Brexit and intellectual property - checklist for a no-deal Brexit

Brexit and intellectual property - check list for a no-deal Brexit

As the uncertainty about whether the UK will depart the EU with a deal or without a deal continues, we set out below a checklist of the practical issues which are likely to arise in relation to intellectual property on a ‘no-deal’ Brexit.  ‘No deal’ means that the UK would leave the EU at 11pm GMT on 29 March 2019 (if it happens then) without a Withdrawal Agreement and without an agreement on the future relationship.

  • Trade mark owners: EU trade mark (EUTM) holders will be notified by the UK IPO of their right to be granted equivalent UK national trade mark protection (free of charge).  EUTM owners should also carry out a ‘health check’ on the validity of their EUTM(s), which will be limited to the EU27 countries from Brexit day. A key point is whether use outside the UK is sufficient to preserve continued validity. In some cases application for national trade marks in key European markets may be advisable.  UK national trade marks will be unaffected (but see exhaustion of rights below).
  • .eu domain names: After Brexit UK companies and organisations (if not also established in the EU) and individuals resident in the UK will no longer be able to register .eu domain names, and existing holders will not be able to renew them.  There is also a risk that the Registry will revoke such domains ‘of its own motion’, potentially immediately after Brexit.    Companies and organisations affected should consider transferring ownership of their .eu domain names into the name of an eligible associated company or organisation where appropriate. Even where this is done, however, they should be aware that it will no longer be possible to rely on rights that are only recognised or established in the UK (e.g. a UK national trade mark) in .eu domain name dispute proceedings. They may also consider whether a different gTLD might be more appropriate. Press reports suggest that more than 300,000 .eu domain names are likely to be affected.
  • Owners of Community (EU) design rights: As for trade marks above, Community registered design (CRD) holders will be notified of their right to be granted equivalent UK national rights (free of charge). The CRD will continue limited to the EU27 countries. Existing unregistered Community designs (URDs) will continue to be enforceable in the UK for the remainder of their term (total term is 3 years). In addition, UK designers will continue to qualify for unregistered Community design rights covering the EU27 countries but should note that first disclosure of the design must be in the EU27. The UK intends to introduce a new UK ‘supplementary unregistered design right’ mirroring the terms of the UCD to protect designs disclosed in the UK after Brexit.  Further details of the terms for this new right are expected to be published in the near future. Going forward, design owners should consider applying for UK registered design right protection for key designs, an easy and inexpensive procedure.
  • Outstanding applications for EUTMs and CRDs: Applicants will have nine months to refile for an equivalent UK registered trade mark or design based on the existing priority and seniority. They will have to bear the costs of this application at the usual UK rates.
  • Patent holders – Currently, all patents in the UK have UK national effect only. This includes UK national patents and European Patents (UK), which are obtained through the European Patent Office, a non-EU body. These will not be affected by Brexit, so no immediate steps are necessary. The EU legislation on supplementary protection certificates (SPCs) will be retained in UK law and will also continue to operate in the UK as before. Companies that own patents in the UK or anywhere in the EU should remain alive to the possibility that the Unified Patents Court and unitary patent system may come into force with relatively little notice, either within the EU27 states only or (less likely) including the UK, once a constitutional challenge in Germany is resolved. It remains important, therefore, for companies to prepare by deciding which patents they wish to opt out of this system so that they are ready to do so in the sunrise period.
  • Copyright – Copyright is a UK national right which will not be immediately affected by Brexit. However, in areas where EU legislation provides for reciprocal, copyright-related protections  and arrangements between member states, the UK will not be able to secure equivalent reciprocal rights in other member states without a deal. Areas affected include:
    • Database rights – After Brexit UK citizens, residents and businesses will no longer qualify for database right protection in EEA member states. A new, UK-only database right will be available to UK stakeholders but will not be enforceable outside the UK. So far as existing database rights are concerned, the UK has declared that it will honour all database rights existing at Brexit whether owned by UK or EEA businesses, but EEA states will not be obliged to reciprocate. Companies should review their contracts in Europe to ensure they give appropriate protection to their databases.
