Published on May 12, 2014
Posted in: Blog
The Federal government of Canada recently passed major new changes to the Trade-marks Act—including changing the name of the Act to the Trademarks Act. The amendments will be the biggest changes to the Act since 1953.
The amendments were quietly included in an omnibus budget implementation act dubbed the “Economic Action Plan 2014”. As a result, the amendments sailed through Parliament with little debate or public consultation.
Among the major changes are the elimination of the “use” requirement for trade-mark applications and the adoption of the Nice Classification system. In addition, there are also various changes to terminology, the government registrar will be granted increased powers to correct administrative errors, and the term of trademark registration has been reduced to 10 years (down from 15).
The amendments will eliminate the distinctly Canadian hyphen in the word “trade-mark”. The word will now be spelled “trademark”, which will surely please our neighbours to the south.
The current Trade-marks Act allows for a peculiar type of pseudo-trade-mark called a “distinguishing guise”. An example of a distinguishing guise would be the shape of a Heinz ketchup bottle. The distinguishing guise has now been rolled into the broader definition of a trademark.
The amendments introduce the concept of a trademark being a “sign or combination of signs”. Many different types of signs are potentially trademarkable, including colours, smells, holograms, tastes, and moving pictures.
Elimination of use requirement for applications
Under the current Trade-marks Act, every trade-mark application must list the date that the applicant started using the trade-mark. Alternatively, an applicant can file a “proposed use” application on the basis that they will start using the trade-mark within 3 years of applying (or within 6 months of allowance, whichever is later). Foreign applicants can also rely on use of the trademark in their country of origin, assuming they have a registration in that other country.
The amendments do away with this requirement to use a trademark in order to have it registered. The registrar will no longer record the date of first use nor, in the case of proposed use applications, will it require applicants to file declarations of use.
These amendments will make it slightly easier to obtain a trademark registration since applicants will not have to declare that they are using a trademark in order to get a registration. Accordingly, there will likely be more trademarks getting registered, many of which are not actually being used by their owners.
It should be noted that, as in the current Act, trademarks that have not been used in the past 3 years can be expunged from the registry for non-use. Any third party can request that a trademark be expunged for non-use. This right will remain, meaning that registrants must continuously use their trademarks or risk losing them.
Practically speaking, the amendments mean that proposed use type applications will now be significantly stronger. An applicant will not need to actually start using a trademark to obtain exclusive trademark rights.
The amendments effectively remove the right to challenge an applied-for or newly registered trademark on the basis that the applicant claimed a mark was in use when in fact it was not. Instead, parties will need to wait a full 3 years after the date of registration file a section 45 notice to have the mark deleted for non-use.
Trademark laws in most countries make use of what is referred to as the Nice Classification system for goods and services, named after the French city of Nice. Every specific type of goods or services fits into a specific pre-defined class, such as “carpets rugs and matting (class 27)” or “telecommunications services (class 38)”.
The amendments to the Trade-marks Act introduce the Nice Classification system to Canada. Applicants will now be required to group all of the associated goods and services into Nice Classification classes. However, the amended Act states that the Nice classes should not be used to determine whether two trademarks are confusing. Accordingly, the classes will not have any practical use or meaning within Canada and will add an extra step to the application process.
The Nice Classification system is being introduced so that Canada can join the Madrid system for the international registration of marks. The Madrid system is a system for filing trademark applications in multiple countries at once, while having the applications be centrally administered through the World Intellectual Property Office. Having the standardized class system in place makes it easier to compare trademarks from different countries, and is a legal requirement for countries to participate in the Madrid system.
Interestingly, the amendments grant the registrar the power to force existing trademark owners to classify their trademarks according to the Nice system. In other words, trademark owners who registered before the amendments pass may be forced to revise their trademarks or else will have them deleted from the registry. We will not know the details of how existing trademarks will be transferred to the Nice classification system until the Act’s regulations are published.
The changes will likely result in increased application fees. In many other countries that use Nice classifications the application fees increase depending on how many classes are applied for.
The amendments include a number of other miscellaneous changes. The mostly redundant concept of a “representative for service” has been deleted, and the role of trade-mark agents has been expanded. Government trademark examiners have been given broader powers to correct administrative errors. A new defence to infringement has been added where an infringer may argue that a trademark is “utilitarian” in nature and therefore should not be enforceable. Applicants will have the new ability to split applications in two (called “divisional applications”) in situations where their application is opposed in part. Finally, trademarks must be renewed every 10 years under the amendments, a reduction from the current 15 year term.
Timeline for coming into force
The amendments to the Trademarks Act have already been passed by Parliament and are the law of the land. However, many of the details of how the revised law will actually be implemented will be contained in the regulations to the Act, which have not been finalized. It is expected that Industry Canada will register the final version of the regulations in late 2015 or early 2016 and the amendments will go into force 30 days after that.