At the sharp end

As we near the fifth anniversary of the UK’s withdrawal from the EU, tallying the score of the winners and losers is an ongoing exercise.

One for the ‘losers’ pile may be the holders of EU trade marks (EUTMs) which formerly applied to the UK and were subsequently transposed into equivalent, cloned UK trade marks on IP Completion Day (31st December 2020).

Previously, these rights holders would have been able to rely on use across the EU (including the UK) as evidence of genuine use of their marks in answer to a non-use revocation claim. However, from 31st December 2025, that will change. From that date, any use in the 27 EU Member States will be of no value in proving use of the UK cloned marks and, similarly, use in the UK will be of no value in proving use of the residual EUTM. The result is that some rights holders have just shy of one year to use it or lose it.

The UK position

A non-use challenge can be an extremely useful weapon for those facing a trade mark infringement claim and wishing to adopt attack as a form of defence. To rebut the challenge, the rights holders must show ‘genuine’ use within a period of five years, per the terms of s46 of the Trade Marks Act 1994 (the Act). The relevant period is either five years from the date of registration or any subsequent uninterrupted period of five years within which use is suspended. A non-use challenge forces the holder of the mark to show evidence of genuine use in each class to avoid losing the mark (or part of it). The fact that the party seeking revocation need not show title or interest, nor evidence in support of the claim, puts immense pressure on the rights holder and can instantly turn the tables of a dispute.

As well as providing an effective tool, s46 achieves an important public policy objective. The possibility of non-use claims deter ‘squatting’ on valuable but unused marks and the ongoing protection of marks that have fallen out of favour.

“Some rights holders have just shy of one year to use it or lose it”

So far as the requirement for ‘genuine’ use is concerned, only actual commercial use of the mark in its essential trade mark function as a badge of origin will be considered genuine. The leading case in both the UK and the EU on what constitutes genuine use is the 2003 case of Ansul BV v Ajax Brandbeveiliging BV.1 In that case, it was established by the ECJ that, while preparatory and/or purely internal use of the mark will not be genuine, promotional/advertorial use of the mark could be sufficient, provided it can be shown that the mark is being used to “create or preserve an outlet for the goods/services”. The Court in Ansul also warned that establishing whether use is genuine will turn on the facts and circumstances of each case, an approach which has been strictly followed by the UK courts. ‘Sham’ use, of course, will not be genuine in any circumstance.

Use must also relate to the goods or services for which the mark was registered. Use in relation to only some of the goods and services registered against the mark could result in partial revocation. The use must also be of the mark itself, or at least a variation thereof which does not alter the distinctive character of the mark in the form in which it was registered.

The EU position

Owners of an EUTM are, of course, protected across all of the now 27 EU Member States. Like UK trade marks, EUTMs can be revoked where they are not put to genuine use within five years of registration (as per Article 58 of the EU Trade Mark Regulation). To gain the protection, they do not have to show genuine use in all the Member States in which the mark is registered. Instead, the use must be sufficient to establish and maintain a real presence on the market in question in order to be considered genuine. As such, provided it is substantial enough, use in one significant Member State could even be enough to establish genuine use throughout the whole EU. In Now Wireless Ltd v OHIM – Starbucks (HK) Ltd, genuine use of the mark in London and the Thames Valley was sufficient for EU-wide protection.2 More recently, the EU Appeal Board confirmed in Toroverde v Torotapas that genuine use of the mark in relation to two restaurants, each in a small town in Spain, conferred protection throughout the EU.3 It appears less likely that single use on a sweet shop in Malta would be sufficient to demonstrate EU-wide use.

