Dispute resolution before the final registration of a domain name

Law enforcement

The Hungarian domain name registration system, which allows IP owners to prevent possible serious infringements, is somewhat unique, since in the Hungarian namespace, there are two kinds of applications: priority and non-priority applications.

A so-called priority application can be filed if the applicant has a trademark fully identical with the domain name applied for effective in Hungary. In this case, the application will be granted without delay.

A so-called non-priority application is publicly announced on the registry’s web server for 14 days and will be granted only in the event that no objections are received during these two weeks. If anybody (i.e. a trademark owner of an identical or a confusingly similar mark) objects to the final registration of the domain name, a consulting board of invited independent experts will decide whether the application shall be granted or rejected.

However, failure to submit an objection cannot be considered as consent to the registration of a domain name identical or confusingly similar to a trademark effective in Hungary; therefore, trademark owners can enforce their rights and recover the domain name later on if necessary.

“The Hungarian Trademark Act stipulates that if somebody uses a designation that is confusingly similar or identical to a trademark within business operations and without a licence, it constitutes trademark infringement.”

This regulation provides an alternative dispute resolution system before the registration of the domain name.

The deadline for filing an objection is not extendable, therefore if the trademark owner fails to file its objection before the due date, the consulting board will not be called, as the domain name will be registered after 14 days. In practice, applicants often withdraw their obviously infringing applications after receipt of an objection, so the objection is not always decided by the Consulting Board.

Frequent legal questions arising from the practice

Fair use

According to the Hungarian Domain Name Rule, a domain name in terms of meaning and/or use must not be unlawful, obnoxious or fraudulent.

The Hungarian Trademark Act stipulates that if somebody uses a designation that is confusingly similar or identical to a trademark within business operations and without a licence, it constitutes trademark infringement.

If the applicant for a domain name identical or confusingly similar to an effective trademark is a company, whose activity is per se business operations, the application itself constitutes trademark infringement.

In the case of a private person, the fraudulent, misleading nature of the domain name application should be emphasised, and the trademark infringement can be examined after receipt of the applicant’s response—if any.

List of goods and services of the concerned trademark

It is also important whether the list of goods and services of the trademark used as the basis of the objection should cover the business activity that the applicant wishes to carry out under the domain name in question. The answer comes from the technical characteristics of the domain name system, as a domain name consists of given characters that can be registered only once under one name space, but identical designations can be registered as trademarks in different classes of goods and services.

As the Supreme Court of Hungary ruled in 2005, the trademark owner’s exclusive right to use the trademark covers all business operations, including activity on the Internet, therefore only the trademark owner is entitled to register a domain name that is identical or confusingly similar to the trademark in question.

Taking that into account, the list of goods and services of the trademark will not be examined.

Watching service

The consulting board provides a cost-effective and time-effective option for trademark owners to prevent their IP rights from possible infringement. Danubia Patent and Law Office LLC also provides watching services for trademark owner companies for a flat fee and also provides professional legal services regarding the preparation and submission of their objections to the final registration of obviously infringing domain name applications.