Entry into force of the european patent with unitary effect: review your contracts!

The European patent with unitary effect and the Unified Patent Court (UPC) will soon come into force^[1].

Before requesting unitary effect or opting out of the exclusive jurisdiction of the Unified Patent Court for a European patent which does not have unitary effect, patent owners will need to be aware of their obligations under existing contracts and, if necessary, adjust them.

Here is a review of the main points to be considered in the context of co-ownership or licensing of a European patent.

How to manage the request for unitary effect for a European patent in joint ownership?

Firstly, it should be remembered that unitary effect cannot be obtained if the owner(s) of the European patent is (are) not the same throughout the territory of the participating Member States^[2] .

The request for unitary effect must be made by all the owners of the patent.

It is therefore necessary to obtain the agreement of all the co-owners.

As the time limit for requesting the unitary effect is very short (one month from the grant of the European patent), it is recommended that a review of the portfolio of co-owned patents be undertaken as of now in order to take a joint decision for each pending European patent application and, thus, be ready to request unitary effect when the grant occurs.

How to manage the opt-out declaration for a European patent in joint ownership?

The opt-out declaration for a patent application or a European patent without unitary effect must also be submitted by all owners.

Although there is no official deadline for filing an opt-out declaration, the initiation of an action before the UPC prevents the opt-out from being applicable. It is therefore in the interest of the co-owners, if they wish to benefit from this derogation, to file the declaration as soon as possible in order to avoid that a third party action prevents it. As explained in our previous article, the opt-out may be filed at any time during a three-month period ("sunrise period") prior to the entry into force of the Unified Patent Court Agreement and then during a transitional period of at least seven years following that entry into force.

The co-owners should therefore consult as soon as possible on the opt-out strategy.

Can the licensee influence the decision to request unitary effect and opt-out?

The request for unitary effect and the opt-out declaration can only be made by the patent owner(s).

Therefore, a licensee, even an exclusive licensee, is not entitled to carry out these formalities.

Some licences provide for an obligation to inform the licensee of the decisions taken by the patent owner regarding the grant procedures, or even to consult on the protection strategy. It will therefore be necessary to check the content of each of these licences in order to respect these obligations.

Conversely, other licences delegate responsibility for the management of the licensed patents to the licensee. Arrangements will need to be made to ensure that the request for unitary effect or opt-out is made by the patent owner.

What is the impact of the new system on the licensee?

Unlike an assignment which can only be made for all participating Member States, a licence of a European patent with unitary effect can be granted for all or part of the territory of the participating Member States.

The owner and the licensee will therefore be free to define the territory of exploitation, whether or not the European patent has unitary effect.

The licensee's right to bring an infringement action before the UPC depends on whether the licence is exclusive or not and on the specific stipulations contained in the licence:

• The exclusive licensee may bring an infringement action before the UPC unless the licence provides otherwise and provided that the patent owner has been informed in advance.
• On the other hand, the non-exclusive licensee is only entitled to bring an action before the UPC to the extent that this is expressly authorised by the licence agreement, and provided that the patent owner has been informed in advance.

REGIMBEAU's teams are at your disposal to study your existing and future contracts in order to clarify their impact and suggest possible amendments.

[1] To date, the entry into force of the Unified Patent Court Agreement is scheduled for 1 January 2023.

[2] On the date of entry into force, there will be 17 participating Member States including: Austria, Belgium, Bulgaria, Denmark, Estonia, Finland, France, Germany, Italy, Luxembourg, Malta, Netherlands, Portugal, Sweden, Lithuania, Latvia, Slovenia