Brexit Is Coming. What Does the Future Hold for Intellectual Property Rights in the United Kingdom?
The most enduring contact that many of our clients have with the British legal system involves their patents, trademarks, and design registrations. The United Kingdom (“UK”) has recently voted to leave the European Union (“EU”). What will this mean for U.S. holders of intellectual property rights?
Much remains unknown at this point. Brexit will take effect after a two-year negotiation period, and many of the impacts we outline below may be resolved through these negotiations. As the UK and the EU grapple with the consequences of the Brexit vote, however, U.S. rights holders should plan to protect their assets in the event that the UK’s step back from globalization ultimately also means the end of its participation in the EU intellectual property regime.
Trademark owners who use or intend to use their trademarks in the UK need to consider what this means for their existing trademark rights and what they need to do for future protection of their trademark rights. While the future of your UK trademark rights is in flux, this FAQ is intended to answer some of your questions until more certainty is legislated.
1. If I own trademark registrations or applications covering the entire EU, which were registered or applied for prior to the date Brexit takes effect, do those registrations and applications still cover the UK?
Yes. European Union trademark registrations and EU applications filed prior to when Brexit takes effect, which applications mature into registrations (“EUTMs”), will continue to cover and be enforceable in the UK until Brexit takes effect. Further, it is highly likely that the UK will pass a new law that will either (i) automatically transition EUTMs into national UK registrations; or (ii) give the owners of EUTMs an opportunity to transition the registrations into national UK registrations.
2. Should I file to protect my mark in the UK separately from the EU now?
Yes, this is advisable. Although it is highly likely that the UK will enact a new law to provide for EUTMs to transition into national UK registrations, there is uncertainty with respect to the extent of protection the new law will provide. For example, the new law may not allow for owners to retain their original priority dates obtained with the EUTMs, and the cost of transitioning from EUTMs to national UK registrations (if any) is unknown. Therefore, because of these uncertainties, it is recommended that owners file separate applications to register their trademarks in the UK.
3. If I only use my EUTM in the UK, am I in jeopardy of losing the EUTM?
Yes. Once Brexit is complete, EUTMs for marks that are only used in the UK are vulnerable to revocation for non-use since the UK will no longer be a member state of the EU. If you want to retain the EUTM, it is recommended to use the mark in another EU member state where possible.
4. What is the impact on enforcement of EUTM rights?
Once Brexit is complete, UK courts will no longer be an avenue for EUTM owners to enforce EUTM rights. Rather, UK courts can only be used to enforce UK trademark rights. It is recommended that an owner of a mark bring two separate enforcement proceedings, one in an EU court (based on the EUTM) and one in a UK court (based on UK rights). Although this will increase the cost of litigation, it will ensure an owner’s rights are protected. Further, it is currently unknown what effect Brexit will have on existing injunctions granted by an EU court. It is possible that a separate, UK-specific injunction will be necessary to enforce the injunction in the UK.
1. Will Brexit impact my European design patent rights?
Yes. As things stand, Registered Community Designs will no longer be enforceable in the UK when Brexit takes effect.
1. Will current UK patents be affected?
No. Current utility patent rights in the UK will not be affected by Brexit.
2. How about new patent applications?
No again. Britain will remain a signatory of both the Patent Cooperation Treaty and the European Patent Convention, as membership in those organizations is not tied to membership in the European Union. Post-Brexit, Americans will still be able to obtain UK patent coverage in the same way they have for decades.
Gaze into the future a little further, however, and the story gets murkier. Currently, unlike trademarks, there is no such thing as a European utility patent. Patentees can file applications with the European Patent Office either directly or via the Patent Cooperation Treaty, and that application will be examined by the EPO. However, once an application is allowed by the EPO, a patent must be validated in each individual country in which it is to have effect. Patentees must pay maintenance costs in each individual country. Patentees also must file suit in each country individually in order to enforce their patents. A meaningful level of patent enforcement in Europe means filing suit and winning in key jurisdictions such as Germany, France, and the UK, but true patent enforcement across Europe is a practical impossibility.
In 2012, Europe began implementing a plan to create a unitary patent that would be enforceable throughout the European Union through a Unified Patent Court, as trademarks and design patents are. This effort, however, is tied to the European Union, not to the European Patent Convention, and so Brexit means that the unitary patent system will not cover the UK. This is a significant change—so integral was British membership in the EU to this plan that the Unitary Patent Court was to sit in London. During the forthcoming negotiated transition period, the UK may find a way to participate in the unitary patent system in its own right. If it does not, Brexit will ultimately mean that a unitary European patent will not cover the UK, and may be significantly less valuable.