European Commission Eyes Modernisation Of EU Trademark System

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European Commission plans to update Europe’s trademark system are generally good news for mark owners, a member of European brand owners’ association MARQUES has said.

In draft documents published on 27 March, the EC said it intends to streamline and harmonise registration procedures; modernise outdated provisions; boost the fight against counterfeit goods transiting through European territory; and improve cooperation between national trademark offices and the EU Office for Harmonisation in the Internal Market (OHIM).

While practitioners are still studying the details, several key changes will definitely benefit intellectual property rights holders, said David Stone, of Simmons & Simmons in London, a member of the MARQUES Study Task Force which analysed them.

Europe’s trademark system “has stood the test of time,” Internal Market and Services Commissioner Michel Barnier said at a 28 March press briefing. “There is no need for a major overhaul: the foundations of our system remain perfectly valid.” Rather, he said, the EC wants “well-targeted modernisation to make trademark protection easier, cheaper, and more effective.”

The legislation package has three parts. One [pdf] is a “recast” of Directive 2008/95/EC, which brings national laws on trademarks closer together. The second [pdf] revises a 1994 regulation (207/2009/EC) on the European Community trademark. The third piece revamps a 1995 EC regulation on trademark fees payable to OHIM. An EC memo on the proposed change is here.

Among other things, the draft measures change the terminology “Community trade mark” into “European trade mark” and set out streamlined filing and registration procedures. They remove the requirement that a trademark have “graphic representability,” allowing sounds and other marks using new technologies to be registered. The new system, if adopted, will extend protection to geographical indications. It also requires mandatory cooperation between OHIM and national IP offices to promote convergence of practices and development of common tools.

Application and Renewal Charges Fall

One key change will see OHIM move from a three-class to a pay-per-class system. Stone told Intellectual Property Watch. Trademarks on products and services are registered according to 45 classes established years ago, he said. For example, Class 32 relates to non-alcoholic beverages and beers, Classes 35-45 to entertainment, legal and other services, he said. Trademark applicants who file now get three classes for the 900-euro fee whether they actually need all three or not, but under the new regime they will be able to seek marks in only one class for a fee of 775 euros. Renewal rates will drop for everyone, he said.

This is good for trademark owners because in general, application fees will decrease or stay the same and applicants will have more choice, Stone said. Where there has traditionally been concern is from national trademark offices. When it becomes less expensive to file at OHIM and obtain protection across the entire EU, those bodies may worry about lost revenue, he said.

Tougher Anti-Counterfeiting Rules

Another major shift concerns EU customs procedure, Stone said. Under current rules, goods on the tarmac at, say, Heathrow Airport which are in transit from China to the US aren’t considered to be in the EU or subject to EU trademark law, he said. If those goods are counterfeit, there’s nothing mark owners can do because of that “legal fiction,” he said.

Under a 1 December 2011 European Court of Justice ruling (Cases C-446/09 Philips and C-495/09 Nokia), such goods can only be classified as counterfeit when there is proof that they’re intended for sale or will be advertised in the EU, the EC proposal says. That approach has “met with strong criticism from stakeholders as placing an inappropriately high burden of proof on rights holders, and hindering the fight against counterfeiting,” it says. The EC proposed allowing rights owners to stop third parties from bringing into EU customs territory goods from non-EU countries carrying unauthorised trademarks essentially identical to the European marks registered for those products, whether they are released into circulation or not.

The directive and regulation must be approved by the European Parliament and Council; the new fees by the relevant EC committee on OHIM fees. EU member states are bound by regulations as soon as they become effective, but have some leeway as to how they adopt directives into national law. If the proposed directive is approved by spring 2014, it will have to be made part of national legislation by 2019, the EC said.

Dugie Standeford may be reached at info@ip-watch.ch.

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