10 April 2015 by Vincent Billings

When your reputation precedes you

A Community Trade Mark (CTM) is a trade mark which has been registered in respect of the whole of the European Union, rather than just at a national level in the owner’s home country. As such, registering a CTM can prevent anyone within the EU infringing your brand. Serious consideration should be given to whether this level of protection would benefit any trade marks which are currently only registered at a national level.

In a recent case, Unilever Plc opposed the registration of “be impulsive” as a Hungarian trade mark, believing it to be a derivative of its own existing “IMPULSE” CTM. It’s opposition was upheld in the first instance, as Unilever was able to demonstrate that its existing CTM carried a strong enough brand reputation, in a substantial part of the EU (evidenced by its market share in the UK and Italy in particular), that the risk of the proposed new Hungarian trade mark gaining an unfair advantage – essentially by getting a ‘free ride’ on the back of Unilever’s existing brand – could not be ruled out. 

However, appealing against this decision, the relevant Hungarian company argued that Unilever’s existing CTM in fact had no brand reputation in Hungary at all. As such, the prospective new national trade mark would not cause any detriment to Unilever’s CTM or benefit from any unfair advantage, and should therefore be permitted. 

Ultimately, it was decided that Unilever did not necessarily have to prove that its CTM had any associated reputation in Hungary. However, in order to successfully oppose the registration of the new national trade mark, Unilever did need to show that a substantive proportion of the public in Hungary would make a link between the proposed new national trade mark and the existing CTM. In other words, Unilever needed to demonstrate that the owner of the prospective new mark would be likely to benefit from a ‘free ride’ and therefore gain an unfair advantage. In this context, therefore, the strength of the brand associated with Unilever’s existing CTM was an important factor. 

The rationale for this decision is that, notwithstanding the strength of an existing CTM, the relevant national court must also be satisfied (on the facts) that detriment or ‘free-riding’ is likely to occur in its jurisdiction before upholding any opposition to a proposed new national trade mark, and such detriment is unlikely to occur unless the relevant consumers are already aware of the existing CTM. 

If you are conducting business within the EU, you should consider whether registering a CTM will give your brand the best possible level of protection throughout the EU. 

For advice on trade marks generally, and on how best to protect the brand(s) associated with your business, please contact us on 0207 288 4700 or email us at info@boltburdon.co.uk

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