Turkey: Constitutional Court Cancels Provision Concerning The Invalidation Of Trademarks Due To Non-Use Thereby Fragilizing Further The Legislative Basis For The Protection Of Patents,Uitility Models, Design Patents, Geographical Indications And Trademark

Last Updated: 28 October 2014
Article by Okan Çan and Mehmet Nazım Aydin Deris

According to a recent decision1 of the Turkish Constitutional Court, the provision of Article 42/c of the Turkish Decree Law no: 556 on trademarks has been cancelled upon a request filed by the 4th Intellectual Property Court of Istanbul (IP Court).

The cancelled provision of Article 42/c regulated the issue of invalidity due to non-use and read as follows;

A registered trademark shall be declared invalid by the court in following cases: [... ...] c) where in breach of Article 14, (However, serious use between the date of instituting of the proceedings and the expiry of five years shall not constitute a ground for invalidity. If use has been made upon realization that proceedings are to be instituted, in such a case the court shall not take into consideration the use that took place within three months prior of the institution of the proceedings)

The action before the constitutional court was triggered by the 4th IP Court of Istanbul in accordance with Article 152 of the Constitution whereby the Constitutional Court was requested to cancel the provision of Article 42/c for violating Articles 22, 353 and 91/14 of the Constitution mainly on following grounds:

1/- In accordance with the provision of Article 42/c, a registered trademark can be invalidated by the Court and since the invalidity decision has a retroactive effect as per Article 44 of the Decree Law, the registered trademark is declared invalid as from its registration date. The IP Court claimed that the decision should not have a retroactive effect but should be deemed as a cancellation, having effect from the finalization of the cancellation decision, without having a retroactive effect to the registration date. The IP Court claimed that Article 145 of the same Decree Law properly provided the sanction for nonuse to be a cancellation instead of invalidity with retroactive effect.

2/- The second ground for cancelling the provision was that a "registered trademark" consists of a "property right" and that the invalidation/cancellation of a registered trademark on the basis of the Decree Law is destructive of such "property right". The claim of the IP Court was grounded on the fact that "property rights" can be restricted or abolished only on the basis of a legislative Act voted through the Parliament, but not on the basis of a Decree law, which is an Act of the Council of Ministers.

The Constitutional Court, favorably considering the IP Court's request and grounds for cancellation, decided to cancel the provision of Art 42/c for violating the constitution. In its reasoned decision, the Constitutional Court states that a trademark right consists of a "property right" protected as of Article 35 (property rights) of the Constitution and that Article 91 of the Constitution prohibits the restriction/abolishment of a "Property Right" on the basis of a Decree Law. The Constitutional Court, having based its motivation on the aforementioned main grounds, did not address the other grounds of cancellation put forward by the IP Court.

The decision, by cancelling the provision of Article 42/c of the Decree Law no. 556 concerning the invalidity due to non-use is causing hesitation and uncertainty in regard to claiming cancellation/invalidity of a trademark where the trademark has not been put to use for the past 5 years as of its registration date. Although the Constitutional Court's decision cancelled the provision regarding the invalidation, we continue to believe that the cancellation (but not invalidation) can still be claimed in accordance with Article 14 of the Decree Law No: 556, which has not been affected by the Constitutional Court's decision. However, it should be noted that the cancellation decision to be rendered by the Courts on the basis of Article 14 of Decree-Law No: 556 will not have a retroactive effect to the registration date.

The Constitutional Court has previously issued other decisions declaring unconstitutional the provisions of Articles 1656 and 1587 of the Decree Law No: 551 on Patents and Utility Models which are reasoned exactly on the same grounds: [that patent rights/utility models are "property rights"] that Article 91 of the Constitution provides that the restriction/abolishment of a "property right" can be made solely on the basis of an Act of Parliament and that a Decree Law can therefore not constitute the basis for restricting/abolishing a "property right" such as a Patent or Utility Models.

The Constitutional Court has rendered a decision8on declaring unconstitutional and cancelling the Additional Article 2 of the Copyright Act No: 5846, as amended by Law No: 4630 dated 21/02/2001, on the ground that it violates Article 35 of the constitution on "property rights"

By another decision9 in 2008, the Constitutional Court also cancelled criminal provisions and sanctions provided in Decree-Law no. 556 on trademarks on the grounds that the definition of offences and of the criminal sanctions need to be regulated by an Act and not by a Decree-Law, as per the general principle of criminal law i.e. "Nullum crimen sine lege". A new Act No. 5833 replacing the cancelled provisions of the Decree-Law pertaining to Trademarks only entered into force on 28 January 2009 and the trademark right holders gained the right to ask for the conviction of new trademark infringements committed after 28 January 2009 according to the new Act No 5833.

