Consultation event on Court Fees for the Unified Patent Court - and news on timing of UK implementation

This moggy crept over to the lovely and hospitable offices of Allen & Overy last night to attend the consultation event on the Court fees for the Unified Patents Court.  Readers may recall that he wrote about this consultation when it was launched, and the IPKat would like to remind that responses to the consultation are requested in English and to be sent electronically to the, and the deadline is midnight on the 31 July.  While readers are of course very welcome to comment here, the IPKat points out that comments to the Preparatory Committee will be more efficacious.  It was pointed out last night that responses can be only on one or a few issues that are of concern to you; you need not address every issue raised in the consultation document.  It was also pointed out that evidence as to the specific effect that any of the proposals would have (or that a revision to the proposal would achieve) would in particular be welcomed.

The event was a joint enterprise between the Intellectual Property Office, the IP Federation, and the Chartered Institute of Patent Attorneys.

The event was somewhat sparsely attended in person at the venue; doubtless many were availing themselves of the webinar option to watch from their office/sitting room/local hostelry.  But if you have missed it, never fear, because the video of it can be seen here.  If you are interested in responding to the consultation in particular, it is definitely worth a watch.

Timing of UK Implementation of the UPC
But first, a digression, which may be of more general interest than the specifics of the particular consultation.  The IPKat, ever eager to seek news for his dear readers, took the opportunity to ask whether there was any truth in the speculation that has appeared repeatedly in comments on this blog and elsewhere that the current UK Government might delay ratification of the UPC Agreement until after the UK Referendum on membership of the EU, which is not scheduled until 2017.  The Intellectual Property Office, as it turns out, has an answer prepared for this question, and the IPKat is delighted to share it with you.

EU Referendum question 
The Government is committed to this project and wants the UK to be part of a European patent system that supports growth and fosters innovation. The Prime Minister was personally involved in the negotiations on the Unitary Patent regulations and the UPC Agreement and the UK is taking an active role in the current work to implement the new system.
These is still work to be done before the UK can ratify the Agreement, and I am committed to pressing ahead with this. It is the Government’s intention for our domestic preparations to be completed by Spring 2016.

So, while the answer is veiled in non-specifics, and it is not clear what "domestic preparations to be completed" covers, this moggy believes that the IPO is stating that the UK Government intends to ratify the agreement (which will include enacting the requisite secondary legislation to achieve the necessary amendments to national law) by Spring 2016.  In any case, there is no intention to delay until after the Referendum.

The Consultation Event - the panel
Back to the main topic.  The purpose of the event was to aid thinking on the consultation to enable interested parties to respond.  The august panel was as follows:

  • Carol Arnold (Chair), President of the IP Federation
  • Catriona Hammer, Immediate Past President, CIPA
  • Janis Makarewich-Hall, Head of UPC Taskforce, UKIPO
  • Tracey Webb, UKIPO Lead, UPC Fee negotiations
  • Mr Justice Birss
  • Kevin Mooney, Simmons & Simmons
  • Alan Johnson, Bristows
  • Richard Vary, Nokia

After initial comments from Carol Arnold, Catriona Hammer, and the IPO delegation, four topics were identified for discussion.  In respect of each one, a panelist discussed the issues, and then after presentation of all the topics, the floor was opened for questions and comments.

Topic 1 - the structure (Kevin Mooney)
The structure was set out (see previous post for an overview).  Issues on which interested parties might like to comment are:

  • Timing issues for the value based fees - the court fees are to be paid in advance, but the value will not be known at the very beginning
  • Guidelines are being developed on the assessment of the value for the value based fee; these are not yet published but may be in due course; the main intention is that the case is valued on a reasonable royalty basis, and that the valuation should relate to the whole action.
  • There is a value based fee for infringement action AND for an application to determine damages - does this amount to a double payment of a value-based fee?
  • There is no value based fee for revocation or counterclaim for revocation; this was because many felt that to pay a large fee to simply defend oneself from an invalid patent was unjust. But is it right that there should be a value based fee for infringement but not for revocation?

To finally end a point raised in comments on this blog, this Kat sought and received clarity that under the currently proposed Rules of Procedure of the UPC, if a defendant to a patent litigation does not file a counterclaim for revocation and pay the Court fee (between €11,000 and €20,000), then they may not plead that they do not infringe because the patent is invalid.

It was pointed out in the questions that the fees are set to enable the Court to be self-financing; however the draft budget for the Court is not published (nor apparently is is likely to be), so users (and responders to the consultation) cannot see what are the financial assumptions underlying the level of court fees.

Topic 2 - SME support (Mr Justice Birss)
The consultation proposes two fee structures, one in which there is a reduction of fees to reward certain behaviours such as use of a single judge or early settlement, and one in which there are specific discounts for SMEs, micro-entities, non-profit organisations, universities and public research organisations.  It seemed generally agreed that the first proposal did not specifically help SMEs, and some questioned whether Universities, some of which are wealthy and litigious, should benefit from any reduction.

It was pointed out that any fee reduction for some entities was effectively subsidised by the other users of the system, since the Court is expected to be self financing with the court fees as its only source of income.

