Has the Volte-Face on the Unified Patent Court Agreement been worth it?

Author Cédric Pusney Licence CC BY 2.0 Source Wikimedia Commons

 

Jane Lambert

Tomorrow is World Intellectual Property Day,  It is an international festival of creativity and innovation to celebrate the anniversary of the coming into force of the Convention Establishing the World Intellectual Property Organization on 26 April 1970,  Because it is a very significant anniversary, governments like to make momentous announcements about intellectual property on that day

One such announcement on World Intellectual Property Day was British ratification of the Unified Patent Court Agreement ("UPCA") made exactly 3 years ago by the then Foreign Secretary the Rt Hon Boris Johnson MP.   As British ratification was as welcome as it had been unexpected, I hailed it t as "Possibly the best thing to happen on World Intellectual Property Day", Any euphoria occasioned by that news was very short-lived.   A volte-face came less than 2 years later.  Part of the reason for that reversal. according to a parliamentary written statement by Amanda Solway MP, Parliamentary Under-Secretary of State, Minister for Science, Research and Innovation, was:

"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." (see UK Withdrawal from the UPCA 20 July 2020 Unified Patent Court website).

In other words, the UPCA was thought to be incompatible with "taking back control" and the notion of sovereignty. 

Any intervention by the CJEU would have been minimal compared to matters in which Her Majesty's government has agreed to the continued involvement of that Court. First, the agreement by which the UK withdrew from the EU and Euratom provides for disputes over the Northern Ireland Protocol to be resolved by the CJEU as the House of Lords noted in paras 256 to 258 of their  Report on the Protocol.  

Secondly, s.6 (2) of the European Union (Withdrawal) Act 2018 permits courts and tribunals in the UK to have regard to judgments of the CJEU delivered after 23:00 on 31 Dec 2020 in so far as they may be relevant to any matter before them.  In Warner Music UK Ltd and another v TuneIn Inc. [2021] EWCA Civ 441 (26 March 2021) the Court of Appeal decided to follow the CJEU's judgment in  C-392/19 VG Bild-Kunst v Stiftung Preußischer Kulturbesitz  [2021] EUECJ C-392/19, [2021] WLR(D) 157, EU:C:2021:181, ECLI:EU:C:2021:181 which was delivered months after the expiry of the implementation period provided by art 126 of the withdrawal agreement. 

Thirdly, although the case law of the CJEU delivered before 31 Dec 2020 continues to bind British courts and tribunals, the Court of Appeal does have power to depart from that case law on the same basis that the Supreme Court has power to depart from one of its own precedents or of one of the House of Lords in accordance with the Practice Statement (Judicial Precedent) [1966] 1 WLR 1234: In TuneIn, the appellant's primary contention was that the Court of Appeal should depart from the entire body of case law of the CJEU on communication to the public, or alternatively, that the Court should depart from Case C-160/15 GS Media BV v Sanoma Media Netherlands BV [2016] WLR(D) 477, [2016] EUECJ C-160/15, [2016] Bus LR 1231, ECLI:EU:C:2016:644, EU:C:2016:644.

The Court of Appeal struck down that argument like a whack-a-mole. Lord Justice Arnold gave no less than 8 reasons why departing from the CJEU's case law would be a bad idea between paras [77[ to [88] of his judgment.  The Master of the Rolls offered two, namely that the CJEU's case law was based on international agreements and there was no immediate .need to change anything.  Lady Justice Rose agreed that this was absolutely not a case in which this court should exercise its power to depart from the EU jurisprudence.  For those who are interested in the TuneIn appeal, I wrote a case note on the Court of Appeal's judgment in The Appeal: Warner Music UK Ltd and others v Tuneii Inc in NIPC Law on 24 April 2021.  

The UPC and the unitary patent would have benefited British industry great which is why they were recommended by both Gowers and Hargreaves.  Because of the adversarial system of civil litigation and the rule that costs of litigation are paid by the losing party the United Kingdom (and in particular) England is the most expensive and riskiest jurisdiction in the world in which to enforce an intellectual property right.  It is no coincidence that the country of Newton and Berners-Lee which initiated the industrial revolution and which still has some of the strongest research universities in the world trails consistently not just Germany and France in the number of European patent applications but also the Netherlands with a third of its population and Switzerland with one eighth.   A heavy price indeed for the chimaera of sovereignty.

