Philippine company ordered to drop Rolex name

The Securities and Exchange Commission (SEC) has ordered a Philippine company to remove the term 'Rolex' from its registered corporate name (Case 06-94-4794).

Philippine company Rolex Scientific Corporation (RSC) is engaged in the manufacture and sale of scientific equipment, laboratory chemicals and supplies. Montres Rolex SA, the Swiss manufacturer of timepieces under the famous ROLEX mark, took issue with the use of Rolex in RSC's registered corporate name and brought a complaint before the SEC. RSC argued, among other things, that it had priority in the registration of the name and had received its licence to transact business under that name ahead of the Philippine arm of Montres Rolex.

The SEC rejected RSC's argument. It reasoned that Montres Rolex was entitled to the protection of its trade name and trademark under the Paris Convention for the Protection of Industrial Property. It relied upon documentary evidence proving that Montres Rolex was founded in 1920 in Switzerland and that watches bearing the trademark ROLEX have been sold in the Philippines since 1946. It also considered evidence that ROLEX:

• is "known worldwide as a leading brand name for watches";
  
  
• has "one of the highest market recognition rates for any business or product anywhere"; and
  
  
• is registered in the Philippines.

Rejecting RSC's contention that its use of the name for the conduct of business unrelated to watches was unlikely to cause confusion, the SEC declared that Montres Rolex's exclusive right to the ROLEX mark and trade name, should be protected not only against unauthorized use on products but also against appropriation by unrelated companies.

The decision affords broader protection to trademark owners than that granted by the Supreme Court in its ruling in Philips Export BV v Standard Philips Corporation (9616, February 21 1992). In that case, the Supreme Court restrained the use of the PHILIPS mark and trade name by a local company only in relation to fields of business also covered by electronics giant Philips's famous PHILIPS mark.

The SEC's decision liberally applies Section 18 of the Philippine Corporation Code, which prohibits the use of a name "already protected by existing law" as part of a corporate name. Such laws include: (i) Section 123.1(f) of the Intellectual Property Code, which protects well-known marks registered in the Philippines against appropriation by others even in respect of goods or services that are not similar to those covered by the registration; and (ii) the Paris Convention, which protects the rights of nationals of member countries without the obligation of filing or registration.

Vicente B Amador, SyCip Salazar Hernandez & Gatmaitan, Manila