Many of you own valuable trademarks and service marks for products and services that primarily or exclusively have been sold in the United States. As the economy changes and your markets evolve and expand, however, foreign markets may be a desirable and fruitful option. It is important to protect your valuable marks abroad, just as you may have done in the United States. A U.S. trademark registration offers no protection abroad. Hence, competitors in foreign countries conceivably could beat you to the punch and acquire rights in your valuable marks by applying for registration abroad before you do. While trademark rights may be obtained by prior use in some foreign countries, in many countries the first party to apply for registration of a mark obtains priority rights over others. Additionally, many foreign countries do not require that a mark be put into use for as long as five years from the date of registration. Accordingly, if competitors win the race to the foreign trademark registries, your ability to use your valuable brands abroad could be lost or significantly limited.
Trademark owners frequently avoid foreign filings because of the expense of filing separate applications in each desired country. Up to this point, the only significant "one stop" option for foreign trademark applications has been the Community Trademark (CTM) which allows for one trademark application and resulting registration to cover all 15 of the European Union countries. The upside is that for the cost to prosecute one application, expansive trademark coverage can be obtained. The downside is if the mark is successfully opposed due to an existing mark in any of the 15 countries, the entire CTM application will fail, and the applicant must convert the applications to national applications in the European Union countries where the mark is available (and registration is desired by the applicant). This conversion can be costly.
Commencing on November 2, 2003, however, there will be another option for owners of marks to file a single application and extend that application to over 50 countries. On November 2, 2002, the United States passed legislation to implement the Madrid Protocol, an international treaty with over 50 members (one of the newest members being the United States). The Madrid Protocol is administered by the World Intellectual Property Organization (WIPO), the United Nations agency in charge of promoting intellectual property protection throughout the world. The biggest advantage of this new procedure is that it permits the filing of a single trademark application in the United States Patent and Trademark Office (PTO) that can be extended to any or all of the member countries. The request for extension can be made at the time of filing your U.S. application or at a later date. Additionally, opposition in one country will not affect registration in the other countries. The downside is that there will still be an examination of the trademark application in each country, and if the application is contested, additional costs could be incurred (potentially in multiple countries). There are some other limitations inherent in the Protocol as well, and PTO, international application, and individual country designation fees also will have to be paid. While the CTM still gets the nod for EU countries, the Madrid Protocol is a valuable asset where there are multiple Protocol member countries involved that extend beyond the EU.
This article is intended to serve as a summary of the issues outlined herein. While it may include some general guidance, it is not intended as, nor is it a substitute for, legal advice. Your receipt of Good Company or any of its individual articles does not create an attorney-client relationship between you and Sheehan Phinney Bass + Green or the Sheehan Phinney Capitol Group. The opinions expressed in Good Company are those of the authors of the specific articles.
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