The Community Trade Mark – Is it Worth it?

The reasons why a trade mark is registered in the first place by companies and individuals is fairly self evident from our perspective. Under the law a registered trade mark provides the best protection for the sale of goods and services associated with a logo.

Trade marks in the UK are protected under the Trade Marks Act 1994 UK and the Trade Mark Rules 2000. (the Act grants rights; the Rules are procedural in nature). Trade marks registered in the UK are given the protection of the law. So why then would a trade mark need to be registered in the UK and in the EU?

Community Trade Mark Implementing Legislation

The Community Trade Mark system runs parallel to the trade mark legislation of each national EU member state. All rights in a Community Trade Mark registration date back to the date of filing and not when the registration is actually granted.

The main body of legislation in the Community Trade Mark system is in force in the EU member states including the United Kingdom. Council Regulation 40/94 as amended is the main body of legislation that governs the Community Trade Mark system, known as the (“CTM Regulation”).

The CTM Regulation is supported by Commission Regulation No 2068/95 known as the (“Implementing Regulation”). The Implementing Regulation incorporates the Nice Agreement for the worldwide classification of goods and services for trade marks. The CTM Regulation is also supported by Commission Regulation 2869/95 that is better known as the (“Fees Regulation”).

Community Trade Marks

A Community Trade Mark is a sign that identifies and distinguishes goods and services throughout the EU. Registration of a Community Trade Mark is valid across the 25 EU member states as opposed to a UK registration that is valid only in the UK. The trade mark is personal property and may be sold, used as security or licensed.

In addition invalidation or inability to register in one country of the EU Community Trade Mark deprives the applicant of the Community Trade Mark across the entire all countries of the EU, although the application may be converted to national applications in countries selected by the applicant. Lastly, the Community Trade Mark is a single asset of property. It can only be transferred for the whole of the EU and not with respect to individual countries. However, territorially or otherwise limited licences, even limited for a particular an EU member state are possible.

Geographic factors are key to the decision about whether to apply for a UK trade mark or a Community Trade Mark. The market a company operates within or intends to operate within is the major determining factor when deciding upon a UK trade mark or a Community Trade Mark. However it is not to say that UK trade marks do not still have a valid role to play.

Business enterprises are free to file national trade mark applications, a Community Trade Mark application, or both. The large number of national trade marks already existing and registered in the Member States remain valid. It is entirely up to the strategy of the applicants and proprietors of trade marks whether they want to rely exclusively, or in addition to national trade mark rights, on the Community Trade Mark protection. However, earlier national trade marks constitute earlier rights against a Community Trade Mark, and vice versa. Only the proprietor of the earlier right can raise this issue, either by filing an opposition within 3 months of the publication of the CTM application, or following the registration of the Community Trade Mark by filing an application for a declaration of invalidity.

Signs and Community Trade Marks

A Community Trade Mark may consist of any signs capable of being represented graphically, particularly words, word marks including letters, numbers or combination of letters, numbers and words, figurative marks whether or not including words, figurative marks in colour, colours or combinations of colours, three-dimensional marks, sound marks, personal names, designs, letters, numerals, the shape of goods or of their packaging, provided that such signs are capable of distinguishing the goods or services of one business from those of other businesses.

Trade Marks not capable of Registration

Community Trade Marks will not be valid if they are devoid of any distinctive character. Also any trade mark that exclusively serves to designate the kind, quality, quantity, intended purpose, value, geographical origin or the time of production of the goods or service, or other characteristics of the goods or service will be invalid.

A sign that has become customary in a current language or in the bona fide and established practices of the trade will not be registrable. Trade marks that are deemed contrary to public policy or to accepted principles of morality will not be fit for registration. Finally a trade mark that is of such a nature as to deceive the public, for instance as to the nature, quality or geographical origin of the goods or service is not registrable.

Enlargement of the European Union

The enlargement of the EU on 1 May 2004 that introduced 10 new member states into the EU. This has in effect had repercussions on the Community Trade Mark system. A new Article 159a of Regulation 422/2004 was required to deal with the accession of the new members states.

The same unitary nature of the Community Trade Mark system was required without prejudicing pre-existing rights for trade marks in the new member states.

From 1 May 2004 all registered Community Trade Mark pre-dating accession were automatically extended to include the 10 new member states. This gave equal effect throughout the community for the existing Community Trade Marks.

Applications for Community Trade Marks pre-dating accession may not be refused on absolute or relative grounds if a conflict arises in one of the 10 new members states. However opposition proceedings may be entered against Community Trade Mark applications filed in the six months before accession on the basis of earlier rights acquired in good faith on one of the new member states before the 1 May 2004.

Limitations on Extended Community Trade Marks

Public Interest

Where trade marks filed before the date of accession consist entirely of terms that are descriptive in one of the languages of new member states. These terms are not the subject of monopoly rights as a result of trade mark protection and remain available for use by all.

Automatic extensions may also be misleading or have obscene connotations in the new languages of the accession states. These trade marks would be refused registration in applications after 30 April 2004.

The fall out from this is Community Trade Marks automatically extended do not entitle the proprietors to prohibit third parties from using descriptive indications in the course of trade in the new member state in which the wording of the trade mark has a descriptive meaning. But the trade mark would remain enforceable in the member states old and new in which the term was not descriptive.

Prior Rights

Earlier rights in the new members states may also cause problems to extended Community Trade Marks. The owners of the earlier rights are protected if the earlier trade mark or other right was registered in good faith prior to the date of accession. The right is only protected in the member state for which the earlier right subsists however unless a Community Trade Mark is deemed to be invalid for non use over a five year period.

Conclusion

A business with a registered trade mark is considered by many as a business that is careful about protecting the intellectual assets the business possesses. The business is also perceived to value the brand or get-up the business wishes to sell their goods and services under.

In terms of whether the Community Trade Mark application is worth applying for greatly depends on the market the company operates within. Any business operating across the borders within the EU or intending to do so may seriously consider the Community Trade Mark route as a single application provides legal protection for the brand across all EU member states.

None of the problems of the extension of the EU will apply for new Community Trade Mark applications save as to say that there are additional states and languages that must now be taken into consideration. The protection if a Community Trade Mark is successfully registered is further reaching since the extension of the EU.