ELZABURU Blog - Industrial and Intellectual Property

Author Archives: Elzaburu

OECD Alert to Governments in report entitled “Governance Frameworks to Counter Illicit Trade”

On March 1, 2018, the OECD published the report “Governance Frameworks to Counter Illicit Trade”.

In this report, the OECD has introduced a new phase in its efforts to help countries fight against piracy and to protect the market, consumers and businesses. The reasons for these increased efforts are, among others, inconsistent penalties, lack of control over small shipments and a lack of information and coordination across borders and in free trade areas.

This means that criminal networks traffic billions of dollars’ worth of fake goods each year. The OECD report shows that, on average, 2.5% of internationally trade goods are counterfeit, rising to almost 7% for IT and communications products.

The victims of these fraudulent practices are not just trademark or patent holders, but also consumers and governments themselves. In the words of Marcos Bonturi, Director of Public Governance at the OECD: “trade in fake and prohibited products can be dangerous for consumers and costly for companies and governments. This affects industries in all OECD countries and increasingly from emerging markets as well. Tackling policy gaps can start to increase the risks and lower rewards of illicit trade for criminals.”

The OECD study shows how criminal networks avoid detention and enforcement “thanks to” miscommunication and a lack of cross-border coordination.

The report also explores how the use of postal and courier services and online sales is increasing, making it easier to trade in illicit small shipments.

This is a major warning to Governments on the need to cooperate with one another in the fight against the international trade in counterfeit goods.

  Author: Juan J. Caselles and Alberto Gallo

Visit our website: http://www.elzaburu.es/en

An oddity: The official fee for rehabilitation in the event of non-use of a trademark in Honduras

The Republic of Honduras in Central America is somewhat unusual in its approach to certain aspects of trademark protection.

Article 106 of the country’s Industrial Property Act provides for an optional means of protection for owners who have failed to make use of their trademarks, enabling them to safeguard their marks from the risk of cancellation on that ground by paying what is known as a “non-use rehabilitation fee”.

As one might typically expect, trademarks in Honduras must be put to use in the marketplace. However, the possibility of covering for non-use through the payment of a fee is something that can perhaps be considered almost exclusive to Honduras.

A cancellation action may be brought in Honduras whenever a mark is not in use and the plaintiff knows that there has been no use thereof during the preceding three years and that the owner has not paid the rehabilitation fee during that time.

Thus, in the event of non-use of a trademark over three consecutive years, it is highly advisable to pay the rehabilitation fee. It is similarly advisable to pay that fee in a situation where, although the mark has been used, documentary evidence of that use is not available.

In practice, since there is a legally established provision that enables trademark owners to avoid non-use cancellation through the payment of a fee which is simple and also inexpensive (the official fees amount to approximately 25€), it is recommended to pay the fee, for safety’s sake, for all periods where there has been no use of a mark.

 

Author: Cristina Arroyo

Visit our website: http://www.elzaburu.es/en

Taking stock of the Mobile World Congress in Barcelona: risks and opportunities for exhibitors as a result of patent conflicts

The Barcelona Commercial Courts have published a report on the outcome of the Protocol that had been put in place during the MWC, which was held in Barcelona between 26 February and 1 March. ELZABURU has direct experience of the incidents concerned and can offer a first-hand account of the risks and opportunities that they represent for participating exhibitors. ELZABURU worked on 8 of the 35 cases that were handled by the Courts.

1.      The real risk of an ex parte preliminary injunction order against exhibiting companies 

The Barcelona Courts processed and granted 7 ex parte preliminary injunction petitions within the space of 48 hours. ELZABURU had to deal with one such petition which was filed, processed and granted in a matter of hours, on Wednesday, 20 February, just five days before the Congress began.

2.      The risk of on-site facts verification proceedings during the Congress 

In addition to preliminary injunctions, the Barcelona Courts also granted 3 requests for facts verification proceedings aimed at obtaining information from exhibiting companies during the Congress.

3.      Court presence at the exhibitors’ stands

The risk posed by injunctions and facts verification proceedings is even greater, if indeed that is possible, when we learn that in 9 of the 10 cases mentioned, service of the court decision and execution of that decision by means of a request to remove the products on display happened once the Congress had begun through the –albeit discreet– presence of judges and police authorities at the exhibitors’ stands. ELZABURU managed to avoid that situation in the preliminary injunction proceedings that it handled for one of its clients.

