On June 24, 2016 the referendum results in the UK were in favor of leaving the EU. It is an unprecedented situation that potentially affects all fields governed by European Union law. At this point there is still a great uncertainty on what are the following steps.

1. The decision to leave the European Union is not an automatic consequence.

For any such decision materializes, the specific procedure laid down in Article 50 of the EU Treaty will have to be observed. First, in accordance with Article 50, the Member State which decides to withdraw from the Union must formally notify its intention to the European Council. Secondly, the EU and that Member State will have to negotiate and conclude the withdrawal agreement, which will establish the framework for its future relations with the EU. To this end, the Council shall take a decision to authorize the opening of negotiations, nominating the Union’s negotiator or the leader of the negotiating team. The final text of the withdrawal agreement must be approved not only by the Council (by a qualified majority) but also by the European Parliament.

2. Leaving the European Union is a lengthy process.

According to the abovementioned Article 50, the Treaties only cease to apply to the State in question from the date that the withdrawal agreement enters into force or, failing that, two years after notification of the intention to leave. Considering the fact that the situation is unparalleled and involves complex negotiations, the whole process could take more than two years. The European Council, with the agreement of the Member State concerned, could decide unanimously to extend this period. This means that the practical implementation of an EU exit may take more than two years, either because all of the parties have agreed as such and/or the deadline is extended by the Council. Until the actual date of departure of the EU, all EU law, including primary and secondary legislation, will continue to apply as normal in the UK.

3. Consequences in the area of ​​intellectual property.

This is a first analysis of the consequences of a possible exit from the UK in the intellectual property field, where inevitably there will be profound changes due to the existence of unitary rights regulated uniformly throughout the EU.

Trademarks

Trademarks can be protected in the UK by a national or international registration (Madrid system), or through the European trademark registration (EUTM) and there will be no immediate change in relation to the registration of EUTMs or the legal enforcement of European trademark rights in the UK. However, the EUTMs depend on European regulations that will no longer apply as from the UK’s departure date. One obvious consequence will be that the registrations of EUTMs applied for after the departure date may not take effect in the UK. As to the registrations of EUTMs that are granted or applied for before the date of UK’s departure their future is still uncertain. It is likely that there will be a legal mechanism to allow the conversion of EUTM to national trademarks, keeping the original priority date of EUTM. In this case, the converted marks would be subject to the national law of the United Kingdom, implying in particular that the genuine use of the mark in another EU country will not be enough to maintain the trademark right in the UK. The transition of existing or pending EUTMs will certainly be one of the topics to deal with in the withdrawal agreement.

Designs

The protection of registered and unregistered Community designs will also cease to apply in the UK on the departure date. It is uncertain what will be the status of existing Community design rights on the departure date. It is likely that there will be a transitional solution similar to the one which will apply to EUTMs.

Until the transition rules are defined and in order to avoid legal uncertainty, it is appropriate to consider the protection of trademarks or designs in the UK at a national level, namely using the WIPO international registration systems.

European patents

Brexit will have no impact on European patents since the European Patent Convention is a separate international treaty and not EU law. As usual, the European Patent Office will continue to grant European patents that can be validated and enforced in legal proceedings before the UK courts.

The Unified Patent Court and the Unitary Effect

The legislative package which forms the basis for the unitary effect of European patents in the EU and the establishment of the Unified Patent Court (UPC), and was estimated to enter into operation in 2017 is now affected by major uncertainties. The process to ratify the UPC Agreement was underway in the UK but now appears unlikely to occur due to political constraints arising from Brexit. It is more likely that Brexit would, at the very least, involve amending the UPC agreement and postponing the whole project for several years.

If it is confirmed that European patents may not have unitary effect in the UK and that the UPC’s jurisdiction does not extend to the UK, it will strongly affect the interests and feasibility of the Patent Package, since the UK is a substantial part of the protection strategy of European patent owners (with approximately 50% of European patents being validated only in the UK, Germany and France).

Copyright

Brexit will not immediately affect the area of ​​copyright since there are no uniform EU rules for copyright. Nevertheless the UK’s copyright law is in many aspects harmonized by European directives and case law of the European Court of Justice. Harmonization with the current EU legislation will remain as long as the British legislature does not introduce any changes. However, the UK will not be able to refer questions of interpretation to the European Court of Justice and of course where the EU adopts new directives the UK will no longer be obliged to implement them.