Herbert Smith Freehills' Brexit Legal Guide updated - comparison of IP and pharma provisions in the draft Withdrawal Agreement versus the No Deal provisions promised by the UK Government

See the updated IP section of the revised Herbert Smith Freehills Brexit Legal Guide which reviews the IP and pharma elements of the draft Withdrawal Agreement endorsed by the EU Council on 25 November 2018 and the no deal provisions as set out by the UK Government in its technical notices and draft SIs issued towards the end of last year.

Summary

• IP rights which are designated as applying across the EU (EU trade marks, Community plant variety rights, Community registered designs and Community unregistered designs) and those, qualification for which involves activity within the EU (such as sui generis database rights), are all at risk of termination in relation to the territory of the UK once the definition 'EU' no longer includes the UK.
• However, the Withdrawal Agreement endorsed by the EU Council on 25 November 2018 (the Draft WA) provides for replacement IP rights to be provided by the UK and for coordination of information between the MHRA and EMA in relation to marketing authorisations.
• If there is no deal, the UK Government's own no deal technical notices state that registered rights will be replaced with equivalent rights in the UK and draft statutory instruments have been published confirming this.
• Should the UK leave the EU with no deal, ie not agree the Draft WA or any other arrangements, the SIs will provide amendments to UK IP law to take account of this, just as they would at the end of the transition period if there were no further agreement in the interim.
• The Draft WA does not make provision for patents or the UPC, nor for pharmaceutical regulatory issues. These latter were covered in some detail however in a series of no deal technical notices issued by the Government in August 2018 on what the implications of a no deal Brexit would be.

No deal

No deal arrangements for IP rights effectively mirror the provisions set out in the Draft WA in any case, as they provide for replacement of registered rights and the recognition of unregistered rights that are existing in the UK at the date the UK leaves the EU. The main exception is for Geographical Indications. These will no longer be recognised in the UK if originating from the EU. The UK would set up its own geographical indication protection system. In either a no deal or Draft WA situation, UK originating Geographical Indications would not apply in the EU post-Brexit. Similarly the provision made in the Draft WA for the exchange of information between the EMA and the MHRA would not be agreed and would need to be negotiated separately.

The UK Government has said that, in relation to exhaustion, if there is no deal "the UK looks forward to exploring arrangements on IP cooperation that will provide mutual benefits to UK and EU rights holders and we are ready to discuss issues the EU wishes to raise in the negotiations on our future relationship, including exhaustion of IP rights"; whereas the Draft WA provides that IP rights that were exhausted both in the EU and in the UK before the end of the transition period under the conditions provided for by EU law shall remain exhausted both in the EU and in the UK post-transition. If there was no deal, this would mean that whilst exhaustion within the EU (as it is then constituted) will continue, the UK courts would be able to exercise local or international exhaustion as they see fit. Historically the UK has taken an international exhaustion approach pre-EU membership.

Read more in the Herbert Smith Freehills Brexit Legal Guide - Intellectual Property and Brexit (including pharmaceutical sector provisions)

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