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Brexit through the Lens of IP Law

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brexit-1481028_1920According to the Government’s White Paper on exiting the EU, the 65 million people of the UK are now willing the Government to make the negotiations happen (see PM’s Foreword, paragraph 4). I must have missed my reprogramming session as I’m still waiting for reality to snap back to normal….

However, even if we are now all on board the Brexit Bus, next stop the cliff edge followed swiftly by the foot of the cliff, it’s still good to see a well researched article on the impacts of Brexit on the IP sphere. The world has, of course, been awash with Brexit News Bulletins ever since the result came in but the latest addition,  The Legal Consequences of Brexit through the Lens of IP Law, comes with a sterling pedigree, namely Richard Arnold (a judge at the High Court), Lionel Bentley (University of Cambridge), Graeme Dinwoodie (University of Oxford) and Estelle Derclaye (University of Nottingham).

The paper reviews the legal issues in the event that the UK follows through with a Hard Brexit which, as the paper points out, “is currently the Government’s publicly declared stance”. The IPRs of patents, trade marks, copyright and designs get the bulk of the treatment in the paper but there’s also discussion of other IP areas such as trade secrets. IPcopy recommends that the reader digests this paper (which is only 9 pages long) but also highlights some of the main points below.

  • EU law will apply until end of the negotiation period following the triggering of Article 50. This means that the UK will be within the realm of the CJEU during this time.
  • IPRs are legislated via both EU regulation and EU directive, the former of which is immediately applicable in the UK without a national legislative act and the latter of which requires some form of national legislation. This means that when Brexit actually happens regulations will immediately cease to have effect whereas the Government will have to change UK law to remove any parts of EU directives that it doesn’t want. There are around 2000 such directives according to the paper…
  • Trade Marks. Brexit will impact EU trade marks directly as they are governed by EU regulation. One of the major issues relating to EUTMs surrounds the rights of existing holders and it is likely that some form of national legislation will be needed to give rights in the UK to EURTM holders. CITMA has identified 7 different ways that this could be done which is discussed in more detail in the paper and also here.
  • Another major issue with EUTMs is that of revocation. EUTMs that have been put to genuine use by virtue of use in the UK only may be vulnerable to revocation after Brexit (since use in the UK may no longer be regarded as “use in the Union”). Such an issue would seem to impact UK entities more than those in the rest of the EU.
  • Designs. Similar issues apply to Community registered designs and also the Community unregistered design right, however it is noted that the revocation issue that impacts EUTMs does not hit these Community design rights. The paper speculates that the problems with design rights may be more acute than trade marks as there has been a substantial drop off in national design registrations since the EU system was started and a greater proportion of design rights are pursed at the EU level rather than the UK level.
  • The paper does however see a potential positive of Brexit on designs as it will remove the overlap that exists between national and EU rights. A downside though is in the area of unregistered designs where the Community version protects surface decoration whereas the UK national version does not. On this point the paper suggests that “copyright can often come to the rescue for some of that subject matter”.
  • Patents. The impact on patents is limited since the UK is a member of the European Patent Convention which already includes 10 non-EU states. The paper does however acknowledge the potential impact on the unitary patent scheme (“…does raise significant problems with respect to an ambitious procedural innovation that is intended to simplify and reduce the costs of patent enforcement”). IPcopy notes that we’ve covered these issues on this blog and it’s not clear what will happen to the UPC if it gets up and running while the UK is in the 2 year negotiation phase, namely will the UK stay in the system once Brexit actually occurs?
  • It is interesting to note that the paper does not follow the current Government line that the UPC is an international court as the reason why the UK might remain in the system after Brexit occurs. Instead the paper notes “If the UK Government adheres to its political position that the UK will not in any way be subject to EU law and the Court of Justice, then Brexit will likely exclude the UK from that scheme because of the possible reference to EU law.
  • Trade Secrets. The 2016 Trade Secrets Directive is to be transposed into national law by 9 June 2018, i.e. within the negotiation period following Article 50 notification. Since the Government has said it will honour its obligations as an EU Member State this presumably means that we will implement the Directive. There are however areas of the Directive which are unclear and CJEU guidance will probably be required.
  • Copyright. With nine directives at present and two more on the way along with three regulations, the UK might decide that the time is right to overhaul its copyright provisions including a thorough review of the Copyright Designs and Patent Act 1988. The UK could for example adopt fair use exceptions modelled on the US and reintroduce section 52 CDPA 1988. The rest of the EU could look to further harmonise in areas such as moral rights and author-protective contract rules.
  • Other IPRs. There are other IPRs that are covered by EU regulation (and therefore will be immediately impacted). These include Protected Designations of Origin and Geographic Indications, SPCs and the Customs Regulation. Still further IPRs are covered by directives which will remain part of national law unless and until the Government does something about it (database protection, semi-conductor chip topography, Enforcement Directive).
  • New Directives/Regulations. The Trade Mark Directive is due to be implemented by 14 January 2019 and, as noted above in the Trade Secrets section, the UK has indicated that it will continue with its EU obligations.
  • British judges were apparently quite active as far as CJEU referrals were concerned but this will no longer be possible post-Brexit. Where UK law stays close to the EU version then CJEU decisions may remain persuasive.

Mark Richardson 28 February 2017

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