Brexit: Strategic Considerations for the European Union and Britain
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RESTRUCTURING INTELLECTUAL PROPERTY JURISDICTION POST- BREXIT: STRATEGIC CONSIDERATIONS FOR THE EUROPEAN UNION AND BRITAIN Alexandra George* INTRODUCTION ........................................................................ 132 I. TERMINOLOGY AND ASSESSING OUTCOMES: A HARD OR SOFT BREXIT? ................................................................................... 138 II. GENERAL CONSIDERATIONS AFFECTING INTELLECTUAL PROPERTY LAW-MAKING IN EUROPE ....................................... 140 A. The Scope of ‘Intellectual Property’ ................................ 141 B. Territorial Rights ........................................................... 142 C. The WTO and TRIPS ..................................................... 142 D. TRIPS Plus .................................................................... 143 E. Jurisdictional Complexity .............................................. 144 III. BREXIT’S EFFECT ON INTELLECTUAL PROPERTY JURISDICTION IN THE EUROPEAN UNION ................................ 145 A. The Development of the European Union ...................... 146 B. Legislative Jurisdiction over Intellectual Property Law ..................................................................................... 147 C. Administration & Determination of Intellectual Property Matters ................................................................................ 149 * BA(Hons), LLB(Hons), LLM(Hons), MJur(Hons) Sydney; GDLP College of Law; PGCAP London; PhD ANU; FHEA. The author is Director of the LL.M. (Innovation Law) and LL.M. (Media and Technology Law) in the Faculty of Law, University of New South Wales, Australia. Dr. George previously worked at universities in the United Kingdom and Italy. Grateful thanks are due to Deborah Healey, Donald Kenyon AM, Patrick Lynch, Ralph Melano, Leon Trakman, and Michael Williams for their input and helpful feedback, which improved this article. Any omissions or errors remain the responsibility of the author. © Alexandra George, 2017. The author has not granted rights to re- print this article under a Creative Commons Attribution-Non-Commercial li- cense. Please contact the author directly for reprint permission. 132 BROOK. J. INT’L L. [Vol. 43:1 1. General Courts ............................................................ 150 2. EUIPO—Trademarks and Designs ............................. 151 3. EPO & UPC—Patents ................................................. 155 4. National Registry Offices and Courts ......................... 165 IV. RESTRUCTURING INTELLECTUAL PROPERTY JURISDICTIONS: POST-BREXIT OPTIONS ............................................................ 166 A. The Norway Option ........................................................ 168 B. The Swiss Approach ....................................................... 170 C. The Treaty Approach (“WTO Approach” or “Canada Approach”) .......................................................................... 172 V. LOOKING FORWARD ............................................................ 174 A. Quarantining Brexit’s Intellectual Property Negotiations ........................................................................ 175 B. Laying EU Foundations for Global Intellectual Property Harmonization? .................................................................. 177 C. Precedents for Harmonization via Supra-Territorial Registries ............................................................................. 179 D. An Alternative to Top-Down Intellectual Property Harmonization Projects? .................................................... 181 E. Brexit as a Trigger for Global Intellectual Property Harmonization? .................................................................. 186 CONCLUSION ........................................................................... 188 INTRODUCTION n Thursday, June 23, 2016, Britain1 went to the polls, in O which a 52 percent majority voted for “Brexit,” the collo- quial term for Britain’s exit from the European Union. Within a year, British Prime Minister Theresa May invoked Art. 50 of the 1. For the purposes of this article, the names “Britain” and the “United Kingdom” are used interchangeably to refer to the jurisdiction officially known as the United Kingdom of Great Britain and Northern Ireland. 2017] Intellectual Property Post-Brexit 133 Treaty of Lisbon,2 formally commencing the process of with- drawing Britain from the European Union.3 By April 2019, the formal separation is supposed to be complete.4 The referendum result and subsequent events have sparked fears about what will happen to intellectual property investments in Britain and the European Union in the coming years. This concern is justi- fied, as post-Brexit arrangements between the European Union 2. Treaty of Lisbon amending the Treaty on European Union and the Treaty establishing the European Community, 2007 O.J. C 306/1 [hereinafter Treaty of Lisbon]. Article 50 of the Treaty of Lisbon states: 1. Any Member State may decide to withdraw from the Union in accordance with its own constitutional requirements. 