How will a no-deal Brexit affect your intellectual property rights?

Following the European Council’s approval of a short extension, the UK is set to exit the EU on 12 April 2019 unless a deal is agreed. The UK will then become a ‘third country’ outside the EU territory.

This guide explains how a no-deal Brexit will affect your intellectual property rights. Patents and copyright are essentially non-EU rights and will not be significantly affected. But there will be a major impact on EU trade marks and design rights, as well as the right of UK businesses to continue using.eu domain names.

New UK laws and regulations

To provide continuity, the EU Withdrawal Act 2018 will transpose all EU law into UK law on exit. This means all the laws that currently apply in the UK will remain the same immediately after exit.

The UK government has published a series of ‘technical notices’ to provide clarity on the consequences of a no-deal Brexit on IP rights. It has also approved a range of regulations to govern trade marks and designs in the event of a no-deal exit. The implications are explained below.

EU trade marks and designs

Trade marks protect business names and logos, and rights in design protect the shape and appearance of products. EU trade marks and design rights currently extend throughout the EU and are relied on by many UK businesses to protect their commercial interests. After Brexit, the rights will no longer extend to the UK.

The UK government has taken steps to ensure a level of continued protection in the UK in the event of a no-deal exit. Here’s a summary:

• Existing EU laws relating to trade marks and designs will be transposed into UK law by the Withdrawal Act.
• EU trade marks and designs will no longer extend to the UK after exit.
• Owners of EU trade marks and registered designs will be given standalone UK national rights that mirror the existing EU rights. These will be called ‘comparable trade marks’ and ‘re-registered designs’.
• No action is needed to get these ‘cloned’ rights. They will be issued automatically and without charge. However, they will not be granted for EU applications that are still pending on the date of exit. Applicants will need to re-file pending applications in the UK (subject to standard filing charges) to obtain corresponding UK protection.
• It is possible to opt out of receiving the ‘cloned’ UK rights – unless the associated EU right is subject to security interests, licences, assignments, or equivalent commercial arrangements.
• Existing licences, contracts and security arrangements that refer to the EU right will be deemed to include the ‘cloned’ UK right too. This means there will not be a gap in existing licences and agreements, as they will automatically be considered to include the new UK rights.
• Owners may need to register licences and security interests within a certain period, to maintain full protection for the ‘cloned’ right. In practice, it may make sense for owners to do this promptly after the details of its cloned rights are confirmed.
• Equivalent arrangements apply to international registrations for trade marks and designs designating the EU.

Community Unregistered Design Rights

Community Unregistered Design Rights provide automatic 3-year protection relating to the shape or appearance of products, and are relied on heavily by the fashion industry.

This right currently exists at EU level only. Existing rights will continue to be recognised in the UK for the remainder of their 3-year term and will be known as a ‘continuing unregistered community design’.

An equivalent UK right will come into existence for designs published after the date of exit, known as the ‘supplementary unregistered design’.

Together, these measures will ensure that continued protection remains in place, by the recognition of existing rights and the creation of a new UK right.

Disputes

UK rights will no longer be relevant to oppositions, cancellations and revocations before the European Intellectual Property Office (EUIPO). Oppositions to EU applications based on UK rights will fail if the dispute is not decided before exit. Currently, disputes based solely on UK rights are being suspended by the EUIPO.

At present, EU trade marks and designs can be enforced throughout the EU in a single dispute, with a judgment from a single court. In future, pan-EU injunctions will not be available in UK courts, and separate litigation in the UK will be necessary.

Copyright, patents, domain names

Below, we consider the impact of a no-deal Brexit on copyright, patents, and .eu domain names.

Copyright

Protects photographs, art, words, software, film, and music

No significant change, because copyright is a national right unaffected by Brexit

• Copyright will not be significantly affected by Brexit, because it is governed by national law.
• The UK will continue to be a member of the relevant international treaties for relating to copyright law.
• EU copyright directives will be incorporated into UK law by the Withdrawal Act (to the extent they are not already).
• Copyright owners can continue to enforce their rights before the UK courts.
• Existing rights and licences will remain in force.

Patents

Protect technical innovations and inventions

No significant change

• Patents will not be significantly affected by Brexit.
• Patents in the UK are governed by national law and international conventions.
• The UK will remain a member of the European Patent Convention, which is not an EU agency.
• The European Patent Office is not an EU agency so filings will be unaffected.
• Existing rights and licences will remain in force.
• Enforcement is currently on a national level and will be unaffected.
• The few specialised rules in EU law will be automatically incorporated into UK law by European Union (Withdrawal) Act 2018

Domain names

• Brexit is also likely to affect the ability of UK businesses to use and register .eu domain names. The .eu domain is only available to EU and EEA residents and businesses/organisations established in the EU or EEA.
• After exit, businesses and individuals established in the UK (but not in the EU) will no longer be eligible to register or renew .eu domain names.
• If the UK leaves the EU with no deal, the following measures will be enforced: 
• UK parties will not be entitled to register .eu domain names.
• UK registrants will be informed that their registrations are not compliant, and will have a limited time to demonstrate compliance (e.g. by showing they are also established in the EU or EEA).
• In the interim period, domain names will remain active and transferable to registrants in the EU/EEA.  But it will not be possible to transfer the domains to a UK registrant, or to renew the domain.
• At the expiry of the compliance period, domain names will be withdrawn from registrants who have not demonstrated their eligibility. The domain will no longer function and will not be capable of supporting websites or email.
• According to current plans, 12 months after exit (30 March 2020) all affected .eu domain names will be revoked and will become available for registration by others.

Key action points

The existing arrangements for copyright and patents will be largely unaffected, so there is no real need for concern. However, you should be ready for significant changes to EU trade marks, designs and domain names once the UK falls away from the protected territory. Key action points:

• Review your EU trade marks and design rights and be aware of which rights will no longer be protected in the UK.
• Await grant of new UK ‘comparable marks’ and ‘re-registered designs’ – bring them into your portfolio and diarise new renewal deadlines.
• Review licences, agreements, or security interests deemed to include the new UK rights and consider whether registration of any interests is required.
• Check if you have any pending applications for EU trade marks or designs, and be aware of the time limit to refile in the UK.
• Review trade mark disputes relating to EU rights, including oppositions, revocations or cancellations at the EUIPO, and be aware that they may fail if based solely on UK rights.
• Check whether you own any .eu domain names and consider whether you can transfer them to EU/EEA group companies. If not, be ready to lose the domains.
• Each business has its own different IP requirements, and you should take focused advice from an IP specialist. If you have any questions, Gateley’s intellectual property team will be happy to help.