By John Wilks and Claire Bailey
Judgment has been handed down this week by the Court of Justice of the European Union (CJEU) in the ONEL/OMEL case. Trade mark owners should take note that use of a European community trade mark in a single EU Member State will not preclude the owner from arguing “genuine use” of that mark in defending itself against a revocation action.
The need for Genuine Use in the Community
This case relates to the perimeters of Article 15(1) of Council Regulation (EC) No. 207/2009 (the Regulation), under which a trade mark owner is at the risk of revocation of its trade mark where it fails, within five years of registration, to put the mark to “genuine use in the [European] Community in connection with the goods or services in respect of which it is registered“.
A Fake Dispute about Genuine Use?
Hagelkruis Beheer BV (Hagelkruis) filed an application to the Benelux Office for Intellectual Property (BOIP) for the registration of word mark “OMEL”. Leno Merken BV (Leno), as owner of a Community word mark “ONEL” for two of the same classes, opposed the application. In response, Hagelkruis requested that Leno provide proof of use of the ONEL Community trade mark. Little is known about Leno and Hagelkruis, and it has been suggested by commentators that this dispute was deliberately contrived by trade mark lawyers, to procure the interesting CJEU reference which has resulted.
It was accepted by the parties that the marks were similar, were registered for identical or similar services, and that there was a likelihood of confusion between the two marks. Leno had provided proof of use of the earlier mark ONEL in the Netherlands, but not in the rest of the Community. Questions were referred to CJEU, essentially asking whether use of a Community mark in a single Member State amounts to “genuine use in the Community” and, if not, what requirements or factors should be applied to assess “genuine use in the Community”.
Conclusion: Ignore the Borders
The court rejected an arbitrary rule on territorial scope, and confirmed that “territorial borders of Member States should be disregarded” when assessing whether there has been genuine use in the Community. The CJEU explained that this follows from the underlying rationale of the Regulation that the Community trade mark should provide “uniform protection”. Instead, the CJEU stated that when assessing “genuine use” a court will need to assess “..all relevant facts and circumstances, including the characteristics of the market concerned, the nature of the good or services protected by the trade mark and the territorial extent and scale of the use as well as its frequency and regularity“.
The CJEU went on to explain that the test for “Genuine use” requires trade mark owners to consider (1) “Am I using the mark to fulfil its essential function?” (ie to identify goods or services); and (2) “Am I using my mark for the purpose of maintaining or creating market share?” For each question, territorial extent of use is just one factor, along with nature of the goods/services protected, and the scale and frequency of use. If the answer to either of these questions is no, then steps should be taken to address the manner of its use.
Does this get us any further?
It is unsurprising that the CJEU has avoided finding that use in a single Member State is either insufficient, or sufficient, to constitute genuine use. This is a political issue in an EU of Member States of greatly varying sizes. The good news for trade mark owners whose business is focussed in a single EU Member State is that their Community marks will not automatically be revocable after five years. However, the judgment does hint that the test is slightly different for Community marks as opposed to national marks, and to that extent leaves uncertainty as to how the test will be applied.