28 Oct
2014

Advantages of Andean trademark system from a Peruvian perspective

Peru, Bolivia, Colombia and Ecuador form the Andean Community. The community’s objectives include the balanced and harmonious development of member countries through integration and economic and social cooperation.

At present, the common industrial property regime of the community is regulated by Decision 486 of the Andean Community Commission. However, unlike the European Union, the Andean Community has not established a unified trademark registration system effective in all member countries. On the contrary, Article 154 of Decision 486 expressly states that “registration of a trademark with the competent national office shall confer the exclusive right to its use” (all translations by the author).

The rights in a trademark in a member country are generated through registration of the mark at the trademark office of that country. This means that trademark protection in each Andean Community country is territorial and consequently does not extend, in principle, to the other member countries. However, Decision 486 provides for the following trademark rights that can be enforced in Andean Community countries other than that in which the mark is registered:

  • the right to oppose the registration of a junior mark in a member country based on a registered senior mark or a mark for which registration had already been applied for in another member country;
  • the right to defend a trademark against a non-use cancellation action in one member country by proving that the trademark has been used in another member country;
  • the right to claim notoriety when the mark is notorious in any Andean Community country; and
  • the right to the free trade of goods within the Andean Community if the conditions of Article 159 of Decision 486 are met.

These prerogatives were established by the Andean legislature with the intention of adopting, in future, a unified Andean trademark system. However, until this takes place, owners of registered trademarks in Andean Community member countries must take advantage of these prerogatives.

This chapter considers the scope of the rights that owners of trademark registrations or applications in other Andean Community member countries can exercise in Peru and vice versa.

Andean oppositions

According to Decision 486, the owner of a trademark that has been registered or applied for in an Andean Community member country is entitled to file an opposition based on that trademark against a third party’s application to register a confusingly similar mark filed in another Andean Community country. This opposition, based on a registration or application in another Andean Community country, is usually known as an ‘Andean opposition’.

This is an exception to the rule of territoriality, since the prerogative to file oppositions is not limited to the territory in which the trademark is registered or has been applied for, but rather extends to the territories of the other member countries.

However, this prerogative to prevent the registration of third parties’ marks in other Andean Community countries was established by Decision 486 as a right only to oppose applications, and not to request the nullity or invalidation of a registered trademark. This means, for instance, that the owner of a trademark in Peru is entitled to file an opposition against the registration of a confusingly similar mark in Ecuador. However, if no opposition were filed and the Ecuadorian trademark application matured to registration, the owner of the Peruvian trademark would be unable to request the invalidation or nullity of the Ecuadorian trademark based on its rights in Peru.

Therefore, in order to take advantage of this prerogative, the rights holder must file a timely opposition. Decision 486 establishes a requirement to prove the opponent’s “real interest” in the market in the country where the opposition is filed by applying to register in that country the same mark on which the opposition is based to distinguish the same goods or services.

According to the Peruvian Trademark Authority’s criteria, in order to prove real interest the applied-for mark must be identical to that supporting the opposition and must distinguish identical or overlapping goods or services.

If the local application that proves the opponent’s real interest covers only some of the goods or services of the mark supporting the Andean opposition, the Peruvian Trademark Office will conduct a likelihood of confusion analysis, considering only the goods or services of the Andean mark which are included in the local application.

Non-use cancellation actions

Trademark use is not a requirement to obtain, maintain or renew a trademark registration in Peru or in any other Andean Community member country. However, although Andean legislation does not oblige the applicant or registrant to prove use of its trademark as a condition to obtain, maintain or renew a registration in any member country, Decision 486 provides for the cancellation of a trademark registration on the basis of non-use.

The possibility of cancelling a trademark registration on the basis of non-use becomes available three years after the date on which the owner of the mark to be cancelled was served with the Trademark Authority’s decision granting registration of the mark.

