Community Trade Marks: Use It Or Lose It, But Where is Use Needed?

This article was included in our Summer 2010 edition of Inside IP magazine.

A Community trade mark registration (CTM) gives registered trade mark protection throughout all 27 member states of the European Union. As it is significantly less expensive to obtain a CTM than it is to obtain national registrations in each EU member state, most businesses with interests within the EU use the CTM system to protect their trade marks. Quite apart from the issue of costs, protection via the CTM system brings with it other benefits. One of those revolves around the issue of use of the trade mark and maintaining the registered protection.

Generally, a trade mark registration becomes vulnerable to cancellation proceedings if it is not used, after registration, for a number of years. This is the case for a CTM. To avoid cancellation a mark must be used in the country where it is registered. For a CTM, the “country” is the EU and this leads to the possibility of maintaining protection throughout the EU, without the need to use the mark in every country of the EU.

There are a number of questions regarding what is meant by “use” of the trade mark and these questions are common to national registrations and CTMs. However, an issue peculiar to CTMs is the geographic extent to which the trade mark must be used. If a person wants to cancel a CTM on the grounds that the mark has not been used, the application would generally be filed with OHIM, the body who administers the registration of CTMs. OHIM has long been of the view that use of a mark in just one country of the EU is sufficient to defeat any application to cancel. This issue has, however, recently been questioned by the Benelux trade marks office.

Whilst the body which would normally consider whether a CTM is open to revocation or not is OHIM, the question of a CTM’s vulnerability to cancellation does arise in other actions. In many jurisdictions, in order to rely on a trade mark registration which is old enough to be vulnerable to cancellation for non-use, evidence of use of the mark must be provided. This is the case in the Benelux where just such an opposition was ongoing. The opponent had based its opposition on a CTM and was required to prove that the CTM had been used. The parties agreed that the relevant mark had been used in the Netherlands and no proof of use elsewhere was given. What the parties did not agree on was whether use just in the Netherlands was sufficient. The Benelux trade marks office considered the issue and held that use in just one member state of the EU was not sufficient to maintain a CTM. The opposition therefore failed.

This decision – which is being appealed – has sparked controversy in the European trade marks community. Many have long shared OHIM’s view that use anywhere in the EU is sufficient to maintain a CTM. Others argue that this is not provided for in the law and is undesirable, leading to registered protection being maintained in several countries where a mark is not used.  The fact is that the situation remains unclear and is likely to do so for some time. It is possible that this case will be appealed all the way to the European Court of Justice and that a binding decision will be handed down. However, this process could take a number of years.

If it does eventually become clear that use in just one EU member state is not sufficient to maintain a CTM, all is not lost. There is a provision within the CTM Regulation allowing for a CTM to be converted into national trade mark applications should the CTM fail. If the failure is cancellation for non-use, the CTM can be converted into a national application in any country where there is sufficient use for a registration not to be cancellable. So, where a mark, registered as a CTM, is only used in the UK, if the CTM were cancelled for non-use, it would be possible to convert it into a UK trade mark application.

The benefit of conversion to a national application over filing a new application is that the new national  application retains the original filing date of the CTM. Whilst this certainly gives some comfort to owners of CTMs who do not use their trade mark widely and who might be concerned that their CTM is vulnerable to revocation, it potentially gives rise to some interesting scenarios. What happens, for example, if you sue someone for infringement of your CTM only to have that CTM revoked for non-use? You might then convert the CTM to a national application but you do not, generally, have the right to sue for trade mark infringement until an application matures to registration. So what, in the meantime, happens to your infringement action? And where does all this uncertainty leave the brand owner?

Where, I think, this uncertainty leaves the brand owner is with the need to bear in mind the potential importance of maintaining a national registration alongside a CTM. If you do not use your trade mark widely within the EU, you should consider registering it nationally in the country or countries where you do use it, particularly if it is a trade mark of importance to you.

Kate Széll 14 Jun 2010

Return to news list