What does Brexit mean for EUTMs?
Updated: Apr 29
Brexit may be “done” after the end of the transition period on 31 December 2020, but its impact is continuing to be felt in a number of disputes over EU trade marks.
The ZARA case
Perhaps most interesting is a case regarding an application by Inditex to register the ZARA mark for goods and services in classes 29, 30, 31, 32, 35 and 43. This is now pending before the EU Court of Justice (Case C-65/22) following an EU General Court judgment on 1 December 2021 (Case T-467/20) – a very rare example of the CJEU taking an appeal from the General Court since a new rule was introduced in 2019.
In this case, the EUIPO partially upheld an opposition to the ZARA application, based on likelihood of confusion with an earlier Italian figurative mark ZARA and an earlier international registration designating the EU for LE DELIZIE ZARA, which had effect in the UK.
Before the General Court, Inditex argued that, according to Communication No 2/20 of the EUIPO Executive Director, from 1 January 2021, UK rights cease to be “earlier rights” for the purposes of inter partes proceedings, and that actions in inter partes proceedings based solely on UK rights that are still pending on 1 January 2021 will be dismissed for lack of valid basis. Its argument was reinforced by a subsequent Board of Appeal decision in a different case.
However, the General Court said that “the existence of a relative ground for opposition must be assessed as at the time of filing of the application for registration of an EU trade mark against which a notice of opposition has been filed”. It added:
“The fact that the earlier trade mark could lose the status of a trade mark registered in a Member State at a time after the filing of the application for registration of the EU trade mark, in particular following the possible withdrawal of the Member State concerned from the European Union, is in principle irrelevant to the outcome of the opposition”.
The relevant date was therefore 5 March 2010 (the date of filing of the EUTM application), and the mark could form the basis of an opposition. The General Court upheld the Board’s decision.
The CJEU appeal was lodged on 1 February 2022, so a hearing is likely later this year or early next year.
The APE TEES case
In the meantime, the General Court has published two other judgments relating to the Withdrawal Agreement.
One of these, concerning an application to register the figurative sign pictured as an EUTM, also involved earlier UK rights – in this case, three unregistered UK marks (pictured below).
The EUIPO rejected the opposition, with the Board of Appeal finding that after the end of the Brexit transition period, the applicant could no longer rely on the rules governing common-law actions for passing off in the UK.
However, in line with its judgment in the Inditex case, the General Court (Case T‑281/21) said that “it is clear from now settled case-law that the existence of a relative ground for refusal must be assessed as at the time of filing of the application for registration of an EU trade mark against which an opposition has been brought”.
The fact that the earlier trade mark could lose its status due to the withdrawal of the UK is irrelevant to the outcome of the opposition.
It therefore annulled the Board of Appeal decision.
The STONES case
The third Brexit-related case at the Court concerned an EUTM for STONES, which was registered in 2010. In August 2018, a revocation action was filed based on non-use, on the basis essentially that the mark had only been used in the UK. EUIPO found however that there had been use in the relevant period (21 August 2013 to 21 August 2018).
The Court upheld this finding (Case T-766/20). It said:
“the legislature implicitly accepted that the protection conferred on an EU trade mark should be maintained even where genuine use of that mark is demonstrated only in the territory of the United Kingdom, for as long as the latter remained a member of the European Union”.
It added that “it cannot be held that the protection of the contested mark has become ‘superfluous’ in the light of the significant changes in the situation, or even that there was no legitimate interest in maintaining the mark at issue”.
The Court said the “new context” of Brexit would have to be taken into consideration in future proceedings concerning genuine use, where the relevant five-year period falls in part or in whole after 1 January 2021.
What does this mean?
These three cases are a reminder that, while the UK’s withdrawal from the EU and the transition period are over, there are likely to be continuing arguments about IP issues and conflicts for some time to come.