Entry into force of “Trademark Package” in the European Union: What changes and perspectives for IP rights holders?

The reform of trademark law in the European Union, also called “Trademark Package” came into force this Wednesday March 23, 2016, after the European Parliament adopted it at first reading on December 15, 2015.

This reform, consisting in the adoption of the Regulation (EU) No. 2015/2424[i] and the Directive (EU) No. 2015/2436[ii], meets the objectives of simplification, modernization and harmonization of trademark law in the EU, without however jeopardising the coexistence between the systems of the Community trademark and of national trademarks in the 28 Member States.

While the Regulation (EU) No. 2015/2424 brings substantial changes to Regulation (EC) No 207/2009[iii] on the Community trademark (the “CTMR”) and its related Regulations[iv], the new Directive (EU) No. 2015/2436 is foreseen to replace the current Directive No. 2008/95/EC[v], which will be repealed on January 15, 2019.

The 28 Member States have in this respect a deadline until January 14, 2019 to implement these new provisions in their national law, being specified that the deadline to transpose some other measures (in particular the implementation of an administrative procedure for revocation and invalidation actions – See below) has been extended until 2023.

In practical terms, this reform establishes a terminological update, which has become necessary since the entry into force of the Lisbon Treaty and the abolition of the European Communities. Thus, the Office for Harmonization in the Internal Market (OHIM) is now called the European Union Intellectual Property Office (EUIPO), while the “Community trademark” is renamed “European Union trademark”(EUTM).

Besides these terminological changes, the entry into force of the Regulation and the Directive provides many substantial changes, both legal and procedural, whose rights holders must take the exact measure in order to protect and optimize their trademarks portfolio.

One of the first measures relates to a redesign of the official taxes system of the Office, by the complete repeal of the Commission Regulation (EC) No. 2869/95 on the fees payable to OHIM[vi]. It was so far possible to file and renew a mark in three classes for the same price. Now, the Regulation provides for payment of a class fee, allowing applicants to claim only one or two classes at a lower cost (850 Euros for a class instead of Euros 1050). A 10% reduction on other official fees is also envisaged.

The advantage of this new pricing is twofold: While people with limited financial resources (such as SMEs) could have access to trademark protection at lower cost, this measure will incidentally participate in “decluttering” the European trademarks register. Indeed, so far, the pricing system to three classes tended to encourage applicants to claim more classes than necessary for their activities, without never using them.

Furthermore, this reform deletes the requirement of graphic representability from the definition of an EU trademark. This requirement, which is easily understood by the fact that a trademark needs to be published and seen by everyone, has always been problematic for the registration of “non-traditional” trademarks such as sound marks, olfactory marks or taste marks.

To allow for more flexibility, the legislator has threfore removed this requirement, considering that a brand “should be permitted to be represented in any appropriate form using generally available technology, and thus not necessarily by graphic means” . The legislator has stated that this representation should nevertheless be “clear, precise, self-contained, easily accessible, intelligible, durable and objective.”

The Regulation (EU) No. 2015/2424 also provides tighter requirements for registering shape marks, i.e. three-dimensional marks. The Regulation, as well as the Directive, indeed stipulates that are now excluded from protection by the law of trademarks, signs which consist exclusively of the shape but also of any other characteristic of the product imposed by the nature of the product, which is necessary for the obtain a technical result or which gives substantial value to the goods.

The reform provides for further harmonization of the classification of goods and services, by confirming the literal interpretation of the class headings of Nice Classification adopted by the Court of Justice of the European Union in the famous case law “IP Translator”[vii]. In that decision, the Court put an end to the practice of the Office consisting in considering that trademarks claiming class headings (general terms) designated all the goods and services covered by the class. From now, the use of general termes will be interpreted as only including all goods and services clearly covered by the literal meaning of the term.

The legislator has nevertheless provided a period of 6 months, i.e. until September 24, 2016, during which owners of trademarks registered before 22 June 2012 and designating class headings, could adapt their list of goods and services to this new requirement. It will be possible to submit a declaration to add to their label products and services that are no longer covered by general terms. Failing that, their marks will be deemed to cover only the named goods and services (and not the entire class).

In addition, the reform offers the possibility to invoke new prior rights to contest the registration of a mark. For example, an objection may be based on a designation of origin, a geographical indication, a company name or a trade name.

Finally, one of the major changes introduced by the reform is the implement of administrative procedures for revocation and invalidity actions before the national Offices of the 28 Member States. Under Article 45 of the Directive, this will allow any interested third parties to obtain the cancellation of a trademark from the national offices without having to bring the dispute before a national Court, as it is required now. In addition to ensuring speed, economy and efficiency, these procedures will undoubtedly confer significant powers to national Offices.

We are at your disposal to discuss about your IP rights portfolio, to ensure that the current specification of goods and services ensures adequate protection, and to study together the opportunity to protect new brands which are now eligible to trademark law since the deletion of the graphic representability requirement.

[i] Regulation (EU) 2015/2424 of the European Parliament and the Council of 16 December 2015 amending Council Regulation (EC) No. 207/2009 on the Community trade mark and Commission Regulation (EC) No. 2868/95 implementing Council Regulation (EC) No. 40/94 on the Community trade mark, and repealing Commission Regulation (EC) Np.2869/95 on the fees payable to the Office for Harmonization in the Internal Market (Trade Marks and Designs (OJ No. L 341, 24.12.2015, p.21).

[ii] Directive (EU) 2015/2436 of the European Parliament and of the Council of 16 December 2015 to approximate the laws of the Member Stats relating to trade marks (OJ No. L 336, 23.12.2015, p.1).

[iii] Council Regulation (EC) No. 207/2009 on the Community trade mark (OJ No. L 78, 24.03.2009, p.1).

[iv] Commission Regulation (EC) No. 2868/95 of 13 December 1995 implementing Council Regulation (EC) No. 40/94 on the Community trademark ; Commission Regulation (EC) No. 2869/95 of 13 December 1995 on the fees payable to the OHIM.

[v] Directive 2088/95/EC of the European Parliament and of the Council of 22 October 2008 to approximate the laws of the Member States relating to trade marks (OJ No. L 299, 8.11.2008, p.25).

[vi] Commission Regulation (EC) No. 2869/95 of 13 December 1995 on the fees payable to the OHIM (OJ No. L 303, 15.12.1995, p.33).

[vii] European Court of Justice, 19 June 2012, IP TRANSLATOR, Case No. C-307/10.