In this regard, Article 165 of Decision 486 establishes that any interested party can request the cancellation of a trademark that has not been used for the goods or services covered by the registration for three consecutive years within the Andean Community countries. Hence, proving that the trademark has been used in at least one Andean Community country – even a different one from that where the trademark registration is being challenged on the basis of non-use – is enough to defend the trademark against a non-use cancellation action.

In order to establish use in a non-use cancellation proceeding, Decision 486 provides that a trademark has been used when:

  • the goods or services covered by the mark have been on the market or available to consumers of any Andean Community country, in the quantity and manner which normally correspond to the nature of the goods or services and the form in which they are usually commercialised; or
  • the trademark exclusively distinguishes products which have been exported from an Andean Community country in the manner stated above – that is, in the quantity and manner which normally correspond to the goods, bearing in mind their nature and the form in which they are usually commercialised.

Decision 486 provides for the partial cancellation of a trademark registration if, in a non-use cancellation proceeding, the owner proves use of its mark in connection with only some of the goods or services covered by the registration.

Regarding the partial cancellation of a trademark, the Peruvian Trademark Authority issued a precedent of mandatory compliance in 2005, which provides that if use of a mark is proved only in connection with goods or services which are not expressly listed in the registration certificate, but which are similar to or included within other goods or services expressly listed therein, the registration must remain in force to distinguish only the goods or services expressly listed in the registration certificate that are similar to or comprise the goods or services for which use has been proved.

The precedent of mandatory compliance includes a chart illustrating the different ways in which the coverage of a trademark can be restricted as a consequence of a partial cancellation. This chart has been used to develop the example in Figure 1.

Figure 1. Trademark X in Class 30

Original coverage

Use proved for

Registration cancelled for

Registration remains for

Coffee, cocoa, pastry

Coffee, cocoa

Pastry

Coffee, cocoa

Coffee, cocoa, pastry and other goods in the class

Cocoa

Coffee, pastry and other goods in the class

Cocoa

Coffee, cocoa, pastry and other goods in the class

Coffee, cocoa, pastry

Other goods in the class

Coffee, cocoa, pastry

Coffee, cocoa, pastry and other goods in the class

Rice (not expressly listed in the coverage but comprised within ‘other goods’)

Coffee, cocoa, pastry and other goods in the class

Rice

Coffee, cocoa, pastry

Cakes (not expressly listed in the coverage but comprised within ‘pastry’)

Coffee, cocoa

Pastry

Coffee, cocoa, pastry

Rice

Coffee, cocoa, pastry

The entire registration is cancelled

This means, for instance, that if a trademark were registered in Class 25 in Peru to distinguish “clothing and footwear”, and in the course of a non-use cancellation action against that trademark the owner proved that it had been used to distinguish sweaters exported from Colombia to the European Union, the registration would remain in force to distinguish ‘clothing with exclusion of footwear’, and footwear would be removed from the registration coverage.

Notoriety of trademarks

As mentioned above, in the Andean Community trademark rights are acquired by registering a mark with the trademark office of each member country. The Andean trademark system is based on registration; thus, use of an unregistered mark confers no rights on the user.

However, there is an exception to this rule for well-known signs. Decision 486 does not limit the well-known category to trademarks, but rather extends it to any kind of distinctive sign (eg, trade names, commercial slogans and denominations of origin).

According to Article 224 of Decision 486, a well-known distinctive sign is one which is recognised as well known by the relevant sector in any Andean Community member country, irrespective of the manner or means through which it has become known.

Well-known trademarks (or distinctive signs) deserve special protection which is broader than that granted to regular marks. Well-known marks are protected to avoid the following risks:

  • the likelihood of confusion or association between a third party’s mark and the well-known mark;
  • misappropriation of the prestige or goodwill of the well-known mark; and
  • dilution of the distinctive character of the well-known mark.

