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Important changes in global trade marks - July 2019 update

July 08, 2019

Contacts

Partners Richard Watts
Special Advisors Sarah Chapman

Intellectual property

For New Zealand businesses interested in expanding overseas, there are some important changes happening to the trade mark laws of countries you may be interested in.

In this update we summarise key changes in Canada, China, Malaysia and Brazil.

Canada

It’s been a long time coming, but from 17 July 2019 Canada is finally joining the Madrid Protocol. This will generally bring Canada into line with current trade mark practices in other Madrid Protocol jurisdictions. Practically, this means that:

  • You will be able to file into Canada via the Madrid international filing system. Filing directly via Canadian agents will still be an option, but not a necessity.

  • The term of registration will decrease from 15 years to 10 years. The renewal fee will also change from a flat fee of C$350 to C$400 for the first class and C$125 for each additional class.

  • Divisional applications will be allowed, as will applications for non-traditional marks (eg shapes, colours, sounds and scents).

  • Trade marks in Canada will be classified into the same classes as New Zealand trade marks.

  • Filing fees are changing. The official fee for filing in one class will be C$330, and each additional class will be C$100. This replaces the current filing fee of C$250 for unlimited classes (as Canada does not currently have a class structure in place for trade marks).

The Canadian IP office will be closing down from 13 July to 17 July in order to implement the changes. Deadlines for renewals, applications, divisional, international applications or expansions falling within that time period need to be completed before 13 July 2019.

If Canada is a territory of interest to your business and you are looking to file a trade mark application there covering a large number of classes, you may want to consider filing before 13 July in order to benefit from the currently lower filing fees. Or, if you are thinking of filing an International Registration, you may want to delay filing until after 17 July so that Canada can be included, thereby avoiding fees for subsequent designations.

China

China has introduced a number of changes with the aim of stopping trade mark squatting:

  • China is combatting trade mark squatting and bad faith applications by adding an intention to use requirement. Trade mark squatting is a big problem in China with “professional” squatters making a business out of filing trade marks then selling those marks to brand owners. The “intention to use” requirement, which requires the applicant to confirm that it intends to use the trade mark, will act as a basis for opposition or invalidity proceedings.

  • The onus on trade mark agents is also increased. Agents are expected to decline filing instructions if they know, or should know, that the client does not have an intention to use the mark, or that the mark is being filed in bad faith.

  • The damages available in trade mark proceedings has been increased from RMB 3 million to RMB 5 million. Premier Li stated that the punishment for bad faith infringement must be significant enough to bankrupt the infringer.

The “intention to use” requirement will be useful for businesses entering the Chinese market who find a trade mark squatter (who has no intention to use a mark) has blocked an application. This issue previously had no clear remedy for applicants. 

Separately to the anti-squatting measures:

  • guidance has been issued that examination should take not more than 6 months; previously the guidance was for eight months although in practice examination can take longer. This is an attempt to get through a back log of applications at the Office.

  • Trade mark fees have decreased. Notably, renewal fees have decreased from RMB1,000 to RMB500, recordal of changes are reduced from RMB250 to RMB150, and the official fees are reduced by 10% where e-filing is used for most common trade mark steps, including filing, renewals and requests for opposition or cancellation.

The discount offered for electronic filings will hopefully lead to an uptake in the number of electronic filings, and in turn to efficiencies at the Chinese Trade Mark Office when examiners have fewer paper applications to sift through.

Malaysia

Malaysia is in the process of enacting major reform to:

  • Allow for non-traditional trade marks (eg shapes, colours, sounds and scents).

  • Allow for multi-class applications (previously only single class applications were allowed).

  • Join the Madrid Protocol so that trade marks can be filed via the Madrid international filing system.

  • Expand trade mark owner’s rights to allow for infringement proceedings when goods/services are related to the goods/services covered by the application.

  • Introduce remedies to protect against groundless threats of infringement proceedings.

  • Prevent the use of defensive trade marks.

The reform Bill is due for its second reading in the Malaysian parliament this month (July 2019). While these changes are further away than the Chinese and Canadian reforms, change is coming and filing into Malaysia will become much easier once they join the Madrid Protocol. 

Brazil

As of 3 July 2019, Brazil is now part of the Madrid international trade mark system. Madrid filings will be available in three months’ time, from 2 October 2019. As the biggest economy in Latin America, the addition is a significant for the international trade mark system as brands will more easily be able to enter that market, and Brazilian companies will be able to expand internationally with greater ease.

Please get in touch with any of our contacts above for more information on these developments or to discuss how they could impact your business.

Contributors janelle.simpson@simpsongrierson.com