Although uncertainty lingers around how, when, and even, if, the United Kingdom ("UK") might leave the European Union ("EU"), draft statutory instruments are beginning to emerge which provide a more concrete insight into the intellectual property landscape should Brexit happen.
This note provides an update on our previous article 'Brexit and…trade marks' following the publication of The Trade Marks (Amendment etc.) (EU Exit) Regulations 2018 (the "Exit Regulations"), which sets out the amendments to the Trade Marks Act 1994 ("TMA 1994") that will govern how existing EU trade marks ("EUTMs") will be protected following Brexit.
Overall, the approach set out in the draft statutory instruments discussed below follow that which was outlined by the government in the draft Withdrawal Agreement and draft No Deal Guidance, in that:
- the majority of rights currently enjoyed by holders of EUTMs and IRs will continue to receive the same protections and benefits as they do currently
- there will be minimal amount of administrative and financial burden being placed on rights holders
- continuity of rights, recognition of earlier rights (including use, and seniority and priority claims) and ensuring the functionality of existing agreements and arrangements are the key focus of the provisions.
Grant and opt out
The Exit Regulations confirm that holders of EUTMs will be granted on exit day, automatically and free of charge, a new equivalent UK trade mark, termed a comparable trade mark (EU) ("CM(EU)"). The specification of goods and services will be taken from the English language version; however, anyone with a sufficient interest who does not believe the English version satisfactorily reflects the corresponding EUTM may submit a substitution, verified to the satisfaction of the Registrar as corresponding to the authentic text.
The Exit Regulations also confirm the procedure by which a proprietor may opt out of the registration of a CM(EU). The opt out is available to exercise at any time on or after exit day, except where on or after exit day the CM(EU):
- has been used in the UK by the proprietor or with the proprietor's consent
- has been the subject of an assignment, licence, security interest or other agreement
- is the subject of proceedings initiated by the proprietor or with the consent of the proprietor.
Licences and continuity of rights
Subject to any agreement to the contrary, existing licences that relate to EUTMs will continue to apply to the CM(EU) that is created.
References to an EUTM in documents produced prior to exit day shall be read as references to the CM(EU), unless that document was not intended to have effect in the UK.
Any consents given regarding the EUTM before exit day to an act in the UK which would infringe the CM(EU), shall be considered as a consent to do that act (subject to agreement to the contrary).
As the CM(EU) will have the same renewal date as the equivalent EUTM, the UK Intellectual Property Office ("UKIPO") will be unable to send renewal notices six months ahead of time for any CM(EU) with upcoming expiry dates – as the right will simply not exist until the exit date (which could be less than six months before renewal is due).
Holders of a CM(EU) whose right is due to expire within the first six months following exit, will receive a notice from the UKIPO as soon as reasonably practicable after, or on, the expiry of the right. The proprietor will then have six months from the date of the notice to renew the CM(EU), regardless of when the previous renewal date was. In recognition of this issue, the UKIPO will not require proprietors to make additional payment for the late renewal.
Non-use, genuine use and invalidity
The Exit Regulations set out rules on the recognition of prior use in the EU and registration of the EUTM as an earlier right in respect of the above provisions.
Where the full five year non-use period set out in the TMA 1994 falls entirely before the exit date, evidence of the use of the corresponding EUTM within the EU (including the UK) during that period will be appropriate evidence of use. Where only part of that five year period falls before exit date, a proprietor can use evidence of use within the EU (including the UK) of the corresponding EUTM during that period before exit day to refute any allegation of non-use.
In respect of the five-year period referred to for invalidity proceedings, if the five year period entirely, or any part thereof, falls before the exit date, references to the earlier trade mark will include the EUTM and references to the UK will include the EU for that period before exit date.
Where an EUTM was removed from the register before exit day and then restored on or after exit day, so long as a request is filed with the UKIPO registrar within six months from the date of such restoration, the EUTM will be treated as if it was an existing EUTM on exit day and will be considered a CM(EU).
Ongoing judicial proceedings
Any trade mark infringement cases being heard in the UK in relation to an EUTM that began before exit day and continue after exit day, can continue to be heard in the UK as if the UK were still a Member State; however, any actions taken, or remedies granted, by the UK court will only be applicable to the CM(EU).
The Exit Regulations, therefore, dramatically reduce the scope of any relief being sought, as the UK courts will not be able grant pan-EU injunctions.
Pending EUTM applications
The Exit Regulations introduce provisions to ensure that any holder of a pending EUTM application can retain relevant filing and priority dates in the UK by making a new domestic application. However, as previously noted, the pending EUTM application will not be automatically converted into an equivalent application for a CM(EU).
UK applications based on pending EUTMs must be filed within a period of nine months from exit day. These provisions apply to any pending EUTM, regardless of when that application was filed. As such, if opposition proceedings have been filed against a pending EUTM but these are based on earlier, non-UK rights, the applicant will retain the right to file an application in the UK.
Where, before exit day, an application for an EUTM is refused and then on or after exit day it is restored, if the person who filed the relevant application or a successor in title applies for the same trade mark under the amended TMA 1994 for some or all of the same goods or services, the application will be deemed as if it was a pending application on exit day, and treated accordingly.
International marks designating the EU
The new rules regulating international trade marks protected in the EU are set out in a separate draft statutory instrument – the Designs and International Trade Marks (Amendment etc.) (EU Exit) Regulations 2019 ("Design Exit Regulations").
As is the case for EUTMs, a UK right – termed a comparable trade mark (IR) ("CM(IR)") – will be provided to holders of international trade marks designating protection in the EU, whether the EU was designated as part of the original application or a subsequent extension request. Proprietors will also have the right to opt out to being granted a CM(IR), subject to the same exceptions as with EUTMs.
The renewal date of any international trade mark with EU protection subsequently registered in the UK under the Design Exit Regulations will mirror the date that protection was conferred by the EU registration, if this is different from the renewal date of the corresponding international registration. As with EUTMs, international trade marks with a renewal date within six months of exit day will be given six months from the date they receive a renewal notice to renew the mark, even if this is later than the technical renewal date, without incurring any late renewal fees.
The Design Exit Regulations also provides for holders of UK seniority claims in the EU having those claims transferred to the equivalent domestic right created on exit day. This will allow those holders to retain the earlier date given under the national right.
Applicants for international trade marks pending before the EU will be able to file an identical application in the UK within nine months from exit day and take advantage of the earlier filing or priority date of the international application.