In 2014, the Canadian government passed Bill C-31, which formally introduced amendments to the Trade-marks Act (the “Act”). These amendments were proposed to modernize Canada’s trademark laws and prepare Canada to accede to several international treaties including the Singapore Treaty, the Madrid Protocol, and the Nice Agreement. The changes are expected to be made effective in early 2019, after revisions to the Trade-marks Regulations (the “Regulations”) have been finalized.
In June 2017, the Canadian Intellectual Property Office (“CIPO”) published proposed amendments to the Regulations. Some of the more substantial changes to the Act and Regulations are highlighted below and include the removal of the requirement for declarations of use, shortened renewal periods, and the implementation of the Nice international classification system.
The “Use” Requirement
Current Canadian trademark law requires applicants to demonstrate use of a trademark in order to secure a registration. Applicants must submit a declaration of use either at the time of filing or after the application is allowed (where the application was based on proposed use).
Under the changes to Canada’s trademark laws, applicants will no longer need to specify whether or not the mark has been used in Canada at the time of filing an application or to commence use of the mark in Canada prior to registration. While the changes will undoubtedly simplify the application process, they are anticipated to have significant impacts on rights holders. Since applications will no longer contain an indication of when use of a mark began, that information will not be available to potential opponents or litigants. The increased opacity of the process may make opposition and litigation more frequent and uncertain.
Shortened Renewal Period
Currently, a trademark registration must be renewed every 15 years. The changes will reduce this renewal period to 10 years for renewals due after the amendments come into force. Where a trademark owner renews a trademark which is due for renewal after the coming-into-force (“CIF”) date, under the currently proposed regulations, the shortened renewal period will be applied.
The Nice Classification System
Accession to the Nice Agreement was a requirement for accession to the Madrid Protocol. The Nice Agreement establishes the Nice Classification which is a system for classifying goods and services. When the amendments to the Act and Regulations come into force, applicants and owners of trademark applications and registrations will be required to classify the listed goods and services under the Nice system. Application and renewal fees will be based on the number of listed classes. For applications and registrations involving more than one class of goods or services, the application and renewal fees will be higher than they are now.
Under existing Canadian trademark law, applicants are not required to classify the goods and services claimed in an application. Similarly, application and renewal fees are not dependent on the number of classes of goods and services claimed. This currently allows applicants to file for a trademark and claim many goods and services while paying the same fee as they would for only a single class. Potential applicants who are planning to apply for a trademark claiming more than one class of goods or services should consider applying before the CIF date to take advantage of the lower fees.
It is possible, but uncertain, that trademark owners may save money renewing a registration early, even if the deadline for renewal is not until after the CIF date, if the registration covers multiple classes of goods or services. The CIPO has provided inconsistent information as to whether owners completing renewals before the CIF date that are not due until after the CIF date will be required to pay the difference in the renewal fee if the renewal fee is greater under the new tariff of fees.
Registration of Foreign Trademarks that are Not Without Distinctive Character
Section 14 of the Act currently permits an applicant who owns a trademark registration in another country to register a mark in Canada which might otherwise be non-registrable if it is not confusing with a registered trademark and is not without distinctive character. For example, a mark which is descriptive of its associated goods is not normally registrable in Canada under section 12 of the Act, but could be registrable by virtue of section 14 if the mark had been registered and used abroad and is not without distinctive character in Canada.
Section 14 of the Act is being repealed and this avenue for obtaining a registration in Canada will no longer be available. Owners of foreign trademarks that are potentially descriptive should consider using this provision in relevant cases prior to the CIF date. While a mark that is potentially unregistrable pursuant to section 12 will still be able to be registered based on a showing of acquired distinctiveness pursuant to sub-section 12(2), the evidentiary requirements for a showing of acquired distinctiveness pursuant to sub-section 12(2) are considerably higher than what is required to establish that a trademark is not without distinctive character pursuant to section 14.
Under the existing Act the owner of a trademark may register a confusing trademark if the applicant is the owner of all such trademarks. All such marks are known as “associated marks.” Currently, the owner of associated marks may not transfer an associated mark unless all of the associated marks are transferred to the same recipient. Under the changes to the Act, the owner will not be restricted from transferring ownership of associated marks.
The Madrid Protocol
Canada’s accession to the Madrid Protocol will mean that owners of Canadian trademarks will be able to apply for an international registration with CIPO, though which they may apply for trademarks in any country which is a party to the Madrid Protocol. Protocol applications are expected to streamline timelines and reduce costs for applicants. There are 98 contracting parties to the Madrid Protocol, including the United States, the European Union, Japan, Korea and China.
Currently, Canadians can only apply for international registrations if they maintain a “real and effective industrial or commercial establishment” in a member country. A real and effective establishment might include a branch office conducting transactions but might not include a mere warehouse. The member country in which the Canadian applicant maintains the industrial or commercial establishment would then be the “home country” for the purposes of the Madrid Protocol. For more information refer to this article on the Madrid Protocol.
The changes anticipated to come into force in early 2019 are expected to have an extensive impact on the Canadian trademark system. Potential applicants should consider whether they want to take advantage of the law as it currently exists before changes are made, especially with respect to the changes in filing and renewal fees.
By: John H. Lambert and Stephanie A. Melnychuk