European Unified Patent Court is delayed again

As reported by the Frankfurter Allgemeine Zeitung (FAZ), a German newspaper, two new constitutional complaints were lodged with the German Federal Constitutional Court shortly before the turn of the year. The complaints were lodged shortly after the German parliament had passed the legislation necessary to ratify the UPC Agreement – an international treaty that provides for the creation of the UPC, and upon which the introduction of the European patent with unitary effect also depends.

In order for the German legislation to have effect, and for Germany's ratification of the UPC Agreement to be confirmed, the legislation must be signed into law by Germany's president, Frank-Walter Steinmeier. However, according to the FAZ, the Constitutional Court has requested that Steinmeier "wait until a decision has been made on an urgent appeal before issuing the necessary law". It is not yet known when the court will decide on the complaints and the associated emergency application.

"The establishment of the long-awaited European unitary patent is now stagnating again due to constitutional complaints," said Dr Michael Schneider, patent litigation expert at Pinsent Masons, the law firm behind Out-Law. Last year the European Commission reiterated its intention to "support a rapid roll out of the unitary patent system" in 2021, but Schneider said this timeframe was now in doubt as a result of the hurdles that have arisen again in Germany.

"It is to be hoped that there will be a quick clarification by the Federal Constitutional Court," said Schneider. "Many companies, patent authorities and the legal profession have been waiting in the wings for years now and the harmonised approach to enforcing patent rights that would be made possible by the new unitary patent is welcomed by many European inventors."

The UPC Agreement is an international treaty and part of a regulatory package on patent law, the core of which is the introduction of a European patent with unitary effect at the level of the European Union.

The new system is intended to facilitate both the EU-wide granting of patents and the enforcement of patent rights in order to reduce the costs and efforts involved. The European Commission had indicated that the EU unitary patent, which would only have to be applied for once centrally and would be effective EU-wide after approval, could reduce the costs of patent applications by up to €32,000. However, for the unitary patent to be introduced, the UPC must first be established. Legal challenges raised against German ratification of the UPC Agreement have so far prevented this step from being taken.

German law makers passed legislation to ratify the UPC Agreement previously, in 2017, but in February 2020, the Federal Constitutional Court declared the law null and void in light of a previous constitutional complaint that had been raised. The complaint succeeded on the basis that not enough MPs were present at the time the legislation was voted on in the Bundestag to enable such a transfer of sovereign rights as those associated with the UPC Agreement to go ahead. Changes of that nature require a "two-thirds majority" vote of the Bundestag, the court said at the time. For the new unitary patent system to enter into force, at least 13 EU countries, including the three countries with the most European patents in 2012, Germany among them, must ratify the UPC Agreement through national consent laws to transfer their sovereign rights to the UPC.

The law that was passed again at the end of last year by the Bundestag and Bundesrat included identical wording to that which was passed previously. According to the FAZ, the same person who raised the initial constitutional complaint in 2017, is behind one of the new constitutional complaints raised. The person who raised the constitutional complaint in 2017 was Dr Ingve Björn Stjerna. The person behind the second constitutional complaint is not yet publicly know.

Dr Stjerna's initial complaint was based on a number of grounds. In ruling on his case last year, the Constitutional Court only ruled explicitly to uphold his complaint on the basis that an insufficient number of parliamentarians had been present at the vote – it did not rule on the other grounds of complaint, but they were not rejected as unfounded. The court, however, considered Dr Stjerna, as not having sufficient standing to bring the other parts of the complaint in the form he did.