Enterprises now have a new avenue for resolving patent disputes, as the Unified Patent Court (UPC) Patent Mediation and Arbitration Centre (PMAC) has officially commenced operations.

While enterprises must wait until later this year to obtain expert determinations or arbitration awards through the PMAC, they can already submit applications for relevant proceedings via its case management system. The option to use PMAC mediation services also officially took effect on May 12. The PMAC will be located in two cities: Ljubljana, Slovenia, and Lisbon, Portugal.

Historically, arbitration has had limited application in patent dispute resolution. The prevailing view has been that issues of patent validity and infringement are best adjudicated by courts, which possess the authority to revoke or amend patents, whereas arbitration is generally reserved for disputes such as the assessment of damages and the negotiation of Fair, Reasonable, and Non-Discriminatory (FRAND) licensing terms.

However, we will explore in greater detail below the services the PMAC offers to enterprises, and highlight how the option to resolve disputes via arbitration through the PMAC can be integrated into an enterprise's patent strategy, particularly in light of several recent developments that may have opened the door for broader use of Alternative Dispute Resolution (ADR) mechanisms.

The PMAC was established pursuant to Article 35 of the Agreement on a Unified Patent Court (UPC Agreement) as a dedicated institution for resolving patent disputes through mediation and arbitration. The PMAC Rules were adopted and officially entered into force on April 24, 2026.

Although the PMAC lacks the authority to revoke or amend a patent—that power being exclusive to the UPC—Article 2 of the PMAC Arbitration Rules allows parties to agree on settlement terms, which may include the limitation, abandonment, or non-assertion of patent rights. Such settlement agreements can be incorporated into a consent arbitration award, which the UPC may confirm and enforce under Rule 365 of its Rules of Procedure. Furthermore, such arbitration awards can be enforced globally under the New York Convention, enabling parties to initiate award enforcement mechanisms across more than 170 jurisdictions worldwide.

The PMAC also possesses the authority to issue provisional measures upon request, in the form of either an arbitration award or an order. This procedural flexibility may prove particularly valuable in urgent or cross-border disputes. Importantly, the PMAC's jurisdiction is not limited to the contracting member states of the UPC.

The PMAC maintains a public list of certified arbitrators and mediators from both UPC and non-UPC jurisdictions (including the United Kingdom). Provided they are vetted and approved, parties to a dispute may also appoint their own arbitrators. This respects party autonomy and facilitates the selection of arbitrators and mediators who are well-suited to the industry sector involved and possess the necessary technical expertise.

In accordance with the UPC Rules of Procedure, a judge-rapporteur must actively facilitate an amicable settlement between the parties during the case proceedings and may guide parties to seek dispute resolution via the PMAC at any stage of the litigation.

With the official launch of the UPC's PMAC, enterprises seeking to resolve patent disputes in Europe now have a brand-new pathway.

PMAC as a Platform for Resolving FRAND Disputes

The PMAC Rules contain dedicated FRAND clauses and enhanced confidentiality provisions, which may provide a more suitable venue for resolving issues regarding licensing terms and royalty structures, especially in FRAND disputes involving multiple jurisdictions.

FRAND is an acronym for "Fair, Reasonable, and Non-Discriminatory," describing the terms under which the holder of a Standard Essential Patent (SEP)—a patent related to a technical standard that must be implemented to use that standard—is typically required to license their patent.

To determine global FRAND licensing rates, parties usually need to reference and disclose comparable license agreements, and sometimes confidential transaction documents. These comparable agreements often contain highly sensitive commercial information. Consequently, their disclosure frequently becomes a point of contention in court and is usually subject to strict confidentiality clauses. Under Article 47 of the PMAC Rules, PMAC proceedings are confidential, which can effectively safeguard information related to such comparable license agreements from disclosure.

The PMAC also allows for expert determination in FRAND disputes, where an expert may provide an opinion on specific aspects of the dispute, such as the essentiality of an SEP, or an assessment of what licensing terms constitute FRAND principles.

Strategic Use of Arbitration in Patent Disputes

As the PMAC becomes established, it may influence how parties approach cross-border patent disputes, providing a strong supplement to, or even an alternative for, traditional litigation in other areas, especially following the landmark ruling by the Court of Justice of the European Union (CJEU) in the BSH Hausgeräte case.

