IP Law Issues in Russia
Two perspectives
1. Part IV of The Civil Code:
The comment of the authors in INTA Bulletin (January 15, 2007) that "new Russian IP Law has serious deficiencies for trademark owners and that the law was drafted largely from scratch" has caused heated discussion both in Russia and around the world. However, while discussing the problems the authors seem to err which has created misleading impression and the statement perhaps stems from the fact that the IP legislation is presented as a new Part IV of the Civil Code. Russia currently has several IP laws and amendments have taken place from time to time regardless of whether the legislation was included in a single part.
Uniform Infringement Standard:- It has long been necessary to regulate the principle of the senior right, because it has to be determined often in courts. Part-IV of the Civil Code provides far too broad a scope of protection for domain names and company names as a result of different confusion standards/infringement standard under IP titles and the adopted law version which provides no successful remedy of this problem. Article 1252(6) concerns protection against infringements of exclusive rights for the means of individualization i.e. distinguishing the owner's goods or services. The Article also states that if different means of individualization are identical or confusingly similar to mislead the consumer, the senior right will prevail. If the concept of confusing similarity be applied to the trademark by the Patent Office, it would have to be determined whether the applied-for mark is capable of misleading consufmers. Indeed, capability of misleading consumers may result from similarity, but similarity is not the only cause as consumers may be misled by many circumstances such as, the specific conditions of the use of trademark or advertisements, etc. which the Patent Office cannot reveal. They can be revealed or presented by the parties in case of infringement. Here the Patent Office has to determine the possibility of misleading condition during the examination procedure. So what has been provided in the law seems to be acceptable from all points of view. In fact, the senior right is exercised and the owner who first registers the trademark or the domain name will have the senior right. Abuse of right and unfair competition should also be considered in this situation.
Commercial designations and company names:- Commercial designations are also introduced in the law. A commercial designation is subject to the rule of senior right and can hardly harm the rights of goodwill trademark registrants. It is still too early to predict what the negative consequences of this regulation may be.
Well-known Marks:- TRIPs provides for a broad scope of protection of well-known trademarks and a relevant provision has been included in Part IV. The law provides that no trademark can be registered if it is confusingly similar to another. In the past the Russian Patent Office understood the term 'confusingly similar' narrowly. However, the High Commercial Court did away the patent office's approach and ruled that similar trademark should not be registered, not only in respect of homogeneous goods but also in respect of the accompanying (associated) goods.
Geographical indications:- There is no absolute priority of the geographical indication over trademarks, as Article 1535(2) provides that a geographical indication can be contested and invalidated if it can mislead the consumer for the existence of an earlier trademark. For the sake of justice, it should be acknowledged that not all of the TRIPs provisions regulating correlation between geographical denominations and the trademarks have been respected.
Lack of transparency at the Russian Patent Office and Opposition procedure:-
The database at the Russian Patent Office does not provide sufficient information sometimes. However, the situation is improving but the problem is not traceable to Part IV. With regard to lack of the opposition procedure, it is not a problem at the Russian Patent Office, since the arrangements under Part IV shows the Patent Office's different approach to the examination procedure
Trademark Licensing & Franchising:- The Russian Patent Office does not register licenses involving pending trademark applications. There is no change from the old law according to which pending trademarks were never allowed to be licensed or franchised. After all, a license or a franchise is a disposal of a right. There is no right before the mark is registered.
Fair Use:- Part Iv does not contain provisions on fair use covering a situation where a person advertising the goods mentions trademarks. It would be a good thing if the law included a relevant provision.
Transitional provisions for Soviet-Era Marks:- These are correctly included in Part IV. What the law can be reproached for is only that those provisions were not included until now.
Counterfeiting and Piracy:- The existing law is quite adequate to protect the infringed rights and is up to the standards existing in other developed countries. During the last few years, much progress has been made in this area as the law enforcement bodies and the courts have gained experience and right holders have begun to initiate more infringement cases. However, some amendments/additions in Part-IV are being worked out for the protection of right owners against counterfeiting and piracy and it is hope the provisions will be made in the Civil Code to improve the IP situation.