The advantage of notoriety in the Andean system is that a trademark which is well known in one member country deserves special protection not only in the country where it is well known, but also in the other Andean Community countries. In this respect, Resolution 2688-2010/TPI-INDECOPI, which was issued by the Peruvian Trademark Authority and which recognised the notoriety of the trademark CLUB COLOMBIA in Peru based on its notoriety in Colombia, stated as follows:

Regarding the copy of Resolution 45633 of the Colombian Superintendence of Industry and Commerce, which recognises the notoriety of the trademark CLUB COLOMBIA in Class 32 of the International Classification between 2007 and 2009 in pages 1300 to 1308, it should be stated that – as established in Resolution Nº 1153-2002/TPI-INDECOPI dated December 10 2002 – although it is not the only possible evidence, the best way to demonstrate that the relevant sector of a member country of the Andean Community recognises the notoriety of a mark is that the national authority of said country has declared it so.

In order to be accepted, this evidence must meet the following requirements:

a) It must be issued by the industrial property national authority or by the judiciary.

b) It must be issued as a result of an administrative and/or judicial proceeding.

In this case, said resolution meets both requirements, since it was issued by the competent authority in industrial property matters and has been issued as a result of an administrative proceeding.

In view of the decision rendered in Colombia and considering the evidence submitted in this application, in the opinion of the tribunal, the registered trademark under Certificate 509 is notorious in relation to beer in Class 32 of the International Classification.

In cases where the notoriety of a trademark which is well known in another Andean Community member country is claimed in Peru, the Peruvian Trademark Authority places great probative value on decisions recognising the notoriety of the mark in that other country.

Free trade of goods in the Andean Community

Decision 486 gives owners of registered marks the right to bring infringement actions against third parties which use confusingly similar marks in the same country; however, this right is not absolute or unrestricted. Article 159 of Decision 486 states as follows:

Where registrations of identical or similar marks exist in the sub-region, in the name of different owners, to distinguish the same goods or services, the commercialisation of the goods or services identified by the mark on the territory of the member country concerned shall be prohibited, except where the owners of the marks enter into agreements that permit such commercialisation…

In any event, the import of a product or service to which the situation described in the first paragraph of this article applies shall not be prohibited when the trademark is not being used in the territory of the importing country, as provided in the first paragraph of Article 166, unless the owner of said mark proves to the competent national office that the non-use of the trademark is justified by legitimate factors.

Thus, the owner of a trademark registered in one member country cannot prevent the import of goods bearing a confusingly similar trademark if the following conditions are met:

  • The goods are imported from another Andean Community member country in which the trademark identifying the goods is registered.
  • The trademark registered in the importing country is not being used in that country (unless such non-use is for legitimate or justified reasons).

Therefore, if the owner of trademark X in Peru files a trademark infringement action against the use of confusingly similar trademark Y on products which are imported to Peru from Colombia, the importer of the goods should be able to defend itself successfully against an infringement action by invoking Article 159 of Decision 486, provided that:

  • trademarks X and Y are registered in different member countries for the same goods;
  • trademark X is not being used in Peru; and
  • such non-use is for unjustified reasons.

Comment

Although a proper unified trademark system has not been adopted in the Andean Community, the owners of trademarks registered in Andean Community member countries (Bolivia, Colombia, Ecuador and Peru) should bear in mind these issues in order to maximise the protection of their trademarks in the region.

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Barreda Moller

Av Angamos Oeste 1200

Lima 18

Peru

Tel +51 1 2215715

Fax +51 1 4411916

Web www.barredamoller.com

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Marcela Escobar

Associate

[email protected]

Marcela Escobar is an associate at Barreda Moller. She graduated from the Universidad de Lima and holds a postgraduate qualification in intellectual property. She specialises in trademark-related matters. Ms Escobar is a member of the board of the Peruvian Association of Industrial Property and Copyright, and a member of the International Trademark Association and the Inter-American Association of Industrial Property. Ms Escobar has authored several articles on trademark matters.