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Following the publication of proposals for European trade mark law reform in June 2015, what are the key changes ahead and when are they likely to come into force?
Why is the EU trade mark system being reformed?
The purpose of the reforms is to foster a European trade mark system that is more efficient, cost-effective, accessible and predictable than the current regime. In addition, the reforms are intended to improve harmonisation across trade mark regimes throughout the EU and better co-operation between the Office for Harmonization in the Internal Market (OHIM) and national trade mark offices.The unitary Community trade mark (CTM) was introduced over 15 years ago but there has not been any subsequent meaningful reform while the IP landscape and needs of businesses have changed dramatically.
What are the latest developments?
After two years of discussion and negotiation between EU institutions, there is a provisional agreement on European trade mark reform in the form of a draft regulation and draft directive (see below).
On 21 April 2015, the EU Presidency reached a provisional agreement with the European Parliament on reform of the European trade mark regime. On 10 June 2015, the European Council’s Permanent Representatives Committee (Coreper) approved a compromise agreement which will overhaul existing Community trade law:
What are the key reforms?
The CTM will become the ‘European Union trade mark’ and OHIM will become the ‘European Union Intellectual Property Office’. These names are thought to be more self-explanatory than the current terminology.
Filing and fees
CTM applicants will no longer have a month in which to pay the fee after filing an application. Instead the fee will be payable upon filing.
The little-used option of filing CTMs at national offices will be abolished. Applications may only be filed via OHIM.
The current CTM application fee covers three classes of goods/services. This means that applicants who seek protection in one or two classes are encouraged to extend the application to cover three classes because the effect is cost-neutral. Under the new system an applicant filing in one class only will pay a lower fee of €850 (as compared to the current fee of €1350) with an additional fee for each additional class. The Commission predicts that, overall, application and registration fees will be reduced.
Nice class headings
Following the controversial IP Translator case (Chartered Institute of Patent Attorneys v the Registrar of Trade Marks: C-307/10), there has been much discussion as to the significance and meaning of Nice class headings of goods and services. The debate has been whether Nice headings should be read literally (‘means what it says’ approach) or, whether the class heading should be inferred to mean all goods and services covered by that particular class (the ‘class heading covers all’ approach). The draft Regulation states that use of class headings should be interpreted as including only all the goods and services clearly covered by the literal meaning of the term—a clear rejection of the ‘class heading covers all’ approach.
Registrants of CTMs predating the IP Translator decision (ie prior to 20 June 2012) should be allowed a six month grace period in which to amend their specification of goods and services where they are registered in respect of a Nice class heading only. Where no declaration is filed, the CTM will be deemed to cover only the goods or services covered by the literal meaning.
There will be no requirement to represent marks graphically in a trade mark application. This makes it easier to register unconventional marks, such as sound, as long as other registration criteria are fulfilled.
End to search for earlier CTMs
OHIM will cease to carry out searches for earlier CTMs. Applicants should rely on their own trade mark searches.
Proving acquired distinctive character in invalidity cases
Under the new law, registrants will be able to rely on evidence of acquired distinctive character from after the date of trade mark registration. Previously, this evidence had to relate to the period before the date of trade mark application. Consequently, when seeking to overcome objections for invalidity based on lack of distinctive character, it will be easier to rely on the ground of acquired distinctiveness since the pool of prospective evidence is greater.
End to own name defence for corporate names
Using a sign as a trade name or a company name can infringe a mark. The honest use of a natural person’s name may be a defence to infringement while use of a company name is not.
Dealing with counterfeit goods
Under the new law, CTM registrants will benefit from stronger protection against infringing goods in transit in the EU by the introduction of an express right to prevent goods from entering the EU when goods infringe. There is a defence where the importer can show that the trade mark registrant is not entitled to prevent sale in the country of final destination.
What will happen next?
The next stage is the approval of the compromise agreement by the Legal Affairs committee of the European Parliament. Once this step has been completed, the Council will confirm its political agreement and adopt the legal texts (namely the draft regulation and directive) at the first reading. The second reading by the Parliament will follow.
It is expected that the current draft regulation will come into force in the second quarter of 2016 (while some of the amendments will require secondary legislation). Once the draft directive is formally adopted, member states will have three years in which to implement the new rules into national law.
Jessica Stretch, solicitor in the Lexis®PSL IP & IT team.
This article is republished with kind permission of WIPIT’s sister site, Lexis®PSL IP & IT. For a free trial click here.
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