Netherlands: Domain Name Piracy: Is the Proprietor Powerless?

The domain name Heineken.nl has been pirated. Will brewer Heineken be able to claim back the pirated domain name? Which legal actions will Shell be able to take if a third party (domain name pirate) has registered Shell's trade mark or trade name as a domain name?

The above gives rise to a brief explanation of how an NL-level domain name is acquired in The Netherlands, and on which legal grounds action may be taken against a domain name pirate.

In The Netherlands it is quite easy for a company to acquire a domain name. The Netherlands Internet Domain Name Registration Foundation issues NL-level domain names. This Foundation will only grant the application if the domain name is still available, if it will not cause confusion, if the applicant is a company registered with a Dutch Chamber of Commerce, if an extract from the Register of the Chamber of Commerce has been submitted, and, in case the applicant is a private person, if he will use the domain name to carry on a business or a profession (www.domain-registratie.nl).

For the registration and issuance of domain names, the Foundation applies the "first come, first served" principle. The Foundation is also authorized to reject a domain name if the name contains a general indication and is misleading, for instance because the name suggests an activity that is completely different from the actual activity behind the name (e.g. a soccer club with the domain name "firebrigade.nl") or because the domain name suggests that an entire branch of the economy is represented, whereas the name in reality only represents a part of that branch (e.g. a kiosk with the domain name "bookshop.nl"). A general domain name (such as "hotel.nl") may be granted, however, if it has been demonstrated to the satisfaction of the Foundation that the applicant may reasonably be deemed to represent the specific branch (in this example the hotel branch).

In The Netherlands there are no specific laws addressing the illegal registration of domain names. Case law shows that the Dutch Trade Name Act and the Benelux Trademark Act offer sufficient basis to order a company to transfer an "infringing" domain name to the proprietor of the trade name or trade mark.

In principle the Dutch courts will use the Dutch Trade Name Act and the Benelux Trademark Act to assess whether the use of a domain name infringes the rights of third parties. Use of a domain name may also be qualified as a tort.

Article 1 of the Benelux Trademark Act (BMW) provides that a trademark is an indication which serves to distinguish the goods (or services) of a company. Although a domain name in principle is nothing more than a number which the user has given an alphanumeric designation, practice has shown that domain names have become distinguishing signs. Companies have obviously contributed to this by registering their own trade mark or trade name as a domain name. Furthermore domain names are also used more and more frequently in advertising and other publication materials, so that certain assumptions regarding the identity of the company behind the domain name are created among the public.

The result of this development is that the Dutch courts may qualify the use of a domain name as "use" of a trademark as referred to in the Benelux Trademark Act. The proprietor of the trademark may oppose:

• any commercial use of the trademark for the goods in respect of which the trademark has been registered;
• any commercial use of the trademark or of a similar sign for the goods in respect of which the trademark has been registered, if by that the danger exists that among the public an association is created between the sign and the trademark;
• any commercial use, without due cause, of a trademark that has a reputation in the Benelux territory or of a sign which is identical with or similar thereto in relation to goods which are not similar to those for which the trade mark is registered, if the said use of that trademark or sign may take unfair advantage of, or may be detrimental to, the distinctive character or the reputation of the trade mark;
• any commercial use, without due cause, of a trademark or a sign which is identical with or similar thereto other than to distinguish goods, if the said use of that trademark or sign may take unfair advantage of, or may be detrimental to, the distinctive character or the reputation of the trade mark.

A domain name may also serve to indicate the name under which the business is operated, so that a domain name may also include the "carrying" of a trade name as referred to in the Dutch Trade Name Act.

Pursuant to Section 5 of the Trade Name Act, the proprietor of a trade name may oppose the use of a domain name as a trade name that is identical or similar to the own trade name of the proprietor, if the said use may cause confusion among the public.

This provision has given rise to a large number of court cases in The Netherlands regarding trade name and trademark infringements in connection with domain names.

In the case of Ouders.nl (President of the District Court of Amsterdam, 20 September 1996, KG 1996/334) it was ruled that the domain name used on the Internet to indicate the site where an electronic magazine could be found, is to be qualified as a sign for a good as referred to in the said Article (Article 13A paragraph 1 sub B BMW). In appeal the Court of Appeal confirmed this ruling (Court of Appeal of Amsterdam, 24 April 1997, Computer Law 1997/3).

In the case of La Bouchère (President of the District Court of Amsterdam, 15 May 1997, IER 1997/156) the President considered that the use of the names of the plaintiffs in the litigious domain names (in addition to a trademark infringement) also constitutes an infringement of the trade name rights, now that the defendant presents itself to the public under these names and by so doing also conducts his business under these names. The President also ruled that the defendant without due cause commercially used the registered domain name, and also ruled that the defendant with the relative domain registrations without due cause takes from the plaintiffs the possibility to register the said names themselves. According to the President it makes no difference for the outcome of his decision that the plaintiffs still have the possibility to register a domain name with an other top-level domain name.

When a domain name is applied for, the applicant does not always intend to use it. Some registrations only take place to reserve the domain name and to sell it on to a company that has a great interest in that specific domain name. This may for instance be the case if a third party registers the name Heineken.nl, whereas Heineken is the proprietor of the trade mark and/or trade name Heineken.

