Legal framework

In Austria, trademarks are governed by the Trademark Protection Act (BGBl 260/1970), which implements the EU Trademarks Directive (89/104/EEC).

Community trademarks that are governed by the EU Community Trademark Regulation (207/2009) and EU Regulation 2868/95 implementing the Community Trademark Regulation are enforceable in Austria. Specific provisions on Community trademarks can be found in Sections 69 to 69d of the Trademark Protection Act. Equally, the European Product Piracy Regulation as well as the Austrian Law Against Product Piracy, including the rules of simplified procedure, are applicable.

Austria has acceded to several international treaties, including:

  • the Paris Convention for the Protection of Industrial Property;
  • the Nice Agreement on the International Classification of Goods and Services; and
  • the Agreement on Trade-Related Aspects of Intellectual Property Rights.

Since Austria has implemented the Madrid Protocol on the International Registration of Marks, trademarks based on international registrations are also enforceable in Austria.

Unregistered trademarks

The Commercial Code (dRGBI 219/1897) provides protection for commercial designations which have been entered in the Commercial Register. According to Section 29 of the code, commercial designations must be distinct from other commercial designations in the same location or political municipality. Penalties for infringement include invalidation of the infringing mark and compensation of damages.

Further, Section 9 of the Unfair Competition Act provides for the protection of unregistered company names and trade names, including trade dress, as long as they have been used in commerce and the trade dress is well known to the public.

The names of natural or legal persons are protected by the Civil Code. Improper use of names may also entitle claims for invalidation and/or compensation for damages.

Registered trademarks

The Austrian Patent Office recognises the ownership or registration of trademarks by any natural or legal person. However, applicants without a domicile, seat or commercial establishment in Austria must appoint an Austrian attorney, patent attorney or notary. Notarisation of the power of attorney is not required.

The definition of ‘trademark’ in Section 1 of the Trademark Protection Act covers any sign which can be represented graphically (eg, words, numbers and three-dimensional (3D) shapes). Sound sequences can be registered as trademarks; however, fragrances may not be registered in Austria at present.

In order to be registered as a trademark, a graphically represented sign must be capable of distinguishing the goods and services of one enterprise from those of other enterprises by either inherent or acquired distinctiveness.

Procedures

The Austrian Patent Office examines the trademark application with regard to formality requirements and for any absolute or relative grounds for refusal.

Registration will be refused if absolute grounds for refusal exist; however, relative grounds of refusal such as descriptiveness and genericness can be overcome under certain conditions.

The absolute grounds for refusal apply to:

  • marks which reproduce official symbols;
  • marks which do not fulfil the requirements of Section 1 of the Trademark Protection Act (ie, cannot be represented graphically);
  • 3D marks which consist only of the shape that:
    • results from the nature of the goods as such;
    • is necessary to obtain a technical result; or
    • gives substantial value to the goods;
  • marks which are contrary to public policy or accepted principles of morality;
  • marks which can deceive the public; and
  • marks which wrongfully designate the geographical origin of wines and spirits.

After registration, the trademark is published in the journal Österreichischer Markenanzeiger.

In 2010 the Trademark Act was amended to implement an opposition procedure. The owner of an earlier trademark (registered or filed) can challenge a later conflicting trademark registration up to three months after its publication in the Österreichischer Markenanzeiger. Prior registration of a trademark or application thereof (provided that the trademark will be registered) constitutes grounds for opposition.

A single member of the relevant division of the Austrian Patent Office is competent for opposition proceedings. Opposition decisions of the Austrian Patent Office can be appealed to the Vienna Higher Regional Court.

In addition to the opposition procedure, a cancellation action may be brought where a trademark infringes prior registered or well-known unregistered trademarks. Cancellation actions can also be based on commercial designations. A cancellation action can be brought by any party on the grounds that a trademark should not have been registered based on absolute grounds of refusal. Further, any party may request cancellation of a trademark that has been inactive for five years. The burden will then be on the rights holder to justify the lack of use. Further grounds of cancellation can be found in Sections 30 and following of the Trademark Protection Act.

Enforcement

Trademark infringements are subject to both civil and criminal penalties.