    • Portability of online content – The recently introduced EU Portability Regulation (2017/1128) gives consumers across the EU the right to access their online content services (e.g. video-on demand and streaming) as if they were at home when travelling within the EU. The UK has announced its intention to repeal this legislation from the body of UK law on a no-deal Brexit, removing the obligation to provide portability.  Service providers wishing to continue this service are likely to face a high hurdle in securing the relevant permissions.  Companies will need to review their contracts with customers and others to remove portability – and manage expectations.
    • Satellite broadcasting – current EEA ‘country-of-origin’ rules simplify the clearance of rights in cross-border satellite broadcasting, saving broadcasters from having to clear rights in all countries receiving the broadcast.  On a no-deal Brexit UK broadcasters may need to obtain permission from the copyright holder in every EEA country in which their broadcast is received, depending on the law in that country. The UK has stated that it will continue to apply the country-of-origin principle to broadcasts from most countries – whether within or outside the EEA.
    • Cable retransmissions – On a no-deal Brexit copyright holders whose works are broadcast from the UK and retransmitted via cable in the EEA will no longer be able to rely on the arrangements in the Satellite and Cable Directive which ensure that cable retransmissions are dealt with by a collecting society.  Instead they may need to negotiate licences with cable operators directly; in some countries statutory licensing terms may be imposed on the cable retransmission.
    • Collective rights management – under current EEA rules collecting societies must represent any EEA right holder who requests representation, whichever EEA state they are based in. EEA collecting societies offering multi-territorial online music licences must also, if asked to do so, represent the catalogues of EEA collecting societies which do not offer such licences. On a no-deal Brexit collecting societies in EEA countries will not be obliged to represent UK right holders or societies unless national laws require them to do so.  The UK has stated that it will continue to require UK collecting societies to comply with the existing EEA rules on a unilateral basis.
    • Digitising works in cultural heritage institutions – The EU ‘orphan works’ exception applies where the author of a work is unknown or untraceable. It allows cultural heritage institutions such as libraries, museums or archives to digitise such works to maintain their collections.  After Brexit this EU scheme will no longer apply to UK institutions, with the result that works previously placed online may have to be removed to avoid infringing copyright.  However, the UK Government advises that institutions wishing to maintain their online collections may be able to do so via the UK’s orphan works licensing scheme.
    • Marrakesh Treaty – The Treaty aims to improve access for visually impaired people to copyright works. The UK is currently party to the Marrakesh Treaty through the EU. It is seeking to ratify the Treaty in its own right, but in the interim there is a danger that people with visual impairments may not be able to receive accessible format copies of copyright works as provided by the Treaty in some countries.​
  • Geographical indications (GIs) – The UK will set up its own GI scheme broadly mirroring the current EU regime, which will be “no more burdensome” to producers. All 86 currently existing UK GIs (including, for example, Scotch Whisky, Melton Mowbray pork pies and Jersey potatoes) will automatically be given UK GI status. The UK would no longer be obliged to recognise EU GIs, nor will the EU be obliged to recognise UK GIs. However, UK producers will still be able to apply for EU GI status and vice versa. The expectation is that existing UK GIs will continue to be protected under the EU GI schemes. If not, UK producers may wish to reapply for protection under EU schemes as a ‘third country’ producer. Producers may also consider applying for EU collective or certification marks.​
  • Parallel trade, including online sales: Companies trading in IP protected goods (e.g. branded goods) will be affected by changes in the rules about free movement of goods. Currently, once goods have been put on the market in the UK by the IP right owner or with his consent the IP rights in the goods are treated as ‘exhausted’ and the goods can be sold freely throughout the EEA. Following a no-deal Brexit this rule will fall away. This will affect those exporting goods already put onto the market in the UK. Such goods may be treated as grey market goods in EEA countries if the IP right holder’s consent has not been obtained..  Traders should therefore check with relevant IP right holders to see if permission is needed. So far as goods imported into the UK are concerned, however, the UK Government has said that it the UK will continue to treat IP protected goods put on the market in the EEA with the right holder’s consent as exhausted so that these can move freely into the UK (so far as IP rights are concerned).​
  • IP licences – licensors and licensees should review existing licences to ensure that definitions – for example, the definition of the licensed territory – still operate as intended.  They may also wish to consider whether licensing arrangements which treat the EU/EEA as a single licensed territory remain appropriate.

Contact our experts for further advice

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