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Uncharted Territory

March 6, 2018

Just 388 days to go until the UK leaves the EU yet, despite being told that "Brexit means Brexit", we still cannot be sure what will happen after 30 March 2019. 

 

Some guidance might now have been provided by the European Commission's ("the Commission") draft Withdrawal Agreement which was published on 28 February 2018. The final form of the Agreement will set out the terms of the UK's "orderly" withdrawal from the EU.

 

The draft  has not yet been formally sent to the UK for negotiation, but it does provide us with a useful insight into how the EU intends to deal with a myriad of issues arising as a result of Brexit, including intellectual property (and thus trade marks).

 

So how might Brexit affect trade marks and what should we now be considering?

 

 

THE EUROPEAN UNION TRADE MARK ("EUTM")

 

Generally speaking, trade marks are protected on a country-by-country basis. One exception to this is the EUTM - this is where Brexit will impact on trade mark law and practice.

 

The EUTM is a single, unitary trade mark right covering all 28 Member States of the EU, including the UK. Introduced in 1996, it is very popular since it is a cost effective way of securing trade mark protection throughout the EU. The  unitary nature of the right means that any issues relating to the trade mark (including the renewal of the registration, recording a change in ownership) are very straightforward since they are dealt with by a single Trade Mark Office (the European Union Intellectual Property Office).

 

In addition, a EUTM extends automatically to any countries which subsequently join the EU.

 

But what happens when a country LEAVES the EU? What happens to the EUTM?

 

 

UNCHARTED TERRITORY

 

And therein lies the problem. No one has left the EU before so there is no precedent, no "Go To" Guide. 

 

We are in uncharted territory. There are various scenarios which have been discussed at length by representatives for and members of the IP community, but until now the Commission's view on this has been largely unknown.

 

 

THE DRAFT WITHDRAWAL AGREEMENT ("THE DRAFT")

 

The Draft will now be discussed with the European Council (Article 50) and the Brexit Steering Group of the European Parliament before it is sent for discussion to the UK. The Commission is aiming to have a final version of the Withdrawal Agreement in place by October 2018.

 

Therefore, at this stage, nothing is binding, but the Draft is important insofar as it sets down the Commission's position on how Brexit will affect trade marks.

 

Most importantly, it addresses the burning issue of what will happens to EUTMs once the UK leaves the EU. Article 50(1) of the Draft states that the holder of a EUTM which has been registered or granted before the end of the transition period (this date is still to be finally agreed upon if, indeed, there is a transition period at all) shall, without re-examination, become the holder of a "comparable" UK trade mark. It will have the same filing date (including any relevant priority or seniority claims) as the EUTM and will cover the same goods/services. 

 

On a practical level, it is proposed that this will happen automatically (i.e. it is not necessary for the holder to request that it  be done) and no official fee will be payable.

 

The Draft also states that the resultant UK trade mark will not be liable to cancellation on the ground that the original EUTM Registration had not been used in the UK for a consecutive period of five years or more [UK trade marks and EU trade marks are vulnerable to cancellation on the ground of non-use if they have not been put into use for a period of five years or more following registration or for any uninterrupted period of five years].

 

In terms of EUTM applications pending at the end of the transition period, there will be no automatic protection as a UK trade mark application, although provision is made for the holder of the EUTM to file a corresponding UK application within a period of six months and claim "priority" from the EUTM.

 

The Draft confirms that the above will also apply to International trade marks which designate the EU.

 

 

WHAT SHOULD YOU BE DOING?

 

The proposals set down in the Draft are, on the whole, practical. However, nothing is written in stone. Whilst the automatic registration of EUTMs as UK trade marks makes sense and appears to be a pragmatic response to a difficult dilemma, the final form of the Withdrawal Agreement could change and whilst unlikely (and certainly unpalatable), there is still always a risk that, as of 30 March 2019 (or the end of any transition period), EUTMs will no longer extend to the UK and there will be no automatic right to re-registration in the UK.

 

As the heading to this post says, we are in uncharted territory.  However, one thing is certain - you should now be reviewing your trade mark portfolios with particular attention to your core trade mark rights in the UK and the EU and seeking professional advice on how best to safeguard your trade marks in these still uncertain times.

 

 

 

 

This post is not intended to constitute specific legal advice.  

For any specific advice please contact Rebecca Davis at rdavis@rdtm-trademarks.co.uk.

 

 

 

 

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