Unified Patent Court and unitary patent in the Netherlands: an update

Last year, as basic information for a public consultation, the Dutch government showed their
* draft approval act of the Unified Patent Court and
* draft act amending the patents act
[I have commented at the consultation regarding my concerns on the implementation for the part of the Kingdom of the Netherlands where the European Patent Convention applies, but not EU law (and thus not the unitary patent regulation), but that is not the point of this post]

The logic step after consultation (and -minor- amendment of the draft implementation act) is to send both draft acts for comment to the Council of State (Raad van State) for its mandatory advice. The Raad van State took its time and only delivered its advice on the amendment of the patents act in January 2016.

After the advice, the Government may amend the draft act, and send it, with the Advice, and its comments on that advice to Parliament. When approving treaties, it is customary to send the implementation act and the approval act of the treaty together, so they can be treated together.

Approval of the Agreement: status
This time however, things went a bit different. The Government placed the draft legislation on a list with urgent draft acts requiring speedy treatment in parliament; and send out the piece a few weeks after the Advice was received, but ... only the approval act of the Unified Patent Court, and NOT the draft patents act amendment, stating that needed more time. Parliament (in this case the House of Representatives, Tweede Kamer) did not sit around and send out its first round of written questions last week (apart from the "usual" questions like if there will be a Dutch local division/language arrangements; in this case also questions regarding who is competent for "searches based on a search warrant in UPC cases" and the link with breeder's rights.

Regarding the Amendments to the patents act, I have no idea what is the status, as the advice of the Council of State is only published upon presenting the draft act to parliament. So we don't know what the cause for the delay is. The amendments concerned 2 main things: bringing terminology between EU legislation, Unified Patent Court Agreement and the Patents act in line, so there would be no discussion (and thus also no divergence between national/classical European Patents and unitary patents), and making sure that after unitary effect was granted, the national/classical Dutch part of the European patent would remain, but only with regards to the Caribbean parts of the Kingdom where the unitary effect does not apply. [My guess is that it is this second change that is causing the government a headache. This headache may be strengthened because patents is one of only 4 areas where the countries in the Kingdom are voluntarily cooperating, and this implementation may be a source of conflict.]

The delay in this act is bound not to end any time soon. In an extremely unusual move, the government last week requested the Advice of the Council of State again. This time not for a new version of the approval act, but in a "verzoek om voorlichting" (a request for education/information) regarding a new European patent system". This can only mean that the government does not know or is in conflict on how to proceed following the advice. We unfortunately don't know the advice, nor do we know the content of the new request, so we'll have to wait and see what happens! It does seriously call into question whether the Netherlands will be amongst the initial users of the Unified Patent Court system: the Netherlands say they can ratify without the implementation act, but in my modest view that would give rise to too much legal uncertainty; it certainly has never been the plan from the beginning. ...

Unified Patent Court and Unitary Patent: what UK and NL can learn from eachother

Two days ago, I have placed myself in the perspective of the Isle of Man, and 5 islands of the former Netherlands Antilles in order to discuss the different modes of implementation for the unitary patent and the unified patent court the Netherlands and the UK have chosen with regards to their "dependent territories". Todays post is an advice to both governments. Their legislative proposals both have merit to some extent and they could lear from each other. Combined with a good "Treaty-notifier" advice, in my opinion the system should be implemented like this:

Unified Patent Court: Netherlands should listen to the UK

The Unified Patent Court Agreement (UPCA) is silent on whether it can be extended to dependent territories. While regarding European patents without unitary effect its decisions have effect on the territories, it is not clear whether infringement actions on the territories would be covered. The preambule starting with characterisation of the signatories as "Member States of the European Union" could suggest that the territorial scope is that of the EU, and thus does not cover the territories. 

