The legislation has been passed, regulatory revisions are now complete and practice notices associated with most areas of change have been tabled. Canada’s new trademark regime will commence June 17, 2019.
However, there is no getting away from the fact that the transition stage, between now and the point at which all applications filed under the new system have reached registration or abandonment, will be complex to navigate. This is due in no small part to incredibly convoluted regulations required to effect the three separate Bills containing trademark components – two Budget Implementation Acts and Bill C-86 – Combating Counterfeit Products Act.
Public consultations on the regulations led to widespread feedback suggesting that sections of the Regulations were incomprehensible even to experienced professionals. To complicate matters, treatment of these pending applications will not be uniform but rather will depend on whether the Application has reached publication or not.
CIPO has now prepared in Draft a Guide to Transitional Provisions of Bill C-31. The document can be read here: https://www.ic.gc.ca/eic/site/cipointernet-internetopic.nsf/eng/wr04455.html
Essentially, the document describes handling of Applications pending at the time of coming into force of the new provision.
Re-examination for Distinctiveness
One significant take-away message is that after June 17, 2019 all applications not having reached publication will be re-examined for distinctiveness. Under the current legislation, Examiners cannot assess this criterion. However, after June, any applications covering marks relating to shape, configuration, sound, colour etc. can be refused on the basis of lack of distinctiveness. The same will be true for other marks that, while perhaps not otherwise objectionable for example on the basis of being clearly descriptive, lack sufficient distinctiveness to be deemed registrable.
It remains to be seen how strict the applied standard will be, but all indications suggest the threshold will be set quite high. The practice notice associated with the assessment of distinctiveness covers one of the more difficult aspects of the coming changes and is still under consideration by CIPO. Publication is expected soon, so stay tuned! Marks will also be re-assessed to determine if they contain features dictated primarily by utilitarian function.
Tip # 1. If your client or company has this type of application pending and has the choice of advancing it to the publication stage before June, it would be wise to do so to avoid re-examination.
Another interesting question, at least partially answered by the Guide, is what will happen to claims of use in Canada that give an applicant both the claim to entitlement as of that date and advantages in Opposition proceedings. Quite aside from its obvious deterrent value in respect of others conducting search and clearance, a claim to use in Canada can be a valuable asset in Opposition as it will allow an Opponent to advance a case even without filing evidence of use. The Board will generally infer de minimis use in these instances. If, for example, the marks and goods and services of the parties are very similar and the application is based on proposed use, mere de minimis use can lead to the conclusion that the statutory criteria favour the Opponent with the result being the Opposition succeeds. The Guide clearly states that while the Office will not require Applicants with pending applications not having reached publication to remove such claims, these will not appear in the particulars of the advertisement. It remains to be seen whether such claims will be reflected on the CIPO database or whether applications that reached the publication stage at the time of coming into force will retain their use claims and have these reflected on the register.
Tip #2. If your client or company has a pending application with a claim to use in Canada and has the choice of advancing this application through to, at least publication and, ideally registration, it should do so to preserve its advantage in Opposition and ensure the record reflects the claimed date of entitlement to the extent possible.
If an application has not reached the publication stage on June 17, 2019 it will be necessary for the Applicant to classify the goods and services before the mark can advance. However, applications that have been published will proceed to registration without requiring classification. The Draft Guide indicates however that the Registrar will issue a notice pursuant to s. 44.1 of the new Act, calling for classification and requiring this to be done within six months.
Tip #3. Classify prior to registration. It is unclear precisely how the 44.1 Notice procedure will operate. It is uncertain whether extensions of time will be permitted and how disagreements in classification will be handled. The new legislation allows the Registrar to dictate specific classification AND furthermore it states that determination is not subject to appeal, therefore it is best to have exchanges with the Registrar about appropriate classification whilst under deadlines running from prosecution dates.
The Guide indicates under the title “Fees” that for pending applications not having reached publication the filing fees are those under the previous tariff – i.e. current filing fees of $250Cdn for electronic filings. It is silent on registration fees. However, if one looks to the regulations and in particular the incredibly convoluted Part 3 – Transitional Provisions, Repeal and Coming Into Force, the current registration fee is indeed payable, just as it is for applications which have passed the publication date. In both cases, no fee associated with classification will be applicable until renewal.
Tip #4. Registration fees cannot be avoided unless an application is filed after June 17th, so for pending applications that can be advanced to registration before the Coming Into Force date, registering early will give the trademark owner an extra 5 years of protection given the term will be reduced from 15 to 10 years.
CIPO will allow registrants with renewal dates pending to seek renewal up to six months before that date. If renewal falls within the six-month period and the registration is renewed before the coming into force date, the fees that apply will be the current fee of $350 (if done on-line). However, if renewal is done after coming into force, the new fees of $400 (if done on-line) applies for the first class but in addition a payment of $125 for each additional class will be payable.
Tip #5. If your company or client can renew early, it should do so. This is particularly true for multi-class registrations as the costs could easily double or triple under the new legislation.
Early renewal will not however offer the registrant the longer term of protection. Rather, such registrants will be awarded a 10-year term of protection.
Tip # 6. Time to change the docketing systems now that the coming into force date is known and all requests for renewal will result in a 10-year term of protection in spite of the New Act not yet being in force.
While not covered specifically by the Transitional Guide, it is worth noting that after the coming into force date the cost of multi-class applications will increase. Now filing fees are the same regardless of the number of classes covered. Thus, an applicant covering one class pays the same, $250, as an applicant covering all 45 classes. Under the new legislation applicants will pay $330 (if filing electronically) for the first class and $125 for each additional class. Thus, the same applicants described above would pay $330 versus $4730- quite a difference for the multi-class applicant. The number of new applications covering a large number, or indeed all classes, has certainly increased as of late. Clearly whether it is to obtain defensive registrations or simply to obtain protection before the steep increase in fees occurs applicants are motivated to cover more classes.
Tip #7. Explore the issue of expanded class coverage.
Tip # 8. Talk to a PCKIP Trademark professional if you have any question about the coming changes. We would be happy to help!