Steps towards harmony

In March last year, the first wave of EU trademark changes came into force with the implementation of the new trademark regulation (2015/2424).

Combined with the trademark directive (2015/2436), the changes sought to harmonise different national registration procedures, simplifying the process of securing IP protection.

What impact have the changes had on the way legal practitioners work and brand owners operate?

“Although many talked about these changes being enormous, personally I don’t think that the changes have been that radical,” says Imogen Fowler, partner in Hogan Lovells’ Alicante office.

Ulrike Grübler, partner in DLA Piper’s Hamburg office, agrees, adding that after the first reforms came into effect, it became clear that they were relevant but not that substantial.

That doesn’t mean there weren’t challenges along the way. “It was quite hectic, because there was little time between the approval of the EU trademark reform package and the first set of changes coming into force,” explains Grübler.

"The good news for brand owners is that renewals have become cheaper—€900 ($964) now covers up to three classes."

Causing the most trouble for brand owners and lawyers were changes around the specifications of European Union trademarks (EUTMs).

The new rules codified the Court of Justice of the European Union’s 2012 ruling in IP Translator, which held that class headings are to be interpreted literally and must cover only the precise goods/services listed.

So that existing trademark registrations could comply, article 28 of the regulation introduced a six-month period for EUTM owners to declare the goods and services that their specification was intended to cover.

The window closed on September 24, 2016, “putting pressure on trademark owners to file in a short space of time,” says Grübler.

Trademark owners had an alternative option—to file a partial surrender. This effectively deleted particular goods and services from a specification.

“There was a flurry of activity,” explains Fowler, adding that many practitioners advised their clients to file partial surrenders before the closing of the six-month window.

Around 25,000 article 28 declarations were filed at the European Union Intellectual Property Office (EUIPO), says Fowler, explaining that there is a massive backlog of both partial surrenders and declarations.

Of course, brand owners could have sat back and done nothing—but this risks severely limiting the scope of protection of their EUTMs.

New names

Rebranding was also on the reform agenda. The Community trademark was renamed the EUTM and the Office for Harmonization in the Internal Market (OHIM) was rebranded as the EUIPO.

Practitioners revealed mixed responses to the renaming of the office.

“As a lawyer, in the past, when you’d speak to clients who were not familiar with the system, you always had to explain what OHIM was. Although the change is beneficial, it’s only a renaming,” states Grübler.

She adds however that people were attached to the old name—a sentiment that Fowler concurs with.

“For people who haven’t previously used the EU trademark system, it’s probably easier and more comprehensible. But practitioners and experienced brand owners were used to it and the office had been OHIM for such a long time that I don’t there was a need for change,” she adds.

Fee reform

A mixed bag of news for brand owners came in the form of changes to trademark fees.

Under the reforms, there’s now a one-fee-per-class system for trademark applications and renewals of EUTMs, rather than a three-for-the-price-of-one arrangement.

The good news for brand owners is that renewals have become cheaper—€900 ($964) now covers up to three classes.

However, the official fees for trademark applications containing three or more classes have increased, with owners having to pay €150 for each additional class.

Transit

Another change came in one of the most disputed subjects throughout the EU trademark reform process: the goods-in-transit issue, which covers products that aren’t intended to be delivered into EU countries but cross the territory on their way to their final destination.

The provision has been given much more force under the reforms.

Now, EUTM owners can benefit from customs assistance for goods in transit, even if the final market is outside the EU.

“On the whole, the reforms and their introduction have gone quite smoothly,” says Fowler, although she adds that legislative changes could have been drafted better.

“The changes led to a lot of confusion for brand owners and practitioners but overall the changes themselves are positive,” she says.

Further change afoot

When October 2017 rolls around, so will the next set of changes to the EU trademark system.

These are more relevant and substantial than the March changes, according to Grübler, who adds that all brand owners should at least be considering whether they should do something before implementation.

One of the major changes is the removal of the graphical representation requirement for EUTMs.

This means that marks can be represented in any appropriate form, as long as the representation is “clear, precise, self-contained, easily accessible, intelligible, durable and objective”.

Sounds and colours are now explicitly registrable under the trademark rules.

Fowler isn’t convinced the change will have “an enormous impact”, but she adds that some have suggested that the floodgates will open up to many new and different types of non-conventional trademarks.

“A new ground of refusal has been introduced.   The EUIPO can reject an EUTM where the shape or another characteristic gives essential value to the goods, so the floodgates are unlikely to truly open,” explains Fowler.

It remains to be seen how it will be interpreted.

Grübler believes this change is the most relevant within the October reform package, and although it may not be necessary for every brand owner, it’s definitely something worth monitoring.

Another major change, according to Grübler, is the introduction of an EU certification mark.

The marks will allow a certifying institution or organisation to permit parties adhering to the certification system to use the mark as a sign for goods and services, as long as they comply with the certification requirements.

Although some EU countries previously allowed certification marks, a number of them, including Germany, did not.

“Brand owners may well like to take advantage of this new type of EU-wide mark,” says Fowler.

She adds: “Certification marks are already available in the UK. Now brand owners will be able to enjoy protection across the EU.”

Still to come is what Fowler describes as “the single most helpful change” of the reforms.

Revocation of invalidity proceedings will have to be allowed before each country’s trademark office, although the deadline for implementation is January 2023.

“Unfortunately, it’s a very long time away, but for brand owners this will make an enormous difference,” says Fowler.

She explains that currently in Spain and several other countries, petitioners can’t file a cancellation before the trademark office and instead have to go to court, which involves a full legal action and significant costs.

Opposition and administrative proceedings for revocation or declaration of invalidity must also be provided for by EU member states.

Under the reforms, the disputes have to be brought before the national courts but the member states have several years to introduce these changes, with the deadline for the provision of opposition proceedings being January 2019.

“This will make life a lot easier when it’s introduced, even for those well trained in EU trademark systems,” says Grübler.

The Germany-based lawyer explains that it’s currently very complicated to keep up with the various systems on a national level.

“Because of the reforms, we can now prepare better for the procedures and it will also save trademark owners more money as they don’t have to change the strategy applied to opposition/invalidation proceedings all the time, country by country.”

The big question here is whether trademark law is now fully harmonised across the EU. This is met with a resounding no.

“Obviously the intention of the reforms was to further harmonise trademark law, in particular various procedural rules, but it’s still not fully harmonised,” according to Grübler.

Fowler agrees, explaining that although the changes have made the EU more harmonised than it was, there was nothing “hugely radical” about the reforms.

“There will continue to be national differences, in the way things are interpreted and done, meaning that it’s unlikely that EU trademark law will ever be fully harmonised,” she says.