Important Amendments to Canada's Trademark Law
For decades, Canada has remained one of the few civilized countries that is not a party to the international treaty that allows business owners to file international trademark applications.
Slowly but surely, Canada is moving towards aligning its trademark laws with the rest of the world.
On June 19, 2017, Canadian government published draft regulations that, when enacted, will result in the actual implementation of the amendments that were legislated back in 2014.
In this video, I explain what these amendments will mean to Canadian and non-Canadian brand owners.
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It’s been a very long wait. For years, Canada has remained one of the few civilized countries that is not a party to the international treaty that allows business owners to file what is typically called international trademark applications.
What this means is that companies based outside Canada cannot protect their brands in Canada through a centralized international filing and, up to this day, have had to resort to using Canadian trademark agents to file their trademark applications in Canada directly. What this also means is that Canadian businesses that target worldwide markets cannot take advantage of the international filing system either. Up to this day, they either have to set up operations in a different country (typically, by incorporating a separate company in the U.S.), or file dozens of trademark applications, with their legal bills for trademarking going through the roof.
Canada’s current isolationist system benefits a very particular contingent – large Canadian law firms who readily take advantage of international businesses that are seeking to protect their brands in Canada. For decades, large Canadian law firms were lobbying against Canada moving towards unification of its trademark laws with the rest of the world. Their reasons are simple. They get a lot of their business filing trademarks for American companies who would otherwise be able to file their Canadian trademarks without using Canadian trademark agents.
So finally, in 2014, Canadian government introduced a bill that introduced many long-awaited changes to the Trademarks Act. Some of them into force immediately but most of them are only to come into effect once the government adopts regulations to clarify some of the provisions of the law.
At first, these regulations were expected in 2015. Then, they were promised by end of 2016. Now, everyone’s saying they will come into force in late 2017 or early 2018. Problem is, nobody has seen these regulations until June 19 when the Government finally published the draft regulations inviting the public to provide their feedback.
So in this video, I will not go through all little changes. I’m only going to cover those that actually matter to business owners and their branding strategy.
As I mentioned before, a lot of public comments come from big law firms, so don’t be surprised that a lot of them are negative. In fact, most of these changes are going to make the lives of business owners, in and out of Canada, much easier when in comes to trademarking.
So what are the changes?
1. The biggest deal, of course, is that Canadians will finally be able to file international trademark applications based on their Canadian applications and registrations. What this means is that a Canadian individual or a Canadian company, after filing their trademark application in Canada can file an international application for the same trademark and simply put checkmarks next to countries where they want to register their trademark. The international application is filed in one language. You’re not spending money translating your applications into all sorts of languages. The fees payable to Trademarks Offices around the world are lower. And you don’t need local representation in each country to file there.
This is a massive improvement to the current situation.
Suffice it to say that my company, Trademark Factory we were forced to file for our trademarks individually in many countries, which cost me a pretty penny I’d rather spend building my business.
2. Use will no longer be a requirement for trademark registration. No more trademarks based on proposed use. No more declarations of use. You file your trademark – unless it gets opposed it will be registered. This shifts the burden of protecting one’s brand from the government to business owners themselves. This makes perfect sense: if a business does not care enough to protect its long-standing brand by registering it as a trademark, why should the Trademarks Office care?
This doesn’t mean that Canada becomes a “first-to-file” system that exists, for example, in Europe. If you had been extensively using your brand before someone else runs to the trademarks office and trademarks your brand, you can still win—either through opposition proceedings or in court. Some say that it would make it more difficult for owners of unregistered trademarks to enforce their rights against those who apply to register those trademarks in their own name. Some lovingly refer to them as trademark trolls.
To that I say, BooHoo! If you do not think your brand is valuable enough for you to trademark it, especially when it’s so easy and relatively inexpensive to do, you really don’t deserve to have the whole legal system geared towards protecting your rights against those who choose to use the system designed to let brand owners protect their assets.
Seriously, if you leave your wallet in the middle of a public square, don’t blame the major and the chief of police who might refuse to compensate you for whatever was in your wallet when you come back to the square 5 years later and demand justice.
The new system will make it easier for brand owners to protect their brands. Instead of complaining how much more difficult it would be for you to protect your brand WITHOUT using the system that’s specifically designed to help you do just that, USE the system and protect one of your most valuable assets.
3. It will become easier to register trademarks that relate to the shape of the product. These used to be called a “distinguishing guise” in Canada and had all sorts of special rules around them. These rules are gone, the name is gone. They will be treated the same way as regular trademarks. If the shape of your product can function AS a trademark, in other words, if the shape of your products allows your customers and potential customers to tell your products apart from identical or similar products of everyone else, then it can be registered as a trademark—with a lot less formalities than before.
