What you need to know about intellectual property and Brexit
January 2017 | SPECIAL REPORT: INTELLECTUAL PROPERTY
Financier Worldwide Magazine
In 1993, the EU Council Regulation 40/94 created EU Trademarks (previously known as Community Trademarks). That regulation, which was created more than 20 years ago, does not specify the consequences of a member state leaving the European Union, raising concerns over the future protection of intellectual property rights (IPR) after the impact of Brexit. In fact, statistics released by the IPO show that there were 5390 trademark applications in September of 2016, compared to 4562 in September 2015.
The Great Repeal Bill – easing the impact
The Great Repeal Bill will instantly annul the 1972 European Communities Act which gives EU law instant effect in the UK and will, at the same time, give Parliament the power to absorb parts of EU legislation into UK law and scrap elements it does not want to keep. In October, prime minister, Theresa May announced that EU laws will initially become part of UK law and then be amended or repealed over time to prevent any legislative gap; a glimpse of relief for IPR owners.
In this pre-Brexit climate, it is critical for businesses to prepare their IPR and consider the potential risks and challenges which may present themselves depending on the form Brexit takes. An IP audit is a great way to start this review process. As always, you should seek legal advice on any decision affecting your IPR.
The bottom line
Protect your IP rights. It is not yet clear what the government will do to ensure that European Trademarks (EUTM) holders continue to enjoy UK trademark protection; much of this will depend on the nature of the relationship with the EU in the post-Brexit climate. There may be a conversion option providing rights much like EUTM. There is currently no need to re-file all EUTMs, but your legal adviser should be prepared for the likely rush at the registry once the government has decided on its strategy.
Design rights. It may prove useful to register new designs as both Registered Community Designs and UK Registered Designs. This is because it might not be feasible to re-register existing Registered Community Designs as UK rights because designs need to be ‘new’. It is expected that some transitional provisions will be put into place.
Brexit – legal implications
Brexit will likely affect the value of many businesses’ trademark portfolios, and so it is a key priority for Britain to enforce strong IP laws to protect businesses and encourage continued investment in the UK.
The following are eight issues to consider if you are concerned about your IPR in the Brexit era.
First, determine the extent to which the business relies on pan-EU IP rights, for example EU trademarks or community designs, for protection in the UK. Second, draw up lists of key rights which the business relies on, highlighting those without separate national protection. Third, check IP terms and licences, particularly territory provisions, to address any potential gaps and amendments that may be required. Fourth, prepare for costs and consider a potential ‘additional legal budget’. Fifth, review and amend current agreements to reflect changes to definitions, particularly licences that define a territory; EU scope, for example, should be defined as including the United Kingdom. Sixth, revise agreements that include current EU member states, as it is possible that a number of other EU states will follow in departure. Definitions should state specifically whether they will continue to include countries that leave the EU after the agreement is entered into. Seventh, flag up competition law provisions as these may be contingent on changes to the law. Finally, if relevant, proprietors of rights that are re-registered in the UK should ensure that these are put to genuine use so that they do not become vulnerable to revocation.
Tuli Torn-Hibler is a trainee solicitor and Richard Penfold is partner and head of IP at JAG Shaw Baker. Ms Torn-Hibler can be contacted on +44 (0)203 598 3070 or by email: email@example.com. Mr Penfold can be contacted on +44 (0)203 598 3070 or by email: firstname.lastname@example.org.
© Financier Worldwide
Tuli Torn-Hibler and Richard Penfold
JAG Shaw Baker