01 September 2000

Rebecca Harrison

'Retail services' , as a specification in a trade mark application, has traditionally been seen as a potentially good way to avoid specifying all the goods that a trade mark applicant actually wants to be protected. Only potentially. This is because many trade mark registries, including the UK and Community trade Mark ("CTM") registries, have viewed it as a 'loophole' specification which should not be allowed.

Retail services were not seen by the registries as real services to which a mark could be applied. A mark should be applied to goods, or used in relation to services such as banking, insurance and so on. 'Retail services' meant an assistant behind the counter taking money from the customer. The only occasional use of a mark other than on goods or on uniforms (or some of the ancillary services provided) would be on the shop's letterhead in relation to responses to letters of complaint or correspondence with manufacturers, suppliers and the like. This was not viewed as use of the mark in relation to provision of services. Thus, the registries' view was that 'retail services' should not be allowed to be included in specifications.

Giacomelli Sport SPA attempted get around this in their application to register a CTM word and device mark GIACOMELLI SPORT. The examiner rejected their trade mark application because it included the following class 35 specification:

'Bringing together, for the benefit of others, of a variety of goods - excluding transport - to enable consumers to view and buy the products; organisation of exhibitions in halls and showrooms for commercial or advertising purposes.'

The examiner's comment was that the specification did not identify a service 'for the benefit of others'. Rather, the 'service' was an ancillary sales activities in the interests of the applicant alone. Giacomelli refused to accept this position. On rejection of their application, they appealed to the Second Board of Appeal of OHIM.

Giacomelli's specification did not include the exact term 'retail services'. However, the Board of Appeal saw fit to give a ruling on the latter term as it was in essence part of the specification that Giacomelli were seeking. Indeed, one of the grounds of appeal claimed by Giacomelli was that the services being provided by the retailer 'consist of the choice of goods to be bought and resold, of the organisation of selling premises (for example, the particular layout of the goods, possible background music, colours, fittings, lighting, etc.), of the planning of product ranges, the way the products are presented on the shelves, the services provided by sales assistants, staff uniforms, payment methods, prices, commercial presentations, etc.'. In other words, retail services were not simply an exchange of cash or other payment for a receipt. They encompassed a wide range of activities. This often resulted in a consumer choosing one retailer over another because of the service offered and the association of that service with the name of the retailer.

The Board of Appeal invited the President of OHIM to comment on the matters in hand. The President took the traditional line adopted by the registries - that each category of goods or element of the service provided should be classified in the normal way. Else, others would be prevented from use of a mark in relation to a completely separate sector merely because a catch-all specification had been allowed. This would provide a remit to retailers with a 'retail services' specification to sue for infringement of their mark on absolute grounds - rather than on the basis that there was likely to be confusion between their mark and that of the infringer. He said that 'protection is "absolute" where the goods and services and the marks are identical, whereas in other cases there must be likelihood of confusion in view of the identity or similarity of the marks and the identity or similarity of the respective goods and services'. Frequently in such cases, there would in fact be no risk of such confusion. The President said that 'such a service classification would amount to a kind of "cover-all" class, a concept which is alien to the protection of marks through registration'. The President was not the only one to take this position. He drew the Board's attention to the Council and Commission's Statement made when the CTM Regulation was adopted in 1993. This set out their opposition to the trade mark classification for retail services. Although this Statement predated the inception of the CTM, it was, the President said, 'the expectation... that the Office would not accept such service marks'.

In spite of the strongly worded view of the President, and the apparent support expressed by the Council and the Commission, the Board of Appeal did not consider itself bound by these views. They considered the key issue for their consideration was 'whether or not the services normally provided by retailers of goods for their customers, are services for which Community trade marks can be registered'. The first difficulty they faced was that 'service' was not defined by the CTM Regulation. Due to its intangible nature 'service' was in any event difficult to define. They took definitions of a service from a variety of dictionaries. The Oxford English Dictionary provided the following definitions for services: 'provision of a facility to meet the needs or for the use of a person or thing'; 'An act of helping or benefiting another; behaviour conducive to the welfare or advantage of another. Chiefly in do, render service'; `Friendly or personal assistance'; `Serviceableness, usefulness'.

The Board concluded that it was a matter of common experience that the consumer prefers the service provided by one particular shop over that of another. Choice of retailer was influenced by numerous factors such as the range of goods provided; the presentation of the goods; the location; the overall convenience afforded; the attitude and commitment of the staff; the attention given to customers; and so on. Although such factors would not be taken into account in assessing an application, by and large, they concluded, the goodwill of a retail business was built on the service it provided. This meant that the fact that a shop was self-service would not affect the chances of gaining trade mark registration as a retail service.

The Board further concluded that 'the examiner was [therefore] incorrect in stating that the wording adopted by the appellant to describe its service 'failed to identify a service for the benefit of others but merely an ancillary sales activity in the interests of the applicant alone'. Furthermore, the activity of retailing is mutually beneficial to the retailer and the consumer. That a retailer is motivated to perform these activities by the desire to make or increase its profits, rather than to offer a service to the public, in no way alters the fact that a service is being provided'.

The only proviso to this decision is, sensibly, that the retail services must be restricted to the relevant area such as 'retail services in the field of sports goods'. Without this, it would be difficult, if not impossible, for either the trade mark owner or third parties to have some idea how far the exclusive right extended. This was necessary in order to bring opposition, invalidity and infringement proceedings.

First published in WIPR in September 2000.