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It has been almost two months since the UK officially left theEU on Friday, 31 January 2020, yet it remains in a period oftransition. For intellectual property professionals, rights holdersand applicants alike, this has represented a time of uncertainty asthey seek clarity around important questions concerning process andregulation.

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The UK's relationship with the EU is currently governed bythe Withdrawal Agreement, which provides for a stand-still periodin relation to the application of EU law in the UK. Changes to thecurrent regime are due to take effect from 31 December 2020. Whatthese changes will be will depend on the terms of any agreement(s)reached (or not reached) between the UK and the EU addressing theirlegal relationship from 31 December 2020. In a document released atthe end of February, the UK Government stated it is seeking anagreement that "secures mutual assurances to provide highstandards of protection for IP rights, including registered IPrights such as patents, trademarks or designs."

So what does this currently mean in practice for intellectualproperty? Well, for now, not a lot, but here are five keythings to be aware of in the areas of patents, trademarksand designs as we wait for the Brexit dust to finally settle:

The European patent system is governed by the European PatentConvention and is entirely independent of the EU. It has always hadnon-EU members such as Switzerland, Norway and Turkey, and there isno current reason why the UK could not continue to be a part ofthis regime post-Brexit.

The UK patent system comprises the national system (applicationsmade to the UK IPO) and the European system (applications made tothe EPO). As both systems largely fall outside the remit of EU law,and questions of infringement and validity of each nationaldesignation are a matter for the courts of each relevant country,the impact of Brexit for the existing patent systems is likely tobe minimal.

However, the European patent system is developing with theintroduction of the Unified Patent Court (UPC). While the previousUK government had expressed their intention to remain invested inthe UPC project, the current administration confirmed that the UK"will not agree to any obligations for our laws to be alignedwith the EU's, or for the EU's institutions, including theCourt of Justice, to have any jurisdiction in the UK." Ittherefore seems highly unlikely that the UK would become part ofthe UPC system upon its entry into force.

Companies concerned about having to re-register EUTMs in the UKin the event of a no-deal Brexit need not worry. All EUTMsregistered as at 31 December 2020 will automatically be protectedas "cloned" UK trademarks without any loss of priority,filing or seniority dates at no additional cost. The new UK TMrights will have a prefix to indicate that it is cloned and willrequire its own separate renewal.

For EUTM applications that are still pending at the end of thetransition period, proprietors will have nine months to file a UKapplication for the same trademark or design maintaining thebenefit of the same filing, priority and seniority date.

Where oppositions or proceedings against EU trademarkapplications or registrations are based on prior UK rights, theproceedings will automatically be dismissed once the transitionperiod ends. UK rights will cease to be "earlier rights".We have already seen some adversarial proceedings based on UKrights stayed by the EUIPO. UK rights holders should be reviewingtheir involvement in any EU trademark proceedings with theirattorneys in order to determine whether they will be affected andto identify alternative options at their disposal.

Similarly, existing EU design rights will be automatically"cloned" into UK national rights to ensure that no rightssimply cease to exist.

EU registered design rights in place before Brexit day willbecome "Re-registered Design" rights, and will act as ifit was a UK registered design.

EU's unregistered design rights will become "ContinuingUnregistered Community Designs" to give protection in the UK.It will be possible to obtain the same protection following Brexitby way of the newly formed "Supplementary UnregisteredDesign" right.

At present, the UK operates within a regional exhaustion systemin the European Economic Area (EEA). Post transition period shouldthe UK be moving to national exhaustion or internationalexhaustion? While IP owners would undoubtedly like to see theirnational markets protected, others believe that an internationalexhaustion system would see greater competition and a reduction inprices for consumers.

It is a controversial issue and it is no surprise that theIntellectual Property (Exhaustion of Rights) (EU Exit) Regulations2019 provides that the current system of EEA exhaustion willcontinue as far as possible. This means that at the end of thetransition period, rights in goods put on the market in the EEAwill be exhausted in the UK. However, it is unclear whether the EUwill take the same approach. If it does not, putting goods on themarket in the UK would not exhaust IP rights in the EEA. This meansthat UK rights owners would not be able to prevent parallel importsfrom the EEA but owners of rights in the EEA would be able toprevent UK exports from the UK into the EEA. Importers from the UKinto the EEA would therefore need to consider whether they requirespecific permissions from rights holders. It remains to be seen howthis issue will be approached in the trade negotiations.

Given the UK's current hard Brexit stance in relation to thenegotiation of a future trade agreement with the EU, in which thereappears to be no role for the CJEU and no dynamic legislativealignment, it is likely that the future may see divergence betweenUK and EU patent, trademark and design jurisprudence. Where exactlythey will diverge is yet to be seen. It is also possible that thetimetable for Brexit will change in light of the impact ofCOVID-19.

Read the original article on GowlingWLG.com

The content of this article is intended to provide a generalguide to the subject matter. Specialist advice should be soughtabout your specific circumstances.

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