In The Netherlands the courts have on several occasions been faced with the question whether the mere registration of a domain name in specific cases has to be qualified as "use", and if so, whether this use by the domain name holder may constitute an infringement of someone else's trade marks or trade names.

Until recently the mere registration or reservation of a domain name or the use thereof for the website of an other company did not constitute a "use" of a trade name. The Dutch courts until recently also ruled that the sole registration of a domain name could not be qualified as "use" as referred to in the Benelux Trademark Act.

In the Unilever/NameSpace case (President of the District Court of Amsterdam, 7 April 2000, IER 2000/151) the President ruled that, in view of the description of the business activities of NameSpace and the fact that all litigious domain names give access to the NameSpace website where NameSpace offers information services and advertising space to Internet users, it provisionally had to be assumed that the litigious domain names were used commercially. This means that they are "used" as referred to in Article 13A paragraph 1 sub c of the Benelux Trademark Act.

The above case shows that the courts will verify whether the domain name concerned is a trade mark and whether there are circumstances that determine the same. For example, whether the domain name corresponds with a trade mark and what is the content of the relative website. On the basis of this information, the court will assess whether there is "use" and whether the public is likely to confuse the domain name with the relevant trade mark (trade name).

In the Ariel case (President of the District Court of Amsterdam, 24 February 2000, IER 2000/150) it was ruled that Procter & Gamble (the proprietors of the Ariel trademark) had failed to demonstrate that the website www.ariel.nl was used commercially as referred to in Article 13A paragraph 1 opening lines and sub d of the Benelux Trademark Act. In this case the defendant had registered the domain name ariel.nl for one of its employees. This employee had been active on the Internet for years using the Internet, among other things, to chat under the name Ariel. He had chosen this name because he was of Jewish descent and lions were among his favourite animals (Ariel is a Jewish name, meaning "lion of God" in Hebrew). The President ruled that the fact that the defendant had paid for the registration of the domain name in itself constituted insufficient reason to assume that the domain name was used commercially. The sole circumstance that Procter would not be able to use the name Ariel.nl is not sufficient to prohibit the use or to order the defendant to transfer the domain name. The above case shows that the courts will not easily qualify use as an infringement if the domain name is used for private purposes.

One of the first court judgments in which the sole registration of a domain name was qualified as "use" as referred to in Article 13A paragraph 1 BMW, was KLM/Alitalia (President of the District Court of Amsterdam, 25 October 1999, IER/148). In this judgment the President ruled that the mere reservation of the domain name KLM/Alitalia.com is to be qualified as a "use" for goods in respect of which the trade marks of KLM and Alitalia have been registered, and therefore as an infringement of those trade marks. In so far as there are also non-similar goods and services, Article 13A paragraph 1 sub d BMW is applicable. After all, the domain name registered by the defendant was used commercially without due cause, whereas in so far as the distinguishing power of the trade marks of the plaintiffs is adversely affected, the plaintiffs cannot use their trade mark names as international website names because the defendant already uses those names as such.

The above judgments show that in each individual case it will have to assessed whether the use of a domain name may be qualified as use of a trade name, of a trademark, or of both in case the trade name is also the trade mark.

In the Union judgment (Union, Benelux Court of Justice, 20 May 1983, NJ 1984/72), the court ruled that there is similarity if the trade mark and the sign, each considered in its entirety and also in combination with each other, have such auditive, visual or interpretative similarities that already for that reason the possibility exists that with a person who is confronted with the sign associations may be created between the sign and the trade mark. This criterion was specified further in the PUMA/Sabel judgment, where it was ruled that association in itself is insufficient, but that there has to be a danger of confusion (PUMA/Sabel, CoJ 11 November 1997, NJ 1998/523).

In order to be able to assess whether the registration of the domain name infringes a trademark, it will first have to be established whether the trade mark and the domain name are identical or similar. If the domain name and the trade mark are not identical or similar, the public will in principle not easily confuse the signs, so a danger of confusion will not be deemed to be present. The same applies if the products the trade mark is intended to distinguish are not identical or similar and the allegedly infringing domain name will not cause damage to or be detrimental to the trade mark. Furthermore there will have to be a use of the domain name. From the aforementioned KLM/Alitalia judgment it may be derived that in The Netherlands the courts will, in principle, quickly assume "use", even if the proprietor of the domain name in actuality has done nothing else but register the domain name (domain piracy) and thereby could block the registration by a proprietor of a trade mark or a trade name. Moreover the aforementioned Ariel judgment shows that if a domain name will solely be used for private purposes, the said domain name will in principle not infringe a trade mark and/or trade name, because there is no commercial use.

On the basis of their trade mark and trade name rights, Heineken and Shell may in principle oppose the mere registration of a domain name that is similar to their respective trade marks and/or trade names, unless the proprietor of the domain name has due cause to use his domain name, or unless a company has only registered the domain name for private purposes and does not intend to sell the domain name or to exploit it commercially. In each concrete case it will, inter alia on the basis of the content of the relevant website, have to be established whether in the specific case it concerns a trade mark or a trade name, and for which goods, services or activities it is used.