A kick in the gulyás? Hungary, Benelux stewed by Europe's finest

In the stew: Hungary and Benelux --
but has there been "genuine use" of the law?
Is the use of a Community trade mark -- which covers all 27 Member States of the European Union -- to be regarded as a "genuine use" if it takes place in just one of those countries? This question has raised a good deal of controversy in recent months (see earlier IPKat posts here and here, for example). Not everyone has heard, however, that this topic was discussed last week by the European Parliament. According to a little bird that roosts in the rafters of that organisation, the Benelux and Hungarian IP offices came under a bit of heat.

Michel Barnier (Commissioner for the Internal Market and Services) expressed the view that any new restriction the Community trade mark [ie restricting the concept of genuine use to use that transcended national borders] could have serious consequences for the fight against counterfeiting; it would damage SMEs and business start-ups in particular. For that reason he would like to confirm and reassure the Parliament that his services were following very closely the developments in the Member States involved.
"At this stage we are confident that the national jurisdictions will not confirm these decisions, which do not seem to us to conform with the unitary character of the Community trade mark and with the principles of the single market ... The Commission will not allow one of the important elements of the internal market to be unpicked. If we let this happen due to the somewhat protectionist temptations in this or that country, it will be the SMEs who will be the first victims. We are therefore determined to say ‘stop’ to these temptations".
In the event that the decisions are not overturned at a national level (which Michel was confident they would be), the Commission would consider starting infringement proceedings.

Malcolm Harbour (Chairman of the Committee on the Internal Market and Consumer Protection) described the actions of the Benelux and Hungarian offices as “naked self-interest”:
“I want to thank the Commissioner very much indeed [Hmm, says Merpel, I thought being Commissioner was a thankless task ...] for making it absolutely clear that the behaviour of the two trade mark offices concerned – in Benelux and in Hungary – is absolutely unacceptable".

I emphasise that very strongly, because this is clearly an attack on the fundamental principles of the internal market. The first thing my committee intends to do – and I will make sure it happens – is that, when the Minister for the Internal Market (and indeed the Hungarian Minister, from January onwards) comes to my committee, we will make sure that we ask this question and ask them to go directly to their trademark offices and say this is not acceptable.

Why is it not acceptable? Because it is a fundamental attack on the basic principle of the internal market that there should be no discrimination of any kind on companies, wherever they operate in a single uniform unitary market. In this case it is even worse, because this proposal – or proposed actions, if they were to be upheld – actually discriminates against small enterprises as opposed to larger enterprises.

I cannot understand why it is that, after all the time that we have had the Office for Harmonisation in the Internal Market (the trade mark office) in operation, we suddenly find these two trade mark offices doing this [Shall we tell him?]. Perhaps it is because the cost of registering a European trade mark has come down, because they are operating it so efficiently.

Of course, these two trade mark offices, in trying to sustain these objections to allowing people to register trade marks, will be requiring the companies concerned to register in their own jurisdictions. This is naked self-interest on behalf of these organisations. It cannot be allowed to stand. It is fundamentally against the principles of the European Union and, by the way, it also undermines – as the Commissioner rightly says – a major priority for this Commission, which is innovation, getting new products into the market and making the internal market work better.”
The IPKat is most impressed at these expressions of principle since it was ever his feeling that, whatever the merits of the Benelux/Hungarians' legal arguments -- and their arguments are not entirely devoid of merit -- the principle involved was too big for anyone to let the actual law stand in its way. In any event, it's good to see European Parliamentarians discussing anything to do with intellectual property, since it shows that (i) the subject really is on the agenda and (ii) they know it's there.  Merpel adds, some folk might unkindly comment that, while the European Parliament doesn't yet know much about IP, its expertise in "naked self-interest" is unrivalled ...

Hungarian goulash here and here
A kick in the gulyás? Hungary, Benelux stewed by Europe's finest A kick in the gulyás? Hungary, Benelux stewed by Europe's finest Reviewed by Jeremy on Tuesday, September 28, 2010 Rating: 5


  1. I very much enjoyed watching the debate. Quite impressive that they debate something like this at 23.30. The room was a bit empty, but probably to be expected.

  2. Why are we still talking countries? How many countries are there in the internal market? NONE! Pls give your comments

  3. What occurred in the EU parliament on September 21, 2010 was not a debate but a 'sorcery trial': not wanting or not being able to seriously study this quite intricate matter, some persons more or less accused the Benelux and Hungarian TM Offices of being 'anti-European' (the ‘Unforgivable Mortal Sin’) to try to scare off anyone from openly debating. Just 2 samples of this rampaging rhetoric:
    - Malcolm Harbour (MEP): ''...we will make sure that we ask this question and ask them [the Minister for the Internal Market and the Hungarian Minister] to go directly to their trademark offices and say this is not acceptable.''
    - Seán Kelly (MEP): '''...all political pressure, and possibly sanctions must be brought to bear on Member States who are not embracing it, to bring them to their senses ...'
    Barefoot, wearing a penitent monk's hair shirt, on the Road to Canossa you go, you irresponsible Hungarian and Benelux TM officers!

    And, even if Mr Barnier used more courteous terms, he indeed endorsed these positions (''And so I say to President Harbour for all the reasons he has given with others, that the Commission will not let unravel one of the important elements of the internal market.'') which is most regrettable to say the least. .

    Who remembers there is an ongoing study (conducted by the Max Planck Institute selected... by the European Commission) on the TM systems in the EU (and not only on the CTM)? Who remembers that one of the core issues is precisely the balance between the different TM systems existing in the EU?

    One may think that all national and Benelux TM systems should be abolished so that the CTM becomes the sole source of TM rights in the EU. Why not? But this will then incur a much more difficult access to TM registration as in the USA. And if one is not in favour of this abolition, one must draw logical consequences in particular stop shouting that there are no more borders nor countries.

    A serious debate has been going on essentially since 2005; detailed analysis were already made as well as various proposals. This is why such unashamed 'TM Office bashing’ and defiling combined with an increasing pressure on the national governments, on the Courts and on the Max Planck Institute are totally unacceptable. Everyone following up this issue knows that some high-ranking officers have been ‘touring’ across the EU, in particular in Benelux, to assert sometimes in most aggressive terms how shocking and unacceptable the ONEL decision is and that it should be wiped out in order to save the CTM; of course, these persons never condescended to honestly going into the debate: now this is unacceptable for all persons who – sometimes for several years – are seriously thinking about this question, researching, studying, proposing and discussing without restriction. This somehow paranoid monologue by persons benefiting from their considerable and unbalanced institutional, political and ‘mediatic’ power has been going on too long.

    I do hope that all this "racket" and intimidation will not distort the work of the Max Planck Institute which, I repeat, was requested by the Commission itself to carry out this study: a basic rule for a honest and impartial consultation is to avoid giving answers after having asked a hopefully open question.

    I intend to revert to this subject more in detail as soon as possible. In the meantime Long Live an open and free discussion and down with ideological excommunications!

    François GRIESMAR
    IP Lawyer


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