Effect of Brexit

As a result of Brexit, from 1st January 2021 (the day after IP Completion Day), EUTMs no longer apply to the UK. Instead, a new Schedule to the Act introduced a comparable UK trade mark for any EUTM which had previously applied to the UK (Schedule 2A, s1(1)). The amendments also sought to provide some certainty for rights holders who previously might have sought to rely on genuine use in another Member State for protection of their mark in the UK. Section 8(3) of Schedule 2A provides that:

 “(3) Where IP completion day falls within the five-year period, in respect of that part of the five-year period which falls before IP completion day

(a) the references in sections 11A(3) and (insofar as they relate to use of a trade mark) 46 to a trade mark, are to be treated as references to the corresponding EUTM; and

(b) the references in sections 11A and 46 to the United Kingdom include the European Union.”

 The practical effect of this is that any holder of a new comparable mark can rely on its use of the mark in the EU before IP Completion Day as part of the five-year period and avoid revocation. Use of the mark in the UK has not been necessary. However, the protection of this transitional provision will end completely on 31st December 2025, leaving EU-based rights holders in a race to put their mark to genuine use in the UK.

Establishing genuine use

So, what can brand owners do to establish genuine use in the UK (or the EU) before time runs out?

Proof of commercial sales of the product to which the mark has been applied will be convincing evidence. There is no minimum number of sales necessary for the use to be genuine. In the case of La Mer,4 the sale of around £800 worth of cosmetic stock by a French company to a single party in Scotland was sufficient to establish genuine use. It would, however, be foolhardy to rely on such minimal use, given that each case will turn on its own facts. For example, in the EU case of Reber,5 small but consistent commercial sales of confectionery in a small area of Germany over a period of four years was not held to be sufficient, genuine use when compared to the rest of the German confectionery market. Instead, the focus should be on demonstrating that the mark has been utilised to try to create an ‘outlet’ for the goods/services on the market. For this reason, if only evidence of minor sales can be provided, evidence of why such sales are significant in establishing the mark in the UK should also be given.

“The UK Government’s move to ‘take back control’ has left some brand owners in a position where they will have to actively take control of their UK trade marks.”

This concept of use of the trade mark as an ‘outlet’ for the goods/services also means that promotional-only use of the mark might be enough to establish genuine use. Again, for this to be sufficient, the promotional material must clearly be commercial in nature and directed at creating and/or maintaining the market share for the product/service (see Johnny Rockets).6 However, as demonstrated fairly recently in the Irish McDonalds7 case, where promotional use alone is being relied upon, evidence of the geographical extent, quantity, frequency and duration of any such promotional use will also be expected.

Use that does not actually occur in, but is directed at, the UK may also be sufficient. A good example of this is the Elle Trade Marks case,8 which related to advertisements of Elle’s products in a French magazine. The magazine was available for sale in the UK. The products themselves could be purchased in Paris or over the phone. This was deemed to be sufficient. Translating this to our less quaint times and how online use of the mark might be deemed genuine, merely being able to access a website bearing the mark in the UK will not be enough. There must be evidence that the site is specifically targeting the UK market in relation to the products and/or services for which the mark is registered. Evidence of targeting could be offering prices in pounds sterling, information regarding delivery of products/services to the UK and endorsements which are clearly aimed at a UK audience.

Rights holder strategy

The UK Government’s move to “take back control” has left some brand owners in a position where they will have to actively take control of their UK trade marks. While there is no “oven ready” solution for owners of the new equivalent UK mark, the key recommendation for such owners should be to move swiftly, if they have not already done so. Those likely to be affected should form a strategy for real commercial activity in the UK (or the EU) before the end of 2025. Ideally, this should include targeted promotion towards the UK market in addition to sales.

Close thought ought to be given to the scope of the specification to ensure that the planned use corresponds with its terms. Rights holders should also retain all relevant evidence of the scale, frequency, cost and geographic scope of this commercial activity. Where sales are not significant, rights holders should be ready to demonstrate why those sales are still important to establish the product in the market.

This article was first published in the March/April 2025 issue of CITMA Review, the journal of the Chartered Institute of Trade Mark Attorneys (CITMA). For more information on CITMA, please visit citma.org.uk.

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