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SMEs Embrace the Unitary Patent System

Writer's picture: Ian BryanIan Bryan



Early indications are that SMEs are embracing the Unitary Patent System and the benefits it offers in terms of cost, simplicity and the centralised Unitary Patent Court, with almost a third of applications for Unitary Patents originating from SMEs in 2024.


The Unitary Patent System, which came into effect in June 2023 with the introduction of the Unitary Patent (UP) and the Unitary Patent Court (UPC), is the most significant development in European patent law in decades.  It is being hailed as a great success with more than 36,000 UPs registered by the European Patent Office (EPO) by October 2024 and more than 500 cases initiated before the UPC.

 

The System aims to provide a simpler, cheaper process for the validation and renewal of European patents, and by means of a centralised court gives legal certainty in patent disputes. 

 

‘Classical’ European patents are granted by the European Patent Office (EPO) and provide the proprietor with a bundle of national patents which must be validated in each of the member states in which the patent is to take effect. This is an expensive and complex process, involving many national patent offices, translations and costly renewal fees.  Furthermore, patent disputes such as enforcement or revocation actions must be brought before the national courts, with each court’s decision only having effect in that state.  This leads to parallel litigation across member states which is extremely expensive and unpredictable as the different courts may come to conflicting decisions.

 

The UP (or European patent with unitary effect) overcomes these problems by enabling proprietors to obtain uniform patent protection for all territories of the EU Member States participating in the system (currently 18) more simply and at greatly reduced cost. Instead of having to validate their European patent in several states, proprietors can file a single request for a UP with the EPO which acts as a centralised office to administer the process and fee payments. The renewal fees for a UP are also greatly reduced, the total cost of maintaining the patent for 10 years being less than 5,000 euros.

 

The UPC is a supranational court set up under the UPC Agreement with jurisdiction over UPs and classical European patents which have been validated in the member states participating in the agreement (i.e. those which have not elected to ‘opt out’ of it).  The UPC includes a Court of First Instance and a Court of Appeal.


The Court of First Instance consists of a Central Division and Local and Regional Divisions. Each court is heard by a panel of three multi-national judges, supplemented if necessary by a technically qualified judge. The Court of Appeal, which is based in Luxembourg, sits in panels of five judges, three of whom are legally qualified and two being technically qualified.

 

This centralised, specialist court provides a new forum for enforcing and challenging patents in Europe. The court has significant powers and can grant pan-European injunctions in enforcement actions or revoke patents across all participating member states.





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