The UK Parliament passed Boris Johnson’s Withdrawal Bill this month, and it is now law. As a result, the UK will formally leave the EU at 11pm on Friday 31 January 2020.

There will then be a transition period, scheduled to end on 31 December 2020. During this period, the UK and the EU will attempt to agree a future trade deal. Until then, the legal status quo will be maintained.

With changes in the pipeline there are some important steps you should be taking to safeguard your IP during the transition period.

Registered trade marks

• During the transition period, there will be no change. Your registered EU Trade Marks (EUTMs) will continue to cover the UK, as well as the rest of the EU.
• After the transition period, you will automatically be granted a registered UK trade mark equivalent to your registered EUTM, at no cost. Your EUTM will cover the remaining 27 Member States only.  The new UK trade mark will be backdated to the filing or priority date of the EUTM.  At that point you should ensure that records are updated to log your new UK registered trade marks, and renewal deadlines, and that you budget for additional renewal fees. We can assist you with this.
• If you have a pending EUTM application at the end of the transition period, you will be able to obtain an equivalent UK application, on payment of a filing fee. The UK IP Office will set a deadline to opt in.  We can monitor this for you. If you do opt in, your application will be examined as though it had been filed directly at the UK IP Office, and any filing priority will be recognised.
• If you are considering applying for an EUTM, it may be worth doing so quickly, with a view to it registering before the end of the transition period and therefore avoiding this fee; the process usually takes 5-6 months. As we get closer to the end of the transition period, dual filing in both the UK and EU may be the most cost effective strategy, however.
• Parties to trade mark licences, settlements, or other agreements which depend on EUTMs should review these now, to ensure that the terms are carried through to the new, cloned UK marks, if necessary by amending existing agreements before the end of the transition period, an exercise we can assist with as necessary.
• After the end of the transition period you will no longer be able to rely on UK rights to challenge EUTMs, or to rely on use of a trade mark in the UK to defend a non-use challenge to an EUTM, or vice versa. You should look at your portfolio now to assess how and where you have used your trade marks, in case use needs to be supplemented, or new applications are needed.  We can carry out portfolio use reviews and maintain evidence of use banks.
• If you have pending or imminent disputes in the EU IP Office, you should review their status now and look at steps which may be necessary to preserve or enhance your position. We can also provide strategic advice in relation to the impact of Brexit on disputes.

Domain names

• Non-EU citizens may be unable to renew or register .eu domain names following the transition period, although the position on this is still fluid. If you currently only use a .eu domain, and do not have an EU presence, we can help you look at alternative domains, or alternative means of holding your .eu domains, including the possibility of doing so through agents.

Designs

• Similar provisions described in relation to registered trade marks will apply to EU Registered Community Designs (RCDs). Existing RCDs will be cloned, creating a new UK registered design, and leaving the EU registered design covering the remaining 27 EU Member States.  Pending applications will not be automatically cloned, but as with registered trade marks, there will be a process to convert them, and in all likelihood a fee to pay to have them ported into the UK’s system.
• EU unregistered design rights, which automatically protect certain designs of individual character from copying for 3 years from their first disclosure to the public, are not currently provided for under UK law. The government intends to introduce a supplemental design right, ensuring that all EU unregistered design rights subsisting on at the end of the transition period will continue to be protected in the UK.  However, this new right will not be available for new designs after the end of the transitional period.  You should therefore consider how best to protect designs which are in the pipeline now, but which have not been released.
• As with trade marks, we can assist with Brexit related design applications, monitoring developments, and strategy for new designs, disputes and agreements.

