EU design law: significant changes in the pipeline
The EU Council and Commission have announced that they have reached an agreement on proposed changes to European Designs Regulation no. 6/2002 and European Designs Directive 98/71/EC. The Regulation is the legal basis for Registered and Unregistered Community Designs, which will be renamed ‘Registered European Union Designs’ (REUDs) and ‘Unregistered European Union Designs’ (UEUDs) respectively. The Directive is implemented by EU Member States to give rise to national registered design rights.
The agreement follows proposals made in November 2022 by the Commission to update the Directive and Regulation, which are both now over 20-years old. The planned changes still need to be formally approved by the European Parliament.
Design protection in the digital age
The proposal updates the definition of what constitutes a ‘design’ to encompass the appearance of the whole or part of a product now additionally including “movement, transition or any other sort of animation”. Meanwhile, a ‘product’ would be defined as any industrial or handicraft item other than computer programs (i.e. the underlying software code) “regardless of whether it is embodied in a physical object or materialises in a nonphysical form”. Examples of such products include “packaging, sets of articles, spatial arrangement of items intended to form an interior or exterior environment, and parts intended to be assembled into a complex product” and also “graphic works or symbols, logos, surface patterns, typographic typefaces, and graphical user interfaces”.
It should be noted that it is already possible to protect various digital works under the current EU design system, including graphical user interfaces, logos, and animated designs, and this has proven hugely popular with large numbers of design filings to such subject matter. Nevertheless, the proposed changes are intended to clarify the broad applicability of the design regime and its relevance to the modern digital economy.
The changes also clarify that the spatial arrangement of items can be protected and this would seem to include, for example, the layout within a shop (which broadly echoes the 2014 CJEU decision in which it was held that the layout of an Apple store is protectable via a EU trademark).
New infringement acts and defences
The agreement also seeks to modernise EU design law by conferring on the design holder a new right to prohibit “creating, downloading, copying and sharing or distributing to others any medium or software recording the design for the purpose of enabling a product [incorporating the design] to be made”. This is intended to capture acts relating to 3D printing articles protected by the design. Additionally, holders of registered designs would be granted new rights to prevent the movement of counterfeit products from passing through EU territory.
The agreement introduces new defences to an infringement claim, namely using the design for ‘critique and parody’ and ‘referential use’ (e.g. for the purposes of teaching or comparative advertising). This is in addition to an updated ‘repair clause’, which is discussed in detail below.
The Regulation (but not the Directive) currently includes a ‘prior use’ defence that protects third parties who invested in good faith in developing a product before the priority date of a Registered Community Design, where it transpires that the appearance of the product falls within the scope of protection of the registration. The agreement will amend the Directive to include a corresponding prior use defence, meaning that third parties would also be able to rely on prior use as a defence against infringement of national registered designs rights.
The Directive would also be amended to require that each Member State provides an administrative procedure for challenging the validity of registered designs (e.g. before the national intellectual property office). This should make is easier and less expensive for third parties to challenge the validity of registered designs in certain jurisdictions, where currently the validity can only be challenged through complex court proceedings.
When the Regulation and Directive were drafted more than 20-years ago, European lawmakers were wary of granting manufacturers a monopoly on the sale of spare parts incorporated into their products, which could severely restrict competition in the spare parts aftersales market and thus limit the choice of the consumer. In view of this, the Regulation and Directive include a number of limitations on the scope of protection that is available to spare parts. These limitations are discussed in detail in our article of November 2022.
One of these limitations is the ‘repair clause’: the Regulation states that “protection as a Community design shall not exist for a design which constitutes a component part of a complex product… for the purpose of the repair of that complex product so as to restore its original appearance”. It is therefore not an infringement of a Community design for a third party to reproduce protected features of a design for the purposes of repairing a complex product to its original appearance. For example, replacement of a damaged car body panel would not be an infringement (providing that certain conditions are met), even if the body panel is subject to Community design protection.
