The number of registered trademarks in each country is constantly growing. As of 1 September 2018 the State Register of Certificates for Marks for Goods and Services of Ukraine contains 247 028 trademarks, the relevant Register of the Republic of Belarus contains 65 464 trademarks and the similar Register of the Russian Federation – 671 112 trademarks. In the year of 2017 alone, 37 817 trademarks were registered in Ukraine, 56 849 trademarks were registered in the Russian Federation and 6813 trademarks – in the Republic of Belarus.
The expansion of business on the markets of these countries may somehow lead to a conflict connected with early registered trademarks. The dispute may arise at the stage of trademark registration when the Institution of the country refuses the registration due to similarity with the early filed or registered mark, or at the stage of launching of a product in the market when the owner of earlier mark protects his exclusive rights by prohibiting distribution of a product and by compensation for losses.
There are several ways for resolving such a conflict: 1) termination of the use of a trademark; 2) signing of the agreement on co-existence and non-competition; 3) recognition of a trademark as invalid; 4) pre-term termination of the validity of a certificate for a trademark due to non-use.
One of the principles of possession of a trademark in good faith is its use. In view of this, the legislation of the majority of countries contains the norms providing the possibility of pre-term termination of the validity of a certificate for a trademark due to its uninterrupted non-use within the determined period of time. For efficient implementation of this norm the relevant obligatory conditions must be met. In this article we will consider two aspects of pre-term termination of legal protection of marks for goods and services: 1) determination of time period of non-use of a trademark; 2) forms of evidence of existence of interest of a person in pre-term termination of legal protection of a trademark.
The term of non-use
The majority of CIS countries established in their special laws the term for early termination of trademark legal protection owing to non-use – three years. The same term is prescribed in paragraph 4 of Article 18 of the Law of Ukraine “On Protection of Rights to Marks for Goods and Services”. However, if the mentioned term is clearly determined in the Russian Federation and the Republic of Belarus, so in Ukraine a conflict arose with regard to determination of applicable term of non-use in view of signing of the Association Agreement between the European Union and the European Atomic Energy Community and their member states, of the one part, and Ukraine, of the other part (Association Agreement).
Article 198 of the Association Agreement provides for that a trade-mark shall be liable to revocation if, within a continuous period of five years, it has not been put to genuine use in the relevant territory in connection with the goods or services in respect of which it is registered. After the Association Agreement has entered into force, the discussions were taking place on the matter which term should be applied: three years or five years. The preliminary point in this discussion was made by the Supreme Court on 17 July 2018 within the Collegium of judges of Cassation Economic Court during resolution of the case № 910/14972/17 regarding termination of the validity of certificate for a trademark. The Court in its ruling from 17 July 2018 determined that one of the principles of activity of the state in the area of international treaties’ law is the acknowledged norm pacta sunt servanda — treaties must be implemented, i.e. provisions of Article 198 of the Association Agreement should be applied in cases on pre-term termination of legal protection of trademarks due to non-use, and therefore this is about 5-years term.
As of today, the issue on the date of application of the mentioned norms of the Association Agreement still remains open: from 1 September 2017 — the date when the Association Agreement entered into force or from 1 January 2016 — the date of provisional application of certain provisions of the Association Agreement, including section IV that contains provisions of Article 198 of the Agreement.
In addition to the term of non-use two more moments play an important role: continuity of such non-use and the date of its calculation. The principle of continuity of non-use is equal in all mentioned countries.
As to the date of calculation, the procedure for pre-term termination of legal protection of trademark specified by the law must be taken into account.
Thus, in Belarus the procedure of pre-term termination provides for appeal of a person to the Supreme Court of the Republic of Belarus. Under this procedure the term of non-use is calculated until the date of bringing action before the court.
In Ukraine, according to item 71 of the Resolution of the Plenum of Higher Economic Court of Ukraine from 17 October 2012 № 12 «On Certain Issues of the Practice of Resolution of Disputes Related to Intellectual Property Rights Enforcement», the validity of certificate cannot be earlier terminated if the use of a trademark has been started or resumed before filing the claim. In view of the fact that the courts started to apply the norms of the Association Agreement, it is necessary to consider the provisions of Article 198 prescribing that “the commencement or resumption of use within a period of three months preceding the filing of the application for revocation which began at the earliest on expiry of the continuous period of five years of non-use, shall, however, be disregarded where preparations for the commencement or resumption occur only after the proprietor becomes aware that the application for revocation may be filed”.
Since 12 July 2017 the procedure of pre-term termination of trademark legal protection in the Russian Federation has been changed. The Article 1486 of the Civil Code of the Russian Federation provides for obligatory procedure of pre-trial resolution of such a dispute. According to this procedure the person concerned shall forward a proposal to the rightsholder to perform one of the following actions: to address Rospatent with a declaration on refusal of trademark legal protection or to conclude an agreement on alienation of exclusive right to this mark. In this case such a proposal may be forwarded not earlier than the established term of non-use has expired – three years. If within two months from the date of forwarding the letter before action the rightsholder does not response or gives a refusal, it is possible to appeal to the court. It is necessary to bring the relevant action within 30 days after expiration of the mentioned two months. Thus, in the Russian Federation the term of non-use is calculated not until the date of bringing action before the court, but until the date of forwarding the relevant proposal to the rightsholder.
The person concerned or any person
The legislation of Ukraine provides for that any person has the right to appeal to the court with a declaration for fully or partially pre-term termination of the certificate validity. According to the Civil Code of the Russian Federation only the persons concerned have such a right.
Although the Belarusian law says that any person have the right to appeal to the court with a declaration on pre-term termination, the Supreme Court of the Republic of Belarus is strict in determining of such a person. Item 13 of the Resolution of the Plenum of the Supreme Court of the Republic of Belarus from 28 September 2005 № 9 «Оn Certain Issues of Application of Legislation in Civil Cases Related to Protection of a Right to a Trademark and Service Mark” prescribes that a person should prove the existence of interest in satisfaction of a claim. Such interest could take the form of intention of a person to use a trademark on products, the decision of Patent Office to refuse to grant legal protection of a trademark in favor of a person. If the claimant does not prove in the court the existence of interest, even if the fact of non-use of a mark is established, legal protection of a mark cannot be terminated earlier.
At the same time, the courts in Ukraine are mainly focused on exploration of the facts of the use or non-use of a disputed mark, duration of non-use of a mark, existence of valid reasons for such a non-use.
As a rule, the courts determine the interest of the claimant on the basis of existence of the fact of provisional refusal of trademark registration (the ruling of the Higher Economic Court of Ukraine from 29 September 2015 № 910/9258/14), and only in some cases the courts examine in depth the economic activities of the claimant for justification for the right of action (decision of Economic Court of the City of Kyiv from 1 August 2016 № 910/9685/16).
But, despite apparently superficial approach of courts to the issue of determining the interest of a person you should bear in mind that you may apply to the court for protection of your violated, non-recognized or disputed rights and legitimate interests.
As we can see, the issues of pre-term termination of rights to a trademark in different countries require a thorough analysis of procedural matters and approaches of courts to calculation of time periods and determination of the interest of a person.
The article was published in the #43 of the periodical “Legal Practice” dated 10.23.2018
and on the website http://pravo.ua/article.php?id=100118029
The author: Anna Kravchuk
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