2. Concerns about new Russian IP Law:
Uniform Infringement standard:- The issue here is whether Part IV of the Civil Code differently worded infringement standards for different means of individualization (e.g. domain names, company names, trademarks, etc.) can be justified as reliance on a single standard is applied all over the world. For example, the two-step approach of Article 1252(6) is unnecessarily complex, as firstly different means of individualization be identical or confusingly similar and secondly the capability of misleading consumers be proven. Nothing is lost by having a single, one-step standard which would indeed be more flexible and can take into account any evidence of confusion irrespective of marks and goods identity or similarity.
Domain Names protection:- Part IV provides that registration of a domain name may block a subsequently adopted identical trademark, giving domain names a status equal to trademarks as a means of individualization. This is a huge leap. A domain name may be generic or lack distinctiveness and may not function as means of individualization as well as not bestow exclusive rights on the owner. However, the domain names have therefore been exploited by trademark pirates for nearly two decades. Part IV gives bad faith operators a formidable tool to perpetuate and increase such piratical activity. In short, domain names and trademarks should not be placed on an equal footing, perhaps no other juridiction provides such protection.
Commercial designations & Company names:- As in many other countries, Part-IV provides that notoriety of a commercial designation within a limited geographic area creates prior rights in that designation. However, the new law does not limit them to that geographic area. Moreover Part-IV provides protection to such designations that possess sufficient distinctive characteristics.
Well-known marks:- Part-IV unambiguously applies the 'confusingly similar' standard of goods which fails to accord with current international standards. It clearly says that a trademark must be refused registration if it is identical or confusingly similar to a trademark recognised as well known with respect to similar goods. Thus the Part-IV does not protect well-known marks from registration of identical or confusingly similar third marks for dissimilar goods.
Geographical indications:- Part-IV does not base the relationship between trademarks and geographical indications on established standards of public international law. The WTO Dispute Settlement Panel (March 2005) decision recognized that Article 16 of TRIPs gives a trademark owner an exclusive right enforceable against a geographical indication as long as the trademark has priority. The European Court of Human Rights extended the property guarantees of the Convention to trademark applications, confirming that the priority acquired through a trademark application is the decisive point against which conflicts between trademarks and geographical indications must be judged. Therefore, Part-IV should make clear that (1) only a prior appellation of origin may constitute a ground for trademark refusal; (2) a trademark may lead to invalidation of an appellation of origin where such appellation is likely to cause confusion with the prior trademark; and (3) an appellation of origin may be refused ex officio if it conflicts with a confusingly similar prior trademark and may be opposed on the same ground.
Lack of Opposition procedure:- It is suggested that an opposition procedure is simply an alternative to relative examination, and that the Russian system is better than most because it provides both relative examination and a post-registration cancellation procedure. While in theory it is true, but the norm in practice is to provide pre-registration opposition procedures, even if the jurisdiction also provides relative examination or cancellation or both. This is because opposition procedures are more effective than relative examination in identifying potentially conflicting marks and are more effective than cancellation procedures in resolving conflicts.
Licensing Issues:- Imposing joint and several liability on a trademark licensor for the licensee's goods would create an enormous burden for licensors, with no advantage to anyone, including consumers, as a licensor often does not have control over a licensee's product, but rather has only limited control. While Part-IV does not perpetuate license recordal as a prerequisite for use by the licensee to inure to the trademark owner, this requirement is not consistent with international norms as few countries still impose a mandatory recordal requirement. However, the Singapore Trademark Law Treaty endorsed by the INTA Board of Edirectors to which Russia is a signatory, discourages formalities such as license recordal requirements, as it posses an unwarranted administrative burden and cost on parties, especially in the case of large licensing programs.
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