The Court of Justice of the European Communities (CJEU) issued its decision in the so-called “Onel” case in December 2012 (Leno Merken BV v Hagelkruis Beheer BV, 19 December 2012). This was a landmark judgment on a topic which had come before that court on several occasions, on the concept of genuine use of a trade mark in the EU. The decision was widely anticipated across the EU, however it is of particular interest to owners of trade marks within the smaller EU member states.

Background

Under the Community Trade Mark Regulation, a Community trade mark (CTM) must be put to “genuine use in the Community” within five years. If it is not, the trade mark is vulnerable to cancellation. Similarly, if one registers a CTM, uses it for a period, then ceases use for a continuous period of over five years, it may be cancelled. This makes economic sense, there is no value in affording protection to marks which are not being actively used, and to so allow would have the effect of needlessly preventing the use of that mark by another enterprise who might legitimately wish to use it. So, the doctrine of “use it or lose it” applies.

What was the CJEU Deciding?

In this case, the trade mark owner only “used” the mark in one Member State, the Netherlands. Whether he had satisfied the requirement for “genuine use in the Community” was at the core of the questions before the CJEU.

Why is it Important for Trade Mark Owners?

Many trade mark owners register CTMs due to the cost savings and efficiencies in having a single mark to cover the 27 Member States of the EU. However, their use may be mainly concentrated in a single country or even region. If there is doubt on the question of whether single Member State use is sufficient to ensure a CTM is legally robust, then they would become less attractive a proposition for businesses.

What was the Decision?

The CJEU held that in looking at the question of “genuine use in the Community” one disregards national borders, and instead focuses on the question of whether the mark has been used in accordance with its essential function, and the scale and regularity of use must be considered. Those analyses, taking into account all the facts and circumstances, are to be done at national court level. Use in one Member State may be sufficient, but no hard and fast guidelines or minimum “use” thresholds were set out by the CJEU.

Conclusion

While some have criticised the CJEU decision as a missed opportunity for clarity, the Court may have been trying to steer a middle course. The unitary nature of CTMs would be undermined by a finding that use, even intense use, in one Member State was insufficient. On the other hand, setting a minimum threshold for use might place a burden on SMEs that might be expensive to meet and prove. What is clear is that it is likely that the question will come before the CJEU again in another form. In the meantime, if your CTM is potentially vulnerable on the ground of whether your use of it is genuine use “in the Community” or not, then you should seek advice. Potentially, it may be worthwhile seeking a national trade mark in addition to your CTM, however this will depend on the nature of the current use, and on the sector and your budget.