The long-expected Unitary Patent (UP) system in Europe came into effect on June 1st, 2023. Over a decade in the making, it is a significant development in the world of patents. It was created to streamline patent processing, and the European Commission characterizes it as a system that “ends complex validation requirements and drastically limits expensive translation requirements in participating countries.”
As Slator has covered for the past eight years, patent translation has been a very profitable business. The UP will likely change that.
Also on June 1, 2023, the Agreement on a Unified Patent Court (UPCA), so far ratified by 17 countries, came into effect along with operations at the Unified Patent Court (UPC). The UPC includes English as an official language in all its 14 court divisions.
Furthermore, the court is maintaining the official languages of the European Patent Office (EPO), which include English along with French and German. Under the Unitary Patent rule, as long as filings are done in any of the official languages of the EPO and the UPC, translation will not be mandatory.
The Beginning of the End?
Originally, patent translation was the bedrock of RWS’ business. Since the UP was announced over a decade ago, however, the LSP set out on an aggressive business diversification via M&A, which turned it into the USD 1bn revenue Super Agency we know today.
That said, RWS’s IP Services division continues to perform well, until now. In fact, the expectation, as stated in the company’s June 8, 2023 half-year report, is that there will actually be a temporary boost in the division’s business. Clients who were waiting for the UP rule to take effect in order to benefit from its protections will now require translation and other services. After that, there will likely be a marked reduction in volumes.
The combination of English dominance in patent creation and filing, coupled with the possibility of using a few additional languages under the new UP rule, is set to create a rapid decline in translation volumes.