United Kingdom departure from the European Union - Impact on Trademarks and Designs

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On June 23, 2016, the British people voted that the United Kingdom (UK) should leave the European Union (EU). The first (‘Divorce’) phase of negotiations were successfully concluded towards the end of last year and a Withdrawal Agreement was signed between the European Union and the United Kingdom. However, the Withdrawal Agreement has yet to be ratified by the United Kingdom parliament. Unless the Withdrawal Agreement is ratified by 31st October 2019 (Brexit), the United Kingdom will crash out of the European Union without any deal. This will mean that the United Kingdom will be treated the same as any other country which does not have a trade deal with the European Union.


The impact of Brexit on pan-EU Intellectual Property rights will be immense. There can be little doubt that the UK departure will affect the pan-EU Trade Mark (EUTM) and Design rights (RCD) insofar as they cover the UK. This following is therefore intended to provide guidance on the effect Brexit will have on EU Soft IP rights, e.g. EUTMs and RCDs.


What effect will the Brexit vote have on existing EU trade mark and designs?


Until the UK’s departure at the end of October 2019, EUTMs and RCD’s will continue to be fully enforceable in the UK.


Following Brexit, businesses should expect that their EUTMs and RCDs will no longer be automatically protected in the UK. You should therefore consider the following:

  • European Union Trade Marks (EUTMs)

Unless agreement is reached between the UK and the EU before Brexit, EUTMs and RCDs will not be recognised in the UK after Brexit. TIERNEY IP is recommending to its clients that, if the United Kingdom is a significant market for you, you should:


(i) keep in place existing EUTMs,

(ii) consider filing new UK trade mark applications for the same trade mark as
your EUTMs and;
(iii) file both EUTMs and UKTMs for new trade marks.

  • European Union Design registrations (RCDs)

Filing new UK design applications for the same design as an existing pan EU Design
registration (RCD) is not feasible as the novelty of the later filed UK Design application will be
destroyed by the publication of the earlier RCD. For this reason, the UK and EU is likely to
agree for the automatic extension of existing RCDs in the UK. In the meantime, EUTM and
RCD holders should continue to renew and maintain existing RCDs as they will still have effect
in the remaining 27 Member States of the EU. For new designs, you should seek protection in
both the UK and the EU at the same time.


2. Will it still be possible to enforce EUTMs and RCDs in the United Kingdom following Brexit?


It will not be possible to enforce EUTMs and RCDs in the UK after Brexit. Courts in
the UK will only have jurisdiction to determine cases for infringements of UK registered trade
marks and designs within the UK. It will also no longer be possible to enforce pan-EU injunctions
relating to infringements of EUTMs in the UK. Also, the UK will no longer be bound by rulings from
the Court of Justice of the European Union. Decisions from UK courts concerning Intellectual Property rights will not be recognised or enforced in EU Member State courts.


3. What to do if a EUTM is only used in the United Kingdom?


Following Brexit, a EUTM which has only been used in the UK before Brexit may be vulnerable to
cancellation on the grounds of non-use, even if use continues in the UK. However, it is likely any
use in the UK before Brexit takes place will be taken into account by the European Union
Intellectual Property Office (EUIPO) and EU courts.


If a EUTM is just used in both Ireland and the United Kingdom following Brexit, it is possible that
use in Ireland will be considered sufficient to save it from cancellation, even if an EU court does
not take into account the UK use. This however will depend on the market within which you
operate and whether use of your EUTM has shown sufficient market share.


After Brexit, if you are applying to register an English language mark as a EUTM and are relying on
acquired distinctiveness through use in the UK, the EUIPO will not recognise that use. As Ireland and Malta will be the only de jure English speaking countries in the EU after Brexit, you should ensure that your trade mark is used in Ireland and Malta if seeking to secure registration on the basis of acquired distinctiveness.


