In 1996, the Community trade mark (“CTM”) was introduced. Today, a CTM provides protection across the 28 Member States of the European Union (“EU”). As such, it has proved to be an extremely cost-effective means of securing protection for brands across Europe.
Since its introduction, however, there have not been any major revisions to the CTM system. But, that is about to change as a package of reforms has now been approved by the European Union’s legislative institutions with the aim of bringing the CTM system up to date given the developments in both the intellectual property and commercial landscape in the past two decades.
This is the first of four articles we will be publishing on the key aspects of the reforms which will affect brand owners with CTM registration across all sectors.
Now that the reforms have been approved, the primary changes to the CTM system will come into force on 23 March 2016. The primary changes to the national systems will come into force by 14 January 2019.
The main objectives of the reforms are to foster innovation and economic growth by making trade mark systems across the Europe more accessible and efficient by lowering cost and complexity whilst increasing speed and predictability.
Under the reforms, there will be a number of name changes and adjustments to the official fees payable under the CTM system:-
- Names The CTM is to be renamed the “European Union trade mark”. In addition, the name of the registry which is responsible for administering the CTM (currently “The Office for Harmonisation in the Internal Market”) will be changed to the “European Union Intellectual Property Office”.
These name changes will make the European trade mark system more readily accessible and understandable. However, the adoption of the name “European Union Intellectual Property Office” has been criticised as the registry will not be responsible for all types of intellectual property (such as patents) as it will only administer the trade mark and design system.
- Fees At present, the official fee for filing a CTM is €900 if the application is filed electronically in up to 3 classes. Protection in additional classes is then calculated on a per-class basis. Similarly, the official fee to renew a CTM is €1,350 in up to 3 classes if the renewal is filed online, with additional fees being incurred for the renewal of any further classes.
Given this “3 for the price of 1” fee structure, the majority of applications and renewals are filed in 3 classes, even if the mark is not used in all classes. Downstream, this clutter on the register creates additional cost for brand owners as it can increase the difficulty of obtaining protection for new marks. Under the new system, the structure for official fees will be changed so that they are payable on a per-class basis.
If the application is filed electronically, the revised cost for a European Union trade mark will be:
- €850 in 1 class;
- €900 in 2 classes; and
- €1,050 in 3 classes.
Given these changes, there will be a marginal reduction of €50 for single class applications filed electronically, otherwise applications which are filed in more than 1 class will be the same or more expensive under the new system. However, on the basis that a registration will cover the European Union at large, it still constitutes good value for money given the broad scope of geographic protection. Nevertheless, for clients who are considering filing applications in 3 or more classes this year, it may be worthwhile bringing forward the filing date to avoid paying the increased fees.
The revised costs for renewing a European trade mark will be:
- €850 for 1 class;
- €900 for 2 classes; and
- €1,050 for 3 classes.
The changes represent an overall reduction of 22% for renewing a mark in three classes. The reduction will be welcomed by brand owners. Moreover, it further increases the cost-savings that can be generated by claiming seniority from national registrations (that is, when national registration in Europe are subsumed into a Community registration for the same mark and specification, thereby allowing the national registration to lapse to save renewal costs). It is also worth noting that renewal fees will now be due by the expiry date of the registration, as opposed to the end of the calendar month in which the mark falls due for renewal.
Many other official fees are also being reduced under the new system, including filing an opposition (from €350 to €320), filing a revocation or invalidity action (from €700 to €630) and filing an appeal (from €750 to €720).