As reported in our March 31, 2014 IP Update, the Canadian government has introduced the most significant changes in 50 years to the Trade-marks Act through an omnibus Budget Implementation Bill (Bill C-31, Economic Action Plan 2014 Act, No. 1). The Bill is proceeding through Parliament and is expected to pass in the near future.
Once the Bill passes, the amendments will come into force after suitable regulations have been prepared. The intent of the government appears to be that most of the amendments will come into force in the fall of this year. However, regulations implementing international filing of trade-mark applications under the Madrid Protocol are expected to be delayed until 2015.
What should you be considering now before these changes come into force?
Nice Classification system
There is currently no requirement in Canada to classify goods and services according to any classification system. However, the Canadian Trade-marks Office requires descriptions “in ordinary commercial terms” and requires more specific descriptions than most other countries. The changes expected this year include adoption of the Nice Classification system for goods and services. Prior to the changes being implemented, applications may be filed without specifying the Nice classification. However, it is expected that classification according to Nice will eventually be required for all existing applications and registrations. Further, the strict Canadian requirements are expected to be continued, at least initially, after the changes are implemented.
It is anticipated that fees for applications may increase if registration is sought for multiple classes of goods and services. You should therefore consider expediting the filing of applications for trade-marks used or intended to be used in association with multiple goods or services in Canada to avoid anticipated per-class fees.
Colour and sound marks
If your unregistered trade-marks include colour applied to the surface of goods or sound marks, consideration should be given to applying to register them now. Such marks currently do not require proof of acquired distinctiveness, but this will likely change after the proposed amendments come into force. Acquired distinctiveness is established by way of affidavit and/or survey evidence, which can be quite costly. Further, if distinctiveness is not established throughout Canada, a registration may be limited to be effective only in the parts of Canada where such distinctiveness is established. Filing now may avoid such requirements so long as the application is published before the changes come into force.
Shortened renewal period
Another change is that the renewal period for Canadian trade-mark registrations will be reduced to 10 years from the current 15 years. Registrations issued prior to the amendments taking effect will retain their 15 year term for the first renewal under the new regime. While it is unlikely that an application filed now will issue to registration before the amendments take effect, delay in implementation of the amendments is always possible. Owners of pending applications may wish to expedite registration to the extent possible.
Trade-Mark squatters and pirates and crowded trade-mark register
While the amendments will not change the fact that Canada has a “use” based trade-mark priority system, they will completely remove current requirements for claiming or declaring use in Canada prior to obtaining a registration. Since there will be no indication in applications as to when a trade-mark was first used in Canada or if it has been used, being the first to file will be more advantageous under the amended provisions. Further, there may be notice and evidentiary advantages for applications filed before the amendments take effect, particularly if based on use in Canada.
The amendments to the Trade-marks Act will generally result in simplified procedures for obtaining Canadian trade-mark registrations. That, combined with the anticipated implementation of the Madrid Protocol, is likely to result in more applications being filed in Canada, some of which may cover a wide range of unused goods and services. Also, as it will be possible to obtain a registration in Canada without having use anywhere in the world, it is anticipated that applications may be filed by trade-mark squatters and pirates. We therefore recommend that you carefully review your trade-mark portfolio, including both the scope of existing registrations and unregistered brands and sub-brands, to ensure that marks are fully protected in Canada before the amendments take effect.