The final compromise texts of the amended EU trade mark Directive and Regulation, the basic legislation governing trade marks in the EU, have now been published by the Council of the European Union on its website. They are not yet law, although they are unlikely to go through any more major changes and are expected to come into force in early 2016.

The long-debated draft Regulation and Directive bring a range of largely positive changes for brand owners, including significant reductions in fees, mandatory expanded protection for reputed national trade marks and the mandatory introduction of administrative actions for revocation or invalidation of national trade marks (although the latter is subject to a seven year transition period).
However, in relation to the specification of existing CTMs, brand owners should already consider acting now, before the new Regulation comes into force. 

The draft Regulation provides that CTM owners whose marks:

  1. were filed before 22 June 2012; and
  2. cover the Nice class headings,

will have a 6 month sunset period from the entry into force of the Regulation in which to file a declaration indicating that their intentions were to seek protection for goods or services beyond the literal meaning of the class headings, provided that those goods or services claimed were included in the version of the Nice alphabetical list in place when the CTM was filed.   If no such declaration is filed within the sunset period, CTMs covering the class headings will be deemed to extend only to goods or services clearly covered by the literal meaning of the Nice indications.

Significantly, the draft Regulation also provides that CTM owners with such amended specifications will not be able to prevent any third party from continuing to use a trade mark in relation to goods or services where and to the extent that:

  1. the use of the trade mark for those goods or services commenced before the register was amended, and
  2. the use of the trade mark in relation to those goods or services did not infringe the proprietor's rights based on the literal meaning of the goods and services in the register at that time.

CTM owners will also face similar limitations in case they wish to oppose or cancel a later trade mark (see new Article 28(8)(a)).

Bearing in mind that OHIM's previous practice was that use of the class headings constituted a claim to all goods or services in the class, and that the existing Regulation and Directive contain very few limitations on the ability of CTM owners to attack the use or registration of later marks, these provisions constitute a potentially severe limitation on CTM owners' rights.

As a result, CTM owners whose marks cover the class headings should already start reviewing their trade mark portfolios and considering the amendments to be made. They should also at least consider implementing amendments to specifications now, before the new Regulation goes live. Whilst the limitations and pitfalls set out in the new Article 28(8)(a) will undoubtedly apply to registrations amended during the six month window, this is not clear in relation to amendments or limitations made prior to the new Regulation coming into force.  Before taking any action, CTM owners will need to carefully analyse their CTM portfolios and devise the best strategy to suit their specific needs.