The Unified Patent Court is back on the agenda, and the market expects that preparation work will soon begin. Here, JUVE Patent brings you the latest news on this crucial next phase of the UPC, as well as an overview of our previous coverage on the most important stages in the creation of the first European civil court.
15 September 2021 by Amy Sandys
The UPC must soon overcome an important hurdle. Before the preparatory work for the new court, as set out in the protocol on the provisional application (PAP), can begin, 13 member states must ratify the PAP.
But so far, according to JUVE Patent sources, only Belgium, Bulgaria, Denmark, Estonia, Finland, France, Italy, Luxembourg, the Netherlands and Sweden have signed the protocol. According to the German government, it plans to deposit the ratification bill for the PAP this autumn. Austria has signaled that it will also do so in the next two weeks.
This means one more member state must sign the protocol before beginning preparations. Malta, Portugal and Slovenia are considered candidates for the missing ratification.
German ratification of the UPC Agreement and the protocol on the provisional application (PAP) has overcome another important hurdle. The government published the new UPC law in the Federal Law Gazette. Previously, federal president Frank-Walter Steinmeier had signed the bill.
Although long-awaited, this does not mean that the Unified Patent Court will start soon. UPC officials expect at least eight months of preparation before the court begins officially.
Only when preparations are complete will Germany take the final step of its ratification and deposit the instrument of ratification with the European Council. Germany, France and Italy as well as ten other states must ratify the UPC Treaty in order to bring it into force. The UPC Agreement will enter into force on the first day of the fourth month following the deposit of Germany’s ratification bill.
Today, the German Constitutional Court has rejected two applications for an interim injunction against the German laws for the Unified Patent Court. According to the ruling, the complainants had not sufficiently substantiated the possibility of a violation of their fundamental rights. In all probability, the court will not hear the merits of the case.
Now Germany, and two remaining member states, have a clear road ahead to ratify the UPC. Under the German system, the next step is for the federal president to sign the law.
Speaking exclusively to JUVE Patent, Alexander Ramsay, head of the UPC Preparatory Committee, says, “Given today’s news, we expect Germany to ratify the protocol on provisional application in early autumn. The tasks that the council needs to handle during the provisional application phase should then take at least eight months to complete.”
If everything goes according to plan, we could have a functioning UPC in late 2022 or possibly early 2023, he adds.
A spokesperson for German federal president Frank-Walter Steinmeier has told JUVE Patent that Steinmeier is currently waiting to execute the UPC law. The German Constitutional Court asked him to wait until it issues a ruling before executing the UPC law.
In the meantime, JUVE Patent received more information about the people behind the second claim against UPC ratification. This time it is not a single person, but a group of claimants. The Constitutional Court confirmed that a private individual, a company and an association are behind the second claim.
Düsseldorf lawyer Ingve Stjerna, the man behind the first constitutional objection, confirmed to JUVE Patent that he has filed another complaint against the UPC law. JUVE Patent is not yet aware how Stjerna has justified his second complaint. Stjerna has also applied for an interim injunction, which would prohibit the conclusion of the ratification procedure until the Federal Constitutional Court has ruled on the merits of the case.
The identity of the second claimant is still unknown.
Last Friday, the Federal Constitutional Court again received two complaints against the German UPC legislation. The identity of the plaintiffs and the grounds for the complaints are currently unclear. It is also unclear whether German ratification of the Unified Patent Court will now be put on hold again. The Constitutional Court did not provide any further information except to confirm that it had received the complaints.
Germany is the last country to ratify the UPC before the new court can start.
Today, the German parliament has adopted the UPC legislation. In its final meeting of 2020, the German Bundesrat, the second chamber of the German parliament, voted unanimously in favour. Once again, all parliamentary hurdles in Germany are clear.
New approval by the German parliament became necessary after the German Constitutional Court stopped the ratification of the German UPC laws in March. The Constitutional Court requires that both chambers of the parliament approve such international agreements with a two-thirds majority.
