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Summary of TM Act changes in “Budget” Bill C-31

On March 28, 2014, Canada’s Finance Minister Joe Oliver tabled an omnibus budget implementation bill, titled Economic Action Plan 2014 Act, No. 1., or Bill C-31.  The Bill makes very significant and sweeping changes to the Trademarks Act, despite the obvious lack of any connection to the implementation of the budget.  See my previous blog post for more detail on these changes, including a version of the Trademarks Act with the Bill C-31 changes incorporated, and a comparison of the Act as amended with the current Act.

I’ll summarize a few of the changes below, and I’ll update this post as I make my way through the amended bill.  I’ll refrain from commenting too much on whether these changes are good or bad for the time being.  The points below represent my fairly superficial first impressions of the amendments, and I might be mistaken in my initial interpretation.  This isn’t intended to be a complete list of changes.

“Trade-marks” are now “trademarks” and “wares” are now “goods”

The hyphen will be dropped from “Trade-marks” throughout the Act, including from its title.  This brings us in line with the preferred US spelling.  The term “wares” will be replaced throughout the Act with the term “goods”, which brings us in line with language you might find outside of a Dickens novel.

Term of Protection drops from 15 to 10 years

Amendments to S. 46(1) change the term of trademark protection from 15 down to 10 years.  Due to the action of the Transitional Provisions in S. 69, 70, 72 and 73, it seems that existing applications and registrations will also be affected.

Transitional Provisions

Existing applications and registrations (generally speaking – there are some exceptions) will be subject to the provisions of the new Act, as amended. (see Sections 69-73)

New Definitions of “Sign” and “Trademark”

A new definition of “Signs” in S. 2 of the Act will read as follows: “includes a word, a personal name, a design, a letter, a numeral, a colour, a figurative element, a three-dimensional shape, a hologram, a moving image, a mode of packaging goods, a sound, a scent, a taste, a texture and the positioning of a sign;”  The term “sign” is broadly used throughout the amended Act.

The definition of “Trademark” will read “(a) a sign or combination of signs that is used or proposed to be used by a person for the purpose of distinguishing or so as to distinguish their goods or services from those of others, or (b) a certification mark”

This will open the door to registration of many new types of trademarks, and will have far-reaching effects on the various prohibitions in the Act.

S. 32(1) requires evidence of distinctiveness for some types of signs prior to registration (eg: sounds, scents, tastes, textures)

Declaration of use no longer required

Section 40 (Registration of Trademarks) has been replaced in its entirety with a provision which no longer requires a declaration of use for proposed use marks.  Proposed use trademarks are seemingly still allowed under the new Act, but it seems that now those marks may be able to register before they are actually used.

Declarations of use are not compatible with the Madrid System, but the result that marks could be registered and protected without actual use in Canada is troubling – I’d prefer elimination of proposed use marks entirely.  I hope I just haven’t reviewed the Act closely enough yet, and I’m missing something…

Madrid Protocol, Nice Agreement and Singapore Treaty

Many of the changes are aimed at implementing the Madrid Protocol, the Nice Agreement, and the Singapore Treaty, which the Government of Canada tabled in Parliament on January 28.  Canada’s current trademarks regime is incompatible with these international agreements for a variety of reasons.  Implementing these treaties will allow Canadians and Canadian business to take advantage of the international trademark application system.

For more information on the incompatibility of Canada’s current Trade-marks Act with the Madrid System, CIPO’s Analysis of the Legal and Technical Implications of Adherence to the Madrid Protocol is very useful.

Nice Classification – cost of trademarks in Canada to increase?

Nice Classifications will be required with trademark applications under the new system.  It’s unclear if we will wind up with a fee-per-class regime, but that’s the standard in most Nice countries, so it’s likely the cost of trademarks will increase significantly.  This would fall within the Registrar’s power to make regulations regarding trademark fees – I imagine we’ll see a new set of regulations when these amendments come into force.

Commissioner of Patents is now the Registrar of Trademarks

NOTE: this change is not included in my version of the TM Act, as amended by Bill C-31, because it was introduced in its own section of Bill C-31 (Division 26 – S. 369-370), and I missed it when preparing my document yesterday, since it was tucked in after the Coordinating Amendments.

These changes have the effect of making whoever is the Commissioner of Patents also have the role of Registrar of Trademarks.

Marks can be expunged if they “Limit …art or industry”

A new S. 18.1 reads as follows: “The registration of a trademark may be expunged by the Federal Court on the application of any person interested if the Court decides that the registration is likely to unreasonably limit the development of any art or industry.”  I’m inclined to like this one, but it’s a big change, and it’ll take a fair amount of judicial consideration before we really know what it means.

New “Divisional Applications”

S. 39 of the amended Act says that an applicant may limit the goods/services scope of an original application, and file a second, “Divisional Application” for any of the other goods/services that were within the scope of the original application, with the original application’s filing date.  Divisional Applications may themselves be further divided.

Under S. 41(1), the Registrar may merge registrations stemming from the same original application – ie: merge a one or more divisional applications with the original application, or merge several divisional applications together.

This will presumably allow applicants to hive contentious goods and services from an original application, allowing them to proceed with both applications separately without sacrificing the original application date.

Utilitarian Function

S. 12(2) says that “a trademark is not registrable if, in relation to the goods or services in association with which it is used or proposed to be used, its features are dictated primarily by a utilitarian function.”  And S. 20(1.1) reads “The registration of a trademark does not prevent a person from using any utilitarian feature embodied in the trademark.”

Good news for people who like reasonable IP law, bad news if you’re Kirkby AG and still hoping for another kick at the can, I guess.

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