Anyone wishing to discuss this article may call me on +44 (0)20 7404 5252 during office hours or send me a message through my contact form.

Brexit Briefing - February 2018

Author Mikelo 

Licence Creative Commons Attribution Share Alike 2.0 Generic
Source: Wikimedia Commons

Jane Lambert

The most significant event last month was the publication by the European Commission of a draft agreement for the withdrawal of the United Kingdom from the European Union and the European Atomic Energy Community on 28 Feb 2018.  It has not yet been presented to the British government as it must first be discussed by the governments of the remaining member states and the Brexit steering group of the European Parliament,  I sketched out its structure and main provisions in The Draft Withdrawal Agreement: Getting Down to Business at Last 3 March 2018.

There has been some grumbling from the British side, particularly over the border between Ireland and Great Britain and no doubt some concessions will be made here and there by both parties but the basic shape and content of the agreement contemplated by art 50 (2) of the Treaty of European Union is unlikely to be very different.  There is not much room for movement on the European side because the Commission's negotiators are bound by the Council's Guidelines of the 29 April 2017.  Moreover, the draft is said to be based on the Joint report from the negotiators of the European Union and the United Kingdom Government on progress during phase 1 of negotiations under Article 50 TEU on the United Kingdom's orderly withdrawal from the European Union (see No Fudge - the Next Stage of Negotiations between the EU and UK 12 Feb 2018).  So if we want a trade deal of any kind with the remaining member states of the European Union we will have to accept something like that draft. The alternative is no deal at all.

The most welcome aspect of the Prime Minister's Mansion House speech of 2 March 2018 were the following hard facts:

1. "Brexit will be no bed of roses: 'We are leaving the single market. Life is going to be different. In certain ways, our access to each other's markets will be less than it is now. How could the EU's structure of rights and obligations be sustained, if the UK - or any country - were allowed to enjoy all the benefits without all of the obligations?
2. 'Even after we have left the jurisdiction of the ECJ, EU law and the decisions of the ECJ will continue to affect us.' Aside from the niggle that the initials 'ECJ' are no longer used as that tribunal is now known as the Court of Justice of the European Union ('CJEU') and has been for many years, I welcome that remark. It will make it easier to reach agreement on the withdrawal treaty and it may just make it possible for the UK to remain a party to the Uniform Patent Court Agreement. On the other hand, she omitted to say that the UK will lose its judge and advocate general on the Court who have hugely influenced its decisions since 1973. 
3. No State Aids or Featherbedding: 'If we want good access to each other's markets, it has to be on fair terms. As with any trade agreement, we must accept the need for binding commitments - for example, we may choose to commit some areas of our regulations like state aid and competition to remaining in step with the EU's.'

There are still folk who think that cake exists for eating and cherries for picking but it does not appear that the Prime Minister is one of them (see Mrs May's Mansion House Speech: Some Home Truths At Last 4 March 2018).

Finally, some crumbs of comfort on the Uniform Patent Court ("UPC"). The first is that the legislative hurdles to British ratification of the UPC Agreement appear to have been cleared.  Secondly, as I noted above, the Prime Minister is prepared to countenance some future role for the CJEU in British affairs after we quite the EU which removes one of the difficulties that I mentioned in my article What if anything can be salvaged from the UPC Agreement? 26 Jan 2018 NIPC Law and my presentation to Queen Mary University London on 12 Feb 2018 (see My Contribution to the Discussion on the Implications of Brexit at Queen Mary University London on Monday 12 Feb 2018 17 Feb 2018). The third crumb is that the constitutional challenge to German ratification of the UPC agreement (Verfassungsbeschwerde gegen das Zustimmungsgesetz zu dem Übereinkommen vom 19. Februar 2013 über ein Einheitliches Patentgericht (EPGÜ)) has been listed for hearing in the German Constitutional Court in Karsruhe before Professor Dr Huber under case number 2 BvR 739/17.  Fourthly, there was nothing unhelpful to the UPC in Title IV of Part 3 of the draft withdrawal agreement which covers intellectual property.

Anyone wishing to discuss this briefing or Brexit in general should call me on +44 (0)20 7404 5252 during normal office hours or send me a message through my contact form.