Topic 3 - opt-out fee (Richard Vary)
Apparently earlier European Commissioner Margot FRÖHLINGER principal director for patent law and international affairs in DG 5 at the European Patent Office [edited 2.30pm 24 June] had said that the opt-out fee would be "more than users hoped, but less than they feared" (sound familiar?).  Since €100 was "feared", the proposed level of €80 (per "patent family" - it is not clear to this Kat whether a divisional counts as the same "family") fits this description.  Many present still felt this was too high; this Kat ventured the opinion that compared with the renewal fees that patentees were paying anyway, the sum might be considered relatively modest.

Topic 4 - Recoverable costs (Alan Johnson)
The recoverable costs include legal representation, court fees, and costs incurred in court proceedings (eg simultaneous interpretation, witnesses).  The table of the cap on recoverable costs as currently proposed however only relates to the representation element of this, and it appears that court fees etc are proposed to be recoverable on top of this.  (This Kat would like to apologise if his question, which supposed that the cap applied to the total recoverable costs, caused confusion; however it appears that many present shared his misunderstanding, so it is perhaps as well that the matter was aired).

There are issues if there are multiple defendants - if they win do they all get their costs?  If the patentee wins, do they get the capped amount, the payment to be shared between all defendants?

It is also unclear whether the "value of action" is to be necessarily the same as that assessed for the value based fee.  Should it be?  It is also unclear whether it includes VAT, and what would happen if one party is registered for VAT and another not, which would be even more problematic when the parties are in different countries.

It was pointed out in questions that there is a question as to whether the cap on recoverable costs is compatible with the Enforcement Directive, and there is currently a reference to the CJEU on this point (C57/15).

So, dear readers, there are four main issues.  Of course, you may respond to the consultation on any issue, not just these ones.  If you would like to know more, probably best to watch the recording of the event.  And as ever, if you wish to comment here, then you are most welcome.

Consultation event on Court Fees for the Unified Patent Court - and news on timing of UK implementation Consultation event on Court Fees for the Unified Patent Court - and news on timing of UK implementation Reviewed by Darren Smyth on Wednesday, June 24, 2015 Rating: 5


  1. It doesn't make sense to me to implement the UPC before it is clear whether or not the UK remains a member of the EU. While the IPO may want that it is implemented before any referendum as it is their baby, I am not so sure about the government, especially as it might enable anti EU criticism in the crucial period just before the referendum.

  2. It won't be a hot issue in the referendum period. The overwhelming majority of voters have no knowledge or interest in IP matters. IP was raised as an issue during the Scottish referendum, and gained precisely zero traction with the electorate.

  3. Ms Margot FRÖHLINGER works at the EPO. Whilst in the past, she worked as an official (member of staff)of the European Commission -an offical is not a "European Commissioner" which is a political appointment -one per Member State-("Apparently earlier European Commissioner Margot FRÖHLINGER").

  4. Thank you to last Anon for this correction. Apologies for the error in my note-taking at the event. The blog post has been updated.

  5. I missed the opening of the session and haven't caught up yet so I don't know if this comment was covered in the meeting.

    The phrase "It is the Government’s intention for our domestic preparations to be completed by Spring 2016." is pretty vague. In particular, does this mean "ratified", "secondary legislation enacted" and "instrument of ratification deposited in Brussels"?

    The last action in that list is potentially important. Malta apparently ratified months before they deposited their documents and it would be possible for the UK to ratify and enact secondary legislation and then sit on the final action.

    Previously, we'd assumed sitting on the "deposit" action would enable Germany and the UK to control the "go live" date for the whole system but the referendum adds an interesting twist.

  6. Thank you for your comment Mark. This was not covered in the meeting, but at the reception afterwards. I have no further information than what is quoted, and I agree that it is ambiguous as you describe. As "ratify" is specifically mentioned in the previous sentence, my best interpretation is that deposit of instrument of ratification is included in "domestic preparations", but I completely agree that the statement does not exclude the possibility that ratification may be delayed.

  7. If ratification happened before the referendum I could see it becoming a point of criticism. Something along the lines of the government giving away more powers just when the referendum was happening and therefore showing its true colours or some such nonsense.

  8. Isn't it necessary for one of the top three countries to hold back its ratification until the court is ready to roll? Otherwise, if DE, FR and GB have all ratified, then ratification by any one of the smaller countries could lift the number of ratifications above the threshold that triggers the starting gun. That could give the court a big headache to get everything up and running for an opening day that it wasn't able to control.

  9. Confirmation from the EPO's AC meeting today (on that the council is going for Top 4 funding. Key within that to be works out later.

  10. In the meantime:
    Business friendly fee pattern adopted for the Unitary Patent
    "The Select Committee of the Administrative Council of the EPO endorsed today the True Top 4 proposal tabled by the European Patent Office on renewal fees applicable to the unitary patent.
    The True Top 4 proposal for the fee covering the territory of the participating 25 EU Member States corresponds to the total sum of the renewal fees currently paid for the four most frequently validated countries (Germany, France, UK and the Netherlands), and contains a clause for possible revision after four years. Specific care has been taken to consider the situation of SMEs."


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