Regulations on plain packaging and the effects on trade mark rights
The South African tobacco industry was quick to counter when reports surfaced that South Africa could possibly follow suit in implementing plain packaging legislation following Australia's plain packaging reforms targeted at its tobacco industry. This legislation typically requires cigarette and tobacco products to be sold in identical, prescribed packaging with graphic images of potential side effects of smoking and the brand name displayed in regulated font and size.
Tobacco and cigarette conglomerates may be used to being at the receiving end of censure from governments at this point. Many countries, including South Africa, have already banned most forms of advertising of these products to the public. However, this kind of legislation is considered a first in regulating the form in which the products are packaged and sold to the public.
With various governments indicating that they were likely to jump on this bandwagon, South Africans may soon be faced with graphic images of throat cancer instead of camels or colourful cigarette boxes in stores. In fact, our local government, soon after the developments in Australia, made it clear that it wished to introduce similar laws.
To understand the possible implications of these regulations, consider the very nature and function of a trade mark, namely to act as a badge of origin. When a customer is faced with a brand named product, the brand identifies where the product comes from and to some extent, an inferred assurance of the quality. For registrability, a proposed trade mark must be capable of distinguishing the goods on which it is applied from other goods in the market. Simple trade marks, when not comprised of invented words but rather ordinary English words often struggle to overcome this first hurdle in the registration process. To overcome this, applicants often supplement the mark with visual elements to add distinctiveness. In trade, the visual representation of a trade mark often includes a logo and/or colourful packaging to make the product appealing to the eye. The trade mark then has an advertising function which makes the product marketable in trade.
Registered trade marks that are not distinctive are vulnerable to removal from the Trade Marks records by any interested party. The implementation of plain packaging regulations requiring same colour, font and size of products may threaten the distinctiveness of some registered marks and possibly result in the removal of these marks if all distinctiveness is lost. Additionally, an intention to use a trade mark is an essential requirement for trade mark protection in South Africa and if the registered mark is not used it may be removed. Since the use of brands incorporating logos, colours or any other stylised form would not be allowed in terms of plain packaging regulations, the rights in these trade marks would be tested.
These restrictions will likely also result in the infiltration of counterfeit products in the market. Where product packages are forced to have the same or similar packaging with inconspicuous branding, third parties are bound to push the limits of infringement by copying, making the task of enforcement of rights even more difficult for intellectual property holders.
Intellectual property rights are not absolute rights and may be subjected to reasonable and justifiable limitations. As in Australia, our government may be successful in its promulgation of plain packaging regulations but there is no denying that these restrictions would have a resounding effect on the rights of affected trade mark holders and they would be wise to heed the smoke signals.
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