4.      The effectiveness of protective letters in mitigating those risks

Prior to the Congress, 22 protective letters were filed and granted leave to proceed. ELZABURU filed 7 such submissions. In one case in particular in which ELZABURU was involved, the prior action taken in view of a warning letter received by a company barely a week before the start of the Congress –and the filing of a protective letter– enabled the preliminary injunction order to be served early and a bond to be posted within 24 hours in order to mitigate the effectiveness of the injunction. This was the only case of the 7 mentioned in which the target of the preliminary injunction managed to prevent it from being executed.

5.      Growing importance of court action at the MWC and forecast for 2019

In 2018, the Barcelona Courts resolved 40% more cases than in previous years of the MWC; the number of protective letters has doubled and the number of facts verification proceedings has tripled. 27 companies in total have been affected by these actions.

The forecast for next year suggests that the number of cases will continue to rise. The Barcelona Courts have demonstrated an extraordinary response capacity (acting within 24 and 48 hours), which is commendable. The legal tools (preliminary injunctions, protective letters) work.

It is up to companies to think about how they can use those tools in order to take advantage of opportunities and minimise risks at the Congress in the future. ELZABURU will continue to provide support to companies that wish to set strategies and attend the MWC with the sole aim of doing business … without setbacks or nasty shocks!

Author: Enrique Armijo Chávarri

Visit our website: http://www.elzaburu.es/en

 

The European Commission warns EU trade mark owners of the possible consequences of Brexit

Negotiations between the European Commission and the United Kingdom concerning Intellectual Property rights are now getting under way in this second phase. The negotiations are to conclude in Autumn 2018 so that the Withdrawal Agreement can be approved by 29 March 2019. Thus, a transitional period would begin on 30 March 2019 and would be set to end on 31 December 2020.

This past September the Commission published a position paper setting out its stance in preparation for the negotiations on intellectual property rights with the United Kingdom with a view to ensuring the circulation of goods between the EU and the UK after 30 March 2019.

The Commission’s position posits that withdrawal by the United Kingdom should not result in the loss of protection of the rights in the UK acquired by the owners of EU trade marks, and it proposes that those rights should be recognised by the United Kingdom automatically on completion of a simple procedure with the British authorities (unspecified at this point) not to be too costly for trade mark owners.

However, the Commission has asked the United Kingdom to implement national legislation dealing with geographical indications, something it does not currently have, to ensure that geographical indications will be protected after 30 March 2019, as they are under EU legislation.

In an official notice released last 22 January, the European Commission advised stakeholders to consider the possible repercussions of the United Kingdom’s exit from the European Union – both for national authorities and for private parties – and to act to forestall them.

It advised that even though the European Union’s position supports automatic continuity of protection of EU marks in the United Kingdom, any such continuity will have to be approved by law in the UK. It recommends businesses to plan for the potential consequences of Brexit after 30 March 2019, the date – unless another date is set – on which the United Kingdom will become a “non-Member” State of the European Union.

The effects of the loss of effect by European Union regulations on trade marks could include:

1. European Union trade mark registrations that predate 30 March 2019 will cease to have effect in the United Kingdom, and pending trade mark applications will no longer cover the United Kingdom after 30 March 2019;

2. Seniority will no longer be claimable on the basis of UK trade marks, and British seniorities claimed for EU trade marks will cease to have effect.

3. The United Kingdom will no longer be considered to be a designated territory under international marks that designate the EU.

4. Starting on 30 March 2019, British trade marks may no longer be used as grounds in opposition proceedings at the EUIPO.

5. Use of a trade mark in the United Kingdom will no longer suffice for purposes of maintaining EU trade marks as of 30 March 2019. Similarly, after 30 March 2019 EU trade mark owners will no longer be able to rely on distinctiveness acquired through use of their EU trade mark in the United Kingdom.

6. Decisions issued by the EU courts will no longer have effect in the territory of the United Kingdom from 30 March 2019, and decisions taken before that date will have to be applied in the United Kingdom in accordance with British law.

