What impact will Brexit have in the long term?

What impact will Brexit have in the long term?

While the news in 2020 was dominated by the COVID-19 pandemic, the year also saw the conclusion of the Brexit process, with the UK leaving the EU on 31 January and the UK-EU Trade and Cooperation Agreement concluded on 24 December. What will it mean for IP in the coming years?

Mercifully for rights owners, Brexit had only a small impact on IP. Under the Withdrawal Agreement, the UK agreed to create new UK trade mark and design rights based on EUTMs and RCDs, and this process was completed by the UK IPO by 4 January 2021. Firms, such as Kilburn & Strode, which have offices and qualified staff in EU Member States, can continue to act before the EUIPO and other EU agencies and courts as before.

Two areas that were carved out of the Agreement and are subject to further discussion are exhaustion of rights and geographical indications. On the former, the UK is currently retaining EEA exhaustion, meaning that parallel imports from the EEA into the UK can continue. However, the government is consulting on which policy to adopt in the longer term. On GIs, the Agreement says the UK and EU “may jointly use reasonable endeavours” to provide reciprocal protection and enforcement for GIs. All existing GI product names protected in the EU on 31 December 2020 are protected in the UK.

UK remains aligned with EPO

In patents, meanwhile, nothing substantive has changed as the UK remains part of the EPC and EU law has very little impact on patent law. “There is unlikely to be significant divergence in patent law because UK courts are very closely aligned with the EPO,” says partner Kristina Cornish.

However, in the longer term there are some areas where there may be pressure for change. One is the law on Supplementary Protection Certificates (SPCs). These are national rights, and not directly affected by Brexit. But UK practitioners and judges generally view the legislation as less than perfectly drafted and there are reasonable questions about whether the SPC regime should be extended to other products, such as medical devices, and whether the term of protection should be changed. Kristina says: “Brexit may be an opportunity to review the law on SPCs – the question is would this lead to a desirable outcome?” Partner Nick Bassil adds: “Many patent owners filed SPC applications before December 2020 to avoid any potential disruption following the end of the transition period.”

Research may also be affected by Brexit, given the importance of EU research grants, especially for SMEs. The UK is remaining in the Horizon Europe programme, but leaving the Erasmus+ university exchange system (and setting up a replacement named after Alan Turing). “These changes may have an impact on investment on research in the UK – we will have to wait and see,” says Nick.

One becomes two

In the trade mark and design area too, there may be gradual changes. “Brexit has been smoother than many people expected, but we don’t yet know what the fallout will be,” says senior associate Rachel Harrison. With UK courts now able to diverge from CJEU case law on trade marks, there is the potential for judges to reach different conclusions on, say, registrability or scope of protection.

More immediately, says Rachel, there will be an impact on pending cases at EUIPO involving prior UK rights: “Such ongoing EUIPO proceedings fall away after 1 January, even if all levels of appeal have not been exhausted. In most cases, the impact will not be significant but there may be a few that are critical. It will be interesting to see if anyone challenges these decisions on the basis that their fundamental rights have been denied.”

Another question is whether applicants will continue to seek trade mark protection in both the UK and EU – or whether they will consider the UK market is not worth protecting. So far, says partner Iain Stewart, “there is no evidence of that happening”, with record numbers of filings at the UK IPO in the past couple of years. For most businesses, both the EU and the UK are important markets and given that trade marks are relatively inexpensive, protection in both is likely to be desirable. And, with offices in both the UK and EU, Kilburn & Strode will continue to provide trade mark and design prosecution before both the UK IPO and EUIPO.

Contact Gwilym if you would like to have a word him about his writing, IP or the Welsh countryside.

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