Canada: Harmonization Of Canadian Trademark Laws Allows For Internationalization Of Brands

Canadian trademark laws are poised to undergo significant changes that will result in greater harmonization of the Canadian trademark regime with those of many countries around the world. The changes come as a result of i) legislation passed in 2014 which amends the Trademarks Act  and will be coming into force on June 17, 2019; ii) further amendments to Canadian trademark legislation that have recently been introduced and are also likely to come into force in 2019; and iii) the US – Mexico – Canada trade agreement between Canada, the United States and Mexico (the "USMCA") which was recently signed by the three countries and is intended to replace the current North American Free Trade Agreement ("NAFTA"). These changes will facilitate the internationalization of brands as trademark owners will be able to more easily pursue international trademark registrations and Canada's trademark process and requirements will be more in line with those in numerous other jurisdictions.

i) Canadian Trademarks Act  Amendments

It was recently announced that the amendments to Canada's trademark legislation, which were passed in 2014, will come into force on June 17, 2019.  These legislative amendments are the most significant alteration of Canada's trademark laws since 1954 and are designed to enable ratification and implementation of international treaties relating to trademarks, particularly the Singapore Treaty, the Madrid Protocol and the Nice Agreement. The amendments are also aimed at modernizing and harmonizing Canadian trademark practice and procedures with those of numerous other jurisdictions around the world, particularly in the UK and the European Union. 

Some of the key changes that will come into force on June 17, 2019 that trademark owners should be aware of and consider in developing their current and ongoing intellectual property protection strategy include:

1. Trademark applications will not have to include dates of first use and the filing of a declaration of use or certified copy of a foreign registration certificate (for applications with a foreign use and registration claim) will not be required for a mark to proceed to registration.

2. New applications will have to comply with the Nice classification system which classifies all of the goods and services included in an application. Existing registrations will have to be amended to include classified goods and services descriptions when requested by the Canadian Intellectual Property Office ("CIPO") and as part of the renewal process.

3. The definition of a trademark will be significantly expanded and will result in protection of non-traditional trademarks such as colours, scents, tastes and moving images.

4. Trademark registrations issued after June 17, 2019 will be valid for ten (10) years rather than the current fifteen (15 year term and may be renewed within the six (6) months prior to the renewal deadline or the six (6) months after the renewal deadline.  The term for registrations in existence before the coming into force date will remain at fifteen (15) years and will not be converted to a ten (10) year term until the next renewal deadline.

5. Trademark application filing fees will be $330 for the first class, plus $100 for each additional class of goods / services. This is an increase from the current fee of $250 for all goods and services, regardless of the number of classes. The $200 registration fee will be eliminated. The renewal fee will be $400 for the first class, plus $125 for each additional class of goods / services. This is an increase from the current fee of $350 for all goods and services, regardless of the number of classes.

6. Through the Madrid Protocol, the new trademark regime will enable applicants in countries that are also members of the Madrid Protocol to include Canada in their international registrations.

 

ii) Further Trademarks Act Amendments  in Bill C-86

In addition to these changes, the Federal Government announced Canada's Intellectual Property (IP) strategy in April 2018 and has now introduced legislative amendments to implement the strategy. The Budget Implementation Act, 2018, No. 2(Bill C-86) contains proposed amendments which will affect legislation relating to IP, including further amendments to the Trademark Act

Canada's IP Strategy involves a number of initiatives and an investment of $85.3 million over five years to improve awareness of intellectual property by Canadian businesses to encourage creators, entrepreneurs and innovators to participate more actively in the intellectual property system and to actively protect intellectual property through registration in Canada and abroad.  

Bill C-86 was introduced in the House of Commons on October 29, 2018 and, as it is an omnibus bill affecting many pieces of legislation to implement the Budget introduced earlier this year, the timing of its passage is likely to be expedited.

The key changes to the Trademarks Act resulting from Bill C-86 will be:

1.  There will be new grounds of opposition and invalidation based on the bad faith filing of a trademark application. There is no indication as to what constitutes bad faith but the new grounds would likely be used to address applications filed with no intention to use the mark in Canada but rather an intention to benefit financially by assigning the application or registration to the party with a legitimate entitlement to it. 

2. In order to enforce trademark rights within three years after a trademark is registered, it will be necessary to show that the mark was in use in Canada during that three year period in order to successfully bring an action for infringement.

3. Trademark opposition proceedings and section 45 expungement proceedings will be altered to include the use of case management, the elimination of the automatic ability to file evidence on appeal of the outcome of a proceeding, as well as granting the Registrar of Trademarks the authority to order costs and to issue confidentiality orders in relation to evidence that a party requests be kept confidential.

4. Official Marks are unique to Canada and provide a broader scope of protection than regular trademarks. They will continue to be available but the proposed amendments would limit the rights of Official Mark owners in the event that the owner is not a "public authority" entitled to Official Mark protection or no longer exists as the Registrar of Trademarks could, on his or her own initiative or at the request of a party who pays the prescribed fee, give public notice that the mark is not a valid Official Mark.

If Bill C-86 is passed without significant changes, it will address some of the concerns raised in relation to the previous amendments. In particular, the new grounds of opposition and invalidation based on bad faith will alleviate some concern about speculative filings by trademark squatters. The requirement that registrants show use of their marks within the first three years of registration in order to be able to enforce rights in them addresses the concern relating to the elimination of the requirement that trademarks be used in Canada or elsewhere before registration is granted. It appears possible that both the prior amendments and those proposed in Bill C-86 could be proclaimed in force in 2019

iii) Impact of USMCA Trade Agreement on Trademark Regime in Canada

In addition, the USMCA, which has been signed but is still to be finalized and approved, will result in the ability of border enforcement officials to seize counterfeit goods that are in transit through Canada. Currently measures are only available with respect to goods entering and remaining in Canada. The USMCA will also affect changes to geographic indicators.

The plethora of changes seem likely to facilitate the internationalization of brands as Canada will be part of the international trademark system through the Madrid Protocol and Canada's trademark process and requirements will be more similar to those in numerous other jurisdictions.

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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