How Scandinavian companies selling domestically might mitigate UPC risk - Zacco

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How Scandinavian companies selling domestically might mitigate UPC risk

By Anders Fredriksson, European Patent Litigator

This insight article was first published on 3rd January 2024 at the IAM website.

Scandinavian companies with primarily domestic marketing, production and sales may face new threats following the launch of the Unified Patent Court (UPC). These companies face an increased risk from organisations that they do not consider competitors – often because they are not active in the same markets – but that may still decide to take action against their patents. It is still too early to tell how the UPC will affect non-EU countries that are part of the EPO (eg, Norway), but we should have a better understanding of the implications once the court starts issuing decisions.

There are many benefits to pursuing a unitary patent and companies should not be put off from considering them, but it is crucial to conduct due diligence on the benefits versus the risks and see what is right for each individual organisation. For companies in Scandinavia, the unitary patent and UPC represent an amazing opportunity to pursue and enforce rights in new markets abroad, but as with any expansion, these opportunities remain conditional and depend on the level of potential risk versus reward. In some cases, filing a national patent application may be a better option. Since only some of the markets may be relevant for future unitary patent holders, there may be good reason to review the internal processes for handling third-party patent risks. It could be time for Scandinavian companies to consult a representative with experience in negotiating and drafting settlement and licensing agreements, or even consider creating such a role in-house.

A good starting point would probably be to seek advice or guidance from a qualified patent attorney who will be able to identify potential threats to your international portfolio that emerge from the UPC. They should also be able to conduct full risk assessments if necessary.

Companies that sell to their home markets should perhaps consider expanding their freedom-to-operate efforts in order to identify potential threats to their products. For example, many might want to act on competitors’ incorrectly granted European patents – through filing oppositions – to mitigate the risk of these later becoming a threat to domestic markets.

For those that are aware of competitors already infringing on their intellectual property in other countries and territories, it might be a good time to start exploring the possibility of licensing relevant rights to those companies as a potential new revenue stream. This is particularly true for jurisdictions where an organisation has limited opportunity or appetite to establish themselves directly.

For companies with existing agreements, now is the time to discuss who will bear the risk of future patent infringement. It is often prudent to revisit and reassess existing agreements and the scope of protection within applications to ensure that they remain fit for purpose.

Finally, and on a more general level, best practice means documenting everything. Claiming that your product or service has been on the market longer than anyone else’s will be worthless if you are unable to back up the claim with documented evidence.

The UPC is here – if you have not started considering its implications on your domestic market, then now is definitely the time. A qualified patent attorney should be able to help you set up a process to manage all of the above.

Anders Fredriksson

Anders Fredriksson

Partner, Team Manager
European Patent Litigator, European Patent Attorney, Swedish Patent Attorney
Copenhagen