The creation, by Brexit, of many thousands of new ‘comparable’ UK trade mark registrations from EU designations of international registrations that were protected on 31 December 2020 has thrown a spotlight on the usefulness of a previously seldom-used trade mark principle: that of replacement.
Originally dating back to 4 December 1900, the principle of replacement is a core feature of the Madrid Protocol international trade mark registration system. It is established by Article 4bis of the Protocol and also addressed under Rule 21 of the Common Regulations. Fundamentally, a designation under an international registration may replace an existing national or regional registration in any designated territory, thereby enabling the national or regional registration to be allowed to lapse without any prejudice to the owner’s rights – the earlier priority and/or filing dates of the national right that is being replaced will be preserved.
To be eligible to replace a national or regional mark, the international designation must:
- Be protected in the designated territory;
- Be in respect of the same trade mark;
- Be held by the same ‘holder’ (or owner);
- Cover goods and/or services covered by the existing national or regional mark; and
- Post-date the date of the existing national or regional registration.
A renewed interest post-Brexit
Following the creation of new UK comparable registrations from protected EU designations, many owners are likely to have been investigating this procedure with a lot more thought and rigour. They have understandably been querying whether there is merit in filing a subsequent designation for the UK, before then using that designation, once it has become protected, to replace the comparable or ‘cloned’ UK registration, and so bring the UK protection back under the scope and management of international registration. Anecdotal evidence suggests that the UK IPO is expecting a significant ‘up-tick’ in replacement requests in coming times.
The procedure for recording the replacement of UK registrations
Whilst not particularly well-used to date, requesting the recordal of a replacement of a UK national registration is a relatively straightforward process. Requesting that the UK IPO takes note of the connection to the international registration is advisable for the information of third parties. There does not appear to be any official deadline for filing a request to record a replacement, although, as noted above, the procedure can only be commenced after the new UK subsequent designation is protected.
The owner (or its representative) is required to file a Form TM28 ‘Application to record a concurrent registration’ at the UK IPO. There is no official fee associated with the filing of the application. The Form TM28 is quite straightforward. The requestor only needs to provide basic information about the UK national and international registrations, as well as its own identity, plus identification of the goods and/or services that are to be covered by the replacement. It should be noted that partial replacement either way is possible and acceptable; the national registration can cover greater or fewer goods or services than the international registration, but there must be at least some overlap. The Form TM28 includes sections to enter the filing and priority date (if applicable) of the UK trade mark registration that is being replaced.
Upon receipt of a properly completed Form TM28, the UK IPO should note the link between the UK national registration that is being replaced and the international case on the UK register, before then informing WIPO (World Intellectual Property Organization) which manages the Madrid Protocol system and maintains the international trade mark register. WIPO should then confirm the replacement to the owner and record it on the international register. This process is outlined in the available guidance from both WIPO and the UK IPO.
One of the main perceived advantages of utilising the principle of replacement is that the owner may then choose to let its national registration lapse when it is due for renewal, since its rights will continue embodied in the international registration. This ought to result in some degree of financial saving for the owner, since renewing a UK designation of an international registration that already covers other designated territories is believed to be more cost-effective than renewing a UK national registration. However, some analysis that we have conducted suggests that the UK IPO official renewal fees for the UK registration may only be marginally more expensive than the WIPO renewal fees for the UK designation, with the difference apparently narrowing the greater the number of classes that are protected.
Another notable benefit of replacement would seem to be the ability to manage the mark centrally at WIPO. For example, if the owner’s name or address needs to be updated, or if the mark is assigned to another party, the cost of recording those changes should be significantly reduced if the changes do not also need to be recorded on the national register too, which would be the case if the national registration remained.
New grace period for use
A further, somewhat more sly advantage would seem to be that new protected UK subsequent designation that is the ‘beneficiary’ of the replacement should profit from both the priority or filing date of the old national UK registration and a new five-year grace period for use, as calculated from the date of protection of the designation in the UK. This could result in a particularly valuable earlier right to assert against third parties in any dispute that may arise.
Possible Disadvantages or Adverse Considerations
Firstly, the trade mark owner must keep in mind the cost involved for filing a subsequent designation for the UK under the existing international registration. Whether that initial outlay will be recovered by other financial advantages, such as savings in renewal and management or administration fees, will depend on the mark in question, its longevity and any plans for it.
Examination and publication risks
Next, it is important to remember that the new UK subsequent designation must be protected before its replacement of the national registration can occur. However, the designation must first be examined and then published for opposition purposes before the Statement of Grant of Protection will issue. Any problems that arise at these stages could, at worst, potentially jeopardise the entire replacement strategy. At the very least, the costs involved with responding to any such issues could adversely impact the cost-versus-benefit financial assessment of the replacement.
- The new UK subsequent designation will be freshly examined by the UK IPO. It is therefore possible that the new subsequent designation could encounter objections, such as classification objections or more serious distinctiveness issues perhaps. The cost of responding to any such issues that might be raised will naturally reduce the financial attractiveness of the replacement; and/or
- The new UK subsequent designation will also be open to opposition by third parties during the normal 2-month opposition period that exists in the UK (which is extendable to 3 months upon application by a potential opponent). The possibility of third parties owning conflicting rights that are earlier than the new UK subsequent designation should be considered. Whilst the UK national registration which is intended to be replaced may be earlier than any such intervening third party rights, and so could serve as a basis for an invalidity action, that UK registration might well also be old enough to be vulnerable to a non-use cancellation attack, meaning that any dispute could get quite complicated. Furthermore, the costs associated with handling any defensive oppositions, offensive invalidity actions, non-use challenges and/or negotiations with another party would again reduce the financial attractiveness of the replacement – perhaps substantially so. It is also worth noting that opposition in the UK can be on absolute grounds, and not just relative grounds.
If examination and publication are navigated by the owner of the mark, care should still be taken to review the scope of replacement once the designation is protected; it is evidently possible that the new UK subsequent designation might have undergone significant changes to the goods and/or services which it protects following examination, publication and/or opposition.
Finally, the trade mark owner must keep in mind that the fate of the international registration is dependent on the fate of the national registration that serves as its ‘basic’ case during the five-year so-called ‘dependency period’. It would therefore seem to be very wise for the owner to renew the national or regional registration that is to be replaced whilst this dependency period is on-going.
Whilst replacement does appear to offer some advantages to trade mark owners, there are clearly also some possible risks and other negative factors to consider. Whether it is the right thing to do will no doubt come down to an individual case-by-case assessment. It remains to be seen whether or not there will be a notable increase in the number of replacement requests being filed at the UK IPO following the creation of the very many new UK comparable trade mark registrations post-Brexit. One imagines that owners of national registrations – particularly very long-standing ones – will be rather apprehensive about allowing those registrations to lapse due to non-renewal, even if they have been replaced.
Read more about the impact of Brexit on trade marks.
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