For the very first time, after decades of negotiations and many stops and starts along the way, right holders in Europe will get the option to add Unitary Patents to their patent portfolios and also the addition of a single patent litigation system covering the major part of the European market – the UPC.

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The Unitary Patent is an independent IP right, which exists in addition to national and European patents and has uniform effect in all participating countries - validation in each country as for European patents is not required. 

The procedure for grant is identical to that for the European patents in the European Patent Office (EPO).

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Starting in the ‘sunrise period’ and continuing for the seven-year transitional period that begins when the UPC enters into force, a European patent can be permanently opted out from the jurisdiction of the UPC either as an application or a granted patent. The effect of opt-out is to give the national courts exclusive jurisdiction for each respective national validation of a European patent until expiry, just as it would have had without the UPC.

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The UPC will consist of a Court of First Instance and a Court of Appeal (which includes a Full Court of Appeal for exceptional cases). The Court of First Instance will have a central division and numerous regional and local divisions located across the participating countries. While the central division will be split between locations, every participating country may set up a local division or – together with one or more other participating countries – a regional division.

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According to the current proposal for the fee schedule there are two kinds of fees for using the UPC:

• fixed fees, which are payable for initiating an action (infringement, declaration of non-infringement, revocation), applications for search and seizure of evidence, leave to appeal and other procedural steps 

and, additionally, for infringement actions and declarations of non-infringement:

• a value-based fee.

Natural persons and legal entities are entitled to bring an action in all proceedings before the UPC. The patent proprietor of a Unitary Patent or a (non opted-out) European patent as well as the exclusive licensee have the standing to bring infringement actions, provided the licensee informs the proprietor accordingly. A non-exclusive licensee is only entitled to bring an action if the licence agreement expressly permits it.

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Infringement and revocation proceedings on the merits before the Court of First Instance consist of a written, an interim, and an oral procedure.

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As a basic principle, the burden of the proof of facts is on the party relying on those facts. The burden of proof is reversed however, if a contested product is identical to products derived by the process in suit for obtaining a new product.

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A finding of infringement in the UPC may lead to an award of damages or an account of profits, for which a calculation must take all appropriate aspects into account as well as possible moral prejudice.

The UPC does not however provide for punitive damages. Damages awarded on a licence analogy will only be awarded “in appropriate cases”.

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Faced with the new system, do you leave your European patents within the jurisdiction of the UPC system, or instead opt them out from it? Considering whether to convert some or all newly European patents into Unitary Patents is also important. There are a number of factors to consider when making these decisions that impact on your business.

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