Since the referendum result was announced in June 2016, Brexit has been the primary event for which all industries and sectors have been trying to anticipate so preparations can be made for any potential impact on their business. The media have often claimed that UK-based legal firms will bear the brunt of Brexit, although to date it is still largely unclear as to what degree of impact exiting the European Union will have. This is especially true for trademark and patent attorneys working in the UK as British courts could potentially lose jurisdiction over EU legislature. However, it is, perhaps, fair to say that one of the biggest factors currently affecting the UK legal world isn’t the notion of Brexit itself, but rather the relating uncertainty.
In fact, there has been notable silence surrounding the most likely avenues that Britain could take, which means that it essential to consider all scenarios to ensure that intellectual property rights continue to be protected in the UK should it transpire that EU Trademarks will no longer be recognized after Brexit.
Considering the Future.
While it is uncertain what will happen regarding EUTMs following Brexit, all trademark and patent attorneys should be aware of the various scenarios which have the potential to play out in 2019. One of the biggest questions that is being asked is ‘will EUTMs still hold ground in a post-Brexit landscape?’.
There are three likely scenarios:
1. Agreements are put in place that allow for EUTMs to continue to be legally recognised in the UK. Any new EUTMs applied for following Brexit will be extended to specifically protect IP in the UK.
2. Changes are made to incorporate non-EU states, including candidate countries. This would mean EUTMs would protect IP not only in the UK but also in countries such as Norway and Iceland.
3. EUTMs will fail to protect IP in the UK, and new UK National Trademarks would need to be created. This could either be an automatic process or it may be triggered via an application.
Option 3 — the requirement for brands to register specific UKTMs — is a scenario for which patent attorneys will need to carry out careful preparation. Should things move in this direction, trademark and patent attorneys in the UK will need to consider the timing of such applications, with concerns raised over the impact of ongoing transitions at the time of Brexit, and whether a loss of EUTM jurisdiction by the courts could affect registrations.
Without knowing the exact path that the UK will take, it is impossible to judge the potential impact of Brexit upon the industry with any certainty. However, what is known is that Brexit will undoubtedly send shockwaves throughout all sectors and parts of the economy. In light of this, it isn’t surprising that many businesses have opted to employ survival tactics.
A number of high-profile British companies have already pulled operations from the UK, and the effect has perhaps been most noticeable within the legal sector. For example, there has been a significant spike in legal workers registering in the Republic of Ireland to protect themselves from losing out on the opportunity of future work within the EU.
Could it be the same for trademark and patent attorneys working in Britain? After all, EUTMs — including filing, prosecution, and other related matters — are understood to make up a significant portion of day-to-day tasks for trademark attorneys. Should the UK fail to introduce arrangements or come to agreements which would give them the ability to remain involved with EUTMs, it is reasonable to expect that much, if not all, of EUTM work, would be delegated to attorneys within the EU. This is especially true for international businesses currently operating out of the EU but opting to work with UK-based teams.
This outcome would result in supply and demand issues, with supply far outstripping demand, which could create a potential risk to jobs. Does this mean that UK firms should be looking to open offices in the EU in order to continue handling EUTMs which or will the trademark and patent sector remain in a position to thrive after Brexit? Of course, the answer largely depends on what takes place over the coming months.
Some firms, such as HGF, have very publicly cited Brexit as a major contributing factor towards the launch of their new EU offices in the Netherlands. While there is the potential for a marked increase in independent UK registration, this perhaps isn’t enough to fill the gap left by a loss of EU work, especially true as the industry settles following the initial transitional period.
On the other hand, opening new offices in the EU will arguably prove to be advantageous to legal firms who already have a strong presence on the continent. Those that cannot display this presence may benefit more from a ‘wait and see’ approach, particularly as it is possible that the UK could implement agreements similar to those in Switzerland which permit Swiss trademark attorneys to handle EU work. It is also important to consider a loss of talent which would result from international upheaval, particularly since restricted immigration could hinder or even prevent attorneys from practising within the EU.
Your Next Steps.
At a time of such uncertainty, it is inadvisable for legal firms to make major decisions solely based on the speculation surrounding Brexit. However, there are ways that trademark and patent attorneys can begin to help prepare their clients for the potential effects, with one of the most sensible actions being to ensure that EUTMs are not relied upon exclusively for IP protection in the UK and that UK National Trademarks are considered alongside an EU registration. The good news for trademark and patent attorneys right now is that Government reports demonstrate that applications for new trademarks are remaining steady, which is a strong indication that UK businesses are not making any rash decisions and the industry is currently in a stable condition.