In that case, the CJEU confirmed that the courts of EU member states (including the UPC) have the jurisdiction to hear patent infringement lawsuits brought against non-EU countries designated in a European patent (such as the UK or Turkey), and may also hear the defendant's counterclaims based on patent invalidity. While EU member state courts lack the authority to revoke or amend European patents applicable to non-EU countries like the UK, they may adjudicate the validity of the patent based on the principle of relative effect between the parties during the infringement proceeding; this judgment binds only the parties to the dispute.

Following this ruling, in Fujifilm v. Kodak, the Mannheim Local Division of the UPC exercised jurisdiction over an infringement dispute involving the designated validity of a European patent in the UK. The UPC clarified that while it may determine patent validity for the purpose of concluding the case, the formal authority to revoke a patent remains with the corresponding national authority—in this instance, the UK Intellectual Property Office.

These rulings, along with subsequent cross-border relief orders issued by the UPC and the Munich Regional Court, demonstrate the European judicial system's increasingly open attitude toward adjudicating cross-border intellectual property cases.

Thus, if a party raises a counterclaim of patent invalidity in an infringement dispute and wishes to resolve parts of the dispute outside the UPC’s jurisdiction (e.g., filing invalidity challenges against patents in countries with significant commercial value that have not joined the UPC system), the PMAC can offer significant strategic value, allowing parties to flexibly select arbitration based on their commercial objectives and geographic layout. However, this flexibility also entails strategic maneuvering, meaning arbitration is merely one of several remedial tools available to the disputants. Confident challengers may prefer to have a patent declared invalid through a public judgment to clear market entry barriers; conversely, patent holders may wish to have a favorable result publicized to deter potential subsequent infringement and challenges. In such scenarios, the confidentiality of PMAC arbitration proceedings may be a deterrent for parties choosing this route.

Conversely, confidentiality may also serve as a strategic asset, particularly in disputes where neither party is certain of their chances of success. In the life sciences sector, for example, arbitration often facilitates win-win outcomes: if a patent is found valid and infringed, it may lead to a licensing agreement that allows for market entry under agreed terms; if a patent is found invalid but remains on the register, both the innovator and the generic or biosimilar manufacturer may achieve their goals—the innovator retains nominal patent protection, while the generic manufacturer avoids various compliance regulatory risks. In either case, the arbitration award is not made public, allowing both parties to reach a commercially practical solution away from public scrutiny.

Ultimately, whether parties strategically choose PMAC arbitration depends on their risk appetite, need for transparency, and desire for procedural control. This mechanism also provides a flexible pathway for resolving complex cross-border patent disputes in fields where traditional arbitration is less common, such as the life sciences.

Commercial and Contractual Dispute Resolution: The PMAC Value Proposition

The scope of patent disputes often extends beyond infringement and validity. In the life sciences and technology industries, commercial and contractual matters such as patent grant terms, licensing rates, milestone payments, and termination clauses directly impact an enterprise's market strategy and revenue; such disputes are often poorly suited for resolution through litigation.

Beyond the PMAC Rules, the PMAC has drafted model arbitration clauses, mediation clauses, and arbitration submission agreements. Enterprises may use these to review their intellectual property contracts, incorporating PMAC ADR clauses where appropriate to align and interface with the UPC dispute resolution mechanism.

The PMAC provides an expert-led, confidential solution for contractual disputes. In sectors like automotive and electronics, patent disputes are often intertwined with commercial conflicts concerning supplier obligations, indemnity clauses, and the scope of patent licenses. Such compound disputes are more easily and properly resolved by leveraging the flexibility of arbitration in conjunction with an arbitral tribunal possessing industry-specific practical experience.

Parallel Proceedings

It is worth noting that PMAC arbitration may proceed in parallel with UPC litigation. Parties may address issues such as patent licensing and the assessment of damages through arbitration while the court simultaneously adjudicates patent validity and infringement facts. UPC judges have long advocated for parties to use ADR during pre-trial conferences, and the formal establishment of the UPC will further standardize and unify such practices. Particularly in disputes related to FRAND licensing rates, arbitration can provide a single dispute resolution platform, creating a controlled, commercially-aligned resolution model