Fin(n)ishing late: New Finnish Trade Mark Act and other IP reforms eagerly awaited

When it comes to Directive 2015/2436 (the new Trade Mark Directive), what has been the Finnish take on the implementation thereof? What are the future challenges?

Katfriends Panu Siitonen and Sarita Schröder (Hannes Snellman) discuss the Finnish implementation of the Trade Mark Directive and reflect on what the future might hold for trade marks in this Member State.

Here's what they write: 

"Although usually a front-row pupil, Finland failed to meet the 14 January 2019 deadline for the transposition of the bulk of the provisions of the EU Trade Mark Directive. However, the old adage “good things come to those who wait” holds true, as the proposed new Trade Mark Act and other IP reforms will bring many improvements even beyond those mandated by the EU legislator. Below is a snapshot of a few key changes.

Overcoming Relative Grounds for Refusal Citations to Become Less Burdensome

Finland is among the few EU Member States where relative grounds for refusal are examined at the authorities’ initiative when registering trade marks and company or trade names. In each case, both trade marks and company or trade names can be cited. Especially company and trade names cause many unnecessary headaches, as they can be registered to cover “all lawful business activities”. Consequently, they pose an obstacle for an identical or similar mark or name for any goods, services, or type of business.

Overcoming relative grounds for refusal is cumbersome, as it requires either convincing the authority of an error in their assessment or obtaining consent from the prior rights holder(s) or managing to have the prior right(s) revoked or invalidated.

Currently, revocation and invalidation matters are handled exclusively by the Market Court, where the court fee is EUR 2,050 and the losing party is generally ordered to compensate the winning party’s costs. Moreover, partial revocation of company or trade names is not possible. Therefore, as long as such a name is used for something, it can remain indefinitely registered for everything.

The proposed legislation will introduce an administrative revocation and invalidation procedure for trade marks far ahead of the 2023 deadline set by the Directive. It will be applicable in both contentious and non-contentious cases. However, the court route will also remain available should either party so prefer. Similarly, an administrative revocation procedure will be introduced for company and trade names that have not been put to genuine use over a continuous period of five years. Partial revocation of company and trade names will also be made possible.

These changes are expected to ease the burden caused by the authorities’ examination of relative grounds for refusal – which there are no plans to discontinue or limit.

Opposition Proceedings to Become More Efficient

Opposition proceedings before the Finnish Trade Mark Office are – at least objectively speaking – currently in many ways less efficient than those before, for example, the EUIPO.

Among other things, there is no cooling-off period to facilitate a settlement. Instead, if the parties need time to negotiate, they must apply for extensions of time limits, which are only granted for a few weeks at a time. Moreover, the applicant cannot defend itself by demanding that the opponent provide proof of use of its earlier right(s). Rather, the applicant must file a revocation action before the Market Court if it believes that there has been no genuine use of the opponent’s right(s) for a continuous period of five years. The proposed legislation will introduce a two-month cooling-off period, which may be extended twice by five months at a time. Moreover, as required by the Directive, demanding proof of use as a defence will be made possible.

Opposition proceedings will also be streamlined by generally limiting the number of statements per party to a maximum of two, whereas today the parties are usually allowed to keep submitting statements until both confirm that they have nothing further to comment. However, what will not change is that, unlike before the EUIPO, arguments and evidence supporting the opposition must be filed in connection with filing the opposition.

Criminal Liability for EUTM and RCD Infringements to be Introduced

In April 2018, much to the dismay of brand owners, the Finnish Supreme Court ruled that under the current legislation, there is no criminal liability for infringements of EU trade marks (“EUTM”) or Registered Community Designs (“RCD”).

According to the court's reasoning, the Finnish Criminal Code does not specifically mention acts contrary to the EU Trade Mark Regulation or the Community Design Regulation as being criminally sanctioned. Rather, it only refers to infringements within the meaning of certain national legislation as constituting a crime (subject to certain conditions). Due to the rule of law principle, it is not possible to “fill in the gaps” of the legislation through analogous interpretations.

To enable EUTMs and RCDs to enjoy the same protection in Finland as corresponding national rights, the Criminal Code will be amended to penalise also infringements of these rights. This will provide brand owners with a better enforcement toolkit and help ensure Finland’s compliance with its international obligations, in particular, the TRIPS Agreement.

Other Changes and Outlook for the New Legislation

Other changes that will be brought about by the new legislation include:

• removal of the graphical representation requirement for trade marks;
• introduction of the what-you-see-is-what-you-get principle for black and white trade marks applied for after the entry into force of the new legislation;
• shortening of the term of protection for new trade marks from ten years as of the registration date to ten years as of the application date;
• introduction of a specific provision concerning infringing goods in transit;
• possibility to clarify goods and services covered by trade marks applied for prior to 1 October 2012 (or in some cases, between 1 October 2012 and 31 December 2013) using class headings or numbers; and
• certain changes to procedure and remedies.

The proposed legislation is currently still making its way to a first reading and debate in Parliament. It is, nevertheless, expected to enter into force during the spring of 2019.

However, should the legislation fail to pass before the next parliamentary elections, which are to be held on 14 April 2019, the matter will need to be taken up again by the new Parliament. This could push the effective date to late 2019."