'Genuine use' of Community trade marks should not be solely assessed on a geographic basis, ECJ advisor says

Advocate General Eleanor Sharpston said, though, that using CTMs in every EU member state may also be insufficient to avoid the marks being revoked. She said that the nature of the market for individual products and services within the EU must be considered on a case-by-case basis when assessing whether CTMs have been put to "genuine use" within the trading bloc.

Following that market assessment 'genuine use' can be said to have been made of CTMs where their use has been "sufficient to maintain or create market share in that market for the goods and services covered by the Community trade mark," Sharpston said. Where branded goods have been placed on the market within the EU is irrelevant other than to that assessment, she added.

Under the EU's Community Trade Mark Regulation, CTMs which are not used for five years can be revoked.

"In my opinion, the case-by-case assessment of what constitutes genuine use involves determining the characteristics of the internal market for the particular goods and services involved," she said in an opinion. "It also requires taking account of the fact that those features may change over time."

The Advocate General said that the demand for goods and companies' ability to supply can impact on the market and are factors in assessing where the particular market for CTM-branded goods is. For that reason making an assessment of 'genuine use' of CTMs within the context of national borders within the EU is not the correct approach, she said.

"Demand or supply in, or access to, parts of the internal market may be limited depending on, for example, language obstacles, transportation or investment costs, or consumer tastes and habits," Sharpston said. "Use of a trade mark in an area where the market is particularly concentrated may thus play a more significant role in the assessment than use of the same mark in a part of the market where sources of supply and demand for these goods or services hardly exist or arise."

"It is also conceivable that local use of a Community trade mark none the less produces effects on the internal market by, for example, ensuring that the goods are known – in a commercially relevant manner – by participants in a market that is larger than that corresponding to the territory where the mark is used," the advisor added.

"I therefore do not consider that use in a territory corresponding to that of only one Member State necessarily precludes the use from being characterised as genuine in the Community. At the same time, I do not consider that, for example, use of a mark on a website that is accessible in all of the 27 Member States is by definition genuine use in the Community."

Sharpston said that her conclusions helped to guarantee the choice that firms have over whether to register marks as either a national or Community trade marks.

"The Community trade mark, and its coexistence with national trade marks, were established with the objective of satisfying the needs of all market participants, and not solely those of small enterprises operating in a single Member State or small part of the internal market, or of large undertakings which are active in the whole or a large part of the internal market," Sharpston said.

"Community trade mark protection must be available to all types of undertaking wishing to obtain protection of their marks throughout the territory of the 27 Member States and with the objective of using the mark in a manner that will maintain or create market share in the relevant internal market," she added.

Sharpston was offering her opinion in a case referred to the European Court of Justice (ECJ) by a court in the Netherlands. The ECJ has been asked to assess whether use of a CTM in just one EU member country is sufficient to qualify as a "genuine use" of the mark and if it is not, whether local use of a mark can ever be sufficient and under what circumstances. The ECJ has also been asked whether 'genuine use' of a CTM should be determined without a consideration being made of national borders within the EU.

The Dutch court is trying to assess whether one company's use of a CTM within the Netherlands is sufficient for it to be classed as having been put to 'genuine use'.

The opinions of Advocate Generals are not binding on the ECJ but judges use the opinions in making their decisions and opinions are followed in a majority of cases.

Trade mark law expert Helyn Mensah of Pinsent Masons, the law firm behind Out-Law.com, said she expects the ECJ to come to the same conclusion as Sharpston.

"The essence of the Advocate General's decision in this case is that whether there is genuine use in any case depends on the facts, in particular, the market circumstances which prevail," she said. "This is a sensible approach, since the landscape of trade and commerce is under continual flux and it is not possible to isolate a 'one size fits all' test of genuine use. I would expect the Court of Justice to endorse this view."