Understanding the referendum on the Unified Patent Court

Stephen Lowry delves into details of the upcoming referendum on Ireland’s proposed participation in the Unified Patent Court 

In the wake of referenda on family and care, voters were due to decide on another important constitutional referendum on 7 June.

Although the vote has since been postponed by the Government, voters will be asked whether they approve of Ireland’s proposed participation in the Unified Patent Court (UPC). 

First mooted in 2013 with the signing of the Unified Patent Court Agreement (UPCA), the UPC is a new international court with exclusive competence to grant ‘unitary patents’ – a new form of patent that gives uniform protection across all participating European countries on a one-stop-shop basis. 

Currently within its jurisdiction are 17 EU Member States, though this number is expected to increase over the coming months as more countries move to ratify the UPCA. 

Before Ireland can join the UPC, an amendment to the Constitution is needed as doing so will involve a transfer of jurisdiction in patent litigation from the Irish courts to an international court. 

So, what’s to be gained from joining the UPC? 

1. Reduced cost and administrative burden 

At present, there is no single European patent valid in all Member States. Instead, individual patents must be held in each country where the patent is to be applied. 
Applications can be made to either the national patent office in each country or as a single application to the European Patent Office (EPO).  

Rather than acting as a one-stop-shop for patent litigation, however, the EPO can essentially only grant a bundle of national patents for the countries designated by the patent application. 

If subject to challenge, these patents must then be litigated separately in the national courts of each country in which they are granted – thereby potentially giving rise to legal costs across a number of jurisdictions as well as risking the prospect of different legal outcomes. 

By contrast, the UPC will instead allow applicants to apply for a single patent, which will be valid across multiple Member States, upon which it will be the sole arbiter. 

2. Boost to FDI and export activity

If the referendum is carried, the Government has signalled its intention to establish a local division of the UPC in Ireland. Doing so would mean Ireland would be the only common law, native English-speaking jurisdiction with a UPC. 

Coupled with Ireland’s already attractive tax regime for research and development, the establishment of a local UPC would arguably further boost the State’s profile as a location of choice for inward investment. 

Moreover, access to a streamlined European patent protection system would likely act as a useful incentive for Irish businesses to expand exports to a greater number of countries previously out of reach because of the costs of securing multi-jurisdictional patent protection. 

3. Impact on the domestic economy 

Estimates provided to the Joint Oireachtas Committee on Enterprise, Trade and Employment indicate that the establishment of a local division of the UPC in Ireland would contribute at least €415 million, or 0.13 percent in GDP growth, per annum by way of increased patent development activity. 

Consequently, the establishment of the UPC can also be expected to generate increased expenditure and employment in legal, professional and other related technical advisory services. 

Whether the referendum will be carried  will, however, ultimately depend on the Government’s ability to engage the public on the merits of adopting a streamlined patent court – a difficult task on such a niche subject.