United States Accedes to Madrid Protocol

(Originally printed in Priority Read – Business Law Update, November 21, 2002)

The United States and the European Union have reached an agreement on procedures that will facilitate international trademark registration. The procedures will save hundreds of millions of dollars for U.S. companies and substantially reduce the time it will take for applicants to register their trademarks in European and other participating countries.

Under the Madrid Protocol, companies will be able to obtain a single registration valid in all participating European Union member countries and other participating states, with one renewal date, by filing one application with one fee and one language. Under this procedure, the applicant will no longer be required to register trademarks in the individual member states. The United States and the European Union have also agreed on provisions which permit participating states to make decisions relating to the implementation of the Protocol.

The cost savings under the Protocol are significant. For example, a U.S. trademark owner wishing to register a mark in ten different countries would traditionally file ten separation applications at a cost on the order of $15,000. Under the Madrid Protocol, the total cost would be reduced to approximately $5,000 or one-third the cost of individually filing the applications. Companies will also save considerably on fees relating to amended trademark registrations. Currently, a company with 500 trademark registrations in 10 countries would need to file 500 amendments at a cost of several thousand dollars, not including the legal fees for preparing the amendments. Under the Protocol, applicants would need to file one amendment. The implementation of these procedures will also greatly reduce the waiting period for the prosecution of trademark registration applications. Currently, national applications can take up to as much as two years at the United States Patent Office, and longer with some European offices. Under the Protocol, the contracting states must act upon applications within at least 18 months of the priority filing date.

Background

The predecessor to the Madrid Protocol was the "Madrid Union," brought into existence in 1891 by agreement between Belgium, France, Guatemala, Italy, The Netherlands (Holland), Portugal, Spain, Switzerland, and Tunisia. These and other countries including the United States are also members of other agreements for the protection of industrial property. The Madrid Agreement was therefore seen as permitting intensified cooperation of protecting trademarks on an international basis.

Under the Madrid Agreement, the international registration of a trademark could be requested by any resident of a contracting country having its domicile, industrial, or commercial establishment in any other countries of the Union. Prior to obtaining an international registration, the trademark must have been nationally registered in the country of origin of the application. The application for international registration was filed with the applicant’s local trademark administering body who then transmitted it to the World Intellectual Property Organization International Bureau for the Protection of Industrial Property in Switzerland. The application was presented on a form prescribed by the regulations with the goods and services classified according to an established classification scheme.

Once the mark was registered by the International Bureau, notice of the registration was provided to the local trademark administering bodies identified in the request. The local administering bodies of the contracting parties were required to state within one year of the international registration that protection to the trademark in that territory had been refused. The owner/applicant of the trademark could then take whatever action was permitted pursuant to local rule. Once the application was before the local administrative body, the International Bureau could not interfere in the prosecution of that application.

An international registration of a mark was subject to the payment of the required fees. Once registered on the International Register, the trademark would enjoy the same protection in each of the designated countries as if it had been directly registered in that country. An international registration lasted ten years and may have been renewed indefinitely, at ten-year intervals.

There were, of course, special rules regarding enforcement. The protection resulting from the international registration could not be invoked if the mark registered earlier in the country of origin had been declared, in whole or in part, invalid within five years from the date of the international registration.

Basis for the International Application

The protection of a trademark under the Madrid Protocol may be requested after an application for registration of the mark has been filed with the local administering body of a contracting state, or when the mark has been registered with the local administering body. The applicant (or the owner) may, subject to the other provisions of the Protocol, seek protection for the mark in the territories of the contracting parties by filing the registration with the register of the International Bureau of the World Intellectual Property Organization.

The expression "contracting party," includes not only the contracting states, but also any inter-governmental organization in one of the member states, and that organization has a regional office for the purposes of registering marks taking effect in the territory of the organization. In order to obtain protection under the Madrid Protocol, the basic application or basic registration can be filed to obtain not only the contracting state, but also with an inter-governmental organization as defined by the Protocol.

Requirements of the Applicant

In order to file an international application, the applicant must be a national of the contracting state where the priority application was filed or registration occurred. Alternatively, the applicant must be domiciled or have an effective industrial or commercial establishment in the contracting state.

When the original application has been filed with the national office of the contracting state, or where the registration has been granted on the original application by the national office, the owner of that registration or application must similarly be a national of a contracting state, or be domiciled or have a real and effective industrial or commercial establishment in the territory of the contracting state. This rule effectively controls the benefits offered by the international application to those who are involved in commerce with the contracting states.

The Effective International Registration

The international trademark will be protected in the territories of the contracting parties. The Protocol defines the territory of a contracting party, when the contracting party is a state, by the territory of that state, and where the contracting party is an inter-government organization, as the territory in which the constituting treaty of that organization applies. However, the protection afforded by the international registration will extend to any contracting party only at the request of the party who filed the international application or who is the owner of the international registration. Thus, for the international registration to be effective in any particular contracting territory, the applicant must specifically identify the contracting party or territory in the international application. However, it is possible to request the extension of protection to additional contracting states after obtaining the international registration by filing a special request pursuant to the regulations.

