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Further steps taken towards UK ratification of the Unified Patent Court

The UK's ratification of an international agreement to establish a new Unified Patent Court (UPC) in Europe has moved closer following recent actions taken by parliament and the Privy Council.19 Dec 2017

The Unified Patent Court (Immunities and Privileges) Order 2017 was approved by the House of Commons on 4 December and the House of Lords on 12 December following debates by committees in those houses on 29 November and 6 December respectively.

The Order confers legal capacity and grants immunities and privileges on the UPC and its representatives, judges, registrars and staff. It is the final piece of legislation that needs to be passed for the UK to ratify the UPC Agreement.

To come into law, the Order must first be approved by the Privy Council.

A spokesperson for the Privy Council told Out-Law that its next meeting is due to be held in February 2018.

The spokesperson said that the body is unable to provide details of the scheduled business for the meeting in advance, but confirmed that the legislation passed by the Commons and Lords does not automatically come to it for approval. She said it is up to the government departments responsible for the legislation to submit it to the Privy Council for its consideration and approval.

A spokesperson for the Intellectual Property Office (IPO) told Out-Law.com that the Foreign and Commonwealth Office (FCO), as the department responsible for the legislation, is in the process of submitting The Unified Patent Court (Immunities and Privileges) Order 2017 to the Privy Council for consideration in early 2018.

The IPO spokesperson further confirmed that approval of the Order would be the final legislative step necessary for UK ratification of the UPC Agreement, but that the actual date and process of UK ratification will be subject to discussion within the UK government.

"Once approved by Privy Council, the UK will be in a position to ratify the UPC Agreement," the IPO spokesperson said. "It should be noted that the UK's decision to proceed with ratification of the UPC Agreement is without prejudice to the UK's position on the jurisdiction of the CJEU once the UK has left the EU. Our future relationship with the Unified Patent Court will be the subject of negotiation as we leave the EU."

The Privy Council's last meeting was held on 13 December. At it, the Privy Council made an order approving the International Organisations (Immunities and Privileges) (Scotland) Amendment (No.2) Order 2017. The legislation, which will apply to Scotland, is effectively equivalent to, and complements, the Unified Patent Court (Immunities and Privileges) Order 2017 that has been before the parliament at Westminster. It had previously been approved by the Scottish Parliament in October.

Both the Unified Patent Court (Immunities and Privileges) Order 2017 and the International Organisations (Immunities and Privileges) (Scotland) Amendment (No.2) Order 2017 give effect to the Protocol on Privileges and Immunities. The Protocol forms part of a broad package of legislative and non-legislative measures put in place by cooperating EU member states to underpin the new UPC framework.

The UPC, when established, will serve as a new judicial enforcement framework to underpin a new unitary patent system. Businesses will be able to apply to the European Patent Office for unitary patents which, if granted, would automatically confer on them patent protection for their inventions which will apply across every country that gives recognition to the unitary patent regime, which at the moment looks set to be 25 of the 28 existing EU countries.

For the new UPC system to take effect, at least 13 EU countries, including the three with the most European patents in effect in 2012 – Germany, France and the UK, must pass national legislation to ratify the UPC Agreement that the countries behind the new system finalised in 2013. France is one of the 14 countries to have completed ratification to-date.

In November last year, the UK government confirmed that the UK would ratify the UPC Agreement, despite the country voting to leave the EU. However, since then formal ratification has been delayed, including because of June's general election. There has been continued uncertainty over whether the UK would be able to participate in the new system after the country formally exits the EU, even if its participation began prior to Brexit taking effect. The UPC Agreement currently requires countries participating in the new unitary patent and UPC system to be EU members. 

Dr Michael Schneider, a patent law and litigation expert at Pinsent Masons, the law firm behind Out-Law.com, previously said that political considerations around Brexit in the UK, and an ongoing legal challenge to the proposed reforms in Germany, presented a "two-fold risk" to the UPC project becoming operational.