4. Like the rest of the world, Canada will adopt the Nice Classification of Goods and Services, which divides all goods and services into 45 categories called “classes”– 34 classes of products and 11 classes of services. All applications will need to classify the goods and services for which the trademark is filed into these classes. It was impossible to integrate Canadian trademark laws with the international filing system without switching to the class-based system of trademarks.
One thing that will be different is that the government filing fees will be based on the number of classes in which you are seeking registration, and these fees are going up. Significantly compared to what they are today.
Today, when you file a trademark in Canada, no matter how may products and services it covers, you are paying a single government fee of 250 Canadian dollars. Plus you’re also paying $200 to get the trademark registration certificate after your trademark application is allowed.
Things are about to change.
First of all, because there’s no use requirement anymore, the allowance stage of the process is effectively gone. So if no one opposes your trademark or if you win the opposition proceedings, instead of your trademark being allowed, it will proceed straight to registration. This means that there will not be the post-allowance government fee of CAD $200 anymore.
However, the filing fees will be based on the number of classes and services for which the application is filed. It will cost 330 Canadian dollars for the first class and 100 Canadian dollars for each further class.
So if your application is in a single class, you’re going to save 120 dollars compared to today. If your application is in 2 classes, you’re saving 20 dollars. if you’re filing your trademark in 3 classes, you’re looking at 530 Canadian dollars in government filing fees. And so on.
If you have a brand that you think can cover may products and services, I strongly recommend that you file your trademark application as soon as possible. This way, you can cover all possible products and services for a single fee of 250 Canadian dollars. Then by the time your trademark application is past the opposition stage, the new Regulations will probably be in effect, so you will not be required to show use and you will not be required to pay government fees per-class, so in theory, you can have your trademark cover all 45 classes for only 250 Canadian dollars.
Beware, however, that even though there is no use requirement for registration, your trademark can be registered for non-use if you have not been using it for a consecutive period of 3 years. So the value of such registration in 45 classes may be questionable.
5. The term of registration will drop from 15 years to 10 years. This is also to put Canadian trademark laws in line with those of most other countries. If anything, this should be another incentive for business owners to get their trademarks registered as soon as possible, because they may just be able to secure the 15-year term for the last time. Even though this provision introduces a shorter limit, it’s not really that much of a big deal. If you have been in business under your brand for 10 years, paying a renewal fee should be the least of your concerns. So basically, in 30 years, instead of paying a few hundred dollars twice, you’ll pay a few hundred dollars three times. Big deal!
6. Canada will have divisional applications, which may come handy in case a part of the application is smooth and non-problematic, and some other part of it raises a concern of the trademark examiner. Today, businesses face an all-or-nothing proposition: they either have to convince the examiner that the mark is registrable as it’s described in the application, or get rid of the items that cause concern. With divisional applications, one will be able to proceed to registration in respect of non-problematic parts of the application, while battling over the rest.
7. Unfortunately, #7 is non-news. It’s something that should have been changed but wasn’t. The amendments do nothing to do away with Canada’s unique “official marks”, superpower marks that trump regular trademarks and that are available to any university or any public authority. These official marks not only trump regular trademarks, they confer protection that is not limited to specific goods and services, as is the case of regular trademarks. And such marks don’t expire and cannot be cancelled even if the entity that owns them has no further interest in the mark. Why universities and government entities should be allowed to hold hostage business owners who come up with brands that have nothing to do with education or the functions of these government bodies, is beyond me. If anything, I would really like the amended Trademark Act to strip away the right of universities and public authorities to disregard the usual provisions of the trademark system.
I have long been saying that the cost of trademarking is irrelevant.
If your business makes it, your investment in protecting your brand will probably be your best investment ever. If your brand flops, then a dollar spent on trademarking would be a dollar too much.
On a grand scheme of things, saving a few hundred dollars on your trademark application should NOT be the reason for your decision to trademark or not trademark your brand. If you’re a responsible business owner, you owe it to your business to protect its brand.
But having said that, now may be the perfect time to go for registration of your trademarks—before the government fees skyrocket and the term of protection is shortened.
And once the Regulations are in force, consider seeking international protection through the international treaty that Canada is finally joining!
It will be very exciting times for trademark owners.
Are you going to be a part of this?
Disclaimer: Please note that this post and this video are not and are not intended as legal advice. Your situation may be different from the facts assumed in this post or video. Your reading this post or watching this video does not create a lawyer-client relationship between you and Trademark Factory International Inc., and you should not rely on this post or this video as the only source of information to make important decisions about your intellectual property.
See our answers to other frequently asked questions about trademarks or leave your comments below!
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