Mrs May's Mansion House Speech: Some Home Truths At Last

Source Guardian,  Standard YouTube Licence

 Jane Lambert

The Prime Minister's speech at the Mansion House on Friday has received a mixed reception.  According to Toby Helm "most Conservative MPs and peers gave the prime minister a period of grace after Friday’s address."  However, Lord Heseltine dismissed it as "more detail on a set of demands that the European Union had made clear all along it would never agree to" (see Tories’ Brexit unity fades as Heseltine slams May’s speech 2 March 2018 The Guardian).

I hold no brief for the Prime Minister, but I think that is a little unfair.  She did speak some home truths though I fear she may have pulled her punches:

1. Brexit will be no bed of roses:  "We are leaving the single market. Life is going to be different. In certain ways, our access to each other's markets will be less than it is now. How could the EU's structure of rights and obligations be sustained, if the UK - or any country - were allowed to enjoy all the benefits without all of the obligations?"
2. "Even after we have left the jurisdiction of the ECJ, EU law and the decisions of the ECJ will continue to affect us." Aside from the niggle that the initials "ECJ" are no longer used as that tribunal is now known as the Court of Justice of the European Union ("CJEU") and has been for many years, I welcome that remark.  It will make it easier to reach agreement on the withdrawal treaty and it may just make it possible for the UK to remain a party to the Uniform Patent Court Agreement.  On the other hand, she omitted to say that the UK will lose its judge and advocate general on the Court who have hugely influenced its decisions since 1973. 
3. No State Aids or Featherbedding:  "If we want good access to each other's markets, it has to be on fair terms. As with any trade agreement, we must accept the need for binding commitments - for example, we may choose to commit some areas of our regulations like state aid and competition to remaining in step with the EU's."

The reason Mrs May had to say these things is that there has been a lot of wishful thinking about Brexit. Some have argued that the shock of the departure of its third largest member state would rip the EU apart. That could happen but there are no signs of its happening yet.  It is equally possible that the remaining member states could integrate more quickly and become stronger and more influential than ever. Another bit of wishful thinking is that German car manufacturers, Italian white goods makers and French farmers will force their governments to make concessions were we ever to play hardball. I have never understood that argument because we are not going to start making those goods in Britain or sourcing those goods from elsewhere. Tariffs might dent demand for EU goods and services but it won't destroy it and the business communities in those countries know it.  The fact is that the UK is not negotiating from a position of strength and will on many issues have to take what the remaining member states have to offer or leave it.

Finally, the Institute for Government has produced an excellent, tabulated analysis of the PM's speech with "Area" in come column, "What the Prime Minister said" in another and "What this means" in the third (see The Prime Minister's Mansion House Brexit speech 2 March 2018 The Guardian).  I was about to do my own analysis along similar lines but this is so much better.

Anyone wishing to discuss this article or Brexit in general should call me on +44 (0)20 7404 5252 during office hours or send me a message through my contact form.

Brexit Briefing - December 2017

Author Furfur
Licence: Creative Commons Attribution-Share Alike 4.0 International

Jane Lambert

To my great surprise and joy our government's representatives achieved sufficient progress in their negotiations with the Commission on citizens' rights, the Irish border and the financial settlement for the Commission to recommend to the Council that "sufficient progress has been made in the first phase of the Article 50 negotiations with the United Kingdom" (see the Commission's press release Brexit: European Commission recommends sufficient progress to the European Council (Article 50) 8 Dec 2017).

The actual terms of the agreement in principle are set out in a Joint report from the negotiators of the European Union and the United Kingdom Government on progress during phase 1 of negotiations under Article 50 TEU on the United Kingdom's orderly withdrawal from the European Union 8 Dec 2017.  It is clear that important concessions have been made by Her Majesty's government, including a continued role for the Court of Justice of the European Union after we leave the European Union as I pointed out in A Continued Role for the CJEU after Brexit - A Sensible Concession 29 Dec 2017.  I observed that it was, of course, a very sensible concession and I commended the Prime Minister for making it but I had to add that "a climb down is still a climb down."

There was one paragraph of the Joint Report that I found personally comforting and that was paragraph 32 on continuing recognition of professional qualifications:

"Decisions on recognition of qualifications granted to persons covered by the scope of the Withdrawal Agreement before the specified date in the host State and, for frontier workers, the State of work (either the UK or an EU27 Member State) under Title III of Directive 2005/36/EC (recognition of professional qualifications where the person concerned was exercising the freedom of establishment), Article 10 of Directive 98/5/EC (lawyers who gained admission to the host State profession and are allowed to practise under the host State title alongside their home State title) and Article 14 of Directive 2006/43/EC (approved statutory auditors) will be grandfathered. Recognition procedures under these Directives that are ongoing on the specified date, in respect of the persons covered, will be completed under Union law and will be grandfathered."

