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Proposed Legislation- Modernisation of the European Trade Mark System

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EU flagProposals for reformed legislation, which have been drafted in order to help modernise and further synchronise the European Trade Mark system, have surfaced on the web. The European Commission has indicated that the reform package will ‘foster innovation and economic growth’ throughout the EU as well as ‘ensure coexistence and complementarity’ throughout the trade mark systems. Further, the European Commission has stated that the reform ‘will be beneficial for applicants and owners of both the Community Trade Marks (‘CTMs’) and national trade marks’ by increasing the efficiency of the EU internal market. Further, regardless of the size, market and geographical influence of an entity, the proposals will aim to create a more level playing field.

Once the proposals have been adopted (potentially Spring 2014) the Commission advise that EU countries will have to implement the new rules of the Directive into national law within two years. With regard to the Regulation, most amendments will become effective when it is enforced. However, the Fees Regulation will require prior authorisation by the Committee on OHIM fees with the aim of adopting it before the end of 2013. Below is an overview of some of the proposals. Please note that these proposals are not official.

CTMs and OHIM

–       The terms– ‘Community Trade Mark (CTM)’ is to be renamed ‘European Trade Mark (‘ETM’)’ and ‘OHIM’ is to be known as the ‘European Union Trade Marks and Designs Agency’ (the ‘Agency’).

–       CTM filing practices– filing at national offices and the Benelux Office of Intellectual Property will be abolished. Therefore, OHIM will be the sole agency to which CTM applications can be made. Fees will be due immediately on filing.

–       Graphic representation and non-traditional trade marks– trade marks will no longer be required to be graphically represented (which may mean a change in the acceptance of sound and smell marks). ‘Colours as such’ and ‘sounds’ will be specifically included in the definition of a trade mark. This is a significant movement away from the landmark ECJ ruling defining the Sieckmann criteria which has effectively closed the doors on the registration of non-traditional trade marks.

–       Customs procedures– the burden of proof will be reversed forcing the importer to prove that the counterfeit goods are in fact intended for a market outside of the EU. If the importer does not provide such evidence, the goods will be presumed to be for the EU market and will be liable to seizure.

–       Labels, get up, packaging or other means– CTM owners will be able to take action against those who produce and distribute such items to which the mark may subsequently be affixed to goods or services.

–       Designation and classification of goods and services– the IP Translator decision is being included in the proposed legislation with regard to specifications of goods and services. Goods and services need to be identified by the applicant with ‘sufficient clarity and precision’ to determine the extent of protection the trade mark confers. Those who own registered CTMs are allowed to state that on filing they intended to seek protection in respect of goods and services beyond those covered by the class heading by filing a declaration. If no such declaration is filed, the registered mark will only cover goods and services covered by the literal meaning of the term. Allowing such a declaration to be filed may result in the registrations being republished for opposition purposes. There has been discussion to suggest that it may be better for registrations granted before the IP Translator decision to be left for court interpretation.

–       Certification marks– will be introduced at EU level and this will help to bridge the gap between national systems and the EU trade mark system.

–       Fees– applicants will now be able to file and renew a CTM in just one or two classes with a new fee system being introduced. Filing in just 1 and 2 classes will now attract a reduced fee, with the cost for filing three classes remaining the same. Further, OHIM may charge a fee in a variety of new circumstances including issuing a copy of the certification of registration, issuing of certified copies of the application and registration of a license or another right in respect of a European trade mark.

–       Geographical indications and traditional terms– conflicts with protected geographical indications, traditional terms for wines and traditional specialities are not currently addressed in the grounds for refusal. To ensure a level playing field throughout the EU, relevant provisions will be inserted into the proposed legislation with regard to absolute grounds for refusal of a CTM based on prior designations of origin, geographical indications and any protected traditional terms e.g. wine.

–       Foreign descriptive terms– any terms that may be descriptive if translated or transcribed into any script or official language of a member state will not be granted trade mark protection (e.g. if Chinese characters were translated and found to be descriptive in China it would not be afforded protection in the EU).

–       Bad faith– currently, bad faith is only available as grounds for CTM invalidity post registration. The proposed legislation will enhance protection for marks outside of the EU and it will be possible to oppose EU applications filed in bad faith.

–       Trade and company names– CTM owners will be entitled to prevent infringing acts relating to the use of a trade or company name (or a part of a trade or company name).

–       Priority claims– the procedure for claiming priority is to be simplified. The priority claim need only include the date, number and country of the previous application. The proposed requirements therefore do not require as much documentation as currently needed and this should help to stream line the procedure.

–       Searches– current search regimes by OHIM and members states will be abolished as it is argued that many applicants do not opt for results of national searches from National Offices taking part in the optional system. This will then have a knock on effect on the publication of the application and should speed up the registration process. This may lead to more marks proceeding to registration unopposed as notifications of later CTM applications which are filed will not be sent to prior CTM owners.

–       Examination of opposition– the five year non-use period will be calculated from the five years preceding the filing date (or the priority date) instead of the publication date. Specification queries and objections will impact the difference between the former and the latter.

National Law

Some of the proposed changes as set out in the draft Regulation and some of which are discussed above reflect the proposed changes in the Directive for national levels. Below are some of the changes relating to national law.

–       Genuine use– the five year use period will be calculated from the date when the mark can no longer be opposed, or, in the case where an opposition has been filed and not withdrawn, it will be calculated from the date when a decision terminating the opposition proceedings has been issued.

–       Observations– it will now be possible for third party observations based on absolute grounds to be filed and that third party will not become a party to proceedings. This proposal has also been addressed in the draft Regulation for CTMS and OHIM.

–       Procedure for revocation or declaration of invalidity– it will now be mandatory for revocation and invalidity actions to be brought before national trade mark offices. This will be introduced into several Member States where parties are required to go to the expense of court proceedings. The offices that must add this procedure are Benelux, Estonia, Finland, France, Lithuania, Malta, Romania, Slovenia, Spain and Sweden. Italy and Germany may have to review their procedures for cancellation actions.

Eleni Mezulanik   18 April 2013


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