The UK bluntly states that it will extend the treaty to the Isle of Man, and thus the UPC will full apply. It seems a judgement call whether this is possible, in which the depositary (Council of the EU) has a final say, but if they do (and I think they will, in treaties, a lot of latitude is given with regard to extensions generally when the treaty is silent on it), then it is by far the easiest way to keep the European patent "uniform" within UK+Isle and NL+Curacao+CaribbeanNetherlands+SintMaarten. 

Unitary Patent: UK should listen to the Netherlands

The Unitary patent is governed by the Unitary Patent Regulation, an EU Regulation, which territorial scope is the territorial scope of the EU and excludes these territories. The UK may state that by ratifying the UPCA, the territorial extent of the Unitary Patent Regulation will extend to the territories, but that's would be the first time the territorial scope of a Regulation is extended in this way [the EU, NL, and UK could enter into a treaty of course that extends certain regulations to the territories, but that's a long term solution]. The Dutch made a more clear interpretation of the interaction of the Unitary Patent Regulation with the European Patent Convention: if the "national" European patent without unitary effect will be assumed never to have taken effect when the unitary effect is granted, that has no effect for the territories not covered by the unitary effect. In other words, the unitary effect does not have the effect that the national European patent disappears, but its territorial scope is reduced to the Isle of Man and remains in existence as national European patent under national law. In the UK this is the EP-unitary and the EP-UK coexist, where the latter is best identified as EP-UK-"EPCnonEU" ("European patent in effect as a national UK patent with a territorial scope of the territory under the EPC, but not the territory of the EU: EP valid in the Isle of Man only), to identify its -very- limited territorial scope as a residual national European patent. 

Law applicable to EP-UK-"EPCnonEU" and EP-NL-"EPCnonEU": a suggestion from me

National law still applies to the EP-UK-"EPCnonEU" (EP Isle of Man) and the corresponding residual Dutch national residual European patent (EP-NL_"EPCnonEU"). That means separate renewal fees etc and thus extra costs and handling. Luckily, if implemented as described, the UPC has jurisdiction. However -unlike the corresponding unitary patent- during the transition period the residual European patent may also be tried in national courts. 

In order not to make the treatment of residual European patents different from the unitary patent, I propose to include regulations in the national laws, in which the residual European patents as much as possible have the same effect as the unitary patent. That means they apply the unitary patent regulation as a matter of national law. The implementation should make sure that the residual European patents are really "glued to the unitary patent" by the following provisions regarding residual European patents:

-Exclusive competence for the Unified Patent Court (also during the transition phase)

-any change in the text of the unitary patent will have automatically the same effect for the residual European patents

-the law applicable to residual European patents is  that of unitary patents (as an object of property)

-residual European Patents can not be separately owned, morgaged etc. The ownership etc follows automatically that of the unitary patent

-a license of a unitary patent including the territory of the main office of UKIPO, automatically also is covering the Isle of Man

-a license of a unitary patent including the territory of the main office of the Dutch national patent office, automatically also is covering the Curacao, Sint Maarten and the Caribbean Netherlands. 

Implementation?

Let's see if this is implemented. We haven't seen the statutory instrument for implementation of the Isle, so it is still possible this was planned all along (although that is not what is suggested in earlier documents). Furthtermore, the final proposed legislation in the Netherlands is unknown and still unpublished. It furthermore can be amended by parliament. 

In other words, there  is still time to implement this and have the territories covered in a decent and consistent way. 

Unified Patent Court and Unitary Patent in Isle of Man and other territories

Imagine, just try to imagine, you are a territory. Not just any territory... No, you have a close relationship with the European Union state responsible for your external affairs, but you are -regarding most issues- not part of the EU. Your EU member state is also a European Patent Convention contracting state and has extended application also to you: a European patent in force in "your" EU state, also applies in you. In fact, when the EPC thinks about the member state responsible for your external affairs, it deems that your territory is covered by it.

Change!