Yesterday evening, the German Bundestag (parliament) finally voted in favour of the UPC law. With 88% of the votes, parliament delivered the two-thirds cross-party majority required to pass the Act of Approval to the Agreement on a Unified Patent Court. In addition to governing parties CDU/CSU and SPD, members of the FDP, the Greens and the Left Party also voted in favour. Such a broad majority is important, because federal state representatives in the Bundesrat (the second chamber) must also approve the bill by a two-thirds majority. Different party coalitions govern the federal states. The vote in the Bundesrat is expected at the end of December.
But some parties are still considering filing another constitutional claim against the UPC. Yesterday, Foundation for a Free Information Infrastructure (FFII) took a combative stance, calling on companies to join it in filing a constitutional claim.
The German Bundestag is to vote next week on the renewed attempt to enact the Unified Patent Court law. The Constitutional Court declared the first ratification invalid in spring and ruled a two-thirds majority was required. According to experts, the new draft is largely unchanged from the first ratification bill. Yesterday the German Bundesrat, the second chamber of parliament, dealt with the ratification law in a first sounding. It had no objections.
As a rule, the federal government uses this first vote to test whether there are reservations in the Second Chamber against proposed legislation. The actual vote follows when the bill has passed the Bundestag.
The Bundestag will now again deal with the UPC ratification in a first reading next week. Insiders say there will be no debate among the members of parliament. Usually the law is referred to the relevant committees for discussion. The Committee on Legal Affairs is the lead committee. The Culture Committee also plays a role. The second hearing in parliament is then decisive.
JUVE Patent sources also say the London divisions will go temporarily to Paris and Munich.
The Council of Ministers in Italy has officially proposed Milan as the host of a central division of the Unified Patent Court. The division would focus on pharmaceutical litigation. The bid comes months after the UK officially withdrew its ratification and left London out of the running.
The mayor of Milan, Giuseppe Sala, had strongly advocated for Milan to host the UPC Central Division. However, the political party Five Star Movement opposed the bid, instead suggesting Turin. While ultimately settling for Milan, the Italian government did reach a compromise. If successful in its bid, Milan will host the UPC’s central division, while Turin will be the seat for the Italian Institute for Artificial Intelligence.
Should the UPC go ahead and Milan’s bid be successful, the northern Italian city will stand alongside Paris and Munich as a key location for UPC litigation activity.
Yesterday, the European Commission answered three questions regarding Germany’s ratification of the UPC Agreement following Brexit. German MEP Patrick Breyer, who is opposed to the unitary patent system, submitted the questions to the commission in May 2020.
Breyer’s questions explored whether the commission can confirm that Germany has no right to ratify the UPC Agreement; if the commission will advise the German government against ratification of the current UPC Agreement; and if the commission would launch an infringement procedure if Germany ratified the UPC Agreement as it currently stands.
In its response, the commission confirms that Germany can still ratify the UPC Agreement and rejected the reasoning. The answer confirms that the UK’s withdrawl from the EU as a member state, and its rejection of the UPC Agreement, will not impact the future of a potential UPC. Whether or not Germany will indeed ratify the agreement hinges on a new draft bill and the next decision of the German parliament.
After the Federal Constitutional Court overturned the UPC legislation in March this year, the Federal Ministry of Justice has submitted a new draft bill. The interpretation by the ministry is that the Federal Constitutional Court overturned the law “because the law was not passed with a two-thirds majority.” The ministry makes this clear in its draft. At the same time, the ministry does not see any further problems with the law.
Essentially, the German government simply wants to vote on the law again. According to the Federal Ministry of Justice, “The wording of the law is unchanged, but the explanatory memorandum contains necessary updates.”
The ministry has sent the bill to associations and institutions, asking for opinions. The deadline is in three weeks.
Despite the Federal Constitutional Court’s decision invalidating the German UPC legislation last Friday, the government is sticking to the UPC. Federal justice minister Christine Lambrecht made the announcement today.
Lambrecht says, “I will continue my efforts to ensure that we can provide European innovative industry with a unitary European patent with a European Patent Court. The Federal Government will carefully evaluate the decision of the Federal Constitutional Court and examine possibilities to remedy the identified lack of form before the end of this legislative period.”
The Bundestag will therefore vote again during this legislative period. Germany will elect a new parliament in October 2021.
