Changes in European trademark law: When, Which and How do they affect trademark owners

The Trademark Law Reform process in the EU is finally coming to fruition bringing about changes in nomenclature, fees, proceedings, and substantive law affecting both Community and national trademarks. Most of the changes affecting the CTM come into force on 23 March 2016. A number of the new provisions, typically those that require secondary legislation to be issued, including the introduction of EU Certification marks, will only come into force on 1 October 2017. The recast Directive that concerns the national trademark systems needs to be transposed into the national trademark laws of the Member States, which has to be done by January 2019 (or 2023 for introducing administrative cancellation proceedings). Member States are of course free to transpose the recast Directive more quickly than within three years, and it is hoped that as many as possible will do that.

Here is an overview over the most important changes. We will follow-up with separate reports on specific issues of interest to owners of trademarks in the EU.

Main changes for the CTM regime

Nomenclature

• The CTM will become European Union Trade Mark, or “EUTM”. OHIM will be re-named “European Union Intellectual Property Office” – short “the Office” or «EUIPO». And the President of the Office will become its Executive Director.

Fees

• The official filing fee for electronic filing will be 850 EUR for a single class filing, 900 EUR for a mark filed in two classes and 1,050 EUR in three classes. Each additional class will cost 150 EUR as to date. Other fees are lowered by 10% while renewal fees go down significantly, namely, to 850 EUR for renewal in one class. Additional classes cost the same as for filing (50 EUR second class, 150 EUR every additional class beyond 2) so that renewing a registration in three classes will cost 1,050 EUR as opposed to 1,350 EUR previously, still a 22% reduction.

EUTM Applications – Classification, Priority Claims, Absolute Grounds, IRs

• Classification: General indications are, in principle, permissible (with the exception of vague terms such as “goods made from…” or “repair services”) and cover all goods or services that fall within their literal meaning. Existing registrations filed before 22 June 2012 that cover full class headings in any given class can be amended to include goods or services that do not fall within the literal meaning of the class headings provided they are in the Alphabetical List. The time window for this is 23 March – 24 September 2016. Portfolio audits are recommended to determine the need for amendments.

• Priority claims must be raised with the application and cannot be raised after the application (however, this change only comes into force on 1 October 2017).

• Graphical representation of trademarks will not remain a requirement, although marks still need to be represented in the Register. Again this change will only come into force on 1 October 2017.

• Searches: official searches by the Office will only be provided if requested (and paid for) by the applicant. However, the Office will in any event have to continue searching because watch notices to the owners of earlier EU trademarks will continue to be sent.

• Disclaimers: Mandatory disclaimers (which the Office never required in any event) are abolished and so is the reference to voluntary disclaimers from the Implementing Regulation. The Office therefore now considers them to be inadmissible.

• Functionality to apply to shapes and “other characteristics”: The absolute ground for refusal or invalidity of shape marks is amended to apply also to “other characteristics” that are essentially functional. In theory it could therefore apply to colors or configurations not inherent to the shape.

• Traditional terms for wine, traditional specialities, plant varieties’ names constitute absolute grounds for refusal, which are independent of consumer perception.

• Examination and opposition period for IRs designating the EU: IRs designating the EU are examined as to absolute grounds and classification within 1 month. Then the opposition period of 3 months starts running. If no oppositions are filed, the IR is granted protection within a total of 4 months, as opposed to the current 9 months.

Renewals of CTMs / EUTMs

• Under the new law, renewals must be requested by the date of expiry and no longer at the end of the month during which expiry occurs.

• The new law (i.e. renewal due on the day of expiry and lower fee) will apply to all CTMs that expire on or after 23 March 2016. Owners of such mark can request the renewal already now paying the lower fees. CTMs that expire on or before 22 March will be subject to the old law (i.e. payment of higher fees, renewal can be effected until the end of the month without a surcharge for late renewal). Where CTM owners with marks expiring on or after 23 March have already requested renewal paying the higher fees, the Office will refund excess fees received.

Use requirement: proof of use in disputes before the Office, intervening rights.

• Proof of use in opposition and cancellation proceedings must be supplied upon request where the earlier mark has been registered for five years prior to the application or priority date (not: the publication date) of the junior mark.

• Legal certainty for intervening rights: the owner of an earlier mark who cannot successfully request the cancellation of the junior EUTM (e.g. because of prior consent, acquiescence, or non-use of the earlier mark at the time of the application for the junior mark) cannot prohibit its use either.

Scope of protection

• Goods in transit are subject to customs enforcement measures. Only where the presumed infringer can prove that the trademark will not be infringed at the final destination must the goods be released.

• Use of the earlier mark as a company or trade name is expressly mentioned as one of the forms of infringement.

Certification marks

• The introduction of certification marks in the EU puts an end to the discussion whether they are more appropriately registered as individual or as collective marks. This will, however, only become a reality on 1 October 2017.

Miscellanea

• Continuation of proceedings will be applicable also to time limits in opposition proceedings, which is not currently the case.

• Request for transfer of a trademark registered by an unfaithful agent: the legitimate owner can request the transfer of a EUTM filed by an unfaithful agent (e.g. distributor) by initiating proceedings before the Cancellation Division of the Office, when previously this could only be done in court proceedings.

• Finally, the Office is empowered to create a Mediation Centre where parties can mediate any disputes relating to EUTMs or registered Community Designs, including disputes that do not concern actual proceedings pending before the Office.

Main changes affecting national trademarks

• Protection of marks with a reputation against dilution becomes mandatory. Whilst optional under the current Directive, this is already the law in most Member States.

• Bad faith must be a possible ground for declaration of invalidity of a trademark.

• Member States have to provide opposition proceedings. Opponents can rely on more than one earlier right. Importantly, applicants facing oppositions can request proof of use within the opposition procedure rather than having to initiate cancellation proceedings as is currently the case in many Member States, including Spain.

• Non-use of the earlier mark is a defense in infringement proceedings.

• Administrative (PTO) proceedings for revocation or declaration of invalidity of national trademarks must be provided. In many if not most Member States, such claims currently have to be brought before the Courts. Member States, however, have seven years from entry into force of the recast Directive for introducing this change, i.e. until January 2023.