The challenge for well-known brands in Romania
Published in Intellectual Asset Management, 2006
In the early 1990s, having emerged from behind the Iron Curtain, Romanian entrepreneurs visiting western Europe or the United States of America returned home carrying not only Marlboro cigarette boxes and Coca-Cola bottles, but also a strong residual memory of the famous brands advertised or otherwise seen in those countries. At that time, most of the brands that were famous in such countries, although iconic to consumers in the entire geographical region, did not mean much to Romanian consumers.
This is how brands such as Starbucks, Beefeater, Gap, Burger King, Hyat (yes, only one t), Taco Bell and Domino’s Pizza came to have more than their fame and value in common: all were Romanian trademarks which were not held by their rightful owners. After long and painful litigation all were transferred in the end, but the problem remains a thorny one for a number of reasons that will be outlined in this article.
Theoretically, the Romanian legislative framework concerning intellectual property is quite capable of dealing with the matter of the well-known trademarks. Romania is a long-time member of the Paris Convention for the Protection of Intellectual Property; and article 6 bis of the Convention obliges member states to “refuse or to cancel the registration, and to prohibit the use, of a trademark which constitutes a reproduction, an imitation, or a translation, liable to create confusion, of a mark considered by the competent authority of the country of registration or use to be well known in that country as being already the mark of a person entitled to the benefits of this Convention and used for identical or similar goods”. The provisions of article 6 bis are also to be applied “when the essential part of the mark constitutes a reproduction of any such well-known mark or an imitation liable to create confusion therewith”.
Romania is also a party to TRIPs, which makes the provisions of articles 16 (2) and (3) applicable in the country. Article 16(2) and (3) represent a development and improvement to article 6 bis of the Paris Convention, providing that “In determining whether a trademark is well-known, members shall take account of the knowledge of the trademark in the relevant sector of the public, including knowledge in the member concerned,which has been obtained as a result of the promotion of the trademark.” and “Article 6 bis of the Paris Convention (1967) shall apply, mutatis mutandis, to goods or services which are not similar to those in respect of which a trademark is registered, provided that use of that trademark in relation to those goods or services would indicate a connection between those goods or services and the owner of the registered trademark and provided that the interests of the owner of the registered trademark are likely to be damaged by such use.”
In 1998 Romania enacted Law 84/1998 concerning trademarks and geographical indications (Trademark Law) and Government Decision 833/1998 for approval of the regulations concerning the Trademark Law (Regulation) that introduced into domestic legislation the concept of the “notorious trademark” (despite secondary connotations this should be read as the well-known trademark and will be used as such in the below for reasons of consistency).
The well-known trademark is defined at article 3 of the Trademark Law as a mark that is well known in Romania on the date on which an application for a trademark registration is filed or on the priority date claimed in such application. In order to determine whether a mark is well-known, account shall be taken of the reputation of such mark in that section of the public concerned by the goods or services to which the mark applies, “without it being necessary for the mark to have been registered or used in Romania”.
The legal grounds for opposition and eventual legal action based on senior wellknown trademarks are indicated by Article 6. This provides that a trademark shall be refused registration where it: is identical or similar to a mark that is well known in Romania for goods or services that are identical or similar on the date of the filing of the application for registration of the mark; or is identical or similar to a mark that is well-known in Romania for goods or services which are not similar to those to which the mark applies and for which registration is requested, and where use of the latter without due cause could take unfair advantage of the distinctive character or the repute of the well-known mark or where such use could cause prejudice to the owner of the well-known mark.
All of this was fine, until a few paragraphs on in the Trademark Law. Then article 20 explains what criteria are to be considered when determining the well-known character of a trademark:
- The degree of distinctiveness, initial or acquired, of the well-known mark in Romania.
- The duration and scope of use of the well-known mark in Romania with respect to the goods and services referred to in the application for registration.
- The duration and scope of publicity for the well-known mark in Romania.
- The geographical area of use of the wellknown mark in Romania.
- The degree of recognition of the wellknown mark in the Romanian market by the sector of the public to which it is addressed.
