New legislation brings major changes

27-02-2017

Işık Özdoğan and Ezgi Baklacı

The Turkish parliament finally approved the Industrial Property Rights (IPR) Law (No. 6769) on January 10, 2017. The IPR Law reconciles provisions on trademarks, patents, industrial designs and geographical indications which were previously addressed by separate pieces of secondary legislation (decree laws).

The improvements and clarifications promise to address practical grey areas which currently result from decentralised legislation.

The IPR Law introduces major changes for co-existence agreements and consent letters, and brings significant responsibilities to brand owners. The non-use argument has now become an important defence available to applicants during the opposition period, as well as to defendants during cancellation actions. Significant improvements and changes under the IPR Law include:

Consent letters are now accepted as a legitimate method to overcome a provisional refusal decision, based on the existence of an earlier trademark. Previous legislation did not accept consent letters, coexistence agreements or sister company arrangements as overcoming provisional refusals from the Turkish Patent Institute (TPI). Therefore, even if the prior registration owner consented to the later trademark, the TPI would not cancel its provisional refusal decision. The IPR Law now allows a provisional refusal decision to be overcome by submitting a notarised consent letter from the earlier trademark owner.

If the non-use grace period is over by the time an opposed application was filed, an applicant can now request the opponent to prove its use of the trademark which forms the basis of an opposition. The IPR Law requires the opponent to demonstrate serious use of the trademark in the Turkish market. Alternatively, the opponent could argue that justifiable reasons for non-use in the Turkish market exist. The TPI will reject the opposition if the opponent does not provide such proof (or acceptable justification). Alternatively, the TPI will partially accept the opposition if the opponent proves demonstrated use for a certain portion of the goods and services covered by the basis mark.

The non-use counter statement is introduced to cancellation actions which are based on the similarity of trademarks. A defendant can now request the plaintiff (earlier mark holder) to prove its use of the basis trademark in Turkey. If the non-use grace period is over by the time the later trademark is filed, the plaintiff must prove use of the basis trademark by the time the trademark subject to the lawsuit was filed.

Filing a trademark application and/or obtaining a registration for a mark the same as an earlier trademark and using it as a defence in the trademark infringement actions was a tool for the infringers to circumvent the law. On one hand it was stated that as long as a use is based on a registration, it cannot constitute infringement. On the other hand such an approach was providing a wide range of protection to the bad-faith application. The IPR Law rules that in an infringement action the defendant cannot raise its registered trademarks as a defence.

"Overall, the changes and clarifications are promising, given the practical grey areas and frictions which existed in the Turkish IP regime."

The TPI becomes the authorised body to consider and determine requests for revocation of trademarks based on non-use. Until now, non-use claims have been advanced within the scope of revocation actions, handled by First Instance Courts. The TPI will also examine claims about trademarks becoming generic and misleading. The TPI will accept such claims after seven years of the IPR Law coming into force, ie, January 10, 2024.

Bad faith is specifically added as a ground for refusal/cancellation of a trademark. Although not previously listed among refusal grounds, a 2008 Court of Appeal decision means that bad faith was already accepted as a ground for refusal in Turkey.

Trademark owners are expressly given the right to prevent advertisements (which will be allowed as of January 2018) which are not in accordance with the relevant regulation.

Factors taken into account during exhaustion of trademark rights are clarified. In light of the preamble to the IPR Law, it is safe to say that the international exhaustion principle is accepted in Turkey.

The three-month opposition period is reduced to two months.

Overall, the changes and clarifications are promising, given the practical grey areas and frictions which existed in the Turkish IP regime. On the other hand, non-use counter statements which are now permitted within the scope of oppositions and cancellation actions will change the strategy of foreign brand owners which are not using their trademarks in Turkey. Brand owners should think twice before challenging a trademark application and registration in Turkey.

Işık Özdoğan is a partner at Moroğlu Arseven. She can be contacted at: iozdogan@morogluarseven.com 

Ezgi Baklacı is a partner at Moroğlu Arseven. She can be contacted at: ebaklaci@morogluarseven.com  

Işık Özdoğan, Ezgi Baklacı,Moroğlu Arseven,

WIPR