How will Brexit 2020 affect your trade marks?
Brexit will change the landscape of United Kingdom (UK) and European Union (EU) trade mark portfolios, but not immediately. Here we explain some of the ways in which the UK’s departure from the EU will affect trade mark rights for rights holders in the UK and EU, and what to expect.
The transition period
The UK became the first country to leave the EU on 31 January 2020, known as “Brexit Day”, and we now find ourselves in the 11-month transition period from 1 February to 31 December 2020, during which the UK and EU will negotiate their future relationship.
The post-Brexit regime will officially commence on 1 January 2021, unless the UK requests an extension by 30 June 2020. The maximum extension would be two years, under the terms of the withdrawal agreement.
During the transition period, the UK will remain part of the EU Single Market and Customs Union and, unless otherwise provided, EU law will continue to apply to the UK. But the UK will no longer be entitled to participate in the elections, decision making, and governance of EU entities.
What’s more, the trade mark system will continue as is until 31 December 2020.
The European Union trade mark (EUTM)
Trade mark rights are territorial, so protection is in force only in the country where the trade mark is registered. An EUTM registration is a single trade mark that results in its being valid in all current and future EU Member States. (In comparison, national trade mark registrations are protected only in the countries where they are registered.) An EUTM offers trade mark owners a unified system of protection throughout the EU, and significantly facilitates administrative matters, because only one office needs to be contacted in respect of any assignment, licence or renewal of the trade mark.
An EUTM registration will remain protected and enforceable in the UK until 31 December 2020.
From 1 January 2021, EUTMs will no longer protect trade marks in the UK. Under the Withdrawal Agreement, on 1 January 2021, the UK Intellectual Property Office (UKIPO) will automatically create a free comparable or cloned UK trade mark, recorded on the UK register, for all rights holders.
The UKIPO will convert almost 1.4 million registered EUTMs to comparable UK rights at the end of the transition period. No action is required on the part of such rights holders. No fees are payable and the new UK right will be provided with minimal administrative burden.
It is important to note that an EUTM takes four to five months to proceed to registration, assuming no objections or oppositions. As such, if considering applying for protection in both the EU and the UK, it is worth taking advantage of the transition period by applying for an EUTM promptly in order to have it registered before the end of the transition period. This will avoid the payment of the fees for a separate UK registration.
Owners may opt out of acquiring a comparable trade mark if, for example, this would be in breach of an agreement, but is likely to incur an official fee. The option will only be available as long as the trade mark owner has not made use of its comparable trade mark in the UK. Opt-out requests can only be submitted after 1 January 2021. Therefore, if no detriment will be caused, it may be more cost-effective to simply allow comparable UK trade marks to lapse on renewal.
EUTMs already filed will most likely proceed to registration (barring opposition) before the end of the transition period and thus benefit from a free automatic UK comparable trade mark. However, no comparable UK right will be created at the end of the transition period for pending applications.
Owners of pending EUTM applications will be able to apply to register a comparable UK trade mark using the normal application process in the UK. For nine months from the end of the transition period, the UKIPO will recognise the earlier filing date of the pending EUTM as well as claims to earlier priority and UK seniority recorded on the corresponding EU application, and examine it under UK law. The EUTM application will move forward covering 27 Member States. Owners pursuing this option will be required to meet the cost of re-filing the application, in accordance with the UK application fee structure.
No automatic notifications will be issued by either the UKIPO or European Union Intellectual Property Office (EUIPO) of the expiry of the nine-month period and potential loss of rights in the UK, so this will need to be monitored by EUTM rights holders or their representatives.
Renewing trade marks
Once a comparable UK trade mark is created, a separate renewal fee will apply for each comparable UK trade mark and the existing EUTM, payable separately to the UKIPO and EUIPO.
For the purposes of future renewal, the comparable UK right will retain the existing renewal date of the corresponding EUTM.
Where the renewal date of the EUTM falls on or before 31 December 2020, presuming it has been renewed, the UK comparable right will not need to be renewed until the next renewal of EUTM.
Conversely, where the renewal date of the EUTM falls after 1 January 2021, a renewal fee will need to be paid to maintain the comparable UK trade mark – whether or not the EUTM has been renewed before 1 January 2021.
Where the renewal date of the comparable UK trade mark falls between 1 January 2021 and 30 June 2021, a renewal reminder will be sent by UKIPO. Rights holders will receive an additional six months from the date of the reminder to renew the comparable UK trade mark without payment of any late renewal fee. This will need to be taken into account when clearance searches are being carried out in the UK during 2021.
In a nutshell, therefore, nothing will change until the end of the transition period on 31 December 2020.
There will be no need to re-file registered EUTMS as new UK national applications and dual trade mark filings (UK and EU) are not necessary at this time, unless there are specific reasons to do so. These might include potential EU oppositions or the need for a swift UK registration.
IP owners should review their trade mark portfolios to assess whether or not comparable UK rights will be beneficial to them. Commercial agreements such as co-existence agreements covering the EU should be reviewed and housekeeping issues dealt with. This will help to avoid any inconsistencies being carried over to UK-comparable registrations at the end of the transition period. In addition, existing UK legal representatives should confirm that they have measures in place to act before EUIPO as of 1 January 2021.
* This piece does not intend to cover every intellectual property-related issue that Brexit generates. More guidance will be given as we continue to monitor UKIPO and EUIPO announcements. Visit www.spoor.com
About the authors
Partner, Spoor & Fisher, South Africa
Shamin Raghunandan is a Trade Mark Practitioner with an LLB degree from the University of KwaZulu-Natal. She is an Attorney of the High Court of South Africa and a Notary Public. With over a decade of experience, Shamin specialises in domestic and international trade mark law, trade mark clearance searches, filing and prosecuting trade mark applications and trade mark portfolio management. She has specific expertise in counselling and assisting clients with planning and obtaining trade mark protection throughout Africa.
Candidate Attorney, Spoor & Fisher, South Africa
Mpho Dzhivhuwo has an LLB from the University of Johannesburg. New to Spoor & Fisher, she focuses on trade mark prosecution. Mpho speaks all 11 of South Africa’s official languages