The EU/UK Trade and Cooperation Agreement and Intellectual Property Rights

The TCA provides that nothing it contains affects the freedom of the parties to determine whether and under what conditions exhaustion of IP rights applies. Under the Withdrawal Agreement, IP rights that were exhausted in the UK or the EU before 31 December 2020 remain exhausted in both territories. Where goods have been placed on the EEA market on or after 1 January 2021, the UK has – for now at least – decided to unilaterally maintain EEA-exhaustion for imports into the UK, meaning nothing will change for such imports, at least in the short term. However, for goods placed on the market in the UK, the EEA exhaustion regime will not apply for exports into the EEA, and so EU IP rights in respect of such goods will not be exhausted. Accordingly, consent will be required for parallel traded exports from the UK to the EEA.

The UKIPO has recently confirmed that the Government will hold a consultation in early 2021 on how to manage future parallel trade into the UK. This will no doubt engender a spectrum of views between rights holders and parallel traders.

The TCA contains a series of provisions relating to rights of authors, performers, producers of phonograms, broadcasting organisations, and covers issues such as term of protection (where there is some flexibility for the UK in relation to certain types of work), continued application of artist's resale right (which might have been a candidate to be abolished in a no deal situation), collective management of rights, protection of technological measures, and rights management information.

The provision relating to exceptions and limitations to copyright infringement is relatively brief, referring to the application of the three step test for authorial works (i.e., those special cases which do not conflict with a normal exploitation of the work or other subject matter and do not unreasonably prejudice the legitimate interests of the rights holders). There is scope therefore for the UK to consider the regime for exceptions to copyright infringement in due course.

The provisions in the TCA relating to trade marks are largely reflective of the current regime, as provided for in the Trade Marks Directive and implemented in the UK Trade Marks Act 1994. It appears unlikely that there will be any significant changes to UK trade marks law and practice, beyond the changes that have already been made to reflect the provisions in the Withdrawal Agreement preserving existing registrations and dealing with the implications of those provisions. However, over time, it is perhaps inevitable that interpretation of trade mark law by the EU and UK courts will start to diverge.

The TCA provides that each party should provide for the protection of independently created designs that are new and original. It is worth noting the use of the word 'original' here, as opposed to 'individual character' as in the existing legislation – the TCA goes on to provide that a party may consider that a design with individual character is original.

In relation to unregistered rights, the TCA provides that each party will confer unregistered design protection for at least three years from the date on which the design was first made available to the public in the territory of the relevant party. As discussed in our Brexit IP checklist, the UK has created a 'Supplementary Unregistered Design Right' for new designs on or from 1 January 2021, which mirrors the EU's Unregistered Community Design. However, as the UK and EU failed to agree on reciprocity in relation to the rules of first disclosure, designers face a potential gap in protection due to uncertainties over the proper interpretation of the rules relating to where a design must be disclosed.

Interestingly, the TCA provides that each party shall ensure that designs are also protectable through copyright, albeit the level of originality required is to be determined by each party. It will be interesting to see how the line of case law developed by the CJEU culminating in cases such as Cofemel (discussed in our update here) and Brompton (discussed here) delineating copyright protection for functional design will be interpreted by the UK Courts going forward.

As part of its recently announced Action Plan on Intellectual Property, the EU is considering modernising the EU design framework, so potential divergence may arise as a result of this exercise in the future.

The TCA contains provisions relating to procedures and remedies for trade secret holders to prevent, and obtain redress for, acquisition, use, or disclosure of a trade secret carried out in a manner contrary to honest commercial practices. The Trade Secrets Directive took effect in the EU in June 2018 but again is under review in the EU's IP Action Plan. Whilst the UK had long been considered a favourable and robust jurisdiction to enforce trade secrets by way of breach of confidence actions under the common law, the UK Government decided that certain aspects of the Trade Secrets Directive did require specific legislation. A few years down the line, cases are now starting to come before the UK Courts where the parties are additionally relying upon the Trade Secrets (Enforcement, etc.) Regulations 2018.

The TCA requires the parties to provide in their respective laws measures, procedures and remedies that are necessary to ensure the enforcement of IP rights (reflecting the provisions in the IP Enforcement Directive), and also in relation to measures at the border concerning counterfeit goods. The TCA does not however deal generally with civil justice co-operation and issues relating to jurisdiction, enforcement and service of proceedings. Whilst the UK applied to accede to the Lugano Convention in its own right in April 2020, the EU is yet to agree to this, though it is hoped that this will now take place in the short term, given the TCA having been agreed.

Under the Withdrawal Agreement, all product names protected in the EU as geographical indications (GI) as at 31 December 2020 will remain protected under both the EU and UK's new GI schemes. Going forward, however, no agreement has been reached in relation to GIs; instead, the TCA provides that the UK and EU may use reasonable endeavours to agree rules for the protection and effective domestic enforcement of their geographical indications.