European IP Rights and Brexit

European IP Rights and Brexit

With U.K. Prime Minister David Cameron’s election back in 2015 came his announcement that the U.K. would hold an “in/out” referendum to decide whether the nation would remain part of the European Union. The country was strongly divided, with 52% voting for a departure and 48% voting against—a startlingly close result. While the vote was hailed by some as a welcome change to the political landscape, some in other arenas have expressed their reservations as to what effects the new dynamic will have on intellectual property rights within the EU and the U.K.

The conceptual foundation of the EU is ‘harmonization,’ meaning that participating governments have historically sought to create common legal standards across the internal European market, governed in turn by the European Parliament and EU court system. Traditionally, applicants seeking IP protections have filed their applications in the EU Intellectual Property Office. With the UK leaving, questions remain as to the future of UK trademark holders’ rights as their marks have traditionally been registered within the EU.

Depending on exactly how the U.K. exits, though, the results may differ. What happens in the case of a ‘no deal’ Brexit where the U.K. exits the EU without any formal arrangement outlining a future relationship between the entities? Some English businesses both large and small have registered within the EU as opposed to simply in their own country, so will the protection remain now that ties have been severed?

The current position of the UK government and the European parliament is to grant rightsholders an equivalent mark valid only within the U.K., but none have spoken as to the extent to which existing protection will be reduced or changed at all within mainland Europe. A result as such means EU entities could register marks within the Union which were previously prohibited, inevitably leading to valid U.K. marks standing alongside their EU counterparts where either may be attacked, assigned, or licensed. Rightsowners have been given the option to opt-out of the new assignment altogether.

Current prime minster, Theresa May (set to resign June 7), has proposed a the deal in which existing EU trademarks would be converted into U.K. marks, but her solution has led many to question how the landscape will shift regarding policing, enforcing, and administering rights for respective brands—this is largely due to the fact that each respective U.K. and corresponding EU mark will exist independently of each other. Legislators have thus far tried to retain the current scheme as long as possible prior to the October 31 deadline, but it is still unclear whether there will actually be a Brexit until into 2020.

The current vehicle for exiting the European Union is Article 50 of the Treaty on the European Union (TEU), the same article invoked with the 2016 referendum. With many voters on both sides of the issue expressing disappointment with how Brexit has turned out so far, several EU governments have begun discussions about revoking article 50 to cease or at minimum hamper the process. Many governments’ positions regarding revoking the article remain strongly in favor of leaving it in place, but uncertainty nonetheless remains. What can be expected is further significant delays and an uncertain future for English mark-holders within the Union.

©2019 Buche & Associates, P.C., Article by Mike Jones, J.D. candidate 2020.

Buche & Associates, P.C. is a firm with offices in Texas and Southern California that specializes in intellectual property and technology laws.