Russky Focus

June 4-10, 2001
Page 26-27

Rospatent sends out invitations to the "Hall of Fame"
Soon we will have a new way to protect brands against piracy

By Tatiana Samoylova

The Government has approved and submitted to the State Duma a Draft on amendments to the law On Trademarks, Service Marks and Appellations of Origin of Goods, which has not been changed since 1992. A joint conference on the subject was held by Alexander Korchagin, the head of Rospatent, and Peter Necarsulmer of CIPR. Korchagin hopes that the revised law, will be adopted by the end of this year. The Rospatent director's confidence stems from the fact that one of the major demands from WTO members was submission of the Draft Law to the State Duma for consideration before the next round of the negotiations on Russia's entrance into the WTO, scheduled for this June. A separate chapter in the Draft is dedicated to the establishment of a new category of trademark, the "well-known trademark." Although the new law would come into force no sooner than in 2002, the Rules of Acknowledgement of Trademarks as Well-Known in the RF, adapted by the patent agency, exist and have been in force since last May. In all that time only three trademarks have achieved the status of "well-known:" Izvestiya (the trademark owner is the editorial staff of Izvestiya), Uralmash (United MachineryConstruction Plants) and Yava (British American Tobacco).

What could be in store for the "well-known"

According to Alexander Korchagin, Head of Rospatent, "no other country in the world has the kind of rules on acknowledgement of trademarks as well-known as the ones existing in Russia." This is true, as in most countries the status of "well-knowness" is brought up only when disputes are brought to trial. Moreover, trademarks can be recognized as well-known even if they are only known in one country. Protection of well-known trademarks is provided by Article 6 "bis" of the Paris Convention. According to its provisions, a well-known trademark enjoys primary protection before other trademarks of identical and similar goods. In other words, the acquisition of "well-known" status in Russia provides the trademark owner with protection for all kinds of goods and services, even if the owner produces something highly specific. For instance, if Microsoft was to prove to Rospatent that its trademarks were well-known, then the St. Petersburg Company 'Professor Solonin' would not have been able to, in its, time produce beer under the name of 'WINDOWS '99.'

The status of well-known, according to most experts, could put an end to the dispute which has been dragging on since the early 90s between the Trading House of the Descendants of P.A. Smirnov and Guinness UDV over the exclusive rights for Smirnovskaya vodka production. The Supreme Patent Chamber is already considering the documents submitted by Guinness UDV just after the relevant rules came into effect. However, Rospatent has chosen to postpone the decision concerning the well-known status of trademarks 'Smirnoff' and 'Pierre Smirnoff' until consideration of all cases of former opponents is finalized by other courts. As soon as the US Company Kodak undergoes the procedure of acknowledgement of its trademark as well-known by the RF patent agency, the rights for the domain name and for any other use of the word Kodak will belong only to Kodak, experts say. However, the company does not cherish any particular hope of gaining this status.

Another continuing story is possible only due to the fact that major manufacturer of technical means and accounting equipment and photo equipment, Canon, still does not have the status of a well-known trademark. The company has registered its trademarks, including even some which have not yet been introduced in Russia (probably just in case). In this situation the opportunity presented itself to to try to annul some of the trademarks, which are not being used. If this attempt were successful, than the initiator of the process could try to register Canon in its name. "At present it is very important to impress on trademark owners the idea that even foreign companies can defend their interests in Russia. However, the statistics show that only one in three foreign companies are using the rules of trademark registration." says Peter Necarsulmer, the president of CIPR.

Misinterpretation

According to the head of Rospatent, the approval of amendments to the Law "On Trademarks" could significantly change the situation. In accordance with the Paris Convention, all countries which participate in the Convention must either decline to register, or disqualify the registration, of any trademark if that trademark already exists somewhere else, and can be shown to be a "well-known trademark." This is, by the way, a rather free interpretation of the Convention's provisions, although it is the interpretation used in Russia. In Europe the question is not in trying to prove that a trademark meets some strict interpretation of "well-known;" it is enough to prove that the trademark in question is "generally known" by consumers in some country. Rumor has it that the confusion surrounding interpretation is the result of a simple error made during translation of the Convention text into Russian.

"Well-known" trademarks, and "worldwide known" trademarks, are protected simply because they are universally known, without resort to specialized registration. It is evident that the use of these trademarks for company's goods could lead to a loss of distinctive characteristics and could ruin the reputation of a worldwide-known trademark. There is no direct international law regulating these trademarks; legal regulation is done through the courts. Thus, the worldwide-known trademark TOSCA, which is famous for perfume, was banned by the court from being used for clothing produced by other companies. The use of the name 'LIFE magazine,' which was widely known, was deemed inadmissible for marking television sets.

Rospatent and CIPR agree, that the next stage of development will inevitably be an avalanche-like submission of applications to Rospatent coming first of all from foreign companies. At present, only six of the thirty-four applications submitted to Rospatent for acknowledgement of trademark as well-known have been from Western copanies. With Western companies administrative regulations are handled in various ways. When submitting an application to the patent agency, the owner of the trademark, even if it is Coca-Cola or McDonald's, must provide convincing evidence that the trademark is well-known. Data on sales, the year's average number of consumers for the product, the area in which the product is distributed, costs, and so on - all of this information must be provided for Rospatent's examination.

There are some definite rules, but they do not say, for example, what the minimum number of consumers should be or what date will begin the acknowledgement of the trademark as well-known. Even in the cases of those companies which seem (from an amateur's point of view) to perfectly obviously be well-known, the preparation of the necessary evidence can be expensive. Experts say that, Coca-Cola will spend approximately $15,000 to register just one of its trademarks. And if Coca-Cola decides to prove in Russia that all of its intellectual property - all trademarks (starting from Fanta to Minute Maid), are well-known, the company could have an enormous sum in the "Total" column.

That is the invitation issued by Rospatent's director to Western companies, will, no doubt, receive a stormy reception. On the one hand, they're virtually being asked to spend money "just in case," to ensure that their brands are not attacked by pirates. The possibility of this attack is great, but not of course one hundred percent. However, foreign companies, especially from countries with the Anglo-Saxon legal system, very often by force of habit do not use special measures of protection, as they are so sure they are in the right because they were there first (which makes no difference in Russia).