Benelux Office for Intellectual Property: A Community Trademark Must Be Used in More Than One Member State
The Case
The earlier trademark ONEL had already been registered in 2003
by Leno Merken B.V. for, amongst other things, advertising and
publicity, training and courses, seminars and legal services with
regard to intellectual property. In 2009 Hagelkruis Beheer B.V.
filed the trademark OMEL with the Office for almost the same
services. Because Leno Merken was of the view that the sign OMEL
was confusingly similar to its trademark ONEL, it filed a notice of
opposition against the trademark application.
Because the lapse of a trademark that has not been genuinely used
within a time period of five years can be invoked, in opposition
proceedings an opposing party can request proof of such genuine use
before discussing the substance of the matter. At the time of
filing the notice of opposition the ONEL trademark was older than
five years and Hagelkruis Beheer requested proof of genuine use in
other countries than the Netherlands. In this regard it brought
forward that it was aware of the use of the ONEL trademark in the
Netherlands. However, Hagelkruis Beheer was precisely interested in
the use of the Community trademark ONEL outside the Netherlands
because Hagelkruis Beheer did not want to use the Benelux trademark
OMEL in the Benelux, but wanted it to serve as the basic
registration for an international registration under the Madrid
Protocol in Scandinavian countries.
Leno Merken brought forward that it had already been active as a
trademark agent in the Netherlands for some forty years (also under
the trade name Onel) and that it uses the ONEL trademark for its
services in the Netherlands. Because it was an established fact
between the parties that the ONEL trademark was genuinely used in
the Netherlands and that, according to Leno Merken, in accordance
with the joint statements established by the Council and Commission
with the Community Trademarks Regulation ("CTR"), the use
of a Community Trademark in one single country is sufficient in
order for it to be genuine use within the meaning of Article 15
CTR, Leno Merken did not provide any information about use outside
the Netherlands. Leno Merken furthermore brought forward that it is
irrelevant whether Hagelkruis Beheer wishes to start using the sign
OMEL in Scandinavia and that, if this is done, it will oppose the
Scandinavian filings on the basis of its Community trademark ONEL.
It is true that Hagelkruis Beheer acknowledged that ONEL and OMEL
are confusingly similar and that the services concerned are
identical, but it emphasized that this is not a problem because
ONEL and OMEL were not to be used side by side. Because Leno Merken
has argued that it will invoke its ONEL trademark in Scandinavia,
Hagelkruis Beheer has stated that it has all the more interest in a
decision about the opposition. In this connection Hagelkruis Beheer
brought forward that Article 15 of the CTR speaks of "use of
the trademark in the Community" and not of "use in one
Member State". According to Hagelkruis Beheer, such an
interpretation of the Regulation would lead to the undesired result
that a trademark holder could block the entire European market with
a trademark that it only uses in a very small part thereof.
The Analysis
Because the parties actually only disagreed on the question of
whether use of a Community trademark in one single country is
sufficient to maintain a Community trademark, the Office examined
what is meant by the concept of "in the Community" in
Article 15 of the CTR and more in particular the meaning of the
joint explanation with the CTR, which, after all, mentions that use
of a trademark in one single Member State is sufficient.
The Office has observed that the joint statement was already
overruled by the European Court of Justice by giving a different
interpretation to the CTR than the Council and Commission did in
the explanation. The Office was furthermore of the view that the
opinion that use in one single state is sufficient for the
maintenance of the trademark is on strained terms with
considerations 2 and 6 of the CTR that determine that trademarks
enabling the products or services to be distinguished by identical
means throughout the entire Community, regardless of
frontiers, are desirable for a harmonious development of economic
activities within the entire area of the Community, and
that Community Trademark law does not replace the national
trademark law of the Member States because it would not appear
justified to require undertakings to apply for registration of
their trademarks as Community trademarks whereas national trade
marks continue to be necessary for those undertakings which do not
want protection of their trade marks at Community level. To
conclude, the Office found a contra-indication in Article 112 of
the CTR that regulates the conversion of a Community trademark into
national trademarks. However, according to this provision this is
not possible if the Community trademark has been declared invalid
due to non-genuine use, but in that case with the exception of the
States in which the trademark concerned has been indeed genuinely
used. According to the Office this provision would be meaningless
if use in one single Member State would be sufficient by definition
in order to maintain the trademark.
The Office furthermore considered that putting the territory of the
Community on a par with that of one single Member State would lead
to undesired and unjustified results. Meanwhile, there already are
27 Member States, the Community covers more than 4 million square
kilometers and has almost 500 million inhabitants. According to the
Office, under these circumstances the use of a trademark in one
single Member State may essentially come down to local use. The
Office is of the view that trademark law offers a monopoly, which
is only justified and fulfils its essential function if the
trademark is used. A monopoly that goes (much) further than the
territory within which the trademark is used really poses, in the
view of the Office, a hindrance to the free movement of goods and
the freedom to provide services within the internal market.
According to the Office, it is therefore in conflict with the
intention of the European legislator and also unjustified towards
the major part of small and medium sized businesses if a trademark
holder can prohibit the use of a sign in the entire Community if he
is only using it himself in a very small part of the Community.
As a result, the Office rejected the opinion of the joint statement
that use of a Community trademark in one single Member State is
sufficient to maintain the trademark (everywhere), and allowed the
registration of the trademark OMEL.
The Criticism
The decision is spectacular and - if it would be accepted in the
entire Community - will have a large impact because an enormous
number of Community trademarks is only used locally and is
therefore subject to lapse. This is not only potential bad news for
"local" trademark holders but also creates legal
uncertainty.
Meanwhile, the European Trademarks Office OHIM has taken a position
against the decision of the Office by taking the unusual step on 27
January 2010 to publish an official statement in which it argues
that OHIM maintains its view that the borders of Member States
should not play a role in the adjudication of whether there is
genuine use of the trademark within the Community market.
What is Next?
On 11 February 2010 Leno Merken filed an appeal with the Court of
Appeal of The Hague against the opposition decision, so that the
Court of Appeal must examine the question whether genuine use in
one single Member State (at any rate, in the Netherlands) is
sufficient to maintain the Community Trademark. It is very well
possible that the Court of Appeal of The Hague will present
preliminary questions to the European Court of Justice in this
respect so that in due course the final answer will come from
Luxembourg.