Madrid System on the Rise!
April 14, 2016, marked the quasquicentennial anniversary of the Madrid System of International Trademark Registration, 125 years since its first governing treaty (the Madrid Agreement) was adopted in Madrid on this day in 1891. And for the first time in its history, International Trademark applications crossed 50,000 in a single calendar year. An estimated 52,550 international trademark applications were filed under the WIPO-administered Madrid System in 2016- a growth of 7.2% since 2015, and the fastest since 2010! The system has continued to expand its geographical scope, with Brunei Darussalam being the latest country to have been granted membership, bringing the total number of members to 98. The Madrid System now encompasses an area covering 114 countries in which a member may obtain protection for its trademark.
Asia - the Place to do Business
With the reach of the International Trademark Registration system broadening with every passing year, the Madrid Yearly Review for the year 2016 has thrown up a number of fascinating trends. Principal among these is the rise of non-traditional, middle-income markets, especially in Asia, as being the point of origin for a great number of international applications. Even though all top 10 Madrid applicants (in terms of number of filings) were European companies, it is notable that Asia has jumped to second spot in the number of international applications filed in 2016, with 17.5% of the total number of international applications filed.
The most dominant Asian country, which has seen a prominent spike in international applications is China. Filing a total of 3200 international trademark applications, China has jumped from ninth largest origin country in 2015 to fourth in 2016, with an increase of 1300 international applications filed.
The total number of designations in International Trademark applications showed an increase of 6.2% from the previous year. On average, applicants designated around 7 Madrid members per international application filed in 2016, and almost two-thirds of all international applications filed designated up to 5. More Madrid applicants sought to obtain protection for their trademarks in Asia with China being 2016’s leading country designated in Madrid applications (a total of 22,444). India placed at No. 9, with a total of 11,263 international applications designating India as a territory for protection
China was the third largest designator in its international applications, and it is interesting to note that after the US, the maximum number of designations for India came from Chinese applications!
India also received 644 subsequent designations from Madrid applicants seeking to expand the range of protection for their marks. As an origin country also, India saw growth, filing 171 international application in 2016, up from 152 in 2015.
Another popular Asian country ranking among the top 10 designated countries was the Republic of Korea (South Korea), with 11,271 designations, only slightly more than India. It also featured as No. 15 on the list of the top 20 countries of origin for international applications, thanks to its two major global companies - Samsung Electronics and Hyundai Motor Company. The Republic of Korea obtained 1451 subsequent designations from holders of international registrations, making it the fourth largest recipient of subsequent designations.
Trademark Protection in a Digital World
The total number of classes specified in international applications has grown steadily since 2000, corresponding to growth in number of applications. In 2016, over three-quarters of all applications filed included up to 3 goods or service classes.
As has been the trend for more than a decade, the majority of Madrid applications continued to be in the research and technology sector, with Class 9 goods, which includes computer hardware and software and other electrical or electronic apparatus of a scientific nature, being the ones most specified. This is reflective of a growth of 11.6% from 2015, and 9.4% of the total number of applications filed in 2016. Class 9 was followed by Classes 35, 42 and 41 in popularity. Three out of the six most specified classes are classes for services, and in fact, nearly one-third of all classes specified in international applications filed in 2016 were for services, in keeping with the trend from 2000-2016 where between 26%-34% of all International Trademark applications have been in service classes
Electronic transmission to communicate with the International Bureau was introduced for the first time in 1998, and up till 2014, only a little over half of all applications were received via the electronic medium. In 2016, this has spiked to a whopping 74.5%! A result of WIPO and the IB streamlining its online application procedure to make it easier and more accessible for applicants to apply through this method. To highlight its international accessibility and impact, the bulk of international applications (81.6%) filed at the International Bureau were in English, as compared with a meagre 15.8% in French, the original working language of the Madrid System!
A promising step towards widening the scope and accessibility of the Madrid System outside the First World is the drop in average registration fees, recorded in 2016- 2.968 Swiss francs, as compared to 3.734 Swiss francs in 2008. And while the EU (via the EUIPO) received the largest share of the total fees distributed to Madrid members in 2016, developing nations such as Uzbekistan and Mexico are climbing steadily, with India also receiving 0.8% (1,406,664 Swiss francs) of the total registration fees collected in 2016
On average, holders paid 2,968 Swiss francs per registration recorded in 2016, down from the peak of 3,734 Swiss francs in 2008.
Provisional Refusals to Trademark Protection by Member States
On the whole, issuance of provisional refusals fell by 1.7% in 2016, indicating greater facilitation to applicants looking to enter international markets, as well as increased familiarity and streamlining of Madrid System classification and procedure among both applicants and Member States. The US and the Republic of Korea led the pack in issuing provisional refusals, but India was not far behind, at No. 5, issuing a cumulative of 7,702 provisional refusals to international registrations
The statistics coming out of WIPO regarding Madrid System International filings are reflective of larger changes in global business and communication practices. The world is shrinking as the digital sphere expands, connecting everyone, no matter how far away through just a few clicks. The rise of goods and services catering to the needs of an ever more connected populace, and a marketplace transcending territorial boundaries poses its own set of challenges.
The Madrid System for the International Registration of Marks serves as a solution to traders and businesses looking for a single, over-arching system of trademark protection, without having to painstakingly go through the individual registration procedures of each country. And for an inter-connected digital modern world, the Madrid System has achieved its purpose of being the most convenient as well as cost effective “one-stop shop” for garnering trademark protection. Towards this, the Madrid System itself is evolving to improve and enhance its utility by facilitating access to new and emerging markets. The WIPO website provides access to a host of Madrid System related electronic tools, portals and databases. Starting with electronic access to the International Register through the ROMARIN CD-ROM first released in 1992, E-Services – such as E-Renewal (since 2006), Madrid Real-Time Status (since 2010), Madrid Portfolio Manager (since 2012), and E-Subsequent Designation (since 2014) – have made it increasingly easy for users to track and manage their international trademark registrations. These services have laid the groundwork for a new digital initiative, E-Madrid, focused on the delivery of an enhanced online experience for customers throughout the lifecycle of their mark.