One vexed question which has exercised many minds recently is the meaning of the transitional provisions of the UPC under which patentees can opt out their existing European Patents, and those applied for in the coming years. Many had understood that the intention was that after a transitional period, these existing EPs would have to be litigated in the UPC: there would be a period of seven years when they could be opted out, but after that, the opt out would lapse. It seemed to many that the statement in the Commission on its web site in its FAQs (published 11 December 2012 at: http://europa.eu/rapid/press-release_MEMO-12-970_en.htm?locale=en ) supported that view – see the italicised words below:
However, that is clearly not what the words of the relevant article of the UPC (Article 83) actually say. They say:
(3) Unless an action has already been brought before the [UPC], a proprietor of or an applicant for a European patent granted or applied for prior to the end of the transitional period under paragraph 1 … as well as a holder of a supplementary protection certificate …, shall have the possibility to opt out from the exclusive competence of the Court. To this end they shall notify their opt-out to the Registry by the latest one month before expiry of the transitional period. The opt-out shall take effect upon its entry into the register.”
Sub-clause (1) seems perfectly clear that even in the case of an EP which has not been opted out under the Article 83(3) procedure, one may still have national infringement or revocation proceedings for the first seven years, whilst the second separate provision seems clearly to state that the effect that the opt out lasts for the entire life of the patent/SPC since it does not state that the opt-out comes to an automatic end after 7 years. The great difficulty with the possibility that the plain wording might not be all that it seems is two-fold. First, there would be uncertainty on this until a Court ruling – which may be in the UPC or a national Court, but which could not arise until after the seven year period was over. Second, if every patentee (or nearly so) opts out, as is widely predicted, the Commission may re-visit the provisions to change the wording at the revision stage.
Happily, the Commission has clarified its position and stated that the opt out is intended to be for the life of the patent. The explanation of the opt-out provisions now reads as follows:
Hopefully, this will put this aspect of the uncertainty as to the provisions to an end.
One further point does remain, however. Article 83(3) refers to opting out of the “exclusive jurisdiction” of the UPC. This is presumably meant to be a reference to the UPC having exclusive competence over certain types of actions. However, it seems entirely arguable – which means that litigants will argue the point – that the UPC does not have exclusive competence during the transitional period. On this point the uncertainty regrettably remains.