Corporate and Mergers & Acquisitions (M&A)

EU Court fleshes out Community Trademark Rules

26 Mar 2013

2 min read

The concept of the Community Trademark (CTM) has long been considered very straight-forward in its approach. The common understanding is that it gives protection of a trademark applicable to all 27 Member States of the EU. Naturally, this could be easily abused if a CTM were registered and only used in one Member State. This is why the CTM Regulation (207/2009/EC) requires a CTM to be subject to “genuine use in the Community” within 5 years of registration. This matter, until recently, was a grey area, in that many interpreted it to mean that using a CTM in one Member State was enough. The European Court of Justice (ECJ) has clarified the matter further.

The first time the idea that using the CTM in one Member State was sufficient was challenged in January 2010 in Leno Marken BV v. Hagelkruis Bheer BV which was brought before the ruling body for the Benelux Office of Intellectual Property (BOIP). In this case, Leno, who owned the CTM “ONEL” tried to challenge the registration of Hagelkruis’ Benelux trademark “OMEL”. The latter challenged this action citing that using the CTM in the Netherlands only should not qualify the CTM as valid under the genuine use provisions and, therefore, should not impinge on a local trademark application in another Member State. The BOIP accepted this argument, prompting Leno to appeal to the ECJ. In July 2012, the ECJ confirmed this interpretation as being correct.

In this regard, the ECJ affirmed three separate principles:

  1. That a CTM, if used only in one Member State, does not meet the genuine use criterion.
  2. That a CTM can defeat the validity of a local trademark as long as the CTM is valid.
  3. That a CTM, if not “genuinely used” can be converted to a local trademark as long as it falls within the legal parameters of the Member State where the application will take place.

The ECJ also made it very clear that every case had to be examined on its own merits as it did not wish to set in place any principles which could reduce the attractiveness of a CTM. To this effect, it advised potential applicants should clearly consider the markets in which they intend to use the trademark before tendering their application and to carry out the appropriate searches in advance so as to avoid any litigation.

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