During the transitional period (which is running for an initial period up to 2030 with the option for a further 7 year extension to 2037), a patent owner can avoid infringement or validity actions before the UPC for any granted European patent nationally validated in one or more UPC Member State(s) by opting out from the UPC. Once a European patent has been opted out of the UPC, no infringement or validity action can be initiated at the UPC by the patent owner or a third party in respect of that patent unless the opt out is withdrawn. In other words, infringement or validity actions will be handled by the relevant national courts for that patent.
It is not possible to opt out a Unitary Patent (UP) and so infringement or validity actions are handled only by the UPC for a UP.
Who can opt out a patent?
An opt out must be requested by or on behalf of the ‘true owner’ of the patent (i.e., the person or entity who legally owns the patent). Where a patent is jointly owned, all owners must agree to the opt out. If the ownership differs from that shown in the official register, additional documentation is required to file the opt out request.
Legal instruments, such as licences or joint ownership agreements, may affect patent ownership and/or define who is entitled to make strategic decisions concerning the maintenance of the patent. It is important to check that an opt out request complies with any such agreements.
Ownership will not be examined in detail by the Court Registrar, but ownership (and therefore the validity of the opt out) can be challenged by a third party. Accordingly, it is important that ownership is verified before opting out.
Can patent owner choose to opt out some patents, but not others?
The decision to opt out can be made on a patent-by-patent basis. It is therefore possible, and often likely advisable, to opt out some patents from a portfolio and to leave others from the portfolio within the jurisdiction of the UPC. A patent owner can make different decisions for different patents, and different owners will likely take different approaches to their portfolios based on their commercial and strategic objectives. Please get in touch if you would like to discuss this further.
Are signed documents required to opt out?
We recommend obtaining a signed mandate to confirm that the opt out is:
- Filed by the representative entitled to opt out, and
- Is filed on behalf of all relevant owner(s).
What is the cost of opting out?
The UPC does not charge an official fee to opt out a patent. A service charge is payable to us for the work we undertake to file the opt out on your behalf: there is a flat fee for the first patent/opt out request and a lower fee for each subsequent patent/opt out request when the patents are owned by the same owner(s).
If we need to conduct further work in relation to an opt out, such as advising on ownership or licence issues, then this further work will be charged at our usual hourly rate.
Please get in touch for more detailed information on our pricing structure.
When can an opt out request be filed, and when is it effective?
The option to opt out remains available during the transitional period, which is running until 2030 at the earliest with a possibility of extension until 2037. An opt out is effective from the date it is entered into the register.
Once the transitional period (including the potential extension) concludes, it will no longer be possible to opt out European patents from the UPC. The option to nationally validate granted European patents (either as an alternative or in combination with a UP) will remain.
Are there any bars to opting out?
A patent cannot be opted out of the UPC once an action concerning that patent has been brought before the UPC (regardless of whether that action is brought by the proprietor or a third party). To mitigate against the risk that a third party initiates an action before the UPC and effectively ‘traps’ the patent in the UPC’s jurisdiction, it is advisable to opt out the patent before it grants.
Some commentators have questioned whether the UPC has the ability to hear certain actions that relate to European patent applications, i.e. before the application grants as a patent. This raises the possibility that the UPC can hear an action in relation to a patent application, effectively locking that application in the UPC’s jurisdiction and removing the ability to file an opt-out. It should be noted that there have been no legal cases testing these arguments, and so this remains a legal supposition for the time being. In the vast majority of cases, the grant date therefore remains the key deadline by which an opt-out should be filed if desired.
Can an opt out be withdrawn?
An opt out can be withdrawn by the true owner(s), so that actions can be taken before the UPC. Once an opt out is withdrawn, it is not then possible to file a second request to opt out. In other words, after withdrawing the opt out, the national validations in UPC Member States would then remain under the jurisdiction of the UPC for the rest of their lifetime.
Are there any bars to withdrawing an opt out?
It will not be possible to withdraw an opt out if an action concerning the patent has already been brought before a national court before the withdrawal is filed. If this happens, the patent is locked into the jurisdictions of the relevant national courts. Thus, opting out a patent does carry a risk that the patent owner can be prevented from later initiating an action before the UPC.
What factors should be considered when deciding whether to opt out?
When deciding whether to opt out a European patent that has been nationally validated in a UPC Member State, it may be helpful to consider the following:
- The UPC provides the opportunity for a single infringement action that covers all UPC Member States in which the patent is in force. This can be a cost-effective way to obtain a decision and relief against an infringer operating in multiple UPC Member States. Powerful multi-jurisdictional relief, such as injunctions, are available.
- Under the UPC, a patent can be revoked for all UPC Member States in one decision, either from a counterclaim for invalidity in response to an infringement action or from a standalone revocation brought by a third party (i.e., ‘central revocation’).
- Compared to litigation before some national courts, actions at the UPC proceed via a relatively simplified procedure, and are based on extensive written submissions submitted by the parties at an early stage with shorter oral hearings (typically limited to one day) .
- It will take several years for the UPC to develop harmonised case law on certain issues of law such as claim construction and interpretation, tests for novelty and inventive step, and tests for infringement.
What happens at the end of the transitional period?
At the end of the transitional period, opt out will not be possible and all granted European patents validated in UPC Member States will solely fall under the jurisdiction of the UPC. To avoid the UPC, national patents will need to be filed (i.e., patents granted via a national Patent Office instead of the EPO), because national courts will continue to handle infringement and validity actions for national patents. In some states (including Belgium, France and the Netherlands) it is not possible to obtain national patents via a PCT application, and so for these states national patent applications would need to be filed directly at the relevant national Patent Offices at the end of the priority year. The transitional period will last until 2030 at the earliest, with the possibility of an extension until 2037.
