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Brexit – What is the Impact for European Trademark Owners?

Published: 06/24/2016

By Alison Hayman

After the victory for the “Leave” side in the UK referendum, we wanted to provide a further update to our Canadian trademark clients about brand protection in the UK and Europe going forward.

In our June 22, 2016 bulletin we explained that if the UK exited the EU, the UK would cease to be part of the European Trademark system and European Trademark registrations (EUTMs) would no longer grant protection in the UK. This outcome now appears inevitable. It could have a significant impact on Canadian businesses, many of which protect their brands in Europe using the pan-European EUTM. However, there will be no immediate loss of rights, as the UK is expected to take approximately two years to negotiate its exit.

In our prior bulletin we also noted that there would likely be transitional provisions enabling current owners of EUTMs to obtain UK national trademark registrations. Today, leading UK IP firms are maintaining that view. It is expected that the UK will enact transitional provisions that enable EUTM owners to re-register their marks in the UK without a loss of priority. There is precedent for this in other situations where a country has withdrawn from a regional trademark system. Therefore, while some businesses may wish to apply to register their trademarks in the UK now out of an abundance of caution, most UK experts are suggesting that it would also be reasonable to wait for a decision on transitional provisions which may provide better priority in the UK than would new filings.

Over the longer term, another issue will be maintenance of EUTMs. We expect that use of a mark in the UK only will not be sufficient to maintain an EUTM. Unless a mark which is the subject of an EUTM is used in an EU Member State, its registration will likely become vulnerable to cancellation. Companies doing business in the UK only should, therefore, register their marks in the UK if they have not already done so.

The above changes are likely to result in an increase in trademark applications filed with the UK IP Office, which could result in processing delays for applicants.

Cassels Brock & Blackwell LLP will continue to keep you informed of developments in this area.