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TRADE-MARKS REVISED: CANADA IS CHANGING ITS REGISTRATION SYSTEM

Canada’s trade-mark laws are expected to undergo extensive and significant amendments over the next 12 -24 months. The first step was completed on June 19, 2014 when the Canadian Parliament passed legislation that will allow Canada to implement three international treaties, namely: the Nice Agreement, the Singapore Treaty and the Madrid Protocol.

Full implementation of the new legislation is presently suspended while consultations are conducted respecting the development of new regulations and fee structures. While full implementation of the Madrid Protocol is not expected until at least 2015, the provisions implementing the Nice Agreement and the Singapore Treaty may be implemented as early as the fall of 2014.

With a few exceptions, the adoption of these treaties will not directly affect substantive legal rights in a trade-mark. Instead, the goal of the Singapore Treaty and the Nice Agreement is to set an international standard for the administration of the trade-mark registers in each member country and the goal of the Madrid Protocol is to facilitate the registration of trade-marks in multiple countries.

This posting will provide an overview of the significant changes to be introduced by the Singapore Treaty and the Nice Agreement. The international registration system to be introduced with the Madrid Protocol will be reviewed in a future posting.

Singapore Treaty & Nice Agreement – Standardizing Administration of Registry

Classification System

Most significantly, these treaties require the use of a standard international classification system to identify the goods and services to be associated with each trade-mark appearing on the trade-mark register.

At present, the description of related goods and services to be associated with the applied-for-mark is not separated by class. Instead, each of the related goods and/or services must only be described in “ordinary commercial terms”. A benefit of this system is that only one application fee is payable for each application filed regardless of the number of goods and services involved.

Under the Nice Agreement, all the goods and services identified in an application must be assigned to one of 45 possible classes and described according to an international standard. In most countries that have already adopted the Nice Agreement, a separate application, registration fee and/or renewal fee must be paid for each class of goods and services contained in an application or registration. For a trade-mark used in association with a wide variety of goods and services, the filing costs are therefore expected to increase substantially with the implementation of the Nice Agreement.

Pointer: Businesses should therefore consider filing trade-mark applications as soon as possible for any trade-marks that are already or are expected to be associated with a wide range goods and services in the hopes of avoiding some of these anticipated cost increases.

Pointer: Businesses should also expect to receive notices from the Canadian trade-mark office within the next 12-24 months requiring them to amend their existing registrations to comply with the Nice Agreement. Failure to respond to these notices may lead to expungement of the subject registrations.

Declarations of Use Eliminated

At present, trade-mark applications may be filed in Canada on the basis of: (a) a corresponding foreign application or registration; (b) proposed use in Canada; and/or (c) past use in Canada. If the application is based on a foreign application or registration, a certified copy of the foreign registration must be provided prior to filing.  If the application is based on proposed use, the applicant will required to file a declaration that used of the trade-mark in Canada has commenced prior to registration. If the application claims past use in Canada, the applicant must specify the date of first use in its application. After filing, the claimed dates of first use cannot amended to an earlier date or even changed to proposed use and applications filed on the basis of proposed use cannot be amended to claim use prior to the filing date.

With the recently passed amendments, applicants will not be required to: (a) identify any grounds for their application; (b) specify a date of first use; or (c) file a declaration of use.  The failure to use a registered trade-mark in Canada for a period of three years or more will continue to grounds for summary expungement. However, it appears that applicants will be able to obtain a registration without any prior indication that the applied-for-mark has been used in Canada and that the registration may be effectively immune from expungement for the first three years.

While this amendment will likely streamline the filing process (especially for foreign applicants), it has been heavily criticized by the profession as unnecessary to comply with any of the treaties and as potentially problematic over the long term. In particular, many are concerned that it will lead to increased difficulty and cost when trying to determine whether a proposed trade-mark is available for adoption by a business. First, the register is expected to become increasingly crowded with presumptively valid registrations for trade-marks that have never been used in Canada and the cost to challenge such registrations is not insignificant. Second, it will be more difficult to determine whether there are grounds to oppose an applied-for-mark or challenge a registered trade-mark as there will be no readily available information about its date of first use.

This amendment is therefore expected to increase the risk and uncertainty for any business looking to adopt a new trade-mark in Canada or respond to allegations of infringement. With input from the profession, there remains some hope that these risks may be mitigated in the regulations which remain to be drafted.

Term of Registration Reduced

At present, a trade-mark registration in Canada must be renewed every 15 years. With the implementation of the Singapore Treaty, this term will be reduced to 10 years.

Pointer: Registrants may renew registrations up to one year prior to expiry. As a result, registrants may wish to take advantage of the opportunity to renew expiring trade-mark registrations as soon as possible.

Marks Eligible for Registration Expanded

At present, Canada will accept applications to register one or more words, a graphic design, a combination of words and graphics, a colour or a pattern, a unique form of packaging and, in some circumstances, a three-dimensional shape as a trade-mark. It also recently started to accept applications to register sounds, melodies and holograms. However, it does not yet accept applications to register so-called sensory marks such as tastes, smells or textures.

With the implementation of the Singapore Treaty, Canada will be required to accept applications to register such sensory marks. However, it may be necessary to produce evidence that the marks are distinctive of the applicant before such applications will be approved.

Pointer: For businesses that already use or are contemplating the use of such non-traditional means of identifying their goods or services in the market, this is an opportunity to improve the legal protection of the monopoly in their trade-mark.

Applications in Progress may be Divided

At present, a Canadian trade-mark application cannot advance if the examiner or a third party objects to registration of the mark for any of the proposed goods and services. The applicant must either remove the contested goods and services from the application or try to overcome the objection in order for the application to proceed. If the applicant still wants to try to register the trade-mark for the contested goods and services, a new application must be filed and any priority claims arising from the filing date for the first application are lost.

With the implementation of the Singapore Treaty, a pending application may be divided into two or more parts. This will allow the trade-mark to be registered for those goods and services to which there is no objection without delay. At the same time, the applicant can continue its efforts to overcome objections to registration of the mark for any contested goods and services without losing any priority claims arising from the filing date.

More details on these changes, including information about the consultation process, are available through this link to the Canadian Intellectual Property Office.

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