The Application Requirements

The international application must be in a form established by the regulations. The originating office will certify the contents in the international application correspond to the contents, at the time of the certification, to those in the original application or registration. The applicant must also identify the goods and services under which protection of the mark is to be claimed pursuant to the international classification. It is possible, under the Protocol, to claim color as a distinctive feature of the mark. In those particular cases, color copies of the mark must be included with the application.

The Examination Refusal

Pursuant to the national legislation of the contracting states, the trademark office of the contracting party that received notice of the international application can refuse protection of the mark. If the international application is refused by the national office, the national office must provide notice of the refusal and the refusal must be based on specific grounds permitted by international convention. The national office is not permitted to refuse an application, even partially, because local legislation permits registration only on a limited number of classes or for a limited number of goods or services.

Any local trademark office wishing to refuse an international application must notify the International Bureau of the refusal, along with the statement of the grounds for refusal, within the period prescribed by the law applicable to the national office. At the very latest, the Protocol states that notice of refusal must be provided within one year of the date the notification of the extension of international protection was sent to the national office by the Bureau. However, the contracting state may declare the time limit for refusals to be increased to 18 months under the broad authority provided under the Protocol to establish independent rules. In those countries where trademark oppositions are possible, the 18-month deadline is extendable as well.

Once a notice of refusal is received by the International Bureau, the International Bureau is to send the notification without delay to the owner of the international application. The owner/applicant of the international application will then have the same recourse to respond to the refusal as if the application had been filed directly in that contracting party country.

The International Registration

The international registration will bear the date the international application was received by the national originating office, as long as the international application was received by the Bureau within two months of the filing date of the application in the national office. If not, the international registration will bear the date the application was effectively received by the Bureau. The Bureau will immediately notify the designated offices concerned of the international application. Thereafter, on a regular periodic basis, the International Bureau will publish the international applications so the public may have an opportunity to protest where such is available in the contracting states.

Fees

The national office originating the application may fix the fees for the filing of the application or the renewal of the international registration. Registration of a mark with the International Bureau is also subject to an advance payment of an international fee which includes a basic fee, a supplementary fee for each class of the international classification beyond three and a complementary fee for any request for extension of protection available under the rules.

The Effects of the National Registration

The protection afforded the international trademark of each of the concerned contracting states will be the same as if the trademark had been filed directly with the office of each contracting party. The classification of goods and services and the scope afforded by those classifications will be determined by the contracting parties as if the application was originally filed in each of those contracting states independently. Where a mark registered with the national office of a contracting party is also the subject of an international registration and both registrations stand in the name of the same owner/applicant, the international registration will replace the national or regional registration so long as the goods and services included in the national or regional registration are included as part of the international registration. This implies that where the goods and services of the nationally registered mark are not included within the description of goods and services in the international registration, the international registration will not be deemed to replace the national or regional registration.

The Enforcement

The registration of the mark with the International Bureau is valid for ten years and is renewable at ten-year intervals. At the end of the fifth year from the date of the international registration, the registration becomes independent of the national application or registration. If before the end of the fifth year from the date of the international registration, the basic application or registration lapses, has been withdrawn, renounced or been the subject of a final decision of rejection or invalidation, whether with respect to some or all of the goods and services listed in the registration, the protection accorded by the international registration will no longer be available.

Converting an International Registration into a National or Regional Application

In the event that all or some of the classifications of goods or services are canceled in the international registration, the owner may file within three months of the cancellation an application to register the same mark with the national office of one of the contracting states as if it had been filed with the date of the international registration or of its extension to the particular country. However, there are several conditions for the conversion which are beyond the scope of this paper. Additional information is available from the author on this topic.

Renewal

Any international registration may be renewed for a period of ten years by the payment of the specified fee and any supplementary and complementary fees required by statute. The renewal may not change the international registration from its original form. A grace period of six months is permitted by rule to renew an international registration. Thereafter, if no renewal occurs, the international registration will lapse.

Change in Ownership

As with national registrations, the Bureau will record in the International Register any change in ownership of the registration upon the filing of the appropriate documents. However, the new owner must be a person who, under the rules, is entitled to file international applications as set forth above.

Conclusion

The acceptance and accession of the United States to the Madrid Protocol signifies a tremendous step to a truly universal recognition of intellectual property rights. Although the United States has yet to amend its former rules and regulations to be consistent with that of the Madrid Protocol, such is considered merely a formality in the harmonization of intellectual property rights. Clearly, the Protocol affords U.S. applicants significant savings in expanding their markets and protecting their trademarks than previously available under the traditional laws and regulations. At the same time, the Madrid Protocol opens the markets of the United States to foreign-based businesses. This means that businesses in the United States will need to be more vigilant and diligent in protecting their trademark and service mark rights than before in order to avoid any influence from international sources in obtaining trademark protection in this country which may hamper the use of marks in this country.

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