Clifford Chance

Based on what emerged from the discussions in the context of the 2022 Unitary Patent Package Committee—that took place in Amsterdam last July—the first months of 2023 will be crucial for identifying the city hosting the third Unified Patent Court's ("UPC" or the "Court") Central Division, formerly assigned to London.

By virtue of the 2013 Agreement on a Unified Patent Court ("UPC Agreement"), the UPC, whose decisions will be effective in all acceding Member States starting from April 1st, 2023, is intended to concentrate the most economically significant part of European patent litigations at its Central Division, based in Paris and assisted by two branches located in Munich and London, with major consequences in terms of legal certainty and cost savings.

The three Divisions are competent for different subject matters. In particular:

• Paris' Division will specifically deal with technical and industrial disputes involving transport, textiles, paper, constructions, physics, electricity, etc.;
• Munich's Division is intended to be specialized in the mechanical, lighting, heating, weapons and explosives fields;
• London's Division will be, instead, specialized in life sciences and chemistry.

However, following Brexit and the consequent withdrawal of the United Kingdom from the UPC, the seat has remained vacant and on September 10, 2020, the 24 signatory States mutually interpreted the UPC Agreement in the sense that the duties originally assigned to London's Central Division would be shared, for a limited transitional period, between the other two Central Division States.

In this context, as provided by Article 89 of the UPC Agreement, the divisions shall be established in "the three Member States in which the highest number of European patents had effect in the year" 2012. Coming fourth in the ranking in 2020, Italy – which as of 2016 is already hosting a local division in Milan – formally claimed its right to also host the central division.

The decision by the UPC's Administrative Committee is expected by the beginning of 2023. Choosing Milan, a city characterized by a strong patent activity, would not only position the city on the map as a key patent litigation center in the coming years, but also represent a strategic decision towards further involving Italy in the development and growth of the European Union.