In this article, first published on Lexis®PSL, Toby Headdon, senior associate, considers the potential impact of Brexit upon unregistered IP rights and related rights.
How does the scope of an unregistered Community design differ from that of UK unregistered design right?
There are four key differences in scope between an unregistered Community design (UCD) and UK unregistered design right (UKD):
|Subject Matter||The appearance of the whole or a part of a product (covering both two- and three-dimensional aspects)||The shape or configuration (whether internal or external) of the whole or part of an article but not surface decoration|
|Term||Three years as from the date on which the design was first made available to the public within the Community||Usually ten years from the end of the calendar year in which articles made to the design are made available for sale or hire|
|Protection||Use of any design which does not produce on the informed user of a different overall impression||Copying the design so as to produce articles exactly or substantially to that design, or subsequent dealings with such articles|
What mechanism will be put in place in the UK to ensure that holders of unregistered Community designs are recognised as the holder of comparable rights in the UK, following Brexit?
Title IV of the rejected Withdrawal Agreement included provisions addressing intellectual property under which the UCD holder would automatically become the holder of an equivalent UK right. It seems likely that if a negotiated exit is achieved, any amended deal would replicate these provisions, particularly in light of the legislative arrangements the UK has already put in place in anticipation of a no-deal exit.
In that respect, The Designs and International Trade Marks (Amendment etc) (EU Exit) Regulations 2019, SI 2019/638 have been passed and will come into effect on ‘exit day’ (presently 31 October 2019). SI 2019/638, Sch 1, Pt 2 reflects the intention of the rejected Withdrawal Agreement by ensuring that existing UCDs will remain protected and enforceable in the UK following exit, by providing existing UCD holders with a right known as ‘the continuing unregistered Community design’. In addition, SI 2019/638, Sch 1, Pt 2 creates a new unregistered design right in UK law that mirrors the characteristics of the UCD, known as ‘the supplementary unregistered design’, but limited to have effect in the UK only.
Is it possible to opt out of the scheme?
There is no formal scheme to opt out, as these unregistered rights arise automatically and there is no registration requirement.
How will pending proceedings in relation to unregistered Community designs be dealt with?
UK courts are able to act as Community Design Courts in infringement cases involving UCD. For any such proceedings that are pending at exit, insofar as they relate to the UK, they will continue and remain unaffected by SI 2019/638. However, any actions taken, or remedies granted by the UK court would apply in respect only of the continuing unregistered Community design. As this is a UK right, the UK court would only be entitled to grant UK-wide remedies and, in particular, would not have jurisdiction to grant pan-European injunctions.
How will changes to the orphan works regime affect cultural institutions and what can they do to address those changes?
Title IV of the rejected Withdrawal Agreement included very little provision for copyright and nothing on orphan works. It therefore seems unlikely that orphan works would be addressed in any negotiated exit. Subject to that, with effect from exit day, regulation 23 of the Intellectual Property (Copyright and Related Rights) (Amendment) (EU Exit) Regulations 2019, SI 2019/605 removes the availability of certain permitted uses of orphan works by cultural institutions, such as public libraries, educational establishments, museums, archive and heritage institutions, and public service broadcasting organisations.
This means that these cultural institutions in the UK will no longer be able to rely on those permitted uses in order to copy orphan works for the purposes of digitisation, making them available (on their websites) in the European Economic Area (EEA), indexing, cataloguing, preservation or restoration. Such institutions may therefore need to introduce geo-blocking to reduce infringement risk.
It will nevertheless remain open to these institutions to make applications to the Intellectual Property Office for an orphan works licence under the UK’s Orphan Works Licensing Scheme. However, given that such licences apply to the UK (rather than the EEA) it will not fully ameliorate the loss of the permitted uses.
What will be the practical impact of changes to collective management?
The Collective Management of Copyright (EU Directive) Regulations 2016, SI 2016/221 effectively enable collecting societies, also known as collective rights management organisations (CMOs), to offer multi-territorial licences (ie, licences extending to more than one Member State’s territory within the EU) for online music. This is because EEA CMOs that offer multi-territorial licences of rights for online music must represent (on request) the catalogues of any EEA CMOs that do not offer such licences.
Subject to any agreement on collective management being reached as part of a negotiated exit (which seems unlikely), with effect from exit day, and pursuant to SI 2019/605, UK CMOs that offer multi-territorial licensing of online music rights will continue to be required to represent on request the catalogue of other CMOs (UK or EEA) for multi-territorial licensing purposes, provided one of those territories is the UK. However, UK CMOs will not be able to mandate EEA CMOs to provide such licences of their repertoire. These UK CMOs may therefore need to enter into separate contracts to continue operating in the way they do now.
What will happen to online portability?
Regulation (EU) 2017/1128 (the Portability Regulation)—which allows consumers to access their online services when temporarily in another Member State—was implemented in the UK by the Portability of Online Content Services Regulations 2018, SI 2018/249.
