Home / IP Litigation / Proposals Made for Unified Patent Court Opt-Out Fee

Proposals Made for Unified Patent Court Opt-Out Fee

The preparatory committee for the Unified Patent Court (UPC) has issued a consultation document providing two alternative proposals for court fees and a scale of ceilings for recoverable costs.

The proposals table a set of fixed fees for certain UPC actions and procedures. The range of proposed fees is extensive. The smallest, set at 80 EUR, is the UPC opt-out fee (see below). The largest is the fee for an action for revocation, at 20,000 EUR. The fee for an infringement claim (whether by way of initial claim or by way of counterclaim in response to a revocation action) is 11,000 EUR.

For certain actions an additional value-based fee component is proposed when the action exceeds 500,000 EUR in value. The value-based fee starts at 2,500 EUR for actions up to and including a value of 750,000 EUR, and is capped at 220,000 EUR for actions worth more than 30 million EUR. The fee rise escalates for actions of more than 10 million EUR. Details on the precise mechanism for determining the value of an action, especially an action for declaration of non-infringement, are not yet available.

The two alternative fee proposals differ in a number of substantive ways. Alternative 1 proposes certain reimbursements of the fixed and value-based fees to the liable party if certain conditions are met, such as where the action is heard by a single judge, or where the action is withdrawn or settled before the conclusion of certain key events in the procedure. Alternative 2 proposes that small and medium sized enterprises, micro-entities, non-profit organisations, universities and public research organisations may apply for an exemption of value-based fees.

In addition to court fees, the proposal also contains a suggestion to limit costs recoverable from the losing party to a figure between 50,000 EUR and 3,000,000 EUR, once again depending on the value of the action.

The opt-out fee will be of particular interest to many current proprietors of European patents who wish to avoid the jurisdiction of the UPC under the transitional provisions. Under these proposals, although it will be relatively inexpensive to opt-out for each patent, the cumulative cost for proprietors with many existing non-unitary European patents could be significant. However, viewed case-by-case the fee will likely not add significantly to the cost burden of validating a newly-granted non-unitary European patent, and may be viewed by many as a worthwhile way to avoid the uncertainty of the UPC system for the time being. Our comments on the opt-out procedure may be found here.

At 20,000 EUR the official fee for a revocation action will be seen by many as expensive, especially when compared to the EPO opposition fee of 775 EUR. The proposed fee for an appeal, set at 16,000 EUR, is similarly expensive compared to the EPO appeal fee of 1860 EUR. It remains to be seen whether potential court users will have enthusiasm for a UPC at these fee rates, or whether demand for the EPO opposition system strengthens.

Proposals regarding renewal fees were recently made, and our news item on these can be found here.