SPCs and the UPC: Current Status


One immensely important aspect of the new UPC system will be its applicability to supplementary protection certificates.  There are two separate issues to consider:  first, SPCs based on existing and future European patents; and second SPCs based on future unitary patents.

SPCs based on European patents

As with European patents themselves, SPCs referencing the European patent as the basic patent will, under the terms of the UPC agreement, all be subject to the UPC’s “exclusive jurisdiction”.  However, as with European patents, it will be possible to opt out of this exclusive jurisdiction for a time as explained below.  There are separate and complex questions as to the true effect of opting out of the exclusive jurisdiction, in particular whether opting out of the exclusive jurisdiction leaves the UPC with non-exclusive jurisdiction.  However, that is a separate topic and for present purposes we will assume that the opt out is effective to remove the UPC’s jurisdiction entirely.

There are, however, certain SPC-specific issues which the pharmaceutical and agrochemical sectors need to be aware of.

The first is that if an EP has been opted out, and an SPC granted subsequently, the SPC is automatically opted out also, and this opt out lasts (at least according to accepted wisdom) for the whole life of the SPC.  Since existing EPs, and all those applied for in the transitional period after the commencement of the new system (currently seven years), can all be opted out, this means that a full term SPC for an EP applied for in (say) 2023, would still be litigated in the national system until its expiry, which could be as late as 2048.

What then of a situation where an SPC has been granted before an application to opt out an EP is filed?  In this case, the proprietor(s) of both the EP and (if different) the SPC must register the opt out.  In order for an opt out to be valid, all relevant proprietors must, therefore, participate in the opting out process.  The difficulty at the moment is that according to Rule 8.4 of the 17th Draft Rules of Procedure, “proprietor” is defined as the person(s) on the EPO register.  However, are the proprietors of SPCs ever registered with the EPO?  The problem is bad enough for EP owners, since it is uncommon to register changes in proprietor with the EPO after the expiry of the opposition period.  Indeed, on many occasions even the national registers are not updated for practical (including costs) reasons, especially when the transfer is intra-group.  Ultimately it is to be hoped that the definition of “proprietor” will be changed when the final draft Rules of Procedure are published so that it is the person(s) entitled to be registered as proprietor in relevant national patent offices who must register the opt out, but at least for now, patentees and SPC owners in particular will have to take this potential problem into account.

One other potential point to look out for is the case where the underlying EP has already expired, and only the SPC remains in force at the time of the opt out.  It would be tempting to think that all that is needed to be done is to register the opt out in the names of the proprietors of the SPC or SPCs.  This would not appear to be correct, however, and in fact the proprietors of the underlying EP should also participate in the opt out process.  This in any event makes sense because it is, of course, possible to sue for past damages in relation to expired patents subject to limitation periods.

As mentioned above, if an SPC and its underlying EP are opted out, it should be the case that only national litigation in relation to those rights will be possible.  What then of the situation where the SPC is not opted out?  That situation is more complicated, and depends upon the date at which the litigation is started and is linked to the UPC transitional period.

Under Article 83(1) a patent or SPC which has not been opted out whilst prima facie under the exclusive jurisdiction of the UPC can, subject to the Brussels 1 Regulation, nonetheless, be the subject of national litigation, if national litigation is started before UPC litigation.  This opens up the possibility of a “race to the court”.  Take a typical situation where parties are in discussion about generic entry.  A patentee/SPC holder who has decided that it will not opt out will presumably want to use the UPC for central enforcement.  This could indeed be a sensible strategy to obtain effective relief in countries where court systems do not easily permit preliminary injunctions to be obtained.  However, if a generic wishes to try to prevent this, it can bring pre-emptive revocation and/or DNI proceedings to grab jurisdiction nationally and thus probably prevent central enforcement in the UPC.

For cases started after the expiry of the transitional period (which may be extended to fourteen years), the position is different.  At that stage, the UPC will have exclusive jurisdiction, even if, during the transitional period, there has been some national litigation, and even if that is still ongoing when the transitional period ends.

SPCs for unitary patents

The essence of a unitary patent is intended to be that it is a single right.  It is also clear that unitary patents will be capable of being used as basic patents for SPC applications.  Will then, SPCs have the same territorial scope as the “mother” patent?  The answer is, at least for present, no.  There have been discussions about the possibility of a centralised SPC of the same territorial scope, but this is in conflict with the basic nature of SPCs that they are sui generis national rights dependent upon both the basic patent and a national marketing authorisation.  Neither will it be possible to have a single SPC for those countries where both the unitary patent and a marketing authorisation exist.  Instead, the same system as exists at present for SPCs based on national or European patents will apply, that is that individual national applications will have to be made.

Looking further in the future, it is possible that this situation may change, and the uncertainty which surrounds this may be a concern for patentees considering whether to seek unitary patent protection or not.  One long term possibility is that a new section of the EPO might be created to deal with SPCs based on unitary patents.  This would seem inevitably to have to involve an amendment to the European Patent Convention since a procedure would have to be permitted allowing references to the CJEU and for the EPO to be bound by CJEU jurisprudence in relation to interpretation of at least the SPC regulations.  This inevitably would have to be a very long term project, but unless and until there is some clarity as to what might happen in the future, pharmaceutical and agrochemical companies may very well be concerned not to commit to unitary patent protection with the possibility in the future that the system with which they are familiar for the grant of SPCs might be changed.  However, if patentees in this sector do opt for unitary patent protection, then not only will these unitary patents be subject to the exclusive jurisdiction of the UPC, but so too will SPCs based upon them.  This jurisdiction will be truly exclusive in the sense that it will be impossible to opt out, and there will be no possibility, therefore, of any national litigation or the “race to the court” problem mentioned above.  This does, therefore, have potential advantages for rights owners in terms of these deficiencies of enforcement – always assuming that the UPC does indeed live up to its promise as an efficient and cost effective forum.  Probably, however, most rights owners will be very cautious indeed about opting for unitary patent protection at least in the early years of the new regime.  The right time to be reviewing the position is probably toward the end of the transitional period of the UPC (on present estimates around 2023/24).  After that, European patents newly applied for will not be capable of being opted out of the UPC’s jurisdiction, meaning that from a practical perspective in terms of enforcement, there will be nothing to choose between owning European patents and unitary patents.  At that stage it will be fee arrangements and the uncertainty surrounding the SPC issue which will need primarily to be considered by rights owners.  Hopefully, however, by then the uncertainties will have been resolved.  In the long run, subject to the SPC issue, unitary patent protection seems likely to be an attractive option for pharmaceutical companies in particular who need wide ranging geographic protection.  Almost certainly the cost of renewing unitary patents will, over the life of the patent, be much lower than for the equivalent geographic protection using the European patent system.

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