Insurance 25 October 2017

Understanding your intellectual property rights post-Brexit

The European Commission has published a paper in an attempt to reduce uncertainties surrounding business assets after Brexit
The European Commission has published a paper in an attempt to reduce uncertainties surrounding business assets

Following further clarification from the European Commission on its legal expectations for British businesses after March 2019, David Thompson, partner at legal firm Michelmores, explains what small company owners should understand about their intellectual property rights post-Brexit.

Last month, the European Commission (EC) published a position paper setting out the European Union’s (EU) position on intellectual property rights post-Brexit, to be presented to the UK in the context of Article 50 negotiations. The paper positively seeks to reduce the uncertainties surrounding the protection of intellectual property rights following the UK’s withdrawal from the EU.

The importance of intellectual property protection is two-fold. On the one hand, it’s about protecting business assets and on the other, it’s unlocking and exploiting the value in those assets through activity such as licensing deals.

Adopting a rigorous, systematic approach that is tailored to a business’s needs is a good general rule of thumb to protecting intellectual property.

There is often either a misconception or an assumed level of knowledge around intellectual property protection. It is usually not as complex as it seems on the outset but it does need to be approached systematically.

It can be very easy to clock up huge legal bills, which may not have been necessary if the right level of understanding was held at the outset. The lawyer’s role is to demystify and talk through the basics.

So what is included in the new position document and what is the potential impact on your business post-Brexit?

Continued protection for certain unitary rights

Any unitary IP rights (e.g. EU trade marks, registered Community designs and protected geographical indications) granted before Brexit will continue to be given protection within the UK. The paper calls for an “automatic recognition” of such rights in the UK, at no financial cost to the holder of those rights.

Read more: How to protect your intellectual property when pitching to a national retailer

In terms of geographical indications and protected designations of origin, the EU will require the UK to put in place the necessary domestic legislation to provide for their continued protection.

Priority benefits

Where an application for intellectual property rights is pending at the time of Brexit, the applicant will be entitled to keep the benefit of any priority date when subsequently applying for an equivalent right in the UK. Interestingly, unlike for rights already granted, there is no suggestion of any automatic transfer of pending rights.

Supplementary protection certificates (SPC)

Applications for SPCs and for an extension of their duration should receive continued protection where they have been submitted before and are ongoing on the withdrawal date. The paper does not, however, shed light on whether SPCs will continue to be granted within the UK after Brexit.

Database rights

Any database rights protected ahead of Brexit will continue to enjoy protection in both the UK and the remaining EU member states.

Exhaustion of rights

The principle of exhaustion in relation to intellectual property rights is designed to prevent an intellectual property owner from using its rights to restrict further sales, imports or exports of products which it has already placed on the market. IP rights which were “exhausted” in the EU prior to Brexit are to remain exhausted in the UK and EU post-Brexit.

While the paper addresses many of the concerns surrounding the protection of intellectual property rights post-Brexit, it fails to discuss the Unitary Patent or Unified Patent Court.

As it stands, only EU countries can be a part of the Unitary Patent system. In the absence of any comments from the EC, it is still unclear whether the system will apply to the UK following Brexit.

In any event, the paper represents a positive step towards ensuring the protection of intellectual property rights for businesses following Brexit and provides intellectual property stakeholders with some welcome clarity.

Whether the UK will be willing to agree to the EU’s “wish list” remains to be seen, however, given the emphasis the UK government has placed on certainty and continuity, it would be surprising if the UK’s position significantly differed.

Regardless of the outcomes of Brexit, preparation will be key for businesses when it comes to intellectual property protection.

David Thompson is a partner at Michelmores

A guide to using other peoples’ intellectual property

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