But, things are about to change for you, little territory! Several EPC contracting states have made an agreement giving "unitary effect" to European patents in their territory, thus ao solving the problem that different decisions may be made by judiciaries regarding the same patent. From an EPC point of view, you are fully included in that agreement and the unitary effect will also apply to you. Unfortunately however these EPC contracting states have shaped their agreement regarding unitary effect as European Union Regulation 1257/2012, in which they state in Article 1(2) it is also an Agreement in the context of EPC Article 142. Now, article 142 EPC agreements of your contracting state apply to you, but European Union regulations generally don't apply. 

Your contracting state has also signed the Unified Patent Court Agreement. It's clear that applies to you regarding litigation on non-unitary-effect European patents as is explicit from Article 34: 

"Decisions of the Court shall cover, in the case of a European patent [without unitary effect], the territory of those Contracting Member States for which the European patent has effect."

But for European patents with unitary effect that's not so clear because their jurisdiction is arranged in EU instruments. Whether the agreement as a whole applies to you is also unclear, as the agreement is silent with regards to it, but... it is concluded between the contracting parties "member states of the European Union", and you are not considered part of the territorial scope of EU instruments.

So what applies to you?

So, the big question remains: does the unified patent court agreement as a whole apply to you and does the unitary patent apply to you. And if not? what then? What happens if your EU member state's European patent gets unitary effect, and you are left as ..., well as what?

The answer is complicated, that's clear from the discussion above and it is a pity that the drafters of the unitary patent regulation and UPC agreement have not been more clear in their drafting. That means the answer is i) unclear and ii) varies by territory

If you are an EPC-covered territory connected to the Netherlands (Caribbean Netherlands, Curaçao or Sint Maarten), your government considers, even after suggestions not to in a public consultation (see my blogposts here, here and here):

• i) the unified patent agreement can not apply to you (and even uses an approval procedure for the agreement excluding you! despite Article 34 above)
• ii) unitary patents don't apply to you. If a European patent gets unitary effect, a small mini non-European patent will remain (called by me EP-NL-carib), covering just you and your fellow territories. What it costs is unknown, but you'll have to pay renewal fees and fulfil translation requirements. 

However, we still don't really know, as the act has not been presented in its final form to parliament.

If you are an EPC-covered territory connected to France, then we still have no idea. The approval law is silent and no provisions were made. I guess, you'll just have to wait and see.

If you are an EPC-covered territory connected to the UK, then you must be... the Isle of Man. That means you have requested in 2013 already to be part of the unified patent court. And today, the UK government has given you most of the required clarity today

• i) it will extend the Unified Patent Court Agreement to you (jay!)
• ii) that means -according to the UK- that the unitary patent regulation will also apply to you. Unfortunately it is unclear why your government thinks this is possible. That's problematic: it is not the UK that determines the territorial scope of the Regulation but -at least in last instance- the CJEU that decides that. So I am not sure if you are fully satisfied by this solution. Of course the UK could unilaterally consider it applies unitary patent legislation to you (which could also be implemented as my favourite implementation strategy: after the unitary patent applies in the UK, a national European patent -EU(UK-Man) remains, just covering you, to which -as stated in national law- the unitary patent rules apply; which means in practise: you're covered by the unitary patent). But if that's the case and infringement takes place in your territory, will the Unified Patent Court take jurisdiction? 

Conclusion:

The present situation for you as a territory is either uncertain (French territories), certain and as requested but with legal risks (UK-related) or undesirable and legally incorrect (Dutch territories). Maybe it's time to call your fellow territories and together demand the clarity and a clear route how to implement that!

My suggestions: after joining, ask your member states to

1. change the UPC to explicitly allow extending the UPC agreement to non-EU territories, part of the EPC (and that is a change that doesn't require a diplomatic conference or ratification by all)
2. ask your member state to conclude an international agreement between NL, UK, FR and the EU, extending the scope of the Unitary patent regulation to you, in a similar way that many EU regulations are applied to Norway, Iceland and Liechtenstein (the famous "texts with EEA relevance"). 

Who knows, they well might listen!