Copyright and related rights

• The fundamentals of copyright law are unlikely to change substantially, at least initially. Some aspects of copyright law, and related rights, are harmonised across the EU, or are due to be so.  The impact of Brexit on those aspects of copyright and related rights remains to be seen.
• One thing that we do know is that the UK government has announced that it does not intend to implement the EU Copyright Directive, with its controversial “snippet tax”, “upload filter” and “value gap” provisions, meaning that the UK’s copyright law may diverge from that of the EU in this regard. This may have practical consequences for businesses operating in both the UK and the EU after Brexit.  We will be monitoring developments closely.
• EU law also provides for cross-border portability of digital content – meaning that digital content available in one member state must be available in all. This portability will no longer apply to the UK after Brexit.  This could be a boon for rightsholders who will have greater control over their content, but it is also likely to require UK rightsholders to implement new licensing deals allowing for their works to be made available in the EU.  If your business owns or relies on digital content we can help you consider the implications of this change on your business operating and licensing models.
• The EU provides for an exception to copyright infringement, allowing cultural heritage institutions such as museums, archives and libraries to digitise works without identifiable owners, and make these works available online across the EEA. Following the transition period, and without amendment to UK law, this exception to infringement will no longer apply to the UK.
• The biggest impact may be on so called sui generis rights, the most widely used of which is database right. Where a database has received a sufficient investment of time, money or effort, and was created by an EEA national, resident or business, that database is automatically protected across the EEA.  Following the transition period, EEA members will not be obliged to recognise the database rights of UK rightsholders, meaning that enforcement against infringers in the EU will become more difficult.  If your business invests in or uses databases we can advise you on how they may be protected after Brexit.

Patents

• The European Patent Office is a separate entity to the EU, so Brexit will not affect existing European patents. It is likely, however, to affect the proposed Unitary Patent and Unified Patent Court (UPC), which will provide for the grant of a single patent offering EU-wide protection, which the UK is currently a member of and has ratified.  While nothing under the law of the UPC precludes a non-EU state from membership, it is likely to be legally and politically difficult for the UK to remain a member after the transition period.  We will be watching developments closely.

Exhaustion of rights

• The current EEA exhaustion of rights doctrine means that, when a product is first put on the market in the EEA by or with the IP owner’s consent, the IP rights in that product are exhausted within the EEA. If you sell a television to someone in France, say, the same television set can be freely re-sold in the UK because the IP rights are exhausted.
• At the end of the transition period, IP rights in a product first put on the market in the EEA will continue be exhausted in the UK. Unless there is an agreement to the contrary, however, putting a product on the market in the UK will not exhaust the IP owner’s rights in the EEA after the transition period.  This means that owners of UK IP rights will not be able to prevent parallel imports from the EEA, but owners of IP rights in the EEA will be able to prevent parallel imports from the UK.  This could have a significant impact on global distribution and pricing structures, and the market for parallel imports.
• It remains to be seen whether the UK will continue to allow IP owners to rely on their IP rights to prevent parallel imports from outside the EEA, or whether it will introduce international exhaustion.
• Both for businesses dealing in or relying on parallel imports, and for businesses affected by them, we will be monitoring the position, so that your business practices can be adapted to meet potential threats and opportunities.

Other issues

• There are a number of other issues which we can help businesses with.
• For example, licence agreements, settlements, or other agreements which refer to EU rights, or refer to the EU, should be reviewed now, to ensure that they continue to apply as intended. This may mean amending existing agreements before the end of the transition period.
• In addition, businesses which currently have an EU enforcement programme should review their strategy with Brexit related changes in mind. For example, after the end of the transition period, a pan-EU injunction will not cover the UK and will not be available in the UK.  If you are involved in or contemplating a dispute which has an EU wide dimension, you should review its status now.  There may be steps or strategic decisions which we can help you take now to preserve or enhance your position.  Separate UK proceedings may be necessary in some cases.
• If you have an EU Customs Monitoring Notice in place which was granted by the UK, this will no longer be valid in the EU following the transition period. If you require that monitoring to continue to apply within the EU,  we can help you refile with one of the Member States. Unless you had a separate UK national Customs Monitoring Notice in place, we can also help you file a national application with the UK.
• Any UK trade mark and design searches conducted after the end of the transition period should also take account of the EUTM register, to capture any EUTM applications and registrations that could be cloned onto the UK register. Watch services covering the EU should be extended to cover the UK as well.

Our IP team is following Brexit developments closely, and is already actively working with a number of clients on the issues raised in this note.

If you would like any further advice on this topic, you can contact our IP team.