New IP rights for the UK: the implications of Brexit on UK intellectual property rights

Our intellectual property (IP) disputes expert Stephen Welfare looks at changes to UK IP rights after Brexit, and the implications these changes have for European IP rights-holders.

The UK left the EU on 31 January 2020 and moved into a 12-month transition period during which existing laws applied.

The European Union (Withdrawal) Act 2018 amended by European Union (Withdrawal Agreement) 2020 dedicated the IP completion day as 31 December 2020.

But what does that mean?

It means there were significant changes to IP law affecting the UK from IP completion day. The UK lost:

• EU Trademarks (EUTM)
• Community Registered Designs (CRD)
• Unregistered Community Design Right (UCDR).

New UK IP rights, and implications for EU IP rights-holders

Owners of EUTMs CRDs automatically became holders of comparable IP rights in the UK on IP completion day.

Comparable trademarks and registered designs have the same renewal dates and take the same filing or priority dates as the corresponding EU rights. So strictly not new rights but comparable rights to the existing EU rights otherwise lost by reason of Brexit.

Holders of UCDR arising before the end of the transition period have been afforded an equivalent UK right with the same term of protection as the EU right. For unregistered design rights coming into existence after IP completion day the UK Government has created a supplementary right (SUD). This is a ‘new’ right since outside of the EU regime such a right did not exist in the UK.

What is the effect of cancellation of an EU right?

If, as at the IP completion date you had an EUTM or CRD declared invalid, or revoked in proceedings, then the corresponding comparable UK right will also be declared invalid or revoked as of the same date. The creation of the comparable UK right by operation of law does not save the invalid or revoked existing EU right.

Effect of Reputation

A comparable UK trademark right arising from an EUTM will enjoy the benefit of any reputation acquired by the corresponding EUTM, but only until IP completion day. From I January 2021 the UK mark’s reputation is based only on use in the UK. So, trading under a EUTM will continue to be beneficial to that mark in the EU, but you will need to demonstrate use of the new UK comparable trademark in the UK to build up a reputation here.

This all covers the effect of Brexit on EU rights previously operating within the UK, but what is the effect of Brexit on UK rights?

Effect of Brexit on UK rights

No direct impact on existing UK IP rights; UK trademarks – UK design right – Copyright - all unchanged, so too International Agreements.

It is, of course, in respect of EU IP rights within the UK that Brexit has had profound effect. To comply with the Withdrawal Agreement, the Government had to legislate to protect the holders of such rights (EUTMs, CRDs, UCDRs and Rights in Databases). From IP completion day, the parts of those rights that were enforceable in the UK have been preserved under new domestic provision.

Brexit and trademarks

A EUTM is only enforceable in EU member states. The UK’s departure means that owners of EUTMs lost that part which had effect in the UK. To protect UK rights, the Withdrawal Agreement sets out the following principles:

• Comparable trademarks. Holders of EUTMs registered before 31 December 2020 automatically become owners of comparable trademarks in the UK. There is no need for Application or Examination.
• Cancellation of EUTM. If after the transition period an EUTM is declared invalid or revoked, in proceedings started before the IP completion date, the corresponding comparable mark is also cancelled.
• Renewal of comparable mark. A comparable mark has the same renewable date as the corresponding EUTM.
• No initial fees. The UK comparable right is granted and registered free of charge. Renewal fees will be payable, however, for both the EUTM and the UK comparable mark.

Revocation and infringement proceedings

A Defendant in trademark infringement proceedings may require proof that the Claimant has put its mark to genuine use during the 5 years leading up to the filing date of the claim. Why? Because otherwise it may no longer be valid (the use it or lose it rule).

In revocation proceedings the Applicant must prove non-use during a 5-year period. If he can't then the trademark remains valid.

Use of the corresponding EUTM before the IP completion day counts as genuine use of a UK comparable mark, for either purpose, even if in 1 or more of the 27 European Union states and not the UK. But, after IP completion day it’s use within the UK that counts.

This similarly applies where proof is required of reputation of a trademark.

Brexit and design law

Registered Designs share the same requirements for registration in both the UK and EU.

A protected design can be the whole or a part of a product resulting from the features of, in particular, the lines, contours, colours, shapes, texture or materials of the product or its ornamentation, Section 1(2) RDA.

Note – Unlike copyright, there is no requirement for the design to have any artistic merit.

But the design must be new. If it differs from what already exists (the state of the art) in material details only, it will not be capable of registration.

The design must have individual character, meaning that it must give a different overall impression from earlier designs to the informed user (who need not be an expert) but someone familiar with such designs.

Unregistered Design Right differs from the UK and the EU. The UK design right protects those features of the design comprising the shape, or configuration of the whole or part of any article (Section 213(2) CDPA) that are original (meaning not common place). UKDR lasts for the lesser of:

• 15 years from the end of the calendar year when the design was first recorded in a design document or (if earlier) from when an article was first made to the design.
• 10 years from the end of the year when articles made to the design were first made available for sale.

The CUDR differs in that it also provides protection for the appearance of an article resulting from the lines, colours, texture and/or ornamentation as per registered designs. So much wider than UK Design Right.

But the right only lasts for 3 years from when the article made to the design was first made available to the public.

Protection of both UK & EU UDR is restricted to copying.

As with EUTMs, the UCDR ceased to be available to the UK after 31 December 2020. Those designs that were protected in the UK as a UCDR before January 2021 are now protected as a UK continuing unregistered design (CUD). They will continue to be protected in the UK for the remainder of the three-year term attached to it.
The fact that a corresponding UCDR was established before 1 January 2021 through first disclosure in the EU but outside of the UK does not affect the validity of the continuing unregistered design.

So, from 1 January 2021 UCDR is only available to designs first marketed in the EU, and will not apply to the UK, so the UK Government has created a comparable right; the Supplementary Unregistered Design Right (SUDs) as mentioned above.
This right ensures the full range of design protection is available in the UK.
The SUD mirrors the UCDR and protects the 2D and 3D appearance of whole or part of a product for a period of three years.

The protection it provides does not extend to the EU.

In summary, those businesses which owned a EUTM or registered design as at 31 December 2020 now own a comparable right in the UK – automatically. UK unregistered rights are restricted to people resident in the UK or a qualifying country (as defined in The Design Right (Reciprocal Protection) (No. 2) Order 1989) and that doesn’t include the EU.

The test for designers and manufacturers will be to ensure they maintain their EU and UK rights and so ensure continued protection across the UK and all EU member states.