UPC Legal Compass: Can Actions Commenced Before 1 June 2023 Block a Withdrawal of the Opt-Out?

Recently, the UPC Court of Appeal had the possibility to decide the important question of whether national proceedings that were commenced prior to or that were even concluded before 1 June 2023, can block a withdrawal of an opt out. The Local Division Helsinki had held at the end of 2023 that proceedings that were commenced before 1 June 2023 block a withdrawal of an opt-out. This decision has now been overturned by the UPC Court of Appeal.

Understanding Article 83 UPCA

The primary objective of Article 83 of the Unified Patent Court Agreement (UPCA) is not to prevent parallel litigation or contradictory decisions. Instead, it aims to provide a transitional regime that allows patent proprietors to opt out from the jurisdiction of the UPC initially and later reverse that decision as desired. This mechanism ensures that third party rights and legal certainty are not compromised by the patent proprietor's choices while giving the patent proprietor the ability to either test the UPC system or adopt a “wait and see” approach.

Definition of "Actions" Under Article 83 UPCA

The starting point of the Court of Appeal was the Vienna Convention and the principle that a term should generally have the same meaning throughout the provision. Therefore, the term “action” in paragraph (4) cannot have a different meaning than in the other paragraphs of Art. 83 UPCA.

• Paragraphs (1) and (2): These paragraphs refer to actions commenced after the transitional period began. Actions that commenced prior to the transitional period or that were even concluded before 1 June 2023 are not addressed by Art. 83 UPCA
• Paragraph (3): This paragraph only encompasses actions initiated after the transitional period, as the UPC did not exist before this time.
• Paragraph (4): Any reference to "actions" in this paragraph pertains to those mentioned in paragraphs (1) to (3), meaning only actions commenced after the transitional period began.

Blocking the Withdrawal of the Opt-Out

Against this background, only actions commenced after 1 June 2023 can block a withdrawal of an opt-out. Article 83 UPCA aims to prevent abuse of the system by patent owners. Before 1 June 2023, there could not be any abuse, as the system did not exist. Additionally, Article 83 UPCA is not intended to limit the possibility of parallel litigation, as it explicitly allows for parallel cases before the national courts and the UPC.

We hope this clarifies the implications of actions commenced prior to 1 June 2023 on the withdrawal of the opt-out.

Should you have any further questions or require assistance, please do not hesitate to contact us.