Yesterday, the Court of Justice of the European Union ("CJEU") handed down its long-anticipated judgment in the ONEL/OMEL case (Case C‑2149/1, 19 December 2012 between the Dutch companies Leno Merken B.V. and Hagelkruis Beheer B.V. The main issue in this case is whether the use of a Community trademark ("CTM") in just one EU Member State is sufficient to maintain the rights in the CTM registration where such registration is challenged on the basis of non-use.
If a CTM is not put to genuine use in the Community within five years of the registration date, it is subject to revocation or partial revocation. In addition, it cannot be relied on as an earlier trademark in an opposition against a third-party trademark. This follows from Article 15(1) of the Community Trademark Regulation ("CTMR").
There has been a lengthy debate on whether use of a CTM in one EU Member State is enough to maintain the registration if it is challenged on the grounds of non-use. While OHIM has always taken the position that use in one Member State should be sufficient (this was one of the major selling points of the whole CTM system), that viewpoint has been broadly criticised by others, such as the Benelux Office for Intellectual Property ("BOIP"). In her advisory opinion to the CJEU in ONEL/OMEL, Advocate-General Sharpston indicated that the protection granted to a CTM may not be appropriate if there is an intention to trade only on a national scale; therefore, use in only one country may not necessarily be sufficient.
Facts of the case
The owner of the CTM "ONEL" opposed the registration of the Benelux trademark "OMEL" before the BOIP. This opposition was dismissed by the BOIP because the owner of the CTM "ONEL" had refused to demonstrate use of its trademark outside of the Netherlands. The BOIP held that even though genuine use had been demonstrated in the Netherlands, this did not constitute genuine use within the Community. In the BOIP's opinion, use in one Member State cannot by definition be enough to constitute genuine use for the purpose of maintaining a CTM. The BOIP's decision was appealed to the Court of Appeal of The Hague, which subsequently referred four questions to the CJEU.
These four questions can be summarised as follows: (1) Is use of a CTM in one country always enough in order to qualify as genuine use for the purpose of Art. 15(1) CTMR? (2) If not, is it never enough? (3) If it is never enough, what is needed? (4) Should the assessment of the required genuine use be done in the abstract, without reference to the borders of the territory of the individual Member States?
In its judgment, the CJEU decided that the territorial borders of the Member States should be disregarded in the assessment of whether a trademark has been put to "genuine use in the Community" within the meaning of Art. 15 (1) CTMR.
The CJEU emphasised that the territorial scope of the use is not a separate condition for genuine use, but one of the factors determining genuine use. It went on to state that whereas it is reasonable to expect that a CTM should, by its nature, be used in a larger area (within the Community) than a national trademark, this is not by definition necessary in order to accept use of the CTM as genuine use. According to the CJEU, where the market for the goods or services for the CTM has been registered is in fact limited to the territory of a single Member State, it cannot be ruled out that use of the CTM on that territory might "in certain circumstances" satisfy the conditions for genuine use both of a CTM and of a national trademark. However, it is for the national courts to assess the market circumstances.
This decision is important because it makes it clear that the unitary character of the CTM does not necessarily dictate EU-wide use. However, use in only a single Member State will also not by definition be sufficient to maintain the rights to a CTM. On the basis of the characteristics of the product or services in question and the corresponding market, use of a particular CTM in only one Member State may qualify as "genuine use". The suggestion that a de minimis rule be set in the abstract has clearly been rejected by the CJEU. Rather than setting quantitative requirements, the CJEU attaches importance to the scope of the relevant market in each specific case.
Therefore, when assessing whether or not he/it can rely on the protection granted by a CTM registration, the owner of that registration will have to take into account the actual market for the product(s) or service(s) for which the CTM is used, and cannot simply rely on the doctrine that use in one Member State will be sufficient. For further background information reference is made to the article by Charles Gielen in European Intellectual Property Review no. 48 (2011).