EU trademark reform package changes legislation

The reform process of the European Union trademark legislation was finally completed at the end of 2015. The new trademark regulation and directive entered into force on 23 March 2016, replacing the previous Community legislation. The reform has significant consequences both on the interpretation of law and the status of Community trademark applicants and owners.

Trademark applicants and owners are most affected by a change in the classification used in Community trademarks and trademark applications filed before 22 June 2012.

IP Translator case in significant role

The change in the classification practice and its interpretation has its roots in the summer of 2012 when the European Court of Justice gave its widely noted ruling on the IP Translator case. The core issue in the case was how precisely goods and services are to be identified in a Community trademark application in order for the trademark classification in question to serve the intended purpose. Earlier, fairly broad expressions were accepted in the classification and, at the same time, there were terms that the classification did not recognize. The new legislation now requires that the exact words specifying the goods and services to be covered by a registration are mentioned in the classification.

The IP Translator case attracted fairly wide attention in the industry, and expectations regarding the court ruling were high. However, when the decision came out, a common opinion seemed to be that in fact the decision evoked more questions than it provided answers regarding specification of classification. The most important legal instruction obtained from the decision was that the goods and services that a trademark application is to cover must be identified “with sufficient clarity and precision”. The court did not, however, give any further advice on how this “sufficient clarity and precision” is to be understood in practice.

The decision on the IP Translator case has a strong impact on the reform package of the EU trademark legislation. The requirements it sets on the specification of classification form the key element of the reform package, especially at the very beginning of the enforcement of the legislation. Its significance is further emphasized by the retroactive effect of the legislation. Contrary to the usual practice, the new legislation has an effect also on trademarks registered before the entry into force of the new law.

Because of the IP Translator decision, sufficient clarity and precision is required also with regard to identification of goods and services covered by trademarks registered before the new legislation. For this reason, trademark owners must check the classifications of their existing Community trademarks. Naturally, the requirement of sufficient clarity and precision also concerns all new trademark applications within the EU, which is why special attention must be paid to the precision of classification when new trademark applications are being prepared.

Moreover, the new legislation requires that owners with Community trademarks that are already in force, i.e. those applied for before 22 June 2012, review their registrations and, when necessary, specify the classifications so that the classes of their trademark registrations are sufficiently clear and precise and cover the goods and services for which trademark protection was applied.

Before the reform, classifications in connection with trademark applications were chosen on the basis of what are known as class headings, without identifying in more detail the actual goods and services the trademark was to be used for. A class heading is a list of examples of goods and services belonging to a specific class in the international trademark classification system. Under the class heading, the actual goods and services in that specific class are listed in an alphabetical order to itemize all existing goods and services belonging to the class in question. Each class has thousands of alphabetically listed items, and of course their number is constantly growing.

The use of class headings in an application offered an advantage in that the class heading was considered to cover all the goods and services in the alphabetical list of the class in question. This interpretation was followed not only by the EU trademark office but also by the majority of national offices, including the Finnish Patent and Registration Office.

As of 23 March 2016, the EU trademark office will now adopt a different practice. The use of class headings is seen as providing an unreasonably wide protection for trademarks that are hardly ever going to be used for all the goods and services covered by the classes in question. Consequently, the new legislation requires trademark owners and applicants to specify the goods and services their trademark is meant to protect by using words that describe the items concerned with precision.

Class 15 offers an excellent example of the effects of the change. It has a short and simple heading: Musical Instruments. The alphabetical list under class 15, however, includes a number of other goods related to instruments, such as music racks. It is possible that, until now, a company producing music racks has registered its trademarks under class 15 using the class heading and assuming that it covers, in addition to musical instruments, also the other goods in the class.  

However, according to the new legislation music racks are no longer included in the scope of protection because, although they belong to class 15, they are not specifically mentioned in the classification.

On the other hand, the new requirements and obligations imposed on owners of trademark applications offer them an excellent opportunity to go through their existing trademark registrations to be absolutely sure that all the goods and services important for their business are covered. Besides verifying that the goods and services are specified in a sufficient manner, it is also possible to check that the scopes of protection of the trademark registrations are not too broad in view of the genuine uses of the trademarks. It is good to remember that a trademark may be revoked for those goods and services in connection with which it has not been used during an uninterrupted period of five years.

We recommend that all obligations arising from the new legislation are fulfilled in co-operation with a trademark attorney to make sure that the trademark classification both meets the business needs of the owner company and complies with the new legislation.