The long-awaited reform package to the European trade mark system is here. The new Trade Mark Directive (EU) 2015/2436 and the amended Trade Mark Regulation (EU) 2015/2424 were published in the Official Journal of the EU on 23 and 24 December 2015. The aim of the reform is to provide brand owners with a more efficient, cost effective and harmonised trade mark system across all Member States.
The Regulation will come into force on 23 March 2016. The Member States will have 3 years to implement the changes incorporated in the new Directive into their national laws. Directive (EU) 2015/2436 will repeal the current Directive with effect from 15 January 2019.
Importantly, the EU Trade Mark Reforms provide a 6 month window for trade mark owners to secure full specification coverage for qualifying CTMs that include Class headings. If no declaration is made during this period, OHIM will treat the CTM as registered only for the goods and services covered by the literal meaning of the class heading, which could result in a restriction of trade mark rights.
How will this affect brand owners?
Trade mark owners should consider:
- Filing applications in multiple Classes before 23 March 2016 to take advantage of the current fee structure which is lower for multi-class applications
- Reviewing the scope of protection of marks filed before 22 June 2012 that use Class headings to ensure that they provide adequate protection
- Reviewing the additional rights to stop counterfeit goods in transit and update their anti-counterfeiting strategy if needed
- Reviewing whether they have any non-traditional marks that can be protected under the new legislation.
Some of the changes implemented by the reform are:
Classification. The new legislation addresses the current inconsistency in relation to trade marks registered using the International Nice Classification Class headings. Historically, marks registered with Class headings were deemed to cover all goods and services in the relevant Class. Since 22 June 2012, specifications using Class headings have been interpreted literally, meaning owners only get protection for the literal meaning of the words in the Class heading (the difference between the historical "covers all" practice and the current "means what is says" practice). Owners of registered trade marks with Class headings filed before 22 June 2012 will be given a 6 month period between 23 March to 24 September 2016 to make a declaration to ensure the specification provides the coverage originally intended. Owners will be able to make a Declaration to effectively add specific goods or services to their specification that would otherwise not be covered by the literal meaning of the Class heading under the current "means what it says" practice. Trade mark owners will need to identify which of their CTMs have exact Class headings in the specification and review them to decide whether a Declaration claiming additional coverage is required. If no action is taken before 24 September 2016, registered trade marks with Class headings filed before 22 June 2012 will be deemed to cover only the goods and services listed in Class headings, not the entire class. This could significantly narrow the protection afforded by the trade mark. Trade mark owners are encouraged to review their portfolio and take action as necessary.
Terminology. Community Trade Marks, or CTMs, will be referred to as European Union Trade Marks. The Community Trade Mark Registry (currently The Office for Harmonization in the Internal Market or OHIM) will become the European Union Intellectual Property Office (EUIPO). These new names are thought to be clearer and more self-explanatory.
Filing and renewal fees. Currently, official application fees are the same for applications in up to three Classes of goods and services. The new "one-Class-per-fee" system will allow applicants to file a trade mark in one Class only for a reduced fee (€850 instead of the current fee of €900) with an additional fee for each additional Class. This will make the system more accessible to smaller enterprises and help to prevent cluttering of the Register from applications covering goods or services that the applicants do not intend to use in relation to their trade mark. The renewal fees will also be reduced.
Graphic representation. The current requirement to represent a trade mark "graphically" will no longer apply, provided that a trade mark can be represented in a manner which allows third parties to easily and clearly determine the protected subject matter of the mark. This increases the prospects of registering non-conventional trade marks, such as holograms and motion trade marks.
Counterfeit goods in transit. Owners of registered EU trade marks will benefit from stronger protection against infringing goods in transit in the EU. Counterfeit goods passing through the EU will now be infringing in the EU, unless the importer of the goods can show that the trade mark owner would not be entitled to prohibit the sale of the goods in the country of final destination.
Summary of other changes
- The special grounds for objection to shape marks are extended to all non-traditional marks, which can now be rejected if they:
- protect a technical function
- add substantial value to the goods or services
- are derived from the nature of the goods
- The own name defence will be restricted to natural persons, meaning that it will no longer apply to company or trading names
- New grounds of refusal where the sign conflicts with designations of origin and geographical indications will be introduced
- Trade mark owners may prevent use of their trade mark by competitors if it breaches the EU Comparative Advertising Directive (2006/114/EC)
- All Member States will be required to implement administrative revocation and invalidity proceedings, rather than restricting these to Court proceedings.