While it is certain that Brexit will affect Intellectual Property Rights holders much is yet uncertain. This presentation explores the different Brexit models and highlights their pertinent consequences for IP. The presentation also presents the trade context in which the Brexit will be conducted.

1. BREXIT AND INTELLECTUAL
PROPERTY RIGHTS
The big picture, how Brexit can be enacted and
how it will affect IP
Teemu Alexander Puutio
LL.B., LL.M., Ph.D., B.Sc. Econ.
10 November 2016

2. The big picture
Brexit and trade with the EU
Part 1
Part 2
Part 3
Part 4

3. • The EU is the second largest economy in the
world at USD 16.51 trillion (GDP)
• UK is fifth at USD 2.6 trillion (GDP)
• EU represents 51% of exports (£13 billion) and
48% of imports (£21.9 billion) in September
2016
• Caveat: the Rotterdam effect
3
The big picture

4. • 78.4% of the UK economy comes from
providing services
• Between March 2016 and April 2016, the
estimated total surplus on trade in services
was £7.2 billion
• Financial services being the largest
contributor with a surplus of £10.5 billion
• Particularly relevant IPs: Trademarks
4
Trade in services

5. 5
BalanceoftradewithEU

6. 6
HowmuchlosingUKtradewouldhurt

7. • After Brexit, the EU would continue to be the
world’s second largest market
• It would also remain as the UK’s biggest
trading partner.
• Further, more then three million EU citizens
live in the UK, and two million UK citizens live
in the EU
7
Conclusion: the EU is not going anywhere

8. The Brexit models
The different ways in which Brexit could
happen and what it means for IP
Part 1
Part 2
Part 3
Part 4

9. • Continuing from John:
• “May hopes for a sui generis ‘close
relationship’ with the EU after Brexit which
does not fit into any current model which
means that all remaining EU countries will
have a say in negotiating and veto right over
any final agreement that is reached.“
9
The sui generis relationship

10. • One of the most often discussed options is for the UK to ‘do a Norway’ i.e.
to join the European Free Trade Association and the European Economic
Area
• Would minimize Brexit related costs and represents a ‘soft Brexit’
– Full access to single market
– UK would be exempt from EU rules on agriculture, fisheries, justice and home
affairs
• However, would also entail:
– obligatory financial contributions
– many EU Directives are relevant to the EEA and could continue to influence
UK law free movement of people and capital
• Implications for IP
– UK courts would still need to interpret intellectual property law in light of EU
rules
– EU-wide devices such as the Community Trade Mark would no longer apply to
the UK
10
Going Norwegian

11. • UK could also go the way of Switzerland, i.e. to join EFTA
and remain outside of the EEA
• Access to single market for goods would be acquired
through the negotiation of bilateral deals with the EU
• Represents a harder Brexit:
– Financial contributions would remain obligatory
– UK would face regulation without representation a
– Under Swiss model, there would be no blanket agreement with
the EU on free trade in services which drives the UK economy
• Implications for IP
– Similar to Norway model, with more freedom to negotiate
bilaterally
11
Making a Swiss deal

12. • Absent any particular deals with the EU, the UK would
default to WTO rules
• Trade with EU would continue, but now with tariffs
– Tariffs would be set according to “most favoured nation”
terms
• Traded goods would still need to adhere to EU
standards
• Implications for IP:
– No exhaustion rules
– Border measures would be up to negotiation by the UK
12
The default WTO model

13. • Return to 1846 policies – opening up for free trade
unilaterally
• Singapore and Hong Kong apply a similar model with
success
• Meaning is obscure:
– Tariffs only, and a binding commitment to keep at 0?
– For services and IP non-tariff-barriers matter more
• Further critique:
– unilateral free trade would not be economically superior to EU
membership
– would be less simple than imagined
– and would also be politically unacceptable.
13
Singapore and Hong Kong approach

14. Practicalities
Some implications and considerations when
making Brexit decisions
Part 1
Part 2
Part 3
Part 4

15. • UK IP laws are predominantly constructed around European Directives or
derive from European Regulations
• Transitional legislation is needed for types of IP
– EU Trademarks and Registered Community Designs
– Geographical Indications
• Enforcement is another area of concern:
• Post Brexit, the UK will no longer have the benefit of the Brussels Recast
Regulation which enables enforcement and reciprocity of judgments in EU
– UK courts will not be able to take jurisdiction over infringement of foreign
intellectual property rights nor could it grant cross-border injunctive relief
– No automatic recognition of judgments in courts of other Member States
• However, the UK may seek to join the Lugano Convention which provides
for similar mechanisms
15
Avoiding the vacuum and ensuring comity

16. • European Medicines Agency
– Currently hosted in London, with EEA could continue?
• Supplementary protection certificates
– Term of pharmaceutical SPCs to be reviewed
• Regulatory data protection (RDP)
– Protection from first applicaiton in EEA or UK?
• Parallel imports and exhaustion of rights
– A more advantageous regime for rights holders?
• European Digital Single Market
– Copyright reform, roaming charges etc.
16
Particular issues that the Government will need to consider

17. • Negatives:
– Economies of scale as we scale through different
models of engagement with EU
– Uncertainty leading to pressure and making untested
decisions
• Positives:
– Policy independence enabling regulatory innovation
– Faster reactions and reforms
– Bi-lateral mobility
17
The general issues affecting the decision

18. The diplomatic aspect
The state of eurocratic diplomacy and
copycat brexiteers
Part 1
Part 2
Part 3
Part 4

19. 19
Riseofanti-UKsentiment
‘We are seeing the beginning of a
spiteful, dirty tricks campaign
designed to make life difficult for
the British in Brussels, simply
because we voted to leave the EU,’
said Roger Helmer, a Ukip MEP.

20. • A larger anti-EU, anti-establishment
movement and burgeoning nationalism
sentinent is on the rise across EU
• Brexit copycats in Finland, Greece and France
• Scottish refefrendum #2?
20
Sympathy for the devil: Fixit, Grexit and Frexit

21. Thank you
Alexander.puutio@gmail.com
puutio@un.org