The impact of Brexit on trade mark protection

By Reneé Olmstead on 27 November 2018

With Brexit looming on 30 March 2019, trade mark owners are anxious for certainty as to what impact Brexit may have on their existing trade mark rights in the European Union, given that this exit naturally involves substantial changes to the current intellectual property landscape in Europe.

The complexity stems principally from the interplay between the European Trade Mark ("EUTM") system, which affords protection in the whole of the European Union, and that of the UK once Brexit takes place.

The draft EU Withdrawal Agreement, which was approved at a special meeting of the European Council in Brussels on 25 November 2018, provides guidance as to how this exit is intended to impact trade mark owners.

The draft agreement creates a transitional period from 30 March 2019 to 31 December 2020, during which the current intellectual property framework governing the EU and the UK will remain substantially the same and EUTM’s will remain enforceable in the UK.

After the transitional period, the UK intends to grant owners of registered EU rights comparable rights in the UK.

With effect from 1st January 2021, the draft agreement legislates the following position in relation to EUTMs:

Existing registered EUTMs will continue to be valid in the remaining EU member states.
The UK will afford protection to existing EUTMs which were registered before the end of the transitional period (i.e. 31 December 2020) through the granting of a new equivalent UK registration with the same priority, filing and renewal dates as the existing EUTM, automatically and at no additional cost to rights holders.
EUTM right holders will be notified and may opt out if they do not wish to obtain a new corresponding UK registration.
Applicants with a pending EUTM will be able to refile in the UK within nine months from the end of the transitional period for an equivalent UK right, retaining the initial EUTM application date.
Where an existing EUTM is invalidated during formal proceedings, the corresponding UK right will also be declared invalid, provided that these proceedings commenced before the last day of the transitional period. The UK will not however be obliged to declare the corresponding right invalid in the UK if the grounds for invalidity do not apply in the UK.
The corresponding UK right cannot be declared invalid on the basis that the EUTM had not been put to genuine use in the UK before the end of the transitional period. The draft does not however elaborate on the procedure following the end of the transitional period. Where protection in the UK is of importance, rights holders should therefore consider filing a new UK application in advance, especially where no genuine use has been made in the UK.
A trade mark which has acquired a reputation in the EU will be considered to have a reputation in the UK up until the conclusion of the transitional period. Following this date, any continuing reputation found in a trade mark in the UK will have to be based on use made in the UK.
International Registrations (i.e. trade marks registered in terms of the Madrid International Trademark System) designating the EU which have been registered before the end of the transitional period will continue to enjoy protection in the UK and the implementation thereof will need to be formalised by the UK government.

The possibility however still remains that the UK could depart from the EU with no fixed arrangement in place governing the transition since the draft agreement is still subject to ratification by the UK Parliament. Various political parties, including the opposition Labour Party, have already expressed a disinclination to approve the agreement and therefore the outcome is by no means certain yet.

The UK government has issued statements to the effect that all possible measures are being taken to ensure a smooth transition and to recognise equivalent UK rights, should no deal be struck by the end date. However, the details of such measures have not been elaborated on.

While it appears unlikely that the proprietors of EUTM registrations will simply forgo their protection in the UK post-Brexit, the safest approach would be to file a separate UK application at this stage, so as to obtain certainty and have peace of mind that registered rights in the UK have been secured, regardless of the outcome post-Brexit.

If you wish to follow this approach, it is advisable to do so sooner rather than later as we are likely to see a continuing surge of new UK applications and the UK filing process is therefore likely to slow down considerably during this period.

Alternatively, a less risk averse approach is simply to continue filing trade marks in the EU only, since it is likely that these applications will proceed to registration before the end of the transitional period (if no oppositions are encountered), allowing for their conversion if the draft agreement is adopted or the UL government makes good on their stated intent of providing continuity of rights.

Your approach will have to be evaluated on a case-by-case basis, dependent on business strategy and weighing up the actual level of risk against the costs involved. We invite you to contact us for further advice on this topic.

Please note that our blog posts are informal commentaries on developments in the law as at the time of publication and not legal advice. You should place no reliance on our blog posts; we look forward to discussing your particular matter with you.