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01-03-2019 » The near future of trademarks and models in the case of a "No-deal Brexit"

The near future of trademarks and models in the case of a "No-deal Brexit"

In accordance with Article 50 of the Treaty on the European Union, the departure of the United Kingdom from the Union is expected to take place on March 29 2019, unless the European Council and the United Kingdom agree to extend this time limit.

It should be noted, however, that the United Kingdom is free to revoke its intention to leave the European Union as long as the withdrawal agreement negotiated between the European Union and the United Kingdom has not been confirmed between the parties. This possibility was confirmed by the Court of Justice of the European Union in a judgment of December 10 2018 (C-621/18). This outcome is nevertheless unlikely.

The latest version of this draft Withdrawal Agreement was published on November 14, 2018. It has a provisional duration until December 31, 2020, and sections 54 to 61 deal with IP rights. This agreement was rejected by British MPs on January 15, 2019 even though a second vote is expected by March 12, the outcome of which is highly uncertain. In short, the agreement ensures the continuity of registered rights, without review, for European trademarks and designs and also for European rights obtained through the Madrid and the Hague systems. Transitional dispositions are also provided for applications that are currently in progress (see our April 2018 news flash).

At the moment, the signing of this Agreement is largely compromised and it is important to consider the hypothesis of a "No-deal Brexit" because as from the day after March 29, 2019 Union law will no longer apply automatically in the United Kingdom. Indeed, one month from the deadline, this extreme scenario no longer seems excluded.

A withdrawal without agreement will mean from the point of view of industrial property rights that the United Kingdom will find itself in the situation of a third State to the European Union and conversely for the European Union. However, any European directive governing IP rights that has already been incorporated into UK national law will remain so until there is a further national legislative change. From this point of view, it should be noted that the dispositions of the 2015 Trade Marks Directive that were to be incorporated into national law by Member States by January 14 2019 have been incorporated by the United Kingdom. All European regulations, with direct effect, are incorporated into the British normative order by Article 3 of the European Union (Withdrawal) Act 2018, until further national legislative change. On the other hand, future European directives and regulations will have no effect in the United Kingdom. In addition, already various drafts of texts that are likely to modify the corpus of Community law integrated into UK law have been submitted to the British Parliament.

Brexit without agreement with the European authorities has an impact on European rights relating to trade marks, designs, SPCs, plant-breeders’ rights, domain names, copyright and related rights, the regulation on Customs 608/2013, as well as the very advanced project on the unitary patent and the unitary jurisdiction that accompanies it.

A number of documents anticipating the exit of the United Kingdom without agreement have already been published, although it should be noted that, so far, this is only a limited number of texts. The following principles can be deduced. 

As of March 30, 2019, in case of "no-deal Brexit", whether trademark or design,

  • any new application for a right in the United Kingdom will have to be filed nationally and will be examined in accordance with the provisions of the current UK law.
  • any European title (trademark or model) registered and published on that date will be converted in the United Kingdom into a "comparable" national title without any particular formality; it seems that for certification marks and collective marks, the UKIPO will ask the proprietors to provide a copy of the rules of use (and possibly an English translation); proprietors who do not want such a conversion could opt out,
  • For European applications filed with EUIPO, but not yet registered, their proprietors will have a period of nine months from the date of withdrawal (Exit Day) to file an application for national protection in the UK, noting that the filing date of the European application, priority date included, will be conserved.
  • European trademarks and designs will benefit from a grace period for renewal, effective for the UK, after Exit Day,
  • Unregistered European designs will be protected if they have been disclosed in the United Kingdom by Exit Day, by an equivalent nationally created right, which will be adopted as soon as possible.

The continuity in the United Kingdom of existing rights obtained or requested prior to Exit Day via the Madrid trademark system and the Hague system for designs, in a manner similar to European rights, is expected.

The United Kingdom will continue to apply exhaustion of rights at the level of the European Economic Area. As for the fight against counterfeiting, it will be necessary to confirm locally the requests for customs interventions that are filed at the European level.

The provisions outlined above remain conditional as a significant number of the texts are still under study by the UK Parliament.

In conclusion, we remind you that it is advisable to proceed by March 29th with the renewal of all EU trademarks or designs that can be renewed, without waiting for the renewal deadline. Indeed, it is possible to proceed with this renewal six months before the scheduled deadline. It is also important to prepare customs seizure documentation to be filed in the United Kingdom, to compensate for the absence of this territory in European applications filed before Exit Day. Lastly, it is important to undertake the revision of contracts, in particular contracts of coexistence, covering the territory of the Union and which have not anticipated the situation of Brexit, if this has not already been done.

Finally, it should be remembered that after Exit Day, in principle on March 29th, it will no longer be possible to be represented before EUIPO by British firms or attorneys that have no official representation in a Member State of the EU.

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