In contrast, the current Directive (which gives rise to national registered design rights) does not include a repair clause. Instead, Article 14 of the Directive requires that “Member States shall maintain in force their existing legal provisions relating to the use of the design of a component part used for the purpose of the repair of a complex product so as to restore its original appearance and shall introduce changes to those provisions only if the purpose is to liberalise the market for such parts”. This means that, currently, individual EU Member States can strengthen any repair clause that is already in place, but are prohibited from doing the opposite. This is therefore an area where EU design law between EU Member States is not harmonised. For example, in 2021, France finally introduced a repair clause for suppliers who had originally manufactured a component on behalf of vehicle manufacturers, as well as a repair clause for all vehicle glazing components, and limited the term of protection for other types of vehicle components to ten years (rather than the usual 25 years). In contrast, a number of other EU Member States still do not have a repair clause.
The proposal would modify the Directive to include a corresponding repair clause. As a result of this, third parties would also be able to rely on the repair clause to avoid infringement of national registered design rights. This should give consumers increased choice when seeking repair of complex products, thus liberalising the spare parts market. Designs that are filed before the revised Directive enters into force, and which are currently protected under the laws of a Member State due to the lack of a repair clause, will continue to be protected for 8-years from entry into force of the Directive.
In addition, both the Regulation and Directive have been amended to stipulate that the repair clause can only be relied upon where the third party informs consumers about the commercial origin and the identity of the manufacturer of the product to be used for the purpose of the repair of the complex product, so that the consumer can make an informed choice between competing products that can be used for the repair. This follows the CJEU Decision in Acacia v Audi and Porsche, in which it was held that a third party selling a component part (in this case wheel rims) has a duty of diligence to inform the downstream user (e.g. on the product, packaging, and/or catalogue) that the part incorporates a design of which they are not the holder.
According to the Commission, these changes could generate €340 to €544 million in savings for consumers over a 10-year forecast. The proposal also notes that the reparability of products is at the core of a sustainable economy, as highlighted in the European Green Deal.
Applicants will welcome proposals to simply the fee structure for registered designs and to remove the requirement that multiple designs included in a single application are of the same Locarno classification.
There are also plans for a new designs symbol, a ‘D’ surrounded by a circle (analogous to the copyright © symbol), that can be combined with the registered design number to indicate that a product is subject to design protection.
Another proposed change is that any Member State may provide that a design shall be refused where it contains a total or partial reproduction of elements belonging to cultural heritage of national interest. The proposal adopts the UNESCO definition of ‘cultural heritage’, and gives the examples of monuments, buildings, artefacts, handicrafts, and costumes.
The agreement also includes changes to the Directive to bring it into closer conformity with the Regulation. These include the ability to defer publication of a national registered design for up to 30-months and that the named holder of a national registered design is presumed to be entitled to ownership of the design.
The modified Directive will also prohibit Member States from having their own national unregistered design regimes (although no Member State currently has such an unregistered regime in place). Designers will still be able to rely on the Unregistered European Union Design system but must be mindful of its limitations, including that it only protects against unauthorised copying (unlike registered rights which provide a monopoly even if a third party independently conceives the same design) and has a short 3-year period of protection (comparted to the 25-years of registered designs).
Divergence from the UK post-Brexit?
The UK is no longer part of the European Union, and therefore any changes to the Regulation and Directive will not affect the protection provided by UK design rights. However, the UK Registered Design Act 1949 still closely aligns with the current EU Directive, and the new UK Supplementary Unregistered Design right is based on the current Unregistered Community Design right. In other words, despite Brexit there is still significant harmony between the UK and EU design regimes.
In some respects, the proposed changes to the Regulation and Directive can be viewed as a divergence from UK law and, for example, the new definitions of what constitute a ‘product’ and ‘design’ are indeed different to those defined under UK law and the inclusion of the new infringing acts surrounding 3D printing is a notable update. However, in practice, protection of digital designs is already possible under both the UK and EU systems so some of the changes are not as significant as they first appear. Furthermore, some of the proposed changes actually bring the national design law of EU Member States into closer alignment with the position of the UK. For example, in respect of a UK Registered Design it is already possible to file multiple designs in the same application regardless of Locarno classification and there already exists a repair clause. Some of the more radical proposals that were put forward during the consultation process (for example, the mooted requirement that features must be visible to be eligible for design protection, even for non-complex products) and which would have led to greater divergence from the UK position, were rejected.
The planned changes to the Regulation and Directive still need to be approved by the European Parliament. Once the revised Directive comes into force, Member States will have 36-months to incorporate any changes into national design law. We will be sure to report on any updates as they arise.