Arbitrating a patent dispute in Europe: the UPC Centre

The Unified Patent Court is not confined to its divisions. The Agreement that established it also created, alongside them, a mediation and arbitration centre. For a long time no more than a line in a treaty, it now has rules and a schedule of fees. The question is no longer whether it exists, but which disputes to entrust to it and on what drafting conditions.

The answer lies in a distinction: what concerns the patent as a right enforceable against everyone (validity, infringement, proportionality of measures) belongs to the courts; what is settled between two parties (rate, base, portfolio sampling, treatment of confidential comparable licences, payment structure) is better handled by a confidential, technical and enforceable mechanism. Arbitration is not an alternative to litigation: it is an instrument that deals with different questions.

What the Agreement created, and what it forbade

Article 35 of the Agreement on a Unified Patent Court establishes a patent mediation and arbitration centre, with seats in Ljubljana and Lisbon. The same article lays down a limit that nothing can circumvent: a patent may not be revoked or limited in mediation or arbitration proceedings.

That limit is structural, and it is widely misread. It does not prevent the settlement of a dispute that touches on validity; it prevents an award from producing the erga omnes effect of revocation. An arbitral tribunal may assess validity as between the parties, for the purpose of setting a rate or deciding a contractual breach; it cannot remove the title from the register. That boundary is not a weakness of the system: it is the line between what isinter partes and what belongs to the public law of patents.

Three sets of rules, and a single point of entry

In 2025 the Centre put three distinct sets of rules out to public consultation: mediation rules, arbitration rules and expert determination rules. The trilogy deserves attention, because practitioners tend to remember only the second.

• Mediation does not decide: it seeks agreement. Its value lies in cost and in preserving the commercial relationship, which is often decisive where the parties are also supplier and customer.
• Arbitration decides, by an award.
• Expert determination is the most underrated tool: it isolates a technical, economic or licensing question, has it decided by an expert, and spares the tribunal (arbitral or state) from having to resolve it in full. On the essentiality of a portfolio or the selection of comparables, it is often the fastest route.

How it interlocks with the court proceedings

This is what makes the Centre distinctive: it was not conceived as a general arbitral institution adapted to patents, but as a mechanism grafted onto a court. Two procedural rules organise the interface.

The Rule 11 of the Rules of Procedure allows the judge, at any stage, to explore settlement with the parties and to refer them to the Centre; the parties may jointly request a stay. Rule 365 allows the Court to confirm a settlement agreement, which gives it enforceable effect in the Contracting Member States.

That judicial confirmation is the essential point. It explains how a private settlement can produce effects that the award alone could not: a patentee may undertake to limit its patent, to assign it, not to assert it or to accept its revocation, and that undertaking can be given the force of a court decision. The prohibition in Article 35 is not circumvented, it is complied with by another route.

The award and its enforcement

An arbitral award has the benefit of the New York Convention of 10 June 1958 on the Recognition and Enforcement of Foreign Arbitral Awards, to which more than one hundred and sixty States are party. That is the decisive advantage over a judgment, unified or not: the territorial reach of the Unified Patent Court stops at the Contracting Member States, whereas an award reaches every State party to the Convention.

For a global FRAND dispute the asymmetry is not academic. It explains why a worldwide licence is poorly negotiated before a court whose jurisdiction is regional, and why arbitration finds natural ground there.

Arbitration as an element of FRAND conduct

In Huawei v ZTE (CJEU, 16 July 2015, C-170/13) the Court of Justice made the parties’ conduct the measure by which injunctive relief is assessed. That framework has a consequence still poorly appreciated: proposing arbitration is a negotiating act, and refusing it is another.

A vague arbitration proposal ("we are open to arbitration") is worth nothing. A precise one is worth a great deal: named institution, neutral appointment mechanism, seat, language, governing law, timetable, exact scope of what is submitted, confidentiality regime, cost control, and the fate of documents already exchanged before the court. The refusal of such a proposal, balanced and workable, can be held against the party that refused it when its genuine willingness to contract falls to be assessed.

Symmetrically, an instrumental proposal designed to delay or to displace the debate is assessed in the same way. The rule runs both ways, as does the FRAND obligation.

Cost: the comparison is not the one usually made

Before the Unified Patent Court, cost consists of a fixed fee per action plus a value-based fee where the value of the case exceeds a ceiling set at EUR 500,000; a fifty per cent reduction applies to micro-enterprises and small enterprises. The structure is therefore largely driven by the declared value of the dispute.