Unified Patent Court: a Dutch Post Consultation Update

Last May, the Dutch government has held a consultation regarding the changes to the Rijksoctrooiwet (the Kingdom Patents Act) in order to implement the provisions of the unitary patent. The consultation also included implementation provisions for the approval act of the Unified Patent Court.

I have dedicated a blog post to my unease with the current implementation path which IMO had serious disadvantages for the caribbean territories in the Kingdom, to which -as non EU territories- the unitary patent would never apply, but to which the Dutch version of the European Patent (including translation requirements etc) would continue to apply. For those who understand Dutch: my contribution to the consultation is here.

The exciting news of today: the government response to the consultation is in! It shows a disappointingly low response: only 9 responses were received. The response to my (and apparently others') concerns and suggestions regarding the implementation in the caribbean translated (disclaimer: by me) below (with my comments in red):

A couple of respondents asked wether it was possible to implement the option to request unitary effect for a European patent also also for Curaçao, Sint Maarten and the Caribbean part of the Netherlands. This is impossible, as both the Unified Patent Court Agreement and Regulations 1257/2012 and 1260/2012 only can apply to the EU Member State the Netherlands and can therefore not apply to the Caribbean part of the Kingdom. This is true for the Regulations, but it is very much debatable with regards to the UPC Agreement, to which the Kingdom is a signatory, and which will anyway apply to the Caribbean part as the territorial scope of decisions regarding non-unitary patents extends to everywhere where the European patent applies (Article 34 of the UPC agreement seems clear: Decisions of the Court shall cover, in the case of a European patent [with non-unitary effect], the territory of those Contracting Member States for which the European patent has effect.). It remains incomprehensible that the chosen procedure for the UPC agreement approval does use a regular Act and not a Kingdom act. Even if ratification takes only place for the European Netherlands, the Kingdom act approval process guarantees consultation of Curaçao and Sint Maarten and the possibility to include their views in an area where they are clearly effected. 

A couple of respondents has pleaded to extend the Act with provisions that are specific to the situation where a [Dutch version of the] European patent is only applicable in the Caribbean part of the Kingdom, such as other translation requirements, financial provisions or different governance competences. The government is of the opinion that such changes are out of scope of the proposed act. It is emphasized that when a European patent enjoys unitary effect in the European part of the Netherlands, and also gives protection in Curaçao, Sint Maarten and the Caribbean part of the Netherlands as a result of national validation, the situation in the Caribbean part of the Netherlands does not differ from a national validation applicable to the whole Kingdom [e.g. a non-unitary Dutch EP].

Again, the idea is thus that in a case of unitary effect by taking the European Netherlands out of the territorial scope of the "Dutch European patent", nothing changes for the Caribbean. This is not true of course, because:

-invalidation of a unitary effect does not invalidate the the Caribbean part (and vice versa!)

-infringement of a unitary patent in Sint Maarten and in Amsterdam has to be litigated separately

Furthermore, although there may be quite some similarities between 

i) a non unitary EP valid through the whole kingdom on subject x and 

ii) a territorially limited Dutch EP on subject y

but this is not the most relevant comparison, because it still means that a big difference will exist between the unitary patent in the European Netherlands on subject x and the same limited Dutch EP also on subject x in the rest of the Kingdom. This means for example that for the same invention, probably the applicable law is different and renewal fees need to be paid at 2 different locations. 

Regarding the level of renewal fees that should apply to this situation [the territorially limited Dutch EP], the government notes that this is not the subject of the Kingdom Patents Act, but of the implementing Decision of the Kingdom Act. That's true, but it is also a bit cryptic. If the implementing decisions are not changed, patent holders keep paying the full price for their territorially limited Dutch EP. Does the government anticipate to lower renewal fees? And to what level? The fact that the economic value of the Dutch EP falls by 99% (in terms of GDP) means that also with a significant reduction of -say- 50%, the proposition for a territorially limited Dutch EP would be a lot less strong. 

