Introduction

On 31 January 2020 the United Kingdom left the European Union under the terms of the now ratified UK-EU Withdrawal Agreement.

The UK Intellectual Property Office (UKIPO) has published a short, reassuring update about what happens to IP rights during the transition period, which ends on 31 December 2020.

The UKIPO has assured that the transition period will be business as usual, the UK IP system continuing without disruption or change. The UKIPO will convert almost 1.4 million EU trademarks to UK trademarks at the end of the transition period. These will come into effect on 1 January 2021.

Key points for franchisors

Key points for franchisors to note are as follows:

  • Franchisors which operate in the United Kingdom and have a registered EU trademark but no UK trademark need not do anything during the transition period. Instead, they will automatically receive a UK trademark on 1 January 2021 and the EU trademark will continue to be valid.
  • Franchisors which operate in the United Kingdom but have a pending application for an EU trademark – in process on 31 December 2020 – have nine months to apply for the same protection in the United Kingdom. There will be no automatic conversion of that EU trademark, once registered, into a UK trademark. Therefore, action will be required.
  • For franchisors whose only operation is in the United Kingdom but which have an EU trademark, the EU trademark will become susceptible to challenge for non-use after 1 January 2021 if the franchisor does not sell or market its products and services in the European Union. This is a good reason to look at expansion plans.
  • Franchisors whose IP rights have been exhausted (ie, an IP-protected good is placed on the market anywhere in the European Economic Area, with the franchisor's permission, so that the franchisor cannot prevent the movement of those goods within the European Economic Area) in the European Union and the United Kingdom before the end of the transition period will remain exhausted in both areas.
  • Finally, an important point on managing a trademark portfolio: from 1 January 2021, it will be necessary to have a UK-registered representative to manage UK trademarks and an EU-registered representative to manage EU trademarks.

If a franchisor with UK trademarks and EU trademarks currently uses a UK-only representative, from 1 January 2021 that representative's account with the EU Intellectual Property Office will be frozen and they will not be able to represent the franchisor in respect of the EU trademark. The same is true in respect of EU-registered representatives with no presence in the United Kingdom. One solution is to have different representatives or have the principal representative appoint a sub-representative in the relevant market. However, the most practical solution is to have a representative which has a direct presence in both the United Kingdom and the European Union as it stands on 1 January 2021.

Comment

The UKIPO's note also looks at registered designs and considers the position of all other IP rights, including:

  • unregistered designs;
  • patents;
  • supplementary protection certificates; and
  • copyright.

This latest publication from the UKIPO does not change what was previously understood to be the situation if the United Kingdom left the European Union with a deal, but it is nevertheless helpful as confirmation of the position and the timetable ahead.