Before the Centre the structure differs: a registration fee scaled to the amount in dispute, then arbitrators remunerated for time spent, with a cap in the expedited track. Two practical consequences follow.

First, the cost variable is not the same: before the court it is the value of the dispute; in arbitration it is the time consumed, hence the scope of the referral and the number of arbitrators. Second, a tightly delimited arbitration (sole arbitrator, isolated question, expedited track, online hearing) can be appreciably cheaper than full litigation, whereas a three-member tribunal on an undelimited dispute is not.

The amounts actually in force (Unified Patent Court fees, the Centre’s schedule) must be checked as at the date of the decision: they are set by decisions of the Administrative Committee and revised periodically.

Privatising justice? How to put the question properly

The objection always returns: sending these disputes to arbitrators would privatise patent justice. It deserves better than a defensive answer.

What makes justice public is not the nature of the decision-maker but the subject matter of the decision. Deciding the validity of a title, construing the scope of a claim, assessing the proportionality of an injunction: these questions build case law, bind third parties, and must remain public. Determining the rate applicable to a portfolio as between two operators, resolving representative sampling, handling comparable licences covered by confidentiality: these engage only the parties and sit badly in open court.

The real risk is not privatisation, it is opacity: if the structuring disputes disappeared into confidentiality, the law would cease to develop. That is why the publication of anonymised awards, absent objection by a party, is not a cosmetic detail of the arbitration rules; it is the membrane that allows the system to learn from what is settled outside it.

What to draft, and when

In the contract. Une clause compromissoire utile désigne l’institution, fixe le siège, la langue et la loi applicable, prévoit le mode de nomination, et (c’est le point le plus souvent manqué) délimite ce qui est arbitrable au regard de la prohibition de l’article 35.

In the licence negotiation. An arbitration offer is drafted like a licence offer: dated, precise, operational, and kept. It forms part of the conduct file.

During proceedings. A partial referral (a single issue, a fixed timetable, a circumscribed stay) is almost always preferable to a global referral, which means giving up a forum already seised.

Key takeaways

• The mediation and arbitration centre is established by Article 35 of the UPC Agreement; its seats are Ljubljana and Lisbon.
• A patent may not be revoked or limited through mediation or arbitration: an award has no erga omnes effect. erga omnes.
• Three sets of rules went to consultation in 2025: mediation, arbitration and expert determination.
• Rules 11 and 365 of the Rules of Procedure organise referral and judicial confirmation of settlements.
• The 1958 New York Convention gives an award worldwide enforceability, where the Unified Patent Court stops at the Contracting Member States.
• Proposing or refusing a precise arbitration offer is an element in assessing conduct under Huawei v ZTE.
• The cost variable is the value of the case before the court, and time consumed before the arbitrator.

Frequently asked questions

Can a patent be revoked through arbitration?

No. Article 35 of the UPC Agreement expressly excludes it. An arbitral tribunal may, however, assess validity as between the parties, and a settlement by which the proprietor undertakes to limit or not to assert its title may be confirmed by the Court.

Is an award enforceable outside the UPC Contracting Member States?

Yes, under the 1958 New York Convention, which binds more than one hundred and sixty States. That is the principal advantage of the arbitral route in a global dispute.

Does applying to a court for interim relief waive the arbitration agreement?

Modern arbitration rules provide the opposite: applying to a competent court for protective measures does not amount to a waiver of the arbitration agreement. The point should be checked against the version of the rules in force and, if necessary, settled in the clause.

Must one choose between the Unified Patent Court and arbitration?

No, and thinking in terms of alternatives is the first mistake. The two routes address different questions and can be combined: proceedings on the merits before the court, with a delimited referral on the economic question.

Decide early, draft precisely

L’arbitrage des brevets ne se décide pas au moment du différend : il se prépare dans la clause, se propose dans la négociation et se délimite dans l’instance. Dhenne Avocats intervient sur ces trois temps : rédaction des clauses, conduite des négociations de licence, contentieux devant le tribunal judiciaire de Paris et la Unified Patent Court, and acting in arbitration. Talk to us.

This article is an original, expanded adaptation of an analysis by Matthieu Dhenne first published on Kluwer Patent Blog.