2. A Member State which decides to withdraw shall notify the European Council of its intention. In the light of the guide- lines provided by the European Council, the Union shall ne- gotiate and conclude an agreement with that State, setting out the arrangements for its withdrawal, taking account of the framework for its future relationship with the Union. That agreement shall be negotiated in accordance with Arti- cle 218(3) of the Treaty on the Functioning of the European Union. It shall be concluded on behalf of the Union by the Council, acting by a qualified majority, after obtaining the consent of the European Parliament. Id. 3. The European Union (Notification of Withdrawal) Bill became law after passing through Parliament on March 13, 2017. European Union (Notification of Withdrawal) Act 2017, c. 9 (Eng.), http://www.legisla- tion.gov.uk/ukpga/2017/9/contents/enacted/data.htm. On March 29, 2017, a letter from Prime Minister May announcing Britain’s intention to withdraw from the EU was delivered in accordance with the Treaty of Lisbon and trig- gered Article 50. Theresa May, British Prime Minister, Letter to Donald Tusk (Mar. 29, 2017), http://uk.reuters.com/article/uk-britain-eu-letter-text/text-of- pm-mays-letter-to-eus-tusk-triggering-brexit-process-idUKKBN1701JH. 4. Treaty of Lisbon, supra note 2, art. 50. Article 50 states that: The Treaties shall cease to apply to the State in question from the date of entry into force of the withdrawal agreement or, failing that, two years after the notification referred to in par- agraph 2, unless the European Council, in agreement with the Member State concerned, unanimously decides to extend this period. Id. 134 BROOK. J. INT’L L. [Vol. 43:1 and Britain, with respect to intellectual property laws, have yet to be determined. Having developed the world’s largest “single market,” the Eu- ropean Union, which is comprised of twenty-eight member na- tions, is currently one of the world’s largest economies5 and a global intellectual property hub. Recent reports indicate that products of intellectual property intensive industries account for 88 percent of EU imports and 90 percent of EU exports.6 Mean- while, intellectual property intensive sectors account for around 26 percent of EU employment and 39 percent, or EUR 4.7 tril- lion, of EU gross domestic product (GDP) per annum.7 Within Britain, intellectual property intensive industries amount to 37.4 percent of GDP and provide 26.7 percent of employment.8 Using a variety of indicators, including intellectual property sta- tistics, to rank nations according to global innovation trends, the 2016 Global Innovation Index reported that European countries dominated the ‘top ten’ list of the world’s most innovative na- tions,9 with Britain ranking third.10 European intellectual prop- erty offices account for a sizable proportion of the world’s filing concentrations for patents, trademarks, and designs,11 while a 5. EUROSTAT, THE EU IN THE WORLD 79 (2016), http://ec.europa.eu/euro- stat/documents/3217494/7589036/KS-EX-16-001-EN-N.pdf/bcacb30c-0be9- 4c2e-a06d-4b1daead493e. This statistical report states that the twenty-eight member European Union, “accounted for a 23.8% share of the world’s GDP” in 2014, which was the largest single share ahead of the USA at 22.2%. Id. It states that the European Union “was the world’s largest exporter and importer of services in 2014,” id. at 96, and comprised 6.9% of the world’s population in 2015, id. at 21, fig. 1.1. 6. OFF. FOR HARMONIZATION IN THE INTERNAL MKT., INTELLECTUAL PROPERTY RIGHTS INTENSIVE INDUSTRIES: CONTRIBUTION TO ECONOMIC PERFORMANCE AND EMPLOYMENT IN THE EUROPEAN UNION 63 (2013), http://ec.europa.eu/internal_market/intellectual-property/docs/joint-report- epo-ohim-final-version_en.pdf. 7. Id. at 6. 8. Id. at 83, fig. 14. 9. THE GLOBAL INNOVATION INDEX 2016: WINNING WITH GLOBAL INNOVATION 14 (Soumitra Dutta, Bruno Lanvin, & Sacha Wunsch-Vincent eds., 2016), http://www.wipo.int/edocs/pubdocs/en/wipo_pub_gii_2016.pdf. In 2016, Euro- pean nations accounted for eight of the top ten most innovative nations. Id. The ranking was as follows: Switzerland, Sweden, the United Kingdom, the United States, Finland, Singapore, Iceland, Denmark, the Netherlands, and Germany. Id. 10. Id. 11. WORLD INTELL. PROP. ORG., WIPO IP FACTS AND FIGURES 6 (2015), www.wipo.int/edocs/pubdocs/en/wipo_pub_943_2015.pdf. 2017] Intellectual Property Post-Brexit 135 majority of the top fifty applicants