January 2003

Trade Mark Overhaul on Track in Russia

Major changes to trade mark protection in Russia could be in place early in the new year, after the Duma approved amendments to the country's 1992 Trade Marks Law in a second reading.

The third reading - which should be a formality - is expected by the end of November. The legislation then has to be approved by the Senate and signed into law by President Putin.

The amendments strengthen trade mark rights in the country. In particular, they provide for the destruction of infringing goods and include a clear definition of what makes a counterfeit. Under the existing law, it is hard to prove damages but following the amendments trade mark owners will be able to claim damages equivalent to between 1,000 and 5,000 salaries.

Under the amendments, "well-known" marks can be protected across all classes, in line with Article 16.3 of TRIPs, and it will be possible to register trade marks which have acquired distinctiveness. Marks not used for three years can be cancelled. Another amendment will ban pirates from using third parties' trade marks as domain names.

The latest amendments complement reforms to the unfair competition law, passed on October 12, which extend competition regulations to IP.

The unfair competition law has already been tested. In late October, the Anti-Trust Ministry, at the request of Nestle, ordered Novokuznetsk Frozen Foods Company to stop using the Mega trade mark for ice cream. But, until the trade mark amendments are implemented, Rospatent cannot cancel the trade mark registration.

Eugene Arievich, a partner of Baker & McKenzie in Moscow, says the reforms are good news for rights owners: "The Russian government has finally recognized the importance of IP rights, thanks partly to a desire to join the WTO and also to pressure from local manufacturers."

But Arievich adds that brands owners have not got everything they want: "I would like to see the destruction of the means of production as well as the goods themselves." The amendments also follow a European-style approach to appellations of origin, with no priority given to trade marks over geographical indications.

The trade mark amendments were supported by the government, Rospatent, Customs and representatives from industry. Peter Necarsulmer, president of the Coalition for Intellectual Property Rights in Moscow, says:
"It signals a breakthrough for IP rights in Russia."

Alexander Korchagin, director general of Rospatent, urged IP owners to support the Duma in passing the third reading of the amendments, and a separate package of changes to the Copyright Law. "Achieving real IP protection and enforcement in Russia requires that a coalition of government, brand owners, copyright owners and consumers organize to fight for the mutual best interests of all parties."

This article appeared in the magazine "Managing Intellectual Property", on page 10 of
the December-January, 2003 issue. Publisher’s web site: www.legalmediagroup.com

Contact:
James Nurton, Editor
+44 (0) 20 7779 8685
+44 (0) 20 7779 8934 (fax)