Canada: To Play or Not to Play the Waiting Game – That is the Question: Implementing a Filing Strategy before the Canadian Trademark System Becomes Useless

Canadian trademark law and practice is in a state of limbo, caught between the current regime where use is the bedrock of registration, and a new regime where use will no longer be required to obtain registration. Reaction to changes to the Trade-marks Act brought about by Bill C-31, Canada's Economic Action Plan 2014 Act, No. 1, hasbeen mixed. Some view the changes as the crumbling of the foundations of Canadian trademark law, while others, particularly applicants with diverse product/service offerings, are excited about the upcoming changes to the Act, and eagerly await early 2019 (the current expected coming into force or CIF date) to implement new filing and prosecution strategies.

Under the current trademark system, trademark applications can be filed on one or more of the following bases: (1) use in Canada; (2) proposed use in Canada; (3) use and registration abroad; and (4) making known in Canada. Under the new regime, a trademark application may be filed if the applicant is using or proposes to use, and is entitled to use, the mark in Canada, with seemingly no requirement that an application contain any information regarding use or entitlement. As such, it may seem tempting to wait until the CIF date to file new broad applications, but there are opportunities to be had now, and filing strategies can be implemented without delay.

Consider Filing before the CIF Date

Regardless of when it is obtained, there are benefits to owning a valid Canadian trademark registration, including: the ability to sue for trademark infringement and depreciation of goodwill; providing a defence to a third party challenge to use of the mark; satisfying the "Canadian Presence Requirements" for registration of a corresponding '.ca' domain name; and circumventing French translation requirements under the Charter of the French Language, since registered trademarks are an exception to the general rule that all printed material used in commerce in Quebec (including packaging, labels, commercial publications, advertising and public signage) be in French. By filing now, applicants will enjoy significantly earlier rights than those who wait until after the CIF.

Government Fees

By filing prior to the CIF date, beyond beating the potential influx of applications expected after the CIF date, applicants can file for any number of classes of goods and services for a single government filing fee of CDN $250. The proposed filing fees following the CIF date are CDN $330 for the first class of goods or services, and CDN $100 for each additional class. Applicants who file now can file broadly, covering all goods and/or services they may propose to use the mark in association with, without incurring additional class fees.

Declarations of Use

Until the CIF date, there is still a requirement to file a Declaration of Use in connection with applications filed on the basis of proposed use in Canada and to pay a registration fee prior to obtaining registration. However, provided that the CIF date is not significantly pushed back, by the time applications filed now are allowed, Declarations of Use will, or will shortly (well within the permissible timeframe for obtaining extensions to file the Declaration of Use), no longer be required, and the registration will issue for all of the goods and/or services covered by the application. Applicants should remember, however, that the mark must be used within three years of registration, failing which it may become vulnerable to cancellation for non-use, if a third party or the Registrar raises a challenge to use.

Distinctiveness

CIPO currently only examines new trademark applications substantively for specific enumerated grounds of entitlement and registrability. Following the CIF date, CIPO will also examine for distinctiveness. If examiners are not satisfied of the distinctiveness of an applied-for mark, they may request evidence of distinctiveness in Canada. It is not yet clear on what criteria distinctiveness will be assessed, nor the type or extent of evidence that will be required to establish distinctiveness. It may be that marks routinely accepted by CIPO under the current trademark regime, such as letters, numbers and graphic symbols, may no longer be approved without demonstrating distinctiveness. If applicants are interested in such marks, they may wish to consider filing these marks prior to the CIF date, in order to avoid examination for distinctiveness, and the potential uncertainty and expense that may accompany it.

Be Prepared for Madrid Filings

As of the CIF date, Canada will become a member of the Madrid Protocol. This will permit Canadian applicants to seek international registrations for their trademarks, as opposed to filing separately in each country or region of interest. It will also permit foreign applicants to designate Canada under their international applications/registrations, as opposed to filing separately for trademark protection in Canada. It is anticipated that this streamlining of protection will lead to more filings in Canada following the CIF date, particularly when coupled with the dispensation of use as a requirement for registration.

Canadian applicants wishing to file international applications will need domestic applications or registrations on which to base their international filings. Now is a good time to consider whether such applications/registrations are in place so they are in a position to take advantage of the Madrid Protocol as soon as it is implemented.

Foreign applicants should also review their protection in Canada and determine whether there are any steps they should be taking now to ensure that the anticipated increase in filings does not interfere with their rights in Canada.

Provide Nice Classification

Any applications filed after the CIF date must identify goods and services not only in ordinary commercial terms, but also grouped by class and identifying the class number.

Classification is not mandatory under the current trademark regime, but the Canadian Intellectual Property Office ("CIPO") encourages voluntary classification. Even though it is not required at the moment, all pending applications and existing registrations will eventually have to be classified following the CIF date. For pending applications, this could delay the registration process. As such, it is advisable for applicants to include classes in applications filed prior to the CIF date in order to avoid the expense and hassle of doing so later.

Consider Renewing Early

The registration and renewal term in Canada is currently 15 years. The term will change to 10 years following the CIF date. CIPO has indicated that even if a registration is renewed before the CIF date, if the renewal deadline falls after the CIF date, a new certificate of renewal will be issued following coming into force, clarifying that the term is 10 years as opposed to 15 years.

Although early renewal will not result in the longer 15-year term, there may be a cost benefit to renewing prior to the CIF date. The current government fees for renewal are CDN $350, regardless of the number of classes and goods/services. After the CIF date, renewal fees will be calculated on a per class basis (draft Regulations suggest renewal fees will be CDN $400 for the first class and CDN $125 for each additional class). Unlike the proposed claw back in the length of renewal term, it does not appear that CIPO intends to require the additional renewal fees for marks renewed prior to the CIF date but not actually due for renewal until after coming into force.

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Currently, CIPO will not consider correspondence from third parties (meaning any party other than the applicant or its agent) relating to a pending application. As such, there is no way for a third party to draw CIPO's attention to its trademark rights in an attempt to elicit an objection based on confusion or non-entitlement. Third party trademark owners must wait until an application is advertised for opposition to assert their rights. Following the CIF date, CIPO will accept correspondence from third parties during prosecution.

With the dispensation of use as a requirement for registration, policing of the Register will fall to a greater extent on trademark owners, and so trademark owners should consider extending the focus of watch services to cover pending applications, not just advertised applications. In this way, they will be aware of confusing marks at a much earlier stage, can voice their concerns to CIPO long before the mark is advertised, and potentially avoid opposition altogether.

Since the new law was passed, there has already been a flood of suspicious trademark filings for applications covering all 45 classes of goods and services. If, as it appears, trademark squatters and trademark trolls are on their way, watch services will become increasingly important.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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Meghan Dillon
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