In a huge blow to the patent community, the German Federal Constitutional Court has upheld the constitutional complaint filed against the German UPC legislation. The court ruled that the Act of Approval to the Agreement on a Unified Patent Court needed a two-thirds majority by the Bundestag since it would have entailed an amendment of the Constitution in substantive terms.
It is now unclear if the decision will be the end of the patent court. The Bundestag can now save the situation by voting on the Act again with a two-thirds majority. However, this could significantly delay the UPC process. Organising a quorum and a two-third majority in the context of Coronavirus will be a major challenge.
Today, the German Constitutional Court has announced on its website that a judgment in the complaint filed by Ingve Stjerna can be expected on Friday 20 March. There will be no further oral hearing. The European patent community now waits to see whether the UPC will finally be given the green light.
The UK government has confirmed that it will no longer participate in the Unified Patent Court system. The government declared it will seek to rescind its ratification. A press office for the Cabinet Office confirmed to JUVE Patent, “I can confirm that the UK will not be seeking involvement in the UP/UPC system. Participating in a court that applies EU law and bound by the CJEU is inconsistent with our aims of becoming an independent self-governing nation.”
The announcement has surprised many in the European patent community who, despite Brexit, had expected the UK to hold to its ratification. Boris Johnson himself, as foreign secretary under former prime minster Theresa May, ratified the UPC agreement in 2017.
There are now many unanswered questions about how the UPC project will develop. The first hurdle is the impending decision of the German Constitutional Court, due next month.
Yesterday Peter Huber, judge rapporteur in the complaint against the German UPC legislation, indicated there will be a judgment in early 2020. In an interview with Managing IP, Huber stated that it was his “intention to issue a decision on the complaint made against the legislation enabling Germany to ratify the UPC Agreement early next year”.
Nevertheless, whether a decision will actually be reached in the first quarter of next year is unclear. The decision is not only up to Huber, but also his colleagues from the court’s 2nd Senate. A court spokesman stated, “Professor Huber did not comment on the substance [of the complaint]. With regard to the timetable, he did indeed say that a decision will be sought in the first quarter of 2020, but that the specific timing will of course also depend on how the consultation goes.”
Furthermore, it is still uncertain whether the court will decide in time for the UK to participate.
Three years after the last campaign, the UPC Preparatory Committee has announced it is re-opening its judicial recruitment process and accepting new applications. The new campaign will be a ‘top-up’ exercise to complement the major UPC judicial recruitment campaign held in 2016. It covers both legal and technical judicial positions.
The news has ignited rumours in the patent community that a ruling in the constitutional complaint is imminent. However, a spokesperson for the German Constitutional Court called these unfounded.
In October, the constitutional judges extended the deadline for participating institutions to provide an opinion to 31 December 2017. There is speculation that the Ministry of Justice and Consumer Protection asked for more time. However, three other institutions have also been given the opportunity to provide an opinion: the German Association for the Protection of Intellectual Property (GRUR), the European Patent Litigators Association (EPLIT) and the Federation of German Industries (BDI). This increases the number of opinions the Karlsruhe court expects to receive by the end of the year to 27.
Furthermore, lawyer advocacy groups, the German government and the European Patent Office are all compiling opinions. Experts believe that the local governments in each of the four German states that are set to host a UPC local division will also submit an opinion.
When Düsseldorf lawyer Ingve Stjerna filed his constitutional complaint back in spring, the patent community was hoping for a quick ruling. The norm for the court is four to six months. However, with the new extension and sheer amount of paperwork involved, a ruling before 2020 is looking increasingly unlikely.
A complaint at the Constitutional Court has brought the ratification process in Germany – and with it the UPC – to a screeching halt. On 31st March, a private person filed a constitutional complaint against the national implementation law and even the UPC Agreement itself (ref. 2 BvR 739/17). The latter had only just been passed by the German parliament.
In addition, the complainant has applied for a temporary injunction. As a result, on 12 June, president Frank-Walter Steinmeier halted the ratification process.
How quickly Karlsruhe will rule on the complaint is unclear. Although a spokesperson for the court conceded there is a particular sense of urgency, she also insisted the matter is highly complex. Experts estimate Karlsruhe could rule on the urgent motion in four to six months. Technically, this would mean the UPC could still launch in early 2018.