In light of the UK’s decision to leave the EU in last year’s referendum, it's well worth predicting -- or at least thinking about -- what Brexit will actually mean for design rights. After all, these rights are an invaluable part of every luxury brand’s IP portfolio, all the way from start-ups and boutiques to the giants of the luxury marketplace.
Design rights pre-Brexit
In brief, there are currently two types of design rights used by luxury brand owners under UK and EU law -- registered and unregistered designs. Registered designs under EU law, called registered Community designs (RCDs), offer pan-European protection for up to 25 years. These EU registered rights lie in parallel to UK registered rights under the national UK registered design regime (UKRD). As for unregistered designs, EU law provides for an unregistered Community design (UCD) right, which safeguards a design for three years from the date on which the design was first made available to the public in the EU. UK unregistered rights (UKURDs) exist in parallel under UK law.
Design rights post-Brexit: What could happen and why does it matter?
When Britain's exit from the EU actually takes place, it is probable that the Community design regime will no longer operate in the UK. As a result, protecting design rights in the UK will likely involve relying on the UK design rights regime.
This situation could be problematic for luxury brands. Although the UK registered design regime would be a reasonably good substitute for Community registered designs, the same cannot be said of UK unregistered rights in relation to Community unregistered designs as the two unregistered regimes do not offer the same level of protection. For example, the Community regime can protect 2D or 3D designs, whereas the UK regime is limited to protecting 3D designs. This lower level of protection could harm luxury businesses that heavily rely on unregistered design rights and so need these rights to safeguard their brands.
The luxury businesses that really depend on unregistered design rights are those companies under pressure to keep down their costs or create products that are expected to have a short lifespan. This affects both the smallest and greatest brands. Luxury start-ups and boutiques simply do not have the financial resources to pay lots of money for multiple registered design rights. Luxury giants are expected to quickly churn out designs that are ad-hoc trends expected to last no more than a few months – they may not want to go through the slower process of registered design rights. So, it is clear that the luxury industry needs unregistered design rights to protect them, which makes the post-Brexit possibility of reliance on a deficient UK unregistered design regime rather worrying for luxury businesses.
There is considerable uncertainty as to what Brexit will entail for the design rights of brands, but it is still worth trying to predict what it could mean. In the event that luxury companies end up falling back on the UK unregistered design rights regime, there are issues with the level of protection offered that could cause problems for luxury owners, from the smallest business to the largest company.