Zuykov & Partners - Russia
Owners of well-known marks have a number of choices as to how their designations are used and a stronger case for preventing the unfair registration of similar means of individualisation in other classes.
Exclusive rights to a well-known trademark
The Russian Civil Code does not contain any restrictions with regard to the disposal of the exclusive rights to a designation. Trademark owners may:
• give another entity a licence to use the trademark (under a licence agreement);
• conclude a concession agreement and transfer the rights to use a mark in conjunction with exclusive rights to other intellectual property;
• use the exclusive rights to a trademark as a pledged item; or
• transfer the exclusive rights to the designation (under an alienation agreement).
In accordance with Article 1490 of the Civil Code, any disposal of the exclusive rights to a mark must be executed in the form of a written agreement. This must be registered at the Russia Patent and Trademark Office (Rospatent), which then publishes the relevant information in the Register of Well-Known Trademarks so that third parties can verify whether it is possible to obtain permission to use the mark.
An example of a well-known trademark being used actively is the combined designation ‘Rospechat’, which is registered in relation to the Distribution, Processing, Printing Collection Agency. According to the register, since the mark obtained well-known status in 2004, the rights holder has granted the right to use it to 12 enterprises under non-exclusive licence agreements. It is important to note that when granting several licences, a mark owner has the right to set different validity periods for each agreement. For example, LLC Baikal, which holds exclusive rights to the well-known trademark ‘Baikal’ in relation to goods in Class 33 (vodka), has granted non-exclusive licences to various enterprises for up to 10 years and for the entire validity period of the exclusive right to the trademark on Russian territory.
Although the owner of a well-known mark has the right to choose any method of disposing of these exclusive rights, there are still a number of restrictions. Article 1488(2) of the Civil Code prohibits alienating the exclusive right to a trademark “if it may be the reason for misleading the consumer about the product or its manufacturer”.
However, the legislation does not indicate how Rospatent determines the likelihood of misleading consumers. Rights holders are obliged to present evidence of the wide popularity and consumer recognition of a mark, among other things, when applying to register it as well known. Rospatent must confirm that the claims for priority status are justified, the designation is really well known to consumers and an associative product-producer relationship comes to mind when looking at the mark.
When a well-known designation is alienated, it is likely to mislead consumers as to the manufacturer of the product. Granting the rights to a well-known mark under a licence agreement can cause confusion between manufacturers in the inds of consumers.
When considering the situation from a consumer protection point of view, the most reliable way to transfer the exclusive rights under an alienation agreement can be seen in the following example. Nidan Juices company, the rights holder of a well-known trademark MOYA SEMYIA (my family) since 2010 in relation to products in Class 32 (fruit juices, tomato juice), primarily granted the right to use the designation on the basis of the licence to another enterprise. After a certain period, it concluded an alienation agreement with this manufacturer, transferring the exclusive rights to the means of individualisation in full.
This approach to the alienation and transfer of rights to a well-known designation should be prioritised, since in this case the primary rights holder can verify the good faith of the future owner of a well-known trademark.