Madrid Protocol and Community TM

04 June 2004

Cristina Garrigues

The Madrid Protocol (MP) and the Community Trade Mark (CTM) systems offer relatively simple, flexible and inexpensive alternatives for registering marks in foreign countries. However, these systems do not replace the individual national filings, but exist side by side with them.

The purpose of this article is to highlight the features of the Madrid Protocol and the Community trade mark systems, to compare these features and to consider which issues are relevant when choosing one route over the other. It also assesses how the two systems may operate in the future following the accession of the European Community (the EC) to the Madrid Protocol. Currently, the proposed accession date is 1 October 2004.

Madrid Protocol

The Madrid Protocol was adopted in 1989 and entered into force in 1996. It is administered by the World Intellectual Property Organization (WIPO) in Geneva, Switzerland, and supplements the Madrid Agreement adopted in 1891. Together these treaties provide the so called "Madrid System" that allows nationals, residents, and companies doing business in member countries to file a single trade mark application designating over 60 countries world-wide[1], in a single language and paying a single fee.

For years most common law jurisdictions including the UK, the US, Australia and the most developed countries of the Far East did not join the Agreement because its provisions were incompatible with their trade mark laws and because under the Agreement applications had to be made in French. Because the Madrid System could not be fully effective without the participation of the major industrialised countries, in 1989 the countries that had adopted the Agreement amended it to add the Madrid Protocol. The Protocol is a separate treaty that allows other countries to participate in the international Madrid registration system, without requiring that they radically amend their trade mark laws.

Operation of the Madrid Protocol System

Under the Protocol, trade mark owners can apply for an international registration (IR) at the same time as they file an application in their home country. The application can be filed in French, English or Spanish. The owner of an existing application or registration may also apply for an IR on the basis of the previous filing. The filing process in both cases is essentially the same. The applicant files the IR at his national trade mark office and designates additional Protocol countries where he wishes to obtain protection.

The national trade mark office then forwards the international application to the International Bureau of WIPO. The international application will be accorded the filing date of the original application, giving the IR and the basic registration the same priority date. In the case of an IR based on an already existing national application/registration the priority date is the date in which the international application is filed (not the priority date of the original national application/registration). The Protocol also provides for extending the geographic scope of protection of an existing IR to additional countries at a later date by filing a subsequent designation.

After receiving the application or subsequent designation, WIPO examines whether the application complies with the formalities requirements, but does not examine the substance of the application (i.e. whether the mark is descriptive or it conflicts with any earlier rights). If the International Bureau is satisfied the mark is recorded in the International Register. Then the Bureau notifies the national trade mark office of each of the designated countries.

The national trade mark offices then have either 12 or 18 months (depending on the country) to examine the application under its national law. The scope of the examination varies from country to country. Once examined the mark is published for opposition purposes. If a foreign office rejects the application or if a third party opposes the mark, the application will be prosecuted as any national mark.

However, if accepted, an IR is granted for an initial period of 10 years, and may be renewed in all countries with a single renewal fee. Similarly, one notification to the International Bureau will record any change of details, assignments and licenses.

Main Features of International Registrations

Once granted, an IR does not constitute a single right, but a centrally administered bundle of individual national registrations. Therefore, the conditions of registrability, the scope of protection, the requirements of use, invalidation/cancellation proceedings etc are determined by the trade mark laws of each of the designated countries.

However, for an initial period of 5 years, the validity of the IR depends upon the basic application. If the basic application does not achieve registration, or is subsequently invalidated or cancelled, partially or in its entirety, the IR is likewise entirely or partially cancelled. This is called the "central attack". Therefore, it is critical that the basic application/registration is strong and covers a wide range of goods and services.

To remedy the fatal consequences of the central attack the Madrid Protocol provides that the IR application/registration can be transformed into separate, national applications which will retain the filing date of the original application. However, this transformation is an expensive and slow exercise.

Regarding use, an IR requires that the trade mark owner must be able to show use in each of the designated countries once the initial 5 year dependency period expires. If, the mark is not used in that country the registration will be vulnerable to be revoked in that jurisdiction.

An IR does not grant its owner the right to obtain an injunction covering all the designated countries. Separate proceedings must be commenced in each of the countries where the trade marks rights have been infringed.

The Madrid Protocol does not permit any alternation to the IR sought to be registered. The trade mark must remain exactly the same as in the original application.

Finally, international registrations can only be assigned to nationals or entities whose domicile, or real and effective commercial establishment are located in a Protocol country. So international registrations under the Protocol could interfere with a sale of assets to an entity based in a non Protocol country.

The Madrid Protocol is one option for proceeding with the international registration of a trade mark, but is not the only option. Foreign companies interested in obtaining trade mark protection in Europe should also consider the route of the European Community Trade Mark.

