Commersant

May 31, 2001
Page 4

Foreigners Don't Have Enough Money to Pay to be called "Well-Known"

By Dmitry Dobrov

At a press conference yesterday, the director of Rospatent, Mr. Alexander Korchagin, discussed a draft of amendments to the Law on Trademarks, passed to the State Duma by the Government of the Russian Federation two weeks ago. He paid special attention to the issue of "well-known" trademarks. According to Mr. Korchagin, the number of applications from foreign companies for recognition of their trademarks as well-known, should grow significantly after adoption of this law. However, reality can be less optimistic.

The issue of recognition of trademarks as well-known (i.e. protected in all classes without registration) has long been under discussion both in the government and among companies who hold ownership over trademarks. Since 1967 Russia has been a member of the Paris Convention, whose members are obliged "to cancel or to recognize as not valid registration of the trademark, representing a reproduction, imitation or translation of another trademark that … is already well-known."

However, until recently, we did not have a legislative base and mechanism for recognition of a trademark as well-known. This provided an opportunity for Russian entrepreneurs to do some things that may seem unbelievable from the standpoint of Western patent law. For example, producing a fermented brew with the name "Windows 99," taking advantage of the fact that the trademark "Windows" was not registered in the category "beer."

Last year, Rospatent published the Rules of Recognition of the Trademark as Well-Known, describing the procedure for recognition of a trademark as well-known, and the criteria to help establish the status of "well-know trademark." Since then, only three trademarks have been recognized as well-known in our country - "Izvestiya" (the owner is the editorial house "Izvestiya"), "Uralmash" ("United Machine-Building Plants") and "Yava" (BAT). In addition, of 34 applications for recognition of trademarks as well-known received by the Supreme Patent Chamber, only six of them were filed by Western companies. To put it a different way, foreigners are in no hurry to spend their time and money protecting their property.

According to the Rospatent director, this situation can be changed by adoption of amendments to the Law on Trademarks, describing in detail the mechanism of recognition of a trademark as well-known (a whole article in the new document deals only with this issue). Legislative consolidation of this procedure, according to Mr. Korchagin, should improve the situation. "There is no other Law on Trademarks, which provides such detailed description," said Mr. Korchagin, and invited Western trademark owners to be more active in filing applications.

However, we should not expect an avalanche-like increase of the number of filed applications. In Western countries, recognition of a well-known trademark is established by a court when settling a conflict concerning some concrete dispute. In our country, the recognition that a trademark is well-known is established by an administrative order in accordance with an application submitted to the Supreme Patent Chamber. To do this, foreign companies are encouraged to take preventive measures to protect their intellectual property, and to pay a significant amount of money to gather proof of well-knowness of their trademark and for the application itself. It appears that many companies do not agree with the necessity for such expenditures. Further, according to Evgeny Arievich (Baker & McKenzie) the potential applicants are scared off by extremely strict criteria for recognition of a trademark as well-known (results of sociological polls, reports on sales volume, and areas of distribution).

Mr. Korchagin categorically rejects these complaints. According to him, application to the Supreme Patent Chamber would cost less than future lawsuits, and the criteria for recognition as well-known completely corresponds to Western standards. The degree to which Rospatent Head's hopes are grounded, will become clear by the end of this year, when the Duma should approve the draft Amendments.