EU Trademark Reform Delayed; Debate Includes Goods-In-Transit, Harmonisation 25/02/2014 by Dugie Standeford for Intellectual Property Watch Leave a Comment Share this:Click to share on Twitter (Opens in new window)Click to share on LinkedIn (Opens in new window)Click to share on Facebook (Opens in new window)Click to email this to a friend (Opens in new window)Click to print (Opens in new window)Efforts to update European Union trademark law have slowed amid political differences and squabbles over some provisions of the reform package, representatives from the European Commission (EC), European Parliament and trademark community say. Contrary to the wishes of the EC and lawmakers, the legislation will not be completed before European parliamentary elections in May. The modernisation package has three elements, the EC said when it floated it in March 2013: Revisions to the 1994 Community trademark regulation [pdf]; a revamp of the 1989 directive standardising EU member states’ trademark laws [pdf]; and revision of the 1995 EC regulation on fees payable to the Office for Harmonisation in the Internal Market (OHIM), where EU Community trademarks are registered. The European Parliament Legal Affairs (JURI) Committee proposed several changes to the EC version in reports by rapporteur Cecelia Wikström, of the Alliance of Liberals and Democrats for Europe (ALDE) and Sweden. The reports, as amended, were overwhelmingly approved at a 25 February plenary session (the adopted text will be available here). Goods in Transit a Key Provision Updating trademark law is a big deal to Europe’s trademark community, said Lichtenstein, Körner & Partners (Stuttgart) partner Kerstin Gründig-Schnelle, who specialises in Community trademark law. She has followed the proposal since it came out, and headed the International Trademark Association’s OHIM (European Trademark Office) subcommittee for three years. Of chief importance are the provisions on counterfeit goods in transit, harmonisation of basic procedures in national trademark laws and Community trademark fees, Gründig-Schnelle said in an interview. The goods-in-transit issue concerns goods coming from, say, Brazil through Amsterdam to Russia, said Gründig-Schnelle. Under current law, if counterfeit items do not enter the EU market, customs officers can’t seize them, she said, adding that bogus goods are often detected but can’t be taken or destroyed, an unsatisfactory situation for European trademark owners. The EC proposed to make it possible to seize such goods if they infringe a Community trademark even if they’re not placed in the market in Europe, she said. This proposal doesn’t sit well with some stakeholders, said Gründig-Schnelle. Generic drug manufacturers worry that their products could be stopped in customs, and ports and airports fear they’ll lose business because counterfeiters will choose different routes outside Europe, she said. A European Parliament compromise would require that the trademark concerned be protected not only in the EU but also in the country of destination before goods can be seized or destroyed, she said. The goods-in-transit provision sparked heated words at a 24 February plenary debate. Wikström and other MEPs blasted the two largest parties, the European People’s Party (EPP) and Socialists and Democrats (S&D), for back-tracking on JURI’s compromise position on countering fake goods in transit and for being in thrall to big pharmaceutical companies. The amendments are “a threat to international trade” that will affect ports and airports and may mean generic drugs are stopped on the way to poorer countries, said Wikström. But after the vote, major industry organisations praised the “political courage” of the EPP and S&D members who sponsored the “robust measures.” The new provisions will let customs stop bogus goods even if they’re destined to a country outside the EU, won’t affect trade in legitimate goods and will ensure that genuine generic medicines reach their final destination, said the European Federation of Pharmaceutical Industry, American Chamber of Commerce to the EU, MARQUES, International Trademark Association and 11 others. Diverging Views on Harmonisation Another improvement from the perspective of trademark owners is the plan to harmonise basic procedures in national trademark law, said Gründig-Schnelle. Now, there are no uniform provisions across the EU for obtaining national trademarks, cancelling them for non-use, opposing their grant, and so on, she said. Here, too, however, a sticky issue has surfaced. Under Community trademark law, trademarks can only be rejected on “absolute” grounds, for example, if they are void of distinctive character. In some countries, however, national trademark applications must also be checked for relative grounds (such as the existence of an earlier identical or similar mark), but the EC wants to abolish that, said Gründig-Schnelle. Some trademark offices oppose that position, as does Parliament, she said. Differences have also arisen over who should have the authority to change Community trademark fees, Gründig-Schnelle said. Under current law, the EC does so and wants to retain the status quo, while the JURI report calls for fees to fall under the Community trademark regulation so they can only be amended by the European Parliament and Council, she said. Trademark users tend to favour the EC’s more flexible solution, she said. On the actual fee change proposals themselves, however, JURI members backed the amounts and structure the EC proposed, Internal Market and Services Commissioner Michel Barnier said during the debate. The EC wants to ensure that organisations, especially small and mid-sized ones, pay only those fees that correspond to their needs, he said. Technical examination at experts’ level is going on within Council preparatory bodies, and it’s not clear yet what outstanding issues will remain to be discussed at the ministerial level, an EU source said. The picture will be clearer when the technical discussions are complete, the source said. But a preliminary assessment made at the end of 2013 showed some divergent views between the EC and member states on several issues, including the level of harmonisation of national procedures and future governance of OHIM, he said. No Resolution before May JURI members managed in record time to reach unanimity on a very complex issue, but the Council has failed to do so, Wikström said during the debate. She voiced “enormous disappointment” about governments’ “incompetence and complete lack of will” in dealing with trademark reform. Barnier said he was just as determined as Parliament to get the package through in first reading, but despite their efforts, it’s clear that there will be no political agreement before this parliament is adjourned. The Greek EU Presidency is targeting a Council political agreement at the 26-27 May Competitiveness Council, provided the technical work is done by then, the EU source said. The trademark reform package won’t be ready to be adopted into law before Parliament adjourns for elections, so the process will continue in the next legislative term, he said. That means that newly elected MEPs don’t have to start from scratch and can build on the work done this term, JURI said. But the new legislature may decide to start afresh if one of its committees so requests and the conference of leaders of the political groups agrees, JURI said. Share this:Click to share on Twitter (Opens in new window)Click to share on LinkedIn (Opens in new window)Click to share on Facebook (Opens in new window)Click to email this to a friend (Opens in new window)Click to print (Opens in new window) Related Dugie Standeford may be reached at info@ip-watch.ch."EU Trademark Reform Delayed; Debate Includes Goods-In-Transit, Harmonisation" by Intellectual Property Watch is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License.