28 Apr, 2020

New Trademarks Act – a step closer in aligning Serbian legislation with EU law

On February 1, 2020, a new Trademarks Act („Act“) came into force with a view to addressing shortcomings observed during the application of the previous act, to establish a more efficient system for trademark protection, as well as to align Serbian legislation with the laws of the EU Member States in this field.

Placing trademarked goods and services on the market allows the trademark owner to distinguish those goods and services on the market from others that are the same or similar, while simultaneously increasing its responsibility towards consumers.  The importance of trademarks calls for an efficient and simple protection procedure that employs the latest technological possibilities and modelled on EU law.

Characteristics of sign that can obtain trademark protection

With technological development, the method of sign depiction has gone beyond graphic representation meaning that, from now on, the sign no longer has to be represented graphically in order to obtain trademark protection.  A new provision stipulates, among other things, that it is possible for the sign to be a three-dimensional object including the commodity and packing shape.  In this way, new sorts of trademarks manifested and submitted in electronic form, are introduced, such as audio trademark, trademark consisting of moving pictures, multimedia trademark or a combination of them.  The trademark must be represented in a form that can be reproduced in the electronic register using generally available technology in a clear, precise, and intelligible manner.  This arrangement is already applicable under EU law.  For instance, International Trademark Association, among other, is familiar with the concept of a sound mark and further provides protection for songs, known sounds from nature, atypical sounds and sounds produced electronically that do not exist in nature. 

The upgrade of the trademark record is also reflected in the introduction of a unique Register of Trademarks, which is maintained in electronic form and is a publicly accessible database.  This database will keep records of existing and new types of trademarks.  The Act also requires the competent authority to notify the trademark holder of the expiry of the registration.  At the request of a party or a competent authority, a note will be made in the Register of Trademarks that trademark enforcement has been initiated, providing all interested parties with stronger legal certainty re intellectual property protection. In this regard, it is worth noting that the Act stipulates that trademarks are enforceable.

Trademark opposition system

One of the key changes is the introduction of the opposition system in the procedure for examining a trademark application.  In practice, this means that the registration of a trademark is the first but not the only step in the efficient use thereof, since right holders from now on must keep an eye on the publication of new trademark applications to ensure that potential new trademarks do not infringe their rights.  This introduces into national legislation an arrangement that has been present for many years in the national legislation of most European countries and that applies to the so-called EU Trademark.

Namely, if the competent authority assesses that there is no absolute and relative ground to refuse the trademark application, such an application will be published. Interested parties (e.g. earlier right holder) can file an opposition within three months of the application’s publication date.  The opposition may be based on relative and specific grounds for refusal of trademark protection, in respect of part or all of the goods or services in the application.  The applicant may submit a written response within 60 days of receipt of the notice of opposition; otherwise, the opposition will be upheld and the application will be rejected.  The competent authority will also refuse the trademark application if it finds during proceeding that the opposition is well substantiated.  Anyway, parties are entitled to request temporary suspension of the opposition proceeding by the competent authority, for up to 24 months, if they agree to a cooling-off period, allowing negotiations to take place.

International exhaustion of rights and parallel import

Another key change concerns international exhaustion of rights, which implies that trademark owners cannot prohibit the use of a trademark in connection with the goods marked with it, after the goods have been put on the market anywhere in the world by the trademark owner or the person authorized by it.  This arrangement was a feature of Serbia’s legal system until enactment of the previous act which made provision for national exhaustion of rights.  The importance of this provision is that it enables parallel import, so a trademark owner cannot prohibit the trade of goods marked with his trademark that a third party acquired abroad and then imported to Serbia for resale.  This circumstance encourages so-called intra-brand competition, i.e. competition among distributors of goods bearing the same trademark,  that may consist of offering the goods at a lower price or with some additional benefits.

When it comes to the procedural aspect, another change is that decisions in the procedure for the trademark protection will be final.  These decisions can no longer be appealed in administrative proceedings, but an administrative dispute can be directly initiated.

It is expected that the new provisions will improve the protection of right holders in the case of trademark infringement, as well as reduce the occurrence of trademark infringement and the legality of doing business.  However, it should be borne in mind that the adoption of new legal provisions per se is not enough.  As was noted in the European Commission’s 2019 Report for Serbia, coordination among relevant institutions requires further strengthening, as well as awareness and information exchange.  Finally, specialist training should be provided to judges who handle intellectual property right cases.

Authors: Ognjen Colić, Slavica Purić and Danica Misojčić