7. British courts will cease to have jurisdiction in EU trade mark matters, hence in the case of EU trade marks with a British owner, infringement proceedings will have to be brought in the courts of the Member State in which the complainant has residence or, if the complainant is not a resident of a Member State of the EU, in Alicante (as the headquarters city of EUIPO).

On the other hand, indications are that English will continue to be an official language of EUIPO and that as a consequence proceedings will still be able to be brought in English, inasmuch as it is an official language in Ireland and Malta. It will still be possible to claim priority for an EU trade mark based on a British mark, since the United Kingdom is a signatory country of the Paris Convention.

The Commission’s recommendation – which is also our recommendation in view of the uncertainties involved in this second phase of the negotiations – is to start taking steps to limit the impact of Brexit right away so as to obviate the effects on trade mark owners that could ensue from a bad Agreement.

 

Author: Catherine Bonzom

Visit our website: http://www.elzaburu.es/en

European Commission recommends new measures against illegal content online

The dissemination of illegal content online damages citizens’ confidence in the Internet and could pose security threats. Although progress has been made in Europe as regards citizens’ protection online, platforms need to double their efforts to remove illegal content from the Internet more swiftly and effectively. Voluntary measures taken by the sector, as encouraged by the Commission, have already paid off: the EU Internet Forum to eliminate terrorist content from the Internet; the Code of Conduct on countering illegal online hate speech; and the Memoranda of Understanding on the sale of counterfeit goods. Nevertheless, there is still room for more effective action.

Background:

In its Communication of September 2017 on tackling illegal content online, the European Commission promised to monitor progress and assess whether additional measures were needed in order to ensure the swift and proactive detection and removal of illegal content online, including possible legislative measures to complement the existing regulatory framework.

Development: The Commission Recommendation of 1 March 2018

Before determining whether it will be necessary to take legislative action, the Commission has just published its Recommendation of 1 March 2018 on measures  to effectively tackle illegal content online. It consists of a set of operational measures, accompanied by the necessary safeguards, to be taken by companies and Member States. The recommended measures apply to all forms of illegal content, i.e., terrorist content, incitement to hatred and violence, child sexual abuse material, counterfeit products and copyright infringement.

Basically, procedures have been reinforced in order to more effectively remove illegal content by means of the following operational measures:

  1. Clearer “notice and action” procedures. Companies must establish simple, transparent rules for reporting illegal content, including fast-track procedures for “trusted flaggers”. In order to prevent lawful content from accidentally being removed, content providers will be notified of removal decisions and will be able to challenge decisions.
  2. More effective tools and proactive technology. Companies will have to design clear notification systems for users. They will need to have proactive tools to detect and take down illegal content, particularly in the case of terrorist content and content that requires no assessment of the relevant context in order for it to be deemed illegal, such as child sexual abuse material or counterfeit goods.
  3. More solid safeguards to guarantee fundamental rights. In order to ensure that there are solid grounds for removing content, companies must put in place effective and appropriate safeguards, including a human review step, at all times respecting fundamental rights, freedom of expression and data protection laws.
  4. Paying special attention to small businesses. The sector must, by means of voluntary agreements, cooperate and share experiences, best practices and technological solutions, particularly regarding automated detection tools. This shared responsibility will be particularly beneficial to small platforms, which have fewer resources and less technical know-how.
  5. Closer cooperation with the authorities. Where there is evidence which points to a serious offence or suspicions that there is illegal content which poses a threat to human life or security, companies must immediately notify the Security Forces. The Member States are invited to establish the pertinent legal obligations.

Next Steps:

The Commission will follow up on the measures that are adopted in compliance with this Recommendation, determining whether supplementary measures, including legislative action, are required.

In close cooperation with the interested parties, the Commission will continue its analysis with the launch of a public consultation (feedback period ends on 30 March 2018). It will also ask the Member States and companies to provide the pertinent information on terrorist content (within a period of 3 months) and on other illegal content (within 6 months).

We will therefore have to be prepared to cooperate with the Commission in relation to illegal content in the field of copyright and industrial property.

Author: Juan J. Caselles

Visit our website: http://www.elzaburu.es/en

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