Sunday, 20 September 2020

The New DIFC Intellectual Property Law - Trade Marks and Trade Names

Author Mostafameraji Licence CC BY-SA 4.0  Source Wikipedia Tourism in Dubai


Jane Lambert

Last November the Dubai International Financial Centre ("DIFC") enacted a new intellectual property law (see DIFC Intellectual Property Law (Law No 4 of 2019)).  I described its structure in my Introduction to, and Overview of, the New DIFC Intellectual Property Law on 11 Dec 2019 and discussed its provisions relating to patents and utility certificatesindustrial drawings and designs and copyrights and neighbouring rights in subsequent articles.  In this article, I discuss the provisions relating to trade marks (arts 43 to 49) and trade names (arts 50 and 51).   There was already an action for passing off under the Law of Obligations which I discussed in The DIFC Law of Passing Off on 7 April 2011.

What is a Trade Mark?
The table in paragraph 3 of Schedule 1 to the IP Law defines a trade mark as:
"any signs or combination of signs or names, words, signatures, letters, numbers, Drawings, Symbols, addresses, Hallmarks, stamps, pictures, vignettes, notices, packages, colour or combination of colours, or any other mark or combination of marks having a distinctive form and used or intended to be used to distinguish goods, products or services. Sound and smell can be considered as trade marks."

That is broadly consistent with art 2 of Federal Law No. 37 of 1992 on Trademarks (as amended by Law No. 19 of 2000 and Law No. 8 of 2002).

The DIFC Intellectual Property Law makes no provision for registering trade marks in the DIFC.  Instead, art 43 of the Law provides that a trade mark registered under the Federal trade mark law is recognized for the purposes of the DIFC IP Law and is valid and enforceable in the DIFC.  "Federal trade mark law" is defined in the table in paragraph 3 of Schedule 1 as "UAE Law No. 37 of 1992 as amended by UAE Law No. 8 of 2002 and its implementing regulations, any other future amendment or Federal Law with respect to trade marks."  I have already discussed that statute including registration in UAE Trade Mark Law on 20 May 2013.  According to the WIPO, the UAE is not yet a party to either the Madrid Agreement or Protocol.  It appears from Saba Al Sultani and Rob Deans that trade mark law has been harmonized among the Gulf Cooperation Council states but there is not yet a unitary GCC trade mark on the lines of the GCC patent or EU trade mark (see Al Sutani and Read GCC Trademark Law Coming Soon Sept 2014 WIPO Magazine).

Prohibited Marks
The following marks will not be recognized in the DIFC unless they are registered under Federal trade mark law:
"(a) a mark which is not distinctive; 
(b) a mark consisting of a generic name used in relation to goods, products or services; 
(c) a mark that contains one or more familiar drawings or common pictures of goods; 
(d) a mark that is contrary to the public order or morality of the UAE; 
(e) a mark containing the insignia of the UAE, any governmental body in the UAE, flags and other symbols pertaining to the UAE (or any emirate thereof), Arab or international organisations (or any agencies thereof), or any foreign country except with the authorisation of those parties, as well as any imitation of such insignia, flags or symbols; 
(f) a symbol of the Red Crescent or the Red Cross, or any other similar symbol or mark which is an imitation thereof; 
(g) a mark which is identical or similar to a symbol of a purely religious nature; 
(h) a geographical name, where the use thereof may cause confusion as to the origin or source of the goods or services; 
(i) a name, surname, photograph or emblem of a third party, unless his, or his legal successors’, prior consent has been obtained. 
(j) a mark containing a title of honour, where the person applying for registration cannot prove that he is lawfully entitled to its use; 
(k) a mark which may mislead the public or which is identical or confusingly similar to a mark or marks of another party, even though not registered, or which contains false information as to the origin or the source of products or services, or about their other characteristics, as well as a mark containing an imaginary, imitated or forged trade name; 
(l) a mark owned by a person with whom it is illegal to deal with under Federal Law or Dubai Law. 
(m) a mark which, if used for certain classes of products or services, would diminish the value of other products or services distinguished by such mark; 
(n) a mark containing the word or expression: "Patent", "Patented", "registered", "registered Design", "copyright" or "Imitation is forgery" or similar words and expressions; 
(o) a mark containing national and foreign decorations, coins and paper currency; or 
(p) a mark that constitutes a translation or imitation of a well-known mark or the main part thereof or other previously registered mark, where the registration would confuse consumers as to the identity or origin of the goods or services that are distinguished by the mark or similar goods or services" (art 44).

The Commissioner of Intellectual Property ("the Commissioner") may levy a $5,000 fine upon anyone using a mark that falls within sub-paragraphs (d) to (p) pursuant to art 48 (1) and art 59 (see my Introduction to, and Overview of, the New DIFC Intellectual Property Law of 11 Dec 2019).

Well Known Marks
Art 45 (1) of the DIFC Intellectual Property Law protects well-known trade marks of international reputation ("well-known marks") that surpass their country of its origin and acquires fam in a relevant sector among consumers in the UAE. The decision as to whether a mark is or is not a "well-known mark"appears to be one for the court.   In making that decision, art 45 (2) enables the following factors can be taken into account{

"(a) the degree of public knowledge or recognition in a relevant sector; 

(b) the duration, extent and geographical area of use; 

(c) the duration, extent and geographical area of any promotion of the goods or services to which the trademark applies; 

(d) the duration and geographical area of any registrations, or any applications for registrations, to the extent that they reflect use or recognition of the trademark; 

(e) the record of successful enforcement of rights in the trademark, in particular, the extent to which the trademark was recognised as well known by competent authorities; or 

(f) the commercial value associated with the trademark."