By declaring them unconstitutional and cancelling some provisions of the Decree Law No 551 on Patents and Utility Models, of the Decree Law No: 556 on trademarks and of the Copyright Act. No: 5846, successive decisions of the Constitutional Court fragilize the legislative basis for the protection of patents, utility models, design patents, geographical indications and trademarks as the Decree-Laws No: 551, 554, 555 and 556 regulating them contain several provisions which may lead to the restriction/abolishment of the "property right" based on them. The combined effects of these decisions obviously bring forward the debate concerning the validity and enforceability of the provisions of the Decree Laws No: 556 for trademarks, Decree Law No: 551 for patents and Utility Models, Decree Law

No: 554 for Industrial Designs and Decree Law No: 555 for Geographical Indications, as any attempt for either partial or total invalidation/cancellation of the IP rights regulated on the basis of these Decree Laws can be objected and questioned in light of the above referenced precedent decisions of the Constitutional Court during the court proceedings. Such a possibility is obviously causing serious legal uncertainty with respect to the enforceability of Turkish patents, Utility Models, design patents, trademarks and geographical indications on the basis of the current legislation regulating them, which mainly consists of Decree Laws. The draft of the Act which is waiting before the Parliament to be enacted, aims to partially amend the provisions of the existing Decree Laws rather than to replace them with a new Act. The partial amendments are not likely to prevent the non-amended provisions of the Decree Laws from being challenged as unconstitutional. Therefore, in order to remove any uncertainty concerning the effective enforcement of the Decree Laws currently in force and any further decisions of the Constitutional Court on similar grounds, they need to be replaced in their entirety with new and updated Laws enacted through the Parliament.

Footnotes

1 Case No: 2013/147, Decision No:2014/75, Date:09/04/2014

2 II. Characteristics of the Republic; Article 2: The Republic of Turkey is a democratic, secular and social state governed by the rule of law; bearing in mind the concepts of public peace, national solidarity and justice; respecting human rights; loyal to the nationalism of Atatürk, and based on the fundamental tenets set forth in the Preamble

3 XII. Property Rights; Article 35; Everyone has the right to own and inherit property. These rights may be limited by law in view of public interest. The exercise of the right to own property shall not be in contravention of the public interest

4 E. Authorization to Enact Decrees Having the Force of Law; ARTICLE 91. The Turkish Grand National Assembly may empower the Council of Ministers to issue decrees having the force of law. However, the fundamental rights, individual rights and duties included in the First and Second Chapter of the Second Part of the Constitution and the political rights and duties listed in the Fourth Chapter, cannot be regulated by decrees having the force of law except during periods of martial law and states of emergency.

5 Article 14: If, within a period of five years following the registration, the trademark has not been put to use without a justifiable/legitimate reason or if the use has been suspended during an uninterrupted period of five years, the trademark shall be cancelled.

The following shall be understood to constitute use:

a) Use of the registered mark with differing elements without altering/affecting thereby the distinctive character of the trademark,

b) Use of the trademark on goods or their packaging solely for exportation purposes,

c) Use of the trademark with the consent of the proprietor,

d) Importation of the goods carrying the trademark.

6 Case No. 2001/1, Decision 2004/36, Date 23/03/2004, Action triggered by the 1st Commercial Court of Bursa for the cancellation of the provision of Article 165 parag. 3 of the Decree Law No: 551 on Patents and Utility Models

7 Case No. 2013/100, Decision 2014/14, Date 29/01/2014, Action triggered by the request of the 4th IP Court of Ankara for the cancellation of the provision of Article 158 parag 2 of the Decree Law No: 551 on Patents and Utility Models

8 Case No: 2010/73, Decision 2011/176, Date 29/11/2011, Action triggered by the 4th IP Court of Istanbul for the cancellation of the provision of Article Additional Article 2 of the copyright Act No: 5846 as amended by Law No: 4630 dated 21/02/2011

9 Case No. 2005/15, Decision 2008/2, Date 31/01/2008

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