Conclusion

This blogger is slightly disappointed that the government keeps its somewhat formalistic approach (nothing changes in the Caribbean as they don't get a new court or patent) and genuinly annoyed about the fact that the implementation path does not acknowledge the situation that according to article 34 UPC decisions apply also to the Caribbean. He reminds again that as a rule, European Union treaties are approved by an approval act covering the whole Kingdom (because it concerns also the Caribbean parts as Overseas Countries), while ratifying only for the European part (the territorial scope of Union law). That should also be the minimum thing to do here as well. 

And now we wait...

The proposal is now off to the Raad van State (Council of State), a routine and required step. Its advice will be made public as soon as the government sends the legislation to the parliament. The government has the possibility to amend the proposal based on the advise, and may also amend it during the first stage of the parliamentary procedure (before parliamentary voting) through a "nota van wijziging" (Note of amendment). And also members of the 2e Kamer (house of deputies) are able to propose amendments and draft motions (e.g. regarding renewal fees). So not all is lost, there is still lots of intelligent people that can bring the legislation on a level where EU unification doesn't mean separation in the Kingdom!

Consultation Unified Patent Court/Unitary patent in the Netherlands (consultatie rijksoctrooiwet)

Last month, I have argued why I think the proposed Dutch implementation of Unified Patent Court and unitary patent is not fair for Sint Maarten, Curaçao, Bonaire, Sint Eustatius and Saba. These islands formed the Netherlands Antilles until October 2010 and are now "countries" or "special municipalities" within the Kingdom of the Netherlands. The European Patent Convention applies, in contrast to EU law (as the territories have an OCT status in the EU as "Overseas Countries and Territories"). 

I have given my view at the online consultation regarding the implementation act, and post it here -in Dutch- for clarity. As I have no intention to link my name to my treatynotifier account, I have opted for not having my reaction posted publicly at the consultation website. It seems most have reacted in this way, as only 4 reactions were published on the consultation site. 

For the sake of completeness, my full reaction is shown below (in Dutch).

Mijn commentaar richt zich voornamelijk op de gekozen implementatie voor de Caribische koninkrijksdelen. Het maken van een unitair octrooi met bijbehorende eengemaakte octrooirechtspraak leidt in het voorstel weliswaar tot unificatie op Europees gebied, maar heeft als -naar mijn mening ongewenste- consequentie dat hetzelfde Europese octrooi verschillende rechtsgevolgen heeft binnen het Koninkrijk. De memorie van toelichting gaat niet in op de belangenafweging tussen eenmaking op Europees gebied en eenmaking op Koninkrijksgebied en geeft niet aan hoe de overige landen/bijzondere gemeenten in het koninkrijk hier tegenaan kijken. Bovendien lijken er wetgevingsopties te zijn die het uiteenlopen van Caribische en Europese wetgeving in het Koninkrijk verminderen die niet besproken (laat staan gekozen) worden. 

Implicaties voor de Cariben
De effecten van deze wijziging in de Cariben lijken in de toelichting ook niet aan bod te komen. Indien een unitair octrooi wordt verleend, geldt het Nederlandse Europese Octrooi uitsluitend daar (hierna: Caribisch EP), en is het dus beduidend minder waard dan het reguliere Nederlandse  EP (het europees octrooi met gelding voor het gehele koninkrijk - behalve Aruba). Komt dit in de instandhoudingskosten tot uitdrukking, want dat wordt nu niet genoemd? Ook lijkt het vertaalregime (vertaling geheel in het Engels, en conclusies in het Nederlands) niet in balans voor het Caribisch EP: is er echt behoefte aan vertalingen (ook gezien de kosten) in een gebied waar Engels vaak net zo goed wordt begrepen als Nederlands?