Nobody may use a mark that is identical or confusingly similar to a well-known trade mark in the DIFC (art 45 (3)).  Transgressors of this rule can be fined US$15,000 by the Commissioner.  

Owners of well known marks also have the following rights of action under art 45 (4) and (5):

  • the right to prevent any party from using in the DIFC identical or confusingly similar marks, to distinguish goods or services that are not identical to those in respect of which, the well-known trade mark is registered, if: 
    • the use of the mark indicates a possible connection between goods or services and the owner of the well-known trademark; and 
    • the interests of the owner of the well-known trade mark are likely to be damaged by such use; and
  • the right, to prevent another person’s commercial use of a mark or trade name in the DIFC, if such use began after a well-known trade mark has become well-known and the use of the mark or trade name causes dilution of the distinctive quality of the well-known trade mark.
The Commissioner can fine anyone using a trade mark in a way that may cause dilution to a well-known trade mark US$15,000.

Trade Mark Owner's Rights of Action
Art 46 confers upon the proprietor of a trade mark that is registered in the United Arab Emirates the exclusive right to exclude others from the import, export, use, sale, offer for sale, advertising, transit, distribution or use in any manner of goods or services distinguished by an identical or confusingly similar trade mark 

Art 49 provides that the following acts shall not infringe a trade mark or well-known mark:

"(a) to indicate the intended purpose of the goods or a service related thereto, provided that such use is necessary and in good faith;
(b) in news reporting, news commentary or parody; or
(c) by another person in comparative commercial advertising or promotion to identify competing goods or services, provided that such use is in good faith and in accordance to honest practices in commerce."

Should a defendant allege that the trade mark in suit is invalid or should be cancelled for other reasons, art 48 (2) requires him or hee to must issue proceedings in a court with jurisdiction to cancel the registration and satisfy the DIFC court that there are clear and solid grounds for such proceedings.  If he or she does so, the infringement proceedings in the DIFC will be stayed until the court of competent jurisdiction has ruled on the cancellation claim.  If the defendant does not do so, the infringement proceedings in the DIFC will continue.

Punishable Infringements
The following infringements are punishable with the following fines:

  • US$30,000 for "counterfeiting or imitating" a registered trade mark, or a well-known trade mark, with the intent or effect of misleading the public (art 48 (1) (b));
  • US$25,000 for unlawfully using a registered trade mark or a well-known trade mark without the proprietor's consent (art 48 (1) (c));
  • US25,000 for unlawfully using a trade mark that is confusingly similar to a registered trade mark with the intent to, or effect of, causing confusion and misleading the public (art 45 (1) (d))'
  • US$25,000 for knowingly selling, offering for sale or possessing with purpose of selling goods or services bearing a trade mark, or well-known trade mark, that is counterfeited, imitated or unlawfully used (art 48 (1) (e),

Art 47 (1) permits the owner of a trade make by a written instrument, grant a licence to any person to use the trade mark for all or part of the goods or services in respect of which the trade mark is registered.   The owner of the trade mark may also use the mark contemporaneously with the licensee unless otherwise agreed in writing (art 47 (2).  Such a licence is known as a sole licence as opposed to exclusive licences which can be used by the licensee to the exclusion of the licensor and all other persons and non-exclusive licences that can be used by the licensor and any number of licensees.   

A licensee may not assign its rights to any other party, or grant a sub-licence in respect thereof, unless expressly allowed by the terms of the licence agreement (art 47 (3)).

Unless the licence agreement provides otherwise, a licensee is entitled to call on the owner of the trade mark to take infringement proceedings in respect of any matter which affects the licensee’s interests by virtue of art 47 (5) If the owner refuses to act in accordance with a request by the licensee, or fails to do so within two (2) months of being called upon to do so, the licensee may bring such proceedings in his or her own name, as if he or she were the registered owner of the trade mark.

Any act of a licensee in contravention of a licence agreement shall constitute trade mark infringement pursuant to art 47 (4) and may be punished by the Commissioner with a US$30,000 finr.

Trade Names
A trade name is defined in the table to paragraph 3 of Schedule 1 "as every name used in trade to designate particular business and registered with the competent authority."  Art 50 requires of persons registered, incorporated, licenced or permitted to operate in the DIFC to comply with the provisions of the Operating Law (DIFC Law No 7 of 2018) in relation to trade names, and to display such names conspicuously displayed on the façade of their business premises in the DIFC. Failure to display the name in accordance with the law attracts a fine of US$5,000.   Art 51 enables the Commissioner to resolve any conflict between a trade name registered in the DIFC and a trade mark, or a well-known Trademark, which is likely to damage the interests of a person, cause confusion or mislead the public.   Failure to comply with an order of the Commissioner to change a trade name in conflict with a trade mark may be punished with a fine of US$10,000.

False Claims
Art 48 (1) (f) prohibits falsely representing that a mark is registered as a trade mark, or as a well-known trade mark, or making any statement with the intent or the effect of leading others to such a conclusion.  The Commissioner can impose a US$5,000 fine for such misconduct.

Because DIFC law differs from English and EU trade mark law in a number of important respects, particular care should be taken in drafting a trade mark licence or assignment or a franchising, distribution or other agreement to be governed by DIFC law or likely to affect the DIFC.   Should it be necessary to enforce a trade mark or resist enforcement proceedings in the DIFC courts, members of the bar of England and Wales in good standing can obtain quickly and easily the right to appear before those tribunals. Actions to cancel UAE trade marks will have to be undertaken by Emirati lawyers.

Anyone wishing to discuss this artiucle or DIFC law generally should call me on +44 (0)20 7404 5252 during normal UK business hours or send me a message through my comtact form;  

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