EU - UK agreement (so-called “Brexit”): the birth of the “comparable trademark”
It is well known by now that on 24 December 2020 the European Union and the United Kingdom reached an agreement for regulating their future commercial relations following “Brexit”.
This agreement seals the definitive separation between the British and European legal systems and, starting from the date of its enactment (i.e., 1 January 2021, namely the end of the transition period), the rules of European Union law will no longer apply to the United Kingdom, including those concerning intellectual and industrial property rights.
With a view to ensuring an orderly transition towards the new legal regime, the European Commission published a series of “Notices of Withdrawal” (related to the main sectors of European economy) which set out the main practical consequences that will affect the owners of intellectual and industrial property rights.
In particular, the Notice concerning trademarks specifies that, among other things, the owner of an EU trademark registered before 1 January 2021 will automatically become the owner of a “comparable trademark” in the United Kingdom, resulting as registered and subject to opposition in the United Kingdom, in accordance with the laws of that country.
This notion of a “comparable trademark” appears to be new within the field of IP rights, in so far as it was specifically introduced for the purpose of protecting those who – before the definitive withdrawal of the United Kingdom from the European Union – had obtained protection for their EU trademark which, at the time, produced effects also with respect to British territory.
The European Commission – evidently aware of the novelty of this legal concept – in the same Notice clarified that such “comparable trademark”:
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- consists of the same sign that forms the object of EU registration;
- enjoys the date of filing or the date of priority of the EU trademark and, where appropriate, the seniority of a trademark of the United Kingdom claimed by its owner;
- allows the owner of an EU trademark that has acquired a reputation before 1 January 2021 to exercise equivalent rights in the United Kingdom;
- cannot be liable to revocation on the ground that the corresponding EU trademark had not been put into genuine use in the territory of the United Kingdom before the end of the transition period;
- may be declared invalid or revoked or cancelled if the corresponding EU trademark is the object of a decision to that effect as a result of an administrative or judicial procedure which was ongoing before 1 January 2021 (on a date following the “cloning”).
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The British Government has confirmed that it will fall to the competent office of the United Kingdom to proceed without cost with the “cloning” of EU trademarks in the United Kingdom, where they will become “comparable trademarks”. It is not required of the owners of EU trademarks to file any request, nor to commence any administrative procedure in the United Kingdom, nor is it necessary for them to have a postal address in the United Kingdom for the three years following the end of the transition period.
Despite the precise description of the main features of the new “comparable trademarks”, there are – inevitably – uncertainties surrounding the practical application of this legal concept.
In particular, it is puzzling to find that the “comparable trademark” continues to be influenced by European administrative and judicial occurrences (see point e) above), which conflicts with the alleged independence of the United Kingdom from European laws and regulations.
Such inconsistencies evidently have already been noted, in so far as the Notice specifies (in a footnote) that the parties have acknowledged that the United Kingdom “is not obliged to declare invalid or to revoke the corresponding right in the United Kingdom where the grounds for the invalidity or revocation of the European Union trade mark … do[es] not apply in the United Kingdom”. It would seem therefore that the United Kingdom is invested with the power to not conform itself to European decisions.
However, it is not clear what should prevail in this “contest”: the invalidating decision of the European proceedings or British power to deny the effects of such European decision?
Furthermore, if the European proceedings – albeit commenced before the end of the transition period – should last for several years, how should the owner of the “cloned” trademark in the United Kingdom behave? Again, how are we to reconcile the existence of a “comparable trademark” – contemporaneously subject to European and British jurisdiction – with the known principle of territoriality applicable to the world of trademarks?
The situation appears somewhat uncertain and, in our opinion, it cannot be excluded that other issues concerning this new “comparable trademark” may arise in the future and form the object of open debate by those operating in the IP industry.
This is a key point that concerns not just acquired rights (which the British Government has undertaken to protect), but also the future political relations between the EU and the United Kingdom; indeed, it is interesting to note in this regard how such a seemingly innocent subject, namely trademark law, may in fact reveal the frailty of an agreement which is formally commercial but in reality turns out to be predominantly of a political nature.
In light of all the above, it would seem that the EU and the United Kingdom have chosen to follow the easiest path for protecting owners of EU trademarks in the midst of an orderly transition towards a new legal regime imposed by Brexit; on the other hand, this decision raises several legal questions, some of which have been anticipated above, which introduce a measure of uncertainty concerning the new “British hybrid” trademark.
Finally, we cannot fail to note how this new legal concept may represent an interesting precedent in the event that other Member States may decide in the future to leave the European Union. In that regard, we find ourselves before a new concept that certainly seems interesting from a legal standpoint, but potentially may also be “dangerous” from a political point of view and, as such, deserving of close attention in the coming years.