The Community Trade Mark System

The European Union CTM system became operational on 1 April 1996. The Office for Harmonisation in the Internal Market, ("OHIM"), which is located at Alicante, Spain is in charge of the administration.

Under the CTM system a single trade mark registration can be obtained covering the whole of the European Union[2] as a unitary right. This unitary nature of the CTM also means that a CTM can only be registered, transferred, surrended, revoked or declared invalid in respect of the whole of the EU.

Operation of the Community Trade Mark system

Applications for the registration of a CTM can be filed either directly at OHIM or at the trade mark offices of the EU member States. If filed at the national office this will then forward the application to OHIM for its examination. CTM applications can be filed in any of the official languages of the EU but the applicant must also designate one of OHIM's 5 official languages: French, English, German, Spanish and Italian.

A CTM application is only examined by OHIM. Furthermore, OHIM only examines whether the applicant is entitled to be a proprietor of a CTM and whether there exists absolute grounds for refusal (i.e. the mark is descriptive or non distinctive). If there are no objections the application is then published in the CTM journal for opposition purposes. Third parties in any EU Member States may oppose the CTM on the basis of earlier national rights. A notice of opposition can only be filed at OHIM.

Oppositions to an application for a CTM are governed by one set of rules and determined uniformly under the provisions of the Regulation.

The initial period of protection is 10 years, renewable for successive 10 year periods in a single transaction prior payment of a single renewal fee. There is no requirement to certify or prove use of the mark to renew the registration.

As indicated above, if a CTM is not accepted in a single EU Member State for example as a result of a conflict with an earlier right, the CTM application will be refused. Under the CTM system it is not possible to exclude the country/ies in which the application encounters a registrability problem.

However, if this is the case, the CTM system provides for the possibility of converting the CTM into national applications in all of the EU Member States (except in the EU country where the earlier right or registration problem existed) while retaining the filing date (or priority date) of the invalidated CTM application.

This feature is comparable to the right to transform an invalidated IR into national applications in each of the jurisdictions to which the IR had been extended.

A further important advantage of the CTM system is that to satisfy the use requirement of a CTM registration, use in a single EU member will suffice to keep the registrations in all the EU Member States.

A CTM can be assigned to any individual or entity as long as its nationality, its domicile or its real and effective commercial establishment is located in a Paris Convention Country, or in a Member of the World Trade Organisation[3].

In certain circumstances a CTM registration grants its owner the right to obtain an EU wide injunction. This is a significant advantage, as it can eliminate the costs of suing an infringer in each of the EU Member States.

EC accession to Madrid Protocol

Last year, the European Council of Ministers announced that the EC would join the Protocol.

On 27 April 2004, the Commission Regulation (EC) No. 782/2004 of 26 April 2004 amending Regulation (EC) 2868/95 on the accession of the European Community to the Madrid Protocol was finally published in the Official Journal. Taking into account the pending accession of the EC to the Madrid system, the Regulation sets out how OHIM will process international applications based on a CTM and how it will deal with those international applications and registrations which designate the EU as one of the countries in which the applicant/proprietor seeks protection. Amongst other things, it establishes that the filing fee for an international application made through OHIM will be EUR300. It also establishes the provisions for translation of an international application where the application is not in a language allowed under the Protocol, the requests for territorial extensions to international applications, the procedures relating to the examination on absolute grounds of, and oppositions of international applications designating the EU.

The link between the CTM and the MP systems will make it possible for those who hold IRs to request extension of protection into all EU member states via the CTM system. Conversely, holders of CTMs will have the ability to use their CTM registration as the basis for an IR and request extension of protection into any of the Protocol countries.

However, it remains to be seen whether the joining of the CTM and Madrid Protocol will increase the number of filings. While the US are the largest user group of the Community Trade Mark system, two European countries, Germany and France are the largest users of the Madrid system.

Conclusion

Based on all the above, it could be concluded that both systems have their advantages and disadvantages. Therefore, it can be seen that one system is better than the other and that one route should be chosen over the other in all circumstances. The owners of any trade mark seeking international registered protection should carefully consider the particular circumstances of each case when deciding which route to take. In particular, the applicant should consider:

a) the countries in which protection is sought.

This will require a review of the applicant's plans of expansion in the short and medium term. If a registration is only required in a small number of countries, it may be most cost effective to file single national applications. If however, the applicant is considering applications in several European countries then it may be more suitable to file a CTM.

b) the registrations systems available in the countries of interest

As discussed above, to file under the Madrid Protocol the applicant must fulfil certain specific qualification requirements. By contrast there are very few exceptions as to who may use the CTM system.

However, when considering the CTM route it should also be taken into account that certain countries e.g. Norway and Switzerland are not members of the EU and therefore a CTM registration does not offer protection in those jurisdictions, which however are members of the MP.