Octrooi Centrum Nederland
Het OctrooiCentrum krijgt voorts volgens de memorie van toelichting nauwelijks te maken met gewijzigde omstandigheden, hoewel het aantal “validaties” zal afnemen. De gevolgen mogen qua technische werkzaamheden beperkt zijn, maar is er geen effect op budget en personeelsbestand indien een groot aantal unitaire octrooihouders afziet van een Caribisch EP of is de verwachting dat een significant aantal validaties nog steeds zal plaatsvinden? Wellicht is het in dit geval geraden om het aantal validaties/instandhoudingen te vergelijken met gebieden van vergelijkbare grootte, zoals Malta. 

Een alternatief met meer uniformiteit in het Koninkrijk
Ik vraag me af of er niet een alternatieve implementatie kan worden gevonden die uitgaat van het koppelen van het Caribische octrooi zoveel mogelijk aan het unitair octrooi en kosten voor overheid en aanvrager laag te houden, door

-geen additionele vertaling meer voor te schrijven
-de houder van een unitair octrooi automatisch het Caribisch EP toe te kennen
-geen jaartaksen te vragen
-geen register bij te houden, maar slechts te verwijzen naar het unitair octrooiregister
-als object of property, in vorm etcetc altijd de status van het unitaire octrooi te volgen (een door het UPC beperkt unitair octrooi, leidt automatisch tot een beperkt Caribisch octrooi; eigendomsoverdracht of in onderpand geven op wat voor grond dan ook van het unitair octrooi, leidt automatisch tot eigendomsoverdracht/verpanding van het corresponderende Caribisch EP. 
-De Nederlandse rechter doet alleen inbreuk-gerelateerde zaken voor het Caribisch octrooi; en houdt beslissingen ook daarover aan, zolang er vergelijkbare inbreukzaken spelen over het corresponderende unitaire octrooi. De Nederlandse rechter is niet bevoegd wat betreft de reikwijdte/niettigverklaring van het octrooi. 

(-op termijn te streven naar een verdrag tussen de EU, Frankrijk, VK en NL wat betreft hun niet-EU gebiedsdelen, waarbij de unitaire octrooiverordeningen werking krijgen ook binnen deze delen; op vergelijkbare wijze als bepaalde EU wetgeving ook op EVA-staten van toepassing is binnen EEA context)

Rechtspraakverdrag
Deze consultatie gaat niet over de goedkeuringswet voor het eengemaakt octrooigerecht, maar deze is wel bijgevoegd (en de onderwerpen zijn te sterk gelinkt om ze hier niet te beantwoorden). Ik vraag me af of er ook hier geen mogelijkheid bestaat voor een andere implementatie. 

Rijkswet of wet?
Ten eerste -zelfs bij deze wijze van implementatie- dient m.i. voor een rijkswet en niet voor een gewone wet gekozen te worden. Artikel 34 bepaalt dat in geval van een niet-unitair octrooi (klassieke EPs) de beslissing geldt voor het hele gebied waar het Europees octrooi effect heeft, dus ook de Caribische Koninkrijksdelen. Aangezien het octrooiverdrag Curacao en Sint Maarten raakt, zou dat alleen al zou goedkeuring bij rijkswet vereisen (desnoods zoals bij de EU verdragen: goedkeuring voor het gehele koninkrijk, maar ratificeren slechts voor het Europees deel)

Ratificatie voor Caribische Koninkrijksdelen
Ten tweede wordt niet aangegeven of er de mogelijkheid bestaat om ook voor de Caribische koninkrijksdelen het rechspraakverdrag te ratificeren. Daarvoor is weliswaar geen aparte provisie in het verdrag, maar aangezien het Koninkrijk der Nederlanden (en niet Europees Nederland) ondertekenaar is, is het wellicht ook mogelijk om voor het gehele (of bijna gehele) koninkrijk te ratificeren. Dat zou een hoop van de bovengenoemde complicaties oplossen, zeker als er in dat geval voor wordt gekozen dat er wat betreft een Caribisch EP geen rechtsgang naar de Nederlandse rechter zou openstaan.