Trademark

Madrid System & Indian trademark owners – Part II


                                         
ESSENTIAL CONSIDERATIONS WHILE FRAMING THE TRADEMARK STRATEGY
 
  • REAL AND EFFECTIVE PRESENCE

Madrid System requires both the applicant and assignee to have real and effective industrial or commercial establishment in the office of origin and countries intended to be designated. Hence, Indian trademark owners can take advantage of the System only if it shows real and effective industrial or commercial establishment in member states where protection is sought using the System. The creation of Intellectual Property Holding Companies (IPHC) can be considered in this regard. The creation of IPHC shall inter alia consider factors such as tax planning and administrative synergies. IPHC shall not be made a mere passive owner of IP as non-use of IP is a valid ground for revocation in some jurisdictions.
  •  OFFICE OF ORIGIN
The status of office of origin shall be considered while choosing it as it determines the countries which can be designated under the System. If the office of origin is a party only to the Agreement, then the applicant can designate only countries which are parties to the Agreement. If the office of origin is a party only to the Protocol, then the applicant can designate only countries which are parties to the Protocol. If the office of origin belongs to both the Agreement and the Protocol, then the applicant can extend its international registration to all the contracting parties of the Madrid Union. Thus, if India is chosen as the office of origin, then the applicant can designate only countries which are parties to the Protocol. 

An international registration remains dependent on the mark registered or applied for in the office of origin for a period of five years from the date of its registration/application. If, and to the extent that, the basic registration ceases to have effect whether through cancellation following a decision of the office of origin or a court or voluntary cancellation or non-renewal within this five-year period, the international registration will no longer be protected.   Similarly, where the international registration was based on an application in the Office of origin, it will be cancelled if, and to the extent that, the application is refused or withdrawn within the five-year period, or if, and to the extent that, the registration resulting from that application ceases to have effect within that period.  This is often referred to as “central attack”. After the expiry of five years, the international registration attains a status independent of the basic registration or basic application.  

The cancellation or limitation of application/registration under the Protocol does not necessarily cost the trademark owner its rights and priority. The Protocol incorporates a mechanism called “transformation” which in a way mitigates the effects of “central attack”. As per this mechanism, extensions applications/registrations can be transformed into new non-Protocol applications in designated countries within three months from the invalidation or cancellation of the home application or registration. These new non-Protocol applications are permitted to retain filing and priority dates of the invalidated and cancelled home application.  This mechanism does not exist under the Agreement.

In the light of the above mechanism, when a trademark owner anticipates strong opposition to his trademark, it is not advisable to file in an office of origin which is a party only to the Agreement and maintains a high threshold criterion for granting protection. Thus, the status of office of origin is a pertinent factor in the evaluation of threshold for granting protection in an office of origin.
  •  DESIGNATING MEMBER STATES
The Madrid System shall be chosen only if it is beneficial over filing at national and regional trademark offices. It may be noted that the benefits of the System cannot be realised if the mark encounters strong objections in designated countries. If a mark is challenged, the applicant must designate a local representative and pay representation fees.
  •  CLASSIFICATION OF GOODS AND SERVICES

The Madrid applications are required to identify the classes of goods and services for which registration is sought. The goods and services must be set forth in precise terms, preferably according to the classification established by ‘International Classification of Goods and Services for the Purposes of the Registration of Marks under the Nice Agreement’.

The classification of goods and services by the office of origin defines the extent of the rights of the trademark owner in other countries. If the office of origin permits broad classification of goods and services for national applications and registrations, then the scope of protection that an applicant can obtain in other member states under the System will also be broad. However, this is subject to the domestic laws of those countries. The converse is also true. For instance, United States does not allow broad classification of goods and services.

  •    TRADEMARK SEARCH AND CLEARANCE PROCEDURES

Considering the rise in trademark applications with the adoption of Madrid System, the potential for conflict will be more. It may result in rise in risk of filing of third-party applications in the interim. As the national databases may not be up-to-date, search must not be confined to them. If filing in such a country is intended either for using it as an office of origin or for designating it in the international registration, then it is safer to expand the search parameters to include WIPO’s free online trademark databases – Madrid Express and Romarin databases. Even if an applicant intends to register his mark in a member country of Madrid System but does not intend to use the System, it is still advisable to search the above mentioned databases to confirm that no party has designated this member country for protecting the same mark. This will, nevertheless, result in lesser uncertainty while adopting a mark.

Mathews P. George

Mathews P. George

Mathews is a graduate of National University of Juridical Sciences, Kolkata. His interest in intellectual property was kindled when he bagged the second position in his second year of Law School (in the prestigious Nani Palkhiwala Essay Competition on Intellectual Property). His stint as a student of Prof. Shamnad Basheer further accentuated his interest in intellectual property. Winner of almost a dozen essay competitions in his Law School days, he was involved in various research and policy initiatives relating to intellectual property. Mathews is, currently, based out of Munich, Germany. He had earlier done his LLM in 'IP and Competition Law' from Munich Intellectual Property Law Centre (jointly run by Max Plank Institute for Innovation and Competition, University of Augsburg, Technical University of Munich and George Washington University, Washington).

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