Now that goes some way to meeting one of the submissions of the leaders of the British intellectual property professions to Her Majesty's government about which I blogged earlier today in IP and Brexit - Key Requests to HMG 9 Jan 2018. I am 100% behind my chairman, Daniel Alexander QC, in making those requests. They are vitally important to British business as well as the British legal and intellectual property professions. But asking for the legislation creating EU trade marks, Community designs, geographical indications of origin and plant breeders' rights to remain part of out law and even retaining part of the Central Division of the Court of First Instance of the Unified Patent Court in London really is like asking for the moon. I fervently hope that I am wrong but I very much doubt that I am.

So now we proceed with the next phase of negotiations which are for a transitional agreement that will govern our relations with the remaining member states after 29  March 2019. The Commission set out its negotiating objectives just before Christmas.  These are summarized in the Commission's press release on 20 Dec 2017 Brexit: European Commission recommends draft negotiating directives for next phase of the Article 50 negotiations:

• "There should be no "cherry picking": The United Kingdom will continue to participate in the Customs Union and the Single Market (with all four freedoms). 
• The Union acquis should continue to apply in full to and in the United Kingdom as if it were a Member State. Any changes made to the acquis during this time should automatically apply to the United Kingdom.
• All existing Union regulatory, budgetary, supervisory, judiciary and enforcement instruments and structures will apply, including the competence of the Court of Justice of the European Union.
• The United Kingdom will be a third country as of 30 March 2019. As a result, it will no longer be represented in Union institutions, agencies, bodies and offices.
• The transition period needs to be clearly defined and precisely limited in time. The Commission recommends that it should not last beyond 31 December 2020."

Now I am all in favour of give and take but even my hackles rise at those proposals. No wonder our government is exploring no deal alternatives such as membership of the Trans-Pacific Partnership if they will have us (see UK looks to join Pacific trade group after Brexit 2 Jan 2018 Financial Times) and the appointment of a minister for no-deal (see A minister for no deal? 8 Jan 2018 Financial Times).

Anyone wishing to discuss this article should call me on +44 (0)20 7404 5252 during office hours or send me a message through my contact form. 

German Industry Federation advises its Members to prepare for a Hard Brexit

Jane Lambert

In an article on its homepage entitled Deutsche Industrie schaut mit Sorge auf Fortgang der Brexit-Verhandlungen (German Industry views with Concern the Progress of the Brexit Negotiations) the Bundesverband der Deutschen Industrie e.V. ("BDI") the Confederation of German Industry (the equivalent of the CBI) warned its members with interests in the UK to prepare for a very hard Bexit ("einen sehr harten Austritt Großbritanniens aus der Europäischen Union"). "Anything else would be naive," said the BDI's Director-General Joachim Lang.

There is more gloom from the Bar Council which reports that the working assumption of the Commission's art 50 Task Force is that "there will be no formal EU-UK relationship in future. Therefore, following UK withdrawal, no CJEU, no single market, end of application of 4 freedoms and all economic rights; no cooperation in civil and criminal justice etc. UK nationals will no longer be EU citizens" (see Brussels News Issue 137 5 Oct 2017). It follows that "no protection will be given to secondary establishment and cross-border services. Thus, if a UK lawyer is appearing in a case pending before the CJEU at withdrawal date (WD), the client must change lawyer."

The Bar Council reports that the Task Force is aiming for an orderly winding down in judicial cooperation as in other areas. "The EU regime will cease to apply to the UK as at the date of withdrawal. The UK will be starting with a blank sheet, even with the Lugano Convention etc, since it is not a signatory in its own right."

I regret to say that I share the BDI and Bar Council's gloom because I do not think that the remaining 27 states can accept a withdrawal agreement that binds them as a matter of European Union law but not us.  German and other exporters will no doubt lose some sales if tariff barriers and customs formalities return at the border but they will not lose their market altogether. Where else are we Brits to get our cars, white goods, sparkling wine and luxury leather goods than the EU27? The Bar Council concludes that "the harsh reality is that the clock ticking is a far more serious problem for the UK than it is for the EU, whatever committed Brexiteers may wish to believe."

Anyone wishing to discuss this article should call me on +44 (0)20 7404 5252 or send me a message through my contact form.