This paper introduces a novel three-phase unified power quality controller（UPQC）， including its topology and the related control strategies. Compared to the traditional ones， its special topology design can inherently avoid the AC or DC system short circuit， so that no extra isolating circuits， i.e. transformers， are needed and the energy exchange between its series and parallel units can still be ensured. Based on the novel topology， the corresponding control strategies for the series and parallel units are elaborated respectively， which enable the proposed UPQC to achieve such functions as that of the traditional ones. Finally， simulation results using PSCAD/EMTDC are given to verify the validity of the proposed topology and control strategies.