IP Bulletin - Autumn 2012

TRADE MARKS

CJEU considers whether use within a single Member State may constitute "genuine use in the Community" (Article 15(1) Regulation 207/2009)

AG Sharpston's opinion on the meaning of "genuine use in the Community" (Article 15(1) CTM Regulation) makes clear that genuine use should not be assessed solely on geographical lines but should take into account other factors such as the characteristics of the products and services and features of the relevant market for those products and services (all of which may change over time). Use in a single Member State might be sufficient.

Leno Marken BV v Hagelkruis Beheer BV, Case C 149/11, 5 July 2012 http://curia.europa.eu/juris/document/document.jsf?text=&docid=124734&pageInde x=0&doclang=en&mode=req&dir=&occ=first∂=1&cid=540897 3

Hagelkruis Beheer BV ("Hagelkruis") applied to register the word OMEL as a Benelux trade mark in connection with services in classes 35, 41 and 45 of the Nice Classification. Leno Marken BV ("Leno") opposed the registration arguing that it was the proprietor of the already registered Community Trade Mark ("CTM") ONEL for certain services in classes 35, 41 and 42. In response, Hagelkruis asked Leno to prove genuine use of the ONEL mark. Leno responded by providing proof of use in the Netherlands.

The Benelux Office for Intellectual Property rejected Leno's opposition and decided Hagelkruis should be permitted to register OMEL as a Benelux mark. Leno appealed that decision before the Regional Court of Appeal in The Hague. The matter before the court was whether Leno was required to demonstrate genuine use of its CTM for the mark ONEL in more than a single Member State in order to be able to oppose Hagelkruis' registration of OMEL. The Dutch court referred the following questions to the Court of Justice of the European Union ("CJEU").

  1. Must Article 15(1) of [the CTM Regulation 207/2009] be interpreted as meaning that use of a Community trade mark within the borders of a single Member State is sufficient to constitute genuine use of that trade mark, given that, had it been a national trade mark, such use would have been regarded as genuine use in that Member State (see Joint Statement No 10 regarding Article 15 of Council Regulation (EC) No 40/94 of 20 December 1993 and the Opposition Guidelines of the OHIM)?

  2. If Question 1 is answered in the negative, can the use of a Community trade mark within a single Member State as described above never be regarded as genuine use in the Community as referred to in Article 15(1) of [the Regulation]?

  3. If the use of a Community trade mark within a single Member State can never be regarded as genuine use in the Community, what requirements apply' in addition to the other factors' in respect of the territorial scope of the use of a Community trade mark when assessing genuine use in the Community?

  4. Or else' as an alternative to the above' must Article 15 of [the Regulation] be interpreted as meaning that the assessment of genuine use in the Community should be carried out wholly in the abstract, without reference to the borders of the territory of the individual Member States (and that, for example, market share (product markets/geographic markets) should be taken as the point of reference)?'

The CJEU was asked to determine the extent of the territorial area in which the proprietor of a CTM must use the mark to avoid the sanctions set out in the Regulation. Article 15 provides that a proprietor of a trade mark must put the CTM to use and if, within a period of five years following registration, the proprietor has not put the mark to "genuine use in the Community" in connection with the goods or services in respect of which it is registered, or if such use has been suspended during an uninterrupted period of five years, the CTM shall be subject to the sanctions provided for in the Regulation. In opposition proceedings, an opponent can be asked by the applicant for a mark to prove that the earlier mark (on which the opposition is based) has been put to "genuine use in the Community". If not used for five years, a mark may be revoked.

Advocate General Sharpston considered "genuine use in the Community" as an indivisible concept, meaning that "genuine use and "in the Community" are not cumulative conditions to be examined separately. In Sunrider (C-416/04 P Sunrider [2006] ECR I-4237) the CJEU accepted that territorial scope of use is only one of several factors to be taken into account in the determination of whether use is genuine or not. Whilst the place of use is a factor to consider in assessing whether the mark has been put to genuine use, it is not the sole or dominant factor.

AG Sharpston concluded that use within the borders of a single Member State is not, of itself, necessarily sufficient to constitute genuine use of that mark because the territorial scope of use is merely one of the factors to take into account at the assessment. Leno submitted evidence of use of the ONEL mark in the Netherlands only. AG Sharpston commented on the difference between national and Community marks. In determining genuine use of a national mark, only instances of use within the territory of the Member State where the mark is registered are relevant, even if the proprietor uses it elsewhere. Use of a Community trade mark within the meaning of Article 15(1) of the Regulation, on the other hand, must be assessed taking into account instances of use in the entire internal market. Whether a Community trade mark has been used in one Member State or several is irrelevant. What matters is the impact of the use in the internal market: more specifically, whether it is sufficient to maintain or create market share in that market for the goods and services covered by the mark and whether it contributes to a commercially relevant presence of the goods and services in that market.

The court found in Sunrider that a national trade mark has been put to genuine use "Üwhere the mark is used in accordance with its essential function, which is to guarantee the identity of the origin of the goods or services for which it is registered, in order to create or preserve an outlet for those goods or services'. Whether a trade mark has been put to genuine use must be determined taking into account all the facts and circumstances of the case, including the characteristics of the economic sector and the market at issue, the nature of the goods and services protected by the mark, and the scale and frequency of the use. Essentially, trade marks are used in markets. The relevant market for a Community trade mark is the internal market. AG Sharpston considered that to determine whether the condition of genuine use in the Community is satisfied, the court must examine all forms of use of the mark within the internal market. The geographical definition of the relevant market is the entire territory of 27 Member States. In the present case, AG Sharpston considered that use of the mark in the Netherlands forms part of the assessment and may contribute to establishing whether the mark has penetrated the internal market for the services covered by the mark. Use or non-use outside the Netherlands is equally relevant to use inside.

In AG Sharpston's opinion, the case-by-case assessment of what constitutes genuine use involves determining the characteristics of the internal market for the particular goods and services involved and those features may change over time. "Demand or supply in, or access to, parts of the internal market may be limited depending on, for example, language obstacles, transportation or investment costs, or consumer tastes and habits. Use of a trade mark in an area where the market is particularly concentrated may thus play a more significant role in the assessment than use of the same mark in a part of the market where sources of supply and demand for these goods or services hardly exist or arise." The decision of the national court on whether the condition of genuine use is satisfied cannot be based on an assessment solely of use of ONEL in the Netherlands. Instead, the national court must consider all instances of use in the internal market, including in the Netherlands, and give weight to each use against the background of the particular characteristics of the market and the market share of the proprietor in that market.

AG Sharpston has recommended that the CJEU should respond to the national court as follows:

Article 15(1) of Council Regulation (EC) No 207/2009 of 26 February 2009 on the Community trade mark must be interpreted as meaning that:

i. use of a Community trade mark within the borders of a single Member State is not, of itself, necessarily sufficient to constitute genuine use of that trade mark, but ii. it is possible that, when account is taken of all relevant facts, use of a Community trade mark within an area corresponding with the territory of a single Member State will constitute genuine use in the Community.

Genuine use in the Community within the meaning of Article 15(1) of Regulation No 207/2009 is use that, when account is taken of the particular characteristics of the relevant market, is sufficient to maintain or create market share in that market for the goods and services covered by the Community trade mark.

Therefore, what amounts to genuine use for the purposes of Article 15(1) will depend upon the characteristics of the relevant market for the products and services and the market share of the proprietor as well as the area of territory in which the mark is used. If the CJEU follows AG Sharpston's opinion, it can be anticipated that there will be several more references to the CJEU before there is a clear picture of what actually will amount to "genuine use in the Community".

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