1 April 2013Jurisdiction reportsMichael Lantos

Trademark use and national boundaries

What will be shown is that even in case of national trademarks, when use is concerned, national boundaries can be blurred and might lose significance. In national trademark laws, ‘use’ is a requirement within the boundaries of the corresponding jurisdiction. This has been clear for several decades. But with the increasing significance of electronic sales and the internationalisation of certain services, the issue has become less clear.

There are final court decisions in Hungary where the offer for sale of certain goods through the Internet which target domestic consumers has been found to be trademark infringement. A report concerning the ‘i-parfumeria’ trademark infringement case has been published, in which perfumes were sold by a foreign source through the Internet to Hungarian consumers in Hungarian, and the court established that such use constituted infringement.

If a use can be infringing, then it should also qualify as use in the sense of the use requirement. This means that the offer for sale from a foreign location targeting Hungarian consumers and proof of actual sale across the border should certainly qualify as use.

The situation is more problematic in case of services, because services can be provided electronically over great distances. In connection with services the question might be raised whether the location of the service provider determines the site of use or the location of the users where the services are utilised.

If such services are provided for payment and the user is Hungarian, then in a trademark dispute the use by a domestic consumer can be a good argument in support of domestic use even if the service provider acts in a remote foreign country.

“ONE MIGHT STATE THAT THESE FAMOUS EXHIBITIONS AND FAIRS ARE IN ACTUAL USE IN A COUNTRY DIFFERENT FROM THE LOCATION OF SUCH EVENTS.”

There are other specific services where the place of the service and the place of use can be different. These can include international trade exhibitions or fairs, which are normally held at predetermined specific locations but which attract an international crowd. Examples are the Hannover Messe, the Eurobike exhibition held each year in Friedrichshafen, and so on.

These fairs are widely known and the pertinent segment of consumers or representatives of the economic players attend such events. What happens if one of these specific exhibitions has obtained a national Hungarian trademark in Class 35 for exhibition and advertisement services, and a third party launches a cancellation proceeding against that trademark because of non-use?

In the literal sense of the term, the service is provided outside the country. In a narrow sense there is no use in Hungary, therefore the request can be found justified. On the other hand, if all aspects and specialities of the exhibition services are taken into account, then the picture can be quite different.

The pertinent segment of consumers (or their leaders or representatives) attend these fairs or exhibit there. The business information collected during such events may have a major impact on future business decisions of Hungarian consumers, as they know what to buy from whom, what to sell to whom, the international trends in the given field, what products come in and go out of fashion, and so on.

These special services therefore have a substantial impact on business behaviour and the business itself of these domestic players. From this point of view, one might state that these famous exhibitions and fairs are in actual use in a country different from the location of such events.

Trademarks have business objectives. If the name of an exhibition is known or well-known in a foreign country, an enterprise can take unfair advantage of that fame if it chooses the same name as a company name. If there is no national trademark in the foreign country for these exhibitions, how can such unfair use be prohibited?

Based on the listed reasons such use should qualify as trademark use. In January this year, the Hungarian Intellectual Property Office took the narrow interpretation in a cancellation case concerning the name of an international exhibition and established non-use, as the place of the service was outside the country. It is an open question whether in an appeal proceeding the courts will share this narrow view.

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