As stated in Sections 10 and 51 and following of the Trademark Protection Act, the grounds for legal action based on trademark infringement are the use of:

  • an identical mark on identical or similar goods or services;
  • a similar mark on identical or similar goods or services; and
  • an identical or similar sign on dissimilar goods, where the registered trademark is well known in Austria and the use takes unfair advantage thereof.

Litigation – civil law remedies

The registered rights holder or licensee (depending on contractual rights) can take the following measures against infringers.

Cease and desist order: A crucial requirement of a claim for a cease and desist order is the risk of reoffending. In this respect, the principles and precedents of competition law apply when assessing the risk of reoffending. Notably, negligence on the part of the infringer is irrelevant to this assessment.

In certain cases, a preventive action for a desist order is permitted. This differs from the usual claim for a desist order in that the risk of reoffending is replaced by the imminent risk of infringement. This condition is fulfilled if there is a direct threat of infringement (eg, preparatory acts).

Seizure and destruction: The rights holder or licensee may request the seizure and destruction of infringing goods and the means used to reproduce the trademark. Alternatively, the offending trademark may be removed from the goods in question.

Compensation: If the infringement is not the result of negligence on the part of the infringer, the rights holder or licensee can claim only adequate remuneration. However, if the infringer has acted negligently or intentionally, a claim for damages (based on lost profits) or delivery of the unfair profits of the infringer is justified. Compensation is calculated using a reasonable royalty rate, usually equivalent to the payment of a hypothetical licence fee.

Where the amount of the damages cannot be assessed, it is possible to claim double the amount of the adequate remuneration instead. Such a claim requires proof of a minimum of gross negligence on the part of the infringer.

A claim for damages must prove actual damage and establish a causal link between the infringement and the damage incurred. In addition, the burden of proof regarding negligence on the part of the infringer rests on the claimant.

Requirement to submit evidence: The rights holder may require the infringer to submit evidence or render accounts, independent of any negligence. The results thereof form the basis for assessing adequate remuneration. A claim for evidence is procedurally separate from the claim for compensation.

Summary proceedings: A rights holder filing a claim against an infringer can also apply for a preliminary injunction. However, it is possible to apply for a preliminary injunction even before the claim has been filed.

Section 56 of the Trademark Protection Act specifically provides for preliminary injunctions. In most cases, an applicant for a preliminary injunction need only prove its right as a rights holder or licensee, the trademark infringement and the remedy sought – although in some cases it may be necessary to prove continuous and effective use of the trademark. There is no requirement of urgency. Ex parte decisions in summary proceedings are possible, but rare. Usually, the defendant submits evidence before summary proceedings are finalised.

A dispute may be substantially decided in provisional proceedings, provided that no further facts are put forward in the main proceeding which would lead to a different legal assessment. However, an applicant for a preliminary injunction which is refused must bear the defendant’s costs for the preliminary proceedings, irrespective of the final outcome of the trial. Further, if the claim against the alleged infringer fails, the claimant must compensate the defendant for damages incurred due to the granting of a preliminary injunction.

Since the preliminary injunction is provisional, the court can grant only interim relief. As such, the outcome of the preliminary injunction must be reversible. However, the Supreme Court has decided that the destruction of advertising material may be granted, since such material is easily reproduced.

Provisional measures include:

  • deposition of the alleged infringing goods with the court;
  • authorisation for the applicant to seize the alleged infringing goods;
  • an order directing the defendant to act in a particular way; and
  • an order directing the defendant (or a third party) to cease and desist certain actions.

Injunctions are enforceable immediately. The court granting the injunctive relief may suspend enforceability or make enforcement dependent on a bail.

First-instance procedure: First, the claimant files the statement of claim with the court. After examining the formal requirements of the claim, the court will deliver the statement of claim to the defendant, which is instructed to file a statement of defence with the court within four weeks. After receiving the statement of defence, the court will invite the parties to a preliminary hearing. The court will attempt to reach a settlement in the first hearing; if this is not achieved, the parties are allowed to submit written documents to the court.

