UK formally withdraws from Unified Patent Court

On 20 July 2020, the UK withdrew from the UPC by depositing notification of the withdrawal of its ratification of the UPC Agreement.  After depositing this instrument with the Council Secretariat, the UK Government issued a statement explaining its actions to the House of Commons.

The Unified Patent Court project and associated Unitary Patent, which promised to be one of the most significant developments in international IP dispute resolution in the last 40 years, suffered two major setbacks in 2020.  First, the UK Government indicated that the UK would not take part in the UPC as a result of Brexit.  Then, Germany's highest constitutional court ruled in an action brought by an individual, Ingve Stjerna, that the Act of Approval to the UPC Agreement had been adopted in violation of the German Constitution as it had not been approved by the necessary two-thirds majority of the Bundestag.  

The UK Government's latest statement

Even though the UPC is an international court and not an EU construct, the rationale for the UK Government's decision was the perceived involvement of EU law and the CJEU.  This was confirmed in the written statement to the House of Commons made last week by Amanda Solloway (Parliamentary Under Secretary of State, Minister for Science, Research and Innovation):

"UNIFIED PATENT COURT

I am tabling this statement for the benefit of Honourable and Right Honourable Members to bring to their attention the UK's withdrawal from the Unified Patent Court system.

Today, by means of a Note Verbale, the United Kingdom of Great Britain and Northern Ireland has withdrawn its ratification of the Agreement on a Unified Patent Court and the Protocol on Privileges and Immunities of the Unified Patent Court (dated 23 April 2018) in respect of the United Kingdom of Great Britain and Northern Ireland and the Isle of Man, and its consent to be bound by the Protocol to the Agreement on a Unified Patent Court on provisional application (dated on 6 July 2017) (collectively "the Agreements").

In view of the United Kingdom's withdrawal from the European Union, the United Kingdom no longer wishes to be a party to the Unified Patent Court system. Participating in a court that applies EU law and is bound by the CJEU would be inconsistent with the Government's aims of becoming an independent self-governing nation.

The Agreements have not yet entered into force. However, in order to ensure clarity regarding the United Kingdom's status in respect of the Agreements and to facilitate their orderly entry into force for other States without the participation of the United Kingdom, the United Kingdom has chosen to withdraw its ratification of the Agreements at this time. The United Kingdom considers that its withdrawals shall take effect immediately and that it will be for the remaining participating states to decide the future of the Unified Patent Court system".

Impact of the withdrawal and timing

While the withdrawal of the ratification is not a surprise given the UK Government's red line position that there should be no role for the CJEU in the UK, its timing, before Germany's ratification and in the middle of the negotiations for the future relationship between the UK and the EU, is interesting.  While Germany continues in its efforts to pass its national legislation approving the UPC Agreement with the required majority, the UK Government's latest action removes the threat of further action by Patrick Breyer and others who were threatening legal action if Germany tried to ratify whilst the UK was still a signatory of the UPC Agreement.  (The UK was one of the original three mandatory signatories required before the new system could come into effect.)   

What happens next?

The UPC Agreement provides that the Agreement will come into force once ratified by "the three States in which the highest number of European patents was in force in the year preceding the year in which the signature of the Agreement takes place..."  So, as the UK is not actually named as a mandatory signatory, it is possible to substitute the UK's ratification with ratification by the next highest filer of granted patents at the relevant date, namely Italy.  Since Italy has already ratified the UPC Agreement, when Germany ratifies, the UPC Agreement can come into force.

Despite this year's setbacks, there appears to be a renewed enthusiasm for the project.  We understand that the UPC Preparatory Committee will now convene to discuss the consequences of the UK withdrawal and agree a way forward. If Germany passes its legislation by the end of this year then the court could open in 2022.