It seems unlikely that online portability would be specifically addressed in any negotiated exit. Additionally, with effect from exit day, SI 2019/605, reg 34 revokes SI 2018/249. As such, online content service providers will no longer be required to allow cross-border access for UK consumers.
Similarly, in a technical notice, ‘Copyright if there’s no Brexit deal’ published on 24 September 2018, the government confirmed that in the event of a no-deal exit, the Portability Regulation—which allows consumers to access their online services when temporarily in another Member State—will no longer apply to UK nationals in the EU.
Under what arrangement will the cross-border exchange of accessible copies made for the benefit of disabled people operate?
The Marrakesh Treaty is an international treaty enabling certain individuals and organisations to make copies of copyright protected works in accessible formats and to distribute them between treaty countries. This includes formats such as Braille, audio and large print for use by blind, visually impaired and print disabled people.
The EU is a party to the Marrakesh Treaty and has implemented its obligations thereunder in two instruments, namely EU Regulation 2017/1563 and Directive 2017/1564. EU Regulation 2017/1563 is presently directly applicable in the UK. Directive 2017/1564 has been implemented in the UK with Copyright and Related Rights (Marrakesh Treaty) (Amendment) Regulations 2018, SI 2018/995.
Upon exit, these two Regulations will be retained in UK law with changes being made to remove internal EU cross-border arrangements and other references to the EU. EU Member States will then become ‘third countries’ to the UK. However, as the UK is only a party to the Treaty through its membership of the EU, the UK government needs to ratify the Treaty in its own right. Until they do so, local laws of countries signed up to the Treaty (including the EU) may prevent cross-border exchange of accessible copies with the UK.
Once the UK has ratified the Treaty, those with visual impairment or authorised bodies will be able to continue to make, distribute, import or export accessible format copies of copyright with other treaty countries as they do currently.
How will the reciprocal arrangements for artist’s resale right be affected and what can artists and those operating in the UK art market do to prepare?
The Artist’s Resale Right Regulations 2006, SI 2006/346 (which implement Directive 2001/84/EC, the EU Artist’s Resale Right Directive) provide for a resale right in the UK.
Article 14ter of the Berne Convention provides for nationals of signatory countries to receive resale right protection if the author’s own country allows him/her to claim such protection and such protection is permitted in the country where it is claimed.
SI 2019/605, reg 29 amends SI 2006/346. Upon exit, references to the EEA will be replaced with UK, meaning that there is no longer automatic UK resale right protection for EEA nationals. However, UK nationals and those of other Berne Convention countries who recognise resale rights of UK nationals will continue to receive protection in accordance with the principle in Article 14ter of the Berne Convention.
What practical steps should the holders of unregistered rights be taking to prepare for exit?
For UCD, while there are no substantive steps required at this stage, there is some ongoing uncertainty in relation to the proposed ‘supplementary unregistered design’. Ostensibly, this new right should have plugged the territorial gap in UCD protection in the UK arising from exit. However, in practice it will not, as the government has now announced that it intends to apply the requirement that, for the right to subsist, the design has to be first marketed within the UK, following a controversial decision adopted by the German Supreme Court that a design must be first marketed within the EU in order for UCD to subsist at all.
This means that companies (regardless of where in the world they are based) will have to make a choice on where first to launch a new design. If launched in the UK, the new design would benefit from the supplementary unregistered design right but not UCD in the other 27 Member States and vice versa. It is also presently unclear whether a simultaneous launch in both the UK and EU would get around this difficulty.
Whether Brexit ends up being a negotiated exit (unless it is dealt with specifically) or a ‘no-deal’ scenario, databases which have been made by UK individuals, nationals or corporations will no longer benefit from the sui generis database right in the EEA.
The Political Declaration refers to the UK maintaining the ‘current high levels of protection, inter alia, of certain rights under copyright law, such as the sui generis right on databases’. The rejected Withdrawal Agreement mandated the continued protection of databases in the UK protected by a sui generis database right prior to the end of the transition period, both for EEA and UK nationals, and this is likely to be repeated in any new deal in a negotiated exit.
Made in preparation for a no-deal exit, SI 2019/605, reg 28 is intended to ensure that the UK sui generis database right remains available to UK individuals, nationals and corporations following exit.
There is, however, no obligation on other EEA states to provide (or continue to provide) sui generis database rights to UK nationals, residents and corporations. This means that after Brexit in the EEA it would be necessary for those entities to rely either on any copyright in the relevant database (which may be of limited application) and/or contractual arrangements to protect that database.
To the extent that there has been harmonisation of copyright law within the EU, it would form part of ‘retained EU law’ in the UK (which would also include much of the copyright case law of the European Court of Justice) on exit. As such, there is unlikely to be any substantive change to copyright law in the UK immediately thereafter.
There are some cross-border aspects of copyright that would be affected by an exit, many of which have been addressed in the questions above (orphan works, online portability and collective management organisations). In addition to these, UK-based satellite broadcasters that presently rely on the country-of-origin clearance rule for EEA broadcasts may have to obtain clearance in each of the remaining 27 EU Member State to continue with their activities in those locations.