- The existence of identical or similar marks for identical or similar goods or services belonging to a person other than the person who claims his mark is well known.
Further on, it states that when establishing and submitting evidence to a Romanian court or to the Romanian State Office for Inventions and Trademarks (SOIT) that a mark is well known, one should consider:
- The targeted public – this is to be interpreted as the category of potential consumers targeted by the products or services to which the trademark will be applied (identification of potential consumers is to be made based on groups of consumers of certain products or services in relation to which the trademark is used and not on groups of consumers of a general category of products or services; for example, margarine v alimentary product, cigars v. tobacco products, etc).
- Distribution – this is to be interpreted as the channels of distribution of products and services to which the trademark is applied (depending on the nature of such products and services account should be taken of the particular specialists dealing with the products and services as well as of the business circles dealing with the same or similar type of products and services).
Moreover, when explaining in the criteria more depth, the Regulation clearly indicates that to estimate whether a mark is notorious or not, it is sufficient that this mark be well known in the territory of Romania and for the segment of the public from Romania at which the goods and services represented by the mark are targeted.
As one can easily observe, all the appreciations are to be made strictly in relation with the national territory of Romania. The Trademark Law and Regulation add to the confusion when providing guidance on how the term “geographical area” is to be interpreted: “Knowledge in the territory of Romania of the mark whose protection is claimed as a matter of common knowledge and, even outside this territory, when the mark is used in immediate neighbouring territories, in neighbouring territories wherein Romanian is spoken, in the territories covered by the same mass media or in neighbouring territories with which there are close trade relations.” The practice of both Romanian courts and the SOIT was, therefore, to follow territoriality as a requirement to prove use.
One year after the Romanian Trademark Law was passed, the General Assembly of the World Intellectual Property Organisation and the Assembly of the Paris Union for the Protection of Industrial Property (Romania is a member of both) adopted the Joint Recommendation Concerning Provisions on the Protection of Well-Known Marks (Joint Recommendation).
The Joint Recommendation made it clear that when assessing well-known character, a series of factors shall not be a requirement: use, application or registration in the state concerned; recognition as well-known; application or registration in any other member state; and recognition as well-known by the public at large.
In addition, the Joint Recommendation specifies that bad-faith may be considered as one factor among others in assessing competing interests (application or mark v allegedly well-known trademark), and that provisions referring to the conflict with a well-known trademark should extend to business identifiers and domain names.
The reality in court
Despite the above clarification brought by the Joint Recommendation, when confronted with a classic scenario of well-known trademark hijacking (such as, a Romanian trademark similar or identical with a trademark considered well-known internationally, but which is not registered or used in Romania, is filed or used in Romania), the Romanian courts and the SOIT have raised a series of problems that are still under debate:
- Interpretation of the territoriality principle – currently appreciation of the well-known character is made in direct relation to Romanian territory.
- Bad-faith of the applicant – good-faith is a general principle of the Romanian legislative system and the burden of proof in bad-faith scenarios should be consistently elaborated (the simple question: “How can one invent an identical trademark to my well-known trademark?”, was not found sufficient).
- Conflicts with business identifiers and domain names – the practice and interpretation of courts totally depends on how rights are used by the holders (for example, with respect to an eventual conflict between a corporate name and a well-known trademark if such name is not used as a trademark, the court would probably dismiss the case from the start).
- Recognition among the relevant segment of the public – no definitive conclusion has been reached or guidance rendered as to the meaning and required degree of recognition in the “significant part of public”. Nevertheless, of late, Romanian judges have become inclined to accept from the parties in dispute market studies, surveys and expert opinions with respect to the degree of recognition and to the association/confusion of the public, when it is possible to profit from the reputation of a well-known trademark, or to order third-party experts (appointed by the courts) to produce them.
No hard and fast Romanian rules generally applying to well-known brand owners can be drawn from the above. Nevertheless, the hope of the authors is that this article has managed to explain some of the pitfalls and may help owners of well-known and famous brands in taking action against developments that may seriously damage their most valued intangible assets.