultural and food products. There is no equivalent national regime in the UK.

The UK Government's 24 September 2018 Brexit 'geographical indications' guidance states that upon Brexit, the UK will set up its own World Trade Organization (WTO) Trade-Related Aspects of Intellectual Property Rights (TRIPs) compliant GI scheme which will broadly mirror the current regime and will be no more burdensome to producers. All existing UK holders of GI will be given the new UK GI automatically.

What next?

The Government's 24 September 2018 guidance will not be the last word on the implications of Brexit for intellectual property. In particular, in a no deal scenario, further details are expected to be released on the mechanisms for extraction of UK trademark and design registrations from EU registrations at the point of Brexit. Following a no deal Brexit, the Government could also be expected to consider and adjust the UK regimes for exhaustion, representation and subsistence of unregistered rights.

In the event of a deal being reached, the expected transition period will in any case preserve the status quo until the end of 2020.

We will keep you updated.


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