BREXIT – Impact on Design Registrations and UDR

On 23 June 2016, the UK voted to leave the European Union (“Brexit”). The UK is expected to enter into a negotiation period during which the terms of withdrawal from the EU will be settled. The actual exit date is not yet known, but the existence of a two year notice period for withdrawal from the EU suggests that the UK will not exit until 2018 at the earliest.

We have put together the following to address some of the most frequently asked questions. We welcome any questions you may have at brexit@gje.com.

How will Brexit affect Design Protection in the UK?

Currently, there are two systems for obtaining design registrations which cover the UK operating in parallel: British registered designs, which are administered by the UKIPO, and European Community (EC) registered designs (also known as Registered Community Designs – “RCDs”), which are administered by the EUIPO, formerly known as OHIM. Brexit will have no impact on British registered designs.

However, once the UK formally leaves the EU, the strong likelihood is that EC registered designs will cease to have effect in the UK. This means that from that date onward, the only way to obtain registered design protection covering the UK will be by way of a British design registration.

It is worth noting that there are also currently two systems of unregistered design right (“UDR”) protection which cover the UK: British UDR, and EC UDR. Both forms of UDR arise automatically upon the creation of qualifying designs provided they meet certain criteria. However the scope of protection afforded by each system is different and it is fair to say that of EC UDR is more wide-ranging than that of British UDR, albeit shorter in term. Again, once the UK formally leaves the EU, it is likely that the EC UDR will no longer be effective in the UK.

What will happen to existing EC registered designs? Will rights in the UK be lost?

Whilst nothing is certain as yet, the strong expectation is that a conversion process will be put in place enabling holders of EC registered designs to re-register those designs in the UK. In other words, we believe it will be possible to obtain British registered designs having exactly the same relevant dates as existing EC registered designs so that no UK rights are lost in respect of design registrations.

There has been no announcement made yet as to what form this mechanism will take, and in particular whether it will be automatic or might require active steps on the part of the design owner. We will provide an update as soon as details are available. At GJE, we will of course be making every effort to navigate this process for our clients as painlessly and cost-efficiently as possible.

How will UK companies be able to protect their designs in the EU?

Brexit will not prevent UK companies (or natural persons) from applying for and owning EC design registrations – the system does not require the holder of the design registration to be from the EU. Indeed a very large proportion of existing EC design registrations are held by companies from outside the EU, such as the USA and Japan. As such, UK companies will still be able to cost-effectively protect their designs across the remaining Member States of the EU through a single EC design registration.

Unfortunately, it is less clear whether UK companies will still be able to benefit from EC UDR protection in the EU states: it is likely this will depend on the particular circumstances and hence this will need to be assessed on a case by case basis.

Will GJE still be able to continue to file EC registered designs?

Yes. Until the UK leaves the EU, there is no change at all in our EUIPO rights of representation and GJE will be able to file EC design registrations as usual. After the UK leaves the EU, GJE will be in a position to continue to file EC design registrations through our European office, currently located in Munich. In other words, whatever the outcome of the Brexit negotiations, GJE will be able to act for you without interruption.

Does any immediate action need to be taken to secure UK rights for existing designs?

No. As set out above, we expect a re-registration procedure to be put in place through which existing EC design registrations can be made effective in the UK at the appropriate time in the future. As such, there is no need to take any action as regards existing EC design registrations and we would recommend waiting to find out what the conversion process will involve before doing anything.

In limited circumstances it may be worth considering filing a British design application – for instance, if you have an existing EC design registration and are still within six months from the earliest priority date, a British design registration could be filed for now which would benefit from all the same dates as the EC design registration. This would avoid any uncertainty associated with the status of the EC design registration in the UK and may be advantageous for example if you plan to launch UK infringement proceedings in the near future.

However in the vast majority of situations we believe the best approach is “wait and see”.

What about for new designs?

For the same reason, there is no need to immediately change your designs filing strategy in Europe. We would recommend proceeding as normal, and continuing to file EC design registrations, with the intention of re-registering these in the UK as and when this proves necessary.

In the long term, it will most likely be necessary to file both EC and British design registrations in parallel to obtain the same territorial coverage currently provided by an EC design registration. Applying this new filing strategy now to all new designs to be filed going forward would avoid any uncertainty as to your UK rights, and would avoid the need for re-registration in the future. However, at this early stage since we do not yet know what the costs involved in the re-registration process will be (if any), that could prove to be the more expensive strategy overall.