Once all the evidence is gathered, the trial at first instance is complete. No further evidence can be presented to the court.

The court will then take time for deliberations and hand down a written decision.

Costs: The winning party may recover its costs from the losing party, as provided in Section 41(1) of the Code of Civil Procedure. However, the winning party cannot recover all of its costs: costs for the winning party’s attorney are reimbursed only according to a general tariff.

A division of the costs may be made if a party is only partially successful.

Appeals: A higher regional court will hear an appeal against a first-instance decision. The Supreme Court – the highest appellate court – will hear an appeal against a second-instance decision. However, there are various restrictions on the right of appeal to the Supreme Court.

In principal, appeals against substantive decisions have a suspensive effect. This means that a judgment under appeal is not binding on the parties and thus enforcement is not yet possible. One exception is in cases where the higher regional court decides that the preconditions for a second-instance appeal have not been met and the party applies for an extraordinary appeal.

Appeals against both first and second-instance decisions must be filed within four weeks of notification of the contested judgment.

Appeal against first-instance decision: In order to be admissible, the appeal must be based on the following grounds:

  • general procedural grounds for annulment (eg, lack of Austrian jurisdiction or lack of representation);
  • other violations of procedural law (eg, the court did not sufficiently examine the facts);
  • where the court did not decide all the claims raised at first instance or interpreted the evidence wrongly; or
  • where the legal question was wrongly decided.

The facts which were already submitted by the end of the first-instance trial form the basis for the appeal court decision. Therefore, no new evidence or facts may be presented in appeal proceedings.

The appeal court may confirm or amend the contested decision. Under certain circumstances, the court may send the case back to the first-instance court.

Appeal against second-instance decision: Appeals to the Supreme Court are restricted. The Supreme Court will review only questions of law, not questions of fact.

The possibility of appeal to the Supreme Court is contingent on the value of the case and its significance for legal development, certainty and uniformity.

The Supreme Court’s decision is based solely on the written statements of the parties.

Enforcement: Rules for the enforcement of judgments are found in the Enforcement Code. The losing party faces penalties for non-compliance with the decision. Each illegal act may result in a fine of up to €100,000. If the infringement continues, the winning party can ask the court to impose a sentence of up to one year’s imprisonment on the offending party.

Litigation – criminal law remedies

Under the Trademark Protection Act, the intentional infringement of trademark rights and unregistered trade names is punishable by a fine; further, if the offence is committed on a commercial basis, an additional penalty of up to two years’ imprisonment may be imposed. In practice, convicted infringers are likely to be subject to an unconditional fine.

This offence is subject to private prosecution, which may be initiated only by the person or business damaged by the infringement – not the public prosecutor. According to the Trademark Protection Act, the Vienna Criminal Court has exclusive jurisdiction for criminal law remedies based on trademark infringement.

Both individuals and legal entities may be the subject of criminal procedures for infringement; however, employees or other authorised persons who carry out the trademark infringement based on their employers’ orders are not subject to criminal charges.

Ownership changes and rights transfers

A change of ownership of an Austrian trademark should be registered in the Trademark Register. However, this recordal is merely declarative: even if the change of ownership is not recorded in the register, the acquirer can enforce its rights.

There is no requirement to register a licence. Depending on the licence agreement, the licensee may itself start infringement proceedings even without the consent of the licensor.

Related rights

A trademark which is a sufficiently original creative work can be protected simultaneously by copyright law, where it meets the standards of originality according to copyright law.

Online issues

The country code top-level domains ‘.at’, ‘co.at’ and ‘.or.at’ are governed by nic.at GmbH, which manages the issue and administration of Austria’s top-level domains. When registering a domain name, the applicant must ensure that it does not infringe third-party rights (eg, naming rights, trademark rights and unfair competition law). As applications are rejected only if they obviously infringe third-party rights, disputes must be resolved amicably or – if this is not possible – in court. Legal disputes regarding a domain may be registered at nic.at GmbH, and ‘wait status’ may be requested for a domain in order to prevent transfer. 

Egon Engin-Deniz

This article first appeared in World Trademark Review. For further information please visit www.worldtrademarkreview.com.