4. Will I be able continue using a UK lawyer or UK Trade Mark Attorney for EUTMs and Designs?


UK qualified lawyers (Barristers and Solicitors) will continue to have rights of access before the EUIPO after Brexit, provided they or their firm have a substantial place of business in another EEA Member State and are authorised to represent clients in trademark and design matters before the Intellectual Property Office of the relevant EEA Member State. British lawyers solely based in the UK will not be entitled to act on your behalf before the EUIPO.


Post Brexit, UK lawyers will not be entitled to act before the Court of Justice of the European Union (CJEU) on behalf of clients, unless they are also qualified in an EEA Member State.


UK nationals who are on the EUIPO list of Professional Representatives will not be entitled to act before the EUIPO after Brexit. Even if a UK based Registered Trade Mark Attorney re-qualifies in EEA Member State, he or she will still not be entitled to act unless they are a national of an EEA Member State.


As an Irish citizen, lawyer and Registered Trade Mark Attorney qualified in Ireland, our Managing Director, Niall Tierney is NOT affected by the Brexit vote. Niall is authorised to act before the EUIPO on the basis of his Irish legal qualifications of ‘Barrister-at-Law’ and ‘Registered Trade Mark Agent’. Niall is also qualified as a Registered Trade Mark Attorney in the UK and will therefore be able to continue acting on your behalf before the UK Intellectual Property Office (UKIPO), unless the UK Government subsequently removes this right.


5. Why you should consider using an Irish lawyer to act on your behalf?


Following the UK’s departure from the EU, Ireland will be the only official English speaking Common law country within the EU. Like the UK, Ireland has a Common law system which dates back to the 12th century. Intellectual Property rights, including EUTMs and RCDs, are also protected under Ireland’s Constitution, in addition to being protected under statute and at Common law.


Ireland’s Commercial Court is one of the most efficient and technologically advanced in the EU and it is authorised to hear Trade Mark and Design infringement and Passing off cases. Typically, cases can be determined within six months from commencement of proceedings. Cases are heard in English as a matter of course.


After Brexit, the European Union Trade Mark Court in Dublin is likely to be the only English speaking court in the EU to hear and determine infringements and other actions relating to EUTMs and RCDs. Ireland will also have the only English speaking court in the EU to grant EUTM pan-EU injunctions.


6. Will Brexit affect existing IP agreements?


You may have concluded agreements with third parties which refer to the EU or are governed by EU law. Most agreements covering EUTMs and RCDs must comply with EU law, e.g. no challenge clauses are generally frowned upon by the EU courts. By way of illustration, you may have concluded a trade mark licence agreement which governs the use of your or the other party’s Soft IP rights covering the EU. These agreements will need to be reviewed to assess what their effect will be in the UK after Brexit. It possible that these agreements may no longer be enforceable in the UK after Brexit.


7. What you should do now?

  • Undertake an audit of your IP portfolio if it contains EU Soft IP rights. You should then contact TIERNEY IP for further advice and assistance.

  • Think of who you will instruct as your EU IP lawyer after Brexit. It is likely that UK lawyers will have limited or no rights of access and representation before the EUIPO and EU courts following Brexit. If you are a business which operates in a Common law country (e.g. Australia, Canada, India, New Zealand and the United States of America) and you own pan EU Trade Mark and Design rights, you should give strong consideration to using an Irish qualified IP lawyer as he or she will be familiar with many Common law concepts and IP jurisprudence.

  • Undertake a review of your existing IP agreements covering the EU or governed by EU law.

  • Reconsider your enforcement strategy if your portfolio has EUTMs or RCDs.

Summary


There is no doubt that the decision of the British people to leave the EU will give rise to many years of uncertainty. Our recommendation to clients is plan for the worst case scenario, i.e. divorce from the EU which results in pan-EU rights not being recognised, protected and enforced in the UK. Therefore, you should now start reviewing your IP filing, protection and enforcement strategies insofar as they affect pan-EU Soft IP rights.