Proposed amendment to Russian trademark law receives mixed response 21 Jul 14
Russia’s Federation Council on Intellectual Property is proposing an amendment to Russian trademark law that would stop naturalistic images of products and descriptive trademarks as the basis for distinctiveness. There’s been a very mixed response about whether the changes would help rights holder in the country, with some saying it could allow more freedom for product packaging in Russia, while others say that the proposed amendment causes “a lot of concern” and that there are more deep-seated problems that need sorting out.
There have been a number of cases in Russia that highlight the issue that the IP council is claiming it wants to combat: of companies trademarking packaging and descriptive elements and, once accepted into the register, enacting infringement suits against rival companies. For example, Elizaveta holds a trademark for the packaging of its crisp bread product and has sued competitors with products that have packaging with similar images of crisp bread (see image comparison). Natalya Zolotykh, vice president of ‘Support of Russia’ and who attended the council’s meeting on the proposed changes, told Izvestia.ru that the main problem is that, once granted a descriptive trademark or a trademark containing a product image, “right holders then tried to monopolise the market, prohibiting others from selling similar products”.
According to the council, this type of trademark ‘adversely affects the market’, and it is seeking to close the loophole in Russian trademark law that allows descriptive trademarks “when they have already acquired distinctiveness” by modifying item 1483 of the Civil Code so that naturalistic elements may not be the basis of distinctiveness and will, therefore, not be subject to protection. There is currently no specific timeline on when these modifications will go through, and some industry figures expect some companies to try and prevent the introduction of the new amendment.
If and when the amendment go through, global consumer market research company Canadean has a positive outlook, saying on its website that the amendment will “create wider opportunities for new brands” and “will cause a shift in market trends among Russian consumers”. Canadean also says that the “number of companies taking inspiration from each other is set to increase”, therefore “more consumers will shift from the original label to a different manufacturer”. Talking to WTR, Canadean analyst Veronika Zhupanova said the changes will affect trademark applications in general, not just of fast-moving consumer goods (FMCG). She adds: “This definitely means more freedom for packaging design, as well as products shaping and formulations.” It also shows, she adds, how crucial it is that businesses are aware of IP laws before entering new markets.
There’s a very different view of the proposed amendment from Natalia Gulyaeva, partner at Hogan Lovells in Moscow. She told WTR that "the proposed amendment seems to be duplicative to the existing provisions of Russian trademark law prohibiting registrations of non-distinctive and, in particular, generic and descriptive trademarks". She says: “If [and when] some problem trademarks get through, it’s mainly due to wrong interpretation and application of Russian trademark law provisions by the examiners. In my view, it would be much more sensible to invest in the quality of the examination of trademark registrations in Russia, and not waste time in improving provisions that are already in line with international standards. It’s not a legislative problem, it’s an executive problem, and we need improvements in the examination process more than anything else since this is the very issue which causes concern to the right holders and has the potential to make Russian trademark prosecution less attractive for potential applicants.”
One change that Gulyaeva says is needed to improve Russian trademark law is the addition of ‘bad faith’ as grounds for refusal, which will cure “much bigger problems”. She adds: “If trademarks like the Elizaveta example [referred above] appear on the register then it’s a failure of the examination process. [People say] if the amendment is passed then ‘everything will be alright and such trademarks will be invalidated’, but such problem trademarks won’t be invalidated because they were registered in line with existing laws and any legislative amendment may not have retrospective effects on registrations already granted. Therefore, the amendment won’t cure the problem that exists due to already granted trademark registrations.”
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