Last year, 12,527 European Union Trade Mark (EUTM) applications were filed by British companies. This made the UK the second highest member state in terms of EUTM applications filed, (1) at an estimated minimum cost of Eur10.6million (£8 million) (2). The EU trade mark system means one EUTM registration provides protection in – and is enforceable in - all member states of the EU. This system has been in place since 1996.
Jo Eales, Associate in the Commercial and Technology team at Taylor Vinters, comments: “In the eventuality of a vote to leave the EU, the UK would no longer be covered by the EUTM or be part of the European Union Intellectual Property Office (EUIPO) system. This will plunge UK trade mark law into uncharted territory, potentially affecting thousands of UK businesses if they rely on an EUTM for brand protection in the UK.
"If the UK leaves the EU, it is likely there will need to be some transitional negotiations to ensure that existing trade mark rights are not lost. In the short-term, it will be important for UK business’ to review their current trade mark portfolios to ensure they understand the scope of registered trade mark protection they have and in which territories. Business owners wishing to protect their trade marks in the UK will need to ensure they have protection by way of a UK national registration, rather than relying on the EUTM.”
Currently, businesses looking to protect their brand from counterfeiters or competitors choose which territory to register a trade mark in, whether that’s the UK, EU or another international territory. Once a trade mark application has been filed, amendments to the actual trade mark applied for or significant changes to the scope of protection (such as adding new goods and services) are not permitted and a new application must be filed at a further cost. The time to register a trade mark varies depending upon the territory, though a EUTM can typically take four to six months.
Ms Eales adds: “The benefit of registered trade mark protection, is that it gives the proprietor the ability to prevent someone else using a trade mark that is the same or similar, and in a way that is likely to cause confusion or damage its reputation. A registered trade mark is a crucial element of brand protection for any business across any sector, but is especially pertinent for high-growth businesses considering expansion overseas, increasing market share through licensing deals or positioning the business for funding or M&A activity.”
What is a trade mark? Why does it matter?
A trade mark can be a word, logo, colour, sound, or a combination of any of these. It is such brand collateral that typically distinguishes a brand from its competitors.
Trade marks also help companies to license their brand, allowing a third party permission to use the trade mark as an ‘umbrella’, which is one way businesses can expand their reach and market share domestically and internationally.
Trade marks also become part of the “intangible assets” of the business, which can be included in any company valuation. This is important for high-growth businesses seeking funding or those being positioned for a merger or acquisition.
1 Of EU member countries, behind Germany. Source: http://ec.europa.eu/eurostat/documents/2995521/7237244/9-25042016-AP-EN.pdf/7e673318-4893-46f7-9ee6-f293196c8dc6
2 First Class EUTM fee @Eur850 multiplied by the number of EUTM applications in 2015: https://euipo.europa.eu/ohimportal/en/eu-trade-mark-regulation-fees
*******
Anna Marsden, Media Relations at Social i Media: [email protected] or call 07984 638586.
__________________________________________