Institute of Industrial Property upholds oppositions based on unregistered mark

For more than 50 years the Chilean Industrial Property Law strictly followed the principle that trademark rights were acquired and maintained only by means of registration in the Trademark Register. This principle still applies, although it has been modified as a result of the globalisation and harmonisation of the laws. In a 2007 amendment, it was established that non-distinctive denominations that had acquired distinctiveness through use in the national market could be protected.

In a previous amendment dated 2005, it was established that the owner of a trademark that had been put to genuine use in the national territory for more than a year, but was not registered in Chile, could oppose an application for a third-party trademark that was identical or confusingly similar and covered the same or similar products. Further, it was established that such use could serve as a basis to cancel a later registration.

However, with regard to oppositions or cancellation actions based on famous or notorious trademarks, oppositions against applications that contravened good business ethics, or oppositions against trademarks that were likely to mislead consumers as to the source of the products, the Chilean Institute of Industrial Property continued to follow the old principles, requesting that such actions be supported by trademark registrations or, at least, by trademark applications in Chile or in foreign countries.

In two decisions rendered on June 27 2012, this doctrine was modified insofar as it relates to misleading and unfair applications, but was confirmed insofar as it concerns famous or notorious trademarks. The Institute of Industrial Property rejected Chilean applications for the trademarks SHOULDICE and CLINICA SHOULDICE (Nos 863.365 and 863.366, respectively) for a medical clinic specialised in hernia treatment. The applications were filed by Mr William Edward Urquhart and opposed by Shouldice Hospital (Ontario, Canada).

The opponent argued that:

• the trademark applied for was famous abroad;
• registration of the mark in the name of a third party would mislead consumers; and
• registration of the mark would contravene business ethics.

In addition, Articles 6bis and 10bis of the Paris Convention were cited as a basis for the opposition.

No Chilean or foreign trademark applications or registrations were filed as evidence, but the opponent submitted: 

• documents demonstrating that the applicant had been a director of the opponent's hospital in the past;
• press articles;
• copy of patient records; and
• the opponent's company reports.

The opposition was rejected as far as it was based on Article 6bis of the Paris Convention (misappropriation of a well-known mark), which shows that, in this respect, the Institute of Industrial Property still requires that the trademark on which the opposition is based must be registered in Chile or abroad.

However, the institute upheld the opposition based on Article 10bis of the Paris Convention and the Chilean provisions.

The decision shows that it is becoming easier to oppose a trademark application in Chile on the grounds of unfair competition; nevertheless, in order to oppose an application based on a well-known mark, the opponent must still own a registration either in Chile or abroad.

Sergio Amenábar, Estudio Villaseca, Santiago