BREXIT – The EU trademark system
Now that the United Kingdom has voted to leave the EU there will be many aspects of business life that will be affected. From a company administration point of view one area where Brexit could have a significant impact is that relating to Trade Marks registered in the EU.
One of Blake Morgan's Trade Mark specialists, Ben Evans, considers below the key issues which companies may need to consider over the coming months and years as the UK moves towards Brexit.
Brexit is set to cause one of the biggest shake-ups in the history of the EU Trade Mark system. Withdrawal from the EU will, on the face of it, mean that the UK also withdraws from the EU Trade Mark system and EU Trade Marks will no longer cover the UK Brand owners who have chosen to rely solely on the protection provided by EU Trade Marks and have not also registered trade marks under the UK's national regime could therefore be left without any protection in the UK.
Whilst this is a considerable concern for some brand owners, it is by no means the first time that they will have questioned the protection afforded by EU Trade Marks. In particular, the decision of the CJEU (Leno Merken BV v Hagelkruis Beheer BV C-149/11) has been interpreted by the UK courts to mean that in order to maintain an EU Trade Mark, the mark must be used in more than just one Member State. This went rather against the unitary principles of the EU Trade Mark system and left some brand owners questioning whether that left them with the best protection, particularly where they only used the mark in one Member State.
What we don't yet know, and likely won't know for some time, are the transitional provisions that will be put into place for owners of EU Trade Marks. Whilst strictly speaking it is possible that there could be no such provisions, it seems incredibly unlikely. After all, this is not just a problem for UK businesses but for those in the remaining 27 Member States and, indeed, around the world. It is inconceivable that the UK Government, and indeed the EU, will fail to tackle a situation whereby brand owners lose such important rights.
Instead, it seems likely that there will be provision for some form of conversion of those EU rights into national UK rights, although, whether it is by way of an automatic process or whether brand owners will need to re-apply for those rights (but enjoying the same filing date as their prior EU Trade Marks) remains to be seen. Indeed, one further scenario has been mooted: that the Brexit negotiations may play-out to allow the UK to remain within the EU Trade Mark system. Although this may seem a remote possibility in the immediate aftermath of the UK's decision to leave, there could be advantages to all parties, including the EU, which could make this option more attractive as the Brexit negotiations progress.
There is, therefore, no need for EU Trade Mark owners to panic. It is frankly unimaginable that they will be left high and dry in the Brexit negotiations. However, brand owners should ensure that they review their portfolios regularly and in particular consider:
- Where they are using their marks – are EU Trade Marks being used throughout the EU or merely in certain Member States? Regardless of the outcome of the Brexit negotiations, use of an EUTM in only one or a handful of Member States could, depending on the extent of such use, render the mark(s) vulnerable to cancellation;
- What any co-existence agreements say – those agreements that define the EU as the territory may need to be clarified to ensure that they continue to apply to the UK after Brexit; and
- When filing new applications – if filing new applications, it is important to consider whether the mark is going to be used in the EU (outside of the UK). If not, we would suggest simply filing a UK application. If the mark is to be used in the UK and EU, for a belt and braces approach, we would suggest filing both UK and EU applications.
As more information becomes available and the picture becomes clearer Ben will be posting further updates but if you have any specific queries, please contact Ben or you can contact the company secretarial team and we will be happy to pass your query to Ben.