Therefore, since not all countries in Europe are covered by a CTM registration, the IR offers an opportunity to cover the hole in the coverage of trade mark protection in Europe.

c) Advantages and disadvantages of the systems available

In particular the applicant needs to consider the level of protection, remedies available, maintenance requirements etc. For example, regarding use the CTM system would appear more suited to those applicants who currently use their mark in only part of the EU but have plans of expansion. As mentioned above, genuine use of the CTM in one EU member would protect the CTM registration from any non-use revocation attack. By contrast, both individual national registration and registrations under the Madrid Protocol become vulnerable to a revocation attack if the national marks are not used within that territory.

On the issue of remedies a CTM grants its proprietor the right to an EU wide injunction. Furthermore, the enforcement of the rights granted by a CTM are governed by a single set of provisions throughout the EU, giving the certainty (at least theoretically) that all the cases are decided uniformly. By contrast, trade marks registered under the Madrid Protocol can only be enforced at national level by commencing proceedings in each of the countries where the trade marks rights, according to the national law have been infringed.

Other issues that the applicant may also consider are for example the suitability of the mark chosen in different countries. It may be the case, that the mark chosen has unfortunate connotations in a particular country. If this is the case, and the applicant is forced to use variations of the mark in the different countries, both the CTM and the Madrid Protocol will be unsuitable. While the individual national filing route will provide the necessary flexibility.

There is no doubt that the proposed accession of the EC to the Madrid Protocol will further facilitate the international protection of trade marks and the administration of international trade mark portfolios. But in any case, it will always be up to the applicant or its advisers to assess the circumstances of each case before filing any trade mark application abroad.

Comparison Table

  • CTM: Single unified right throughout the European Union.
  • MP: Bundle of national registrations.
  • CTM: A CTM registration will automatically cover all the countries in the EU.
  • MP: The applicant designates the countries in which protection is sought.
  • CTM: Available to nationals of Member States, Paris Convention countries and other countries granting reciprocal rights and other entities which are domiciled or are commercially established in the EU, Paris Convention, and WTO countries.
  • MP: Available to nationals or entities of, or domiciled in, one of the member countries of the Protocol or have an industrial or commercial establishment in one of the member countries.
  • CTM: It does not require the existence of an application or registration in the applicant's home country.
  • MP: It requires the existence of a basic mark, whether an application or a registration in the applicant's home country.
  • CTM: The filing fee for a CTM application covers all 25 countries; no choice of countries is allowed.
  • MP: The filing fee of an IR depends on the number of countries designated.
  • CTM: Genuine use of the CTM in only one country of the EU is sufficient to protect the registration from revocation on the ground of non-use.
  • MP: After the initial 5 years period, the extended registrations become vulnerable to a revocation action for non-use in each of the designated countries.
  • CTM: A single trade mark infringement claim action can obtain an EU wide injunction.
MP: Trade mark infringement actions must be commenced in each of the jurisdictions where infringement is alleged. Action for infringement is taken through the courts of the country concerned and any injunction will be limited to its territory.


[1] List of countries member of the Madrid Protocol as per 10th May 2004 -Albania, Antigua and Barbuda, Armenia, Australia, Austria, Belarus, Belgium, Bhutan, Bulgaria, China, Croatia, Cuba, Cyprus, Czech Republic, Democratic People’s Republic of Korea, Denmark, Estonia, Finland, France Georgia, Germany, Greece, Hungary, Iceland, Iran (Islamic Republic of), Ireland, Italy, Japan, Kenya, Kyrgyzstan, Latvia, Lesotho, Liechtenstein, Lithuania, Luxembourg, Monaco, Mongolia, Morocco, Mozambique, Namibia, Netherlands, Norway, Poland, Portugal, Republic of Korea, Republic of Moldova, Romania, Russian Federation, Serbia and Montenegro, Sierra Leone, Singapore, Slovakia, Slovenia, Syria, Spain, Swaziland, Sweden, Switzerland, The former Yugoslav Republic of Macedonia, Turkey, Turkmenistan, Ukraine, United Kingdom, United States of America, Zambia.

[2] As from 1 May 2004, the European Union includes 25 countries: Austria, Belgium, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Poland, Portugal, Slovakia, Slovenia*, Spain, Sweden, The Netherlands and the United Kingdom.

This enlarged geographical coverage does not just apply to CTM applications filed after 1 May 2004. All existing CTM applications and registrations automatically extended to the additional 10 countries as from that date, at no additional cost.

*The countries in bold acceded to the EU on 1 May 2004.

[3] As of 20 February 2004 CTM applications from territories which are non members of WTO or signatories of the Paris Convention such as The Channel Islands and the British Virgin Islands are also accepted.