Purchase of non-active trademarks that are a barrier to registration

A number of trademark applications are being rejected on the basis of conflict with an existing local or international registered trademark in Egypt. However, upon conducting a market investigation, the client finds that most of the trademark citations arising in the office action not active or have not been seriously used.

Use of the trademark decreases the risk of a non-use cancellation action. If a registered trademark is not used within five years of the registration date, third parties may seek to cancel it on the grounds of non-use based on Article 91 of the Egyptian IP Law No. 82/2002, which provides that: “The competent court may, upon request by any interested party, issue an enforceable decision to cancel the registration if it appears to the court that the mark has not been seriously used for a period of five consecutive years.” The same also applies to international trademark registrations that are designated into Egypt.

Therefore, valid registrations can be used to attack a third party application or registration. For example, if registration is relied upon as a ground for attacking a third party mark in an opposition or cancellation action and the registration has been on the Register for more than five years, then it is almost certain that the party whose mark is being attacked will, if the opposition or cancellation proceeds, ask for proof that the mark has been used in the preceding five years. If this cannot be satisfactorily shown, then the registration concerned will be disregarded in the proceedings as regards the goods/services on which use cannot be proved, unless there is a satisfactory reason for non-use. Such “proof of use” can also be demanded of a proprietor of trademark registration being relied upon as the basis of an infringement action.

Article 19 of the TRIPS Agreement, to which Egypt is a party, provides that: “If use is required to maintain a registration, the registration may be canceled only after an uninterrupted period of at least three years of non-use, unless valid reasons based on the existence of obstacles to such use are shown by the trademark owner.”

First, the applicant must file a response to the official action as issued by the TMO and consequently consider filing a cancelation action based on non-use grounds, supported by evidentiary market surveys. The trademark owner can therefore conduct negotiations with the owners of those inactive trademarks for the purchase and assignment of the dormant trademarks thus avoiding the judicial proceedings, either as a plaintiff or defendant. This course of action often helps the applicant save a significant amount of time in the prosecution of their application.

For more information please contact our Trademarks Department trademarks@eldib.com
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