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We are excited to share the latest edition of the Law Update, beautifully and appropriately titled “Sustainable Horizons: The Saudi Arabian Vision.” Giving special honor to the Kingdom’s 2030 vision, this update focuses on a collection of both informative and inspiring articles.
For those in construction, you can learn about how the tendering environment impacts risk-pricing for contractors, the updates on the legal framework of the construction industry and how contractors can protect themselves against financial difficulties.
There is good news too from the kingdom’s banking sector, from which the practice of “Open Banking” is being pushed for! But what is open banking? We’re answering that too.
Also . . . Are there any women trail blazers in Saudi Arabia you can name? We’ll help you with that. We cover how the Middle East has been making strides in empowering women in the entrepreneurial space,most notably in STEM fields.Read the full edition
The UAE has announced the biggest legislative reform since years, this included the issuance of a new Federal Trademarks Law No. 36 of 2021 (“New Law”), which will come into effect on 2 January 2022. The New Law will replace Federal Law No. 37 of 1992 as amended (“Current Law”) in its entirety, this is the most significant amendment to trademarks law since the Current Law’s enactment.
While the New Law generally adopts the GCC Unified Trademarks Law, it has provided some different aspects and procedures. The New Law addresses several issues that were lagging under the Current Law such as registration of non-traditional trademarks, increasing the penalties for infringement of trademarks, and have confirmed some other aspects that were addressed through Court precedents such as prior use and registration in bad faith. In addition, the New Law has introduced the registration of Geographical Indications for the first time, and provided for the grounds of its registration and enforcement. Procedures provided under the New Law will be further detailed in executive regulations which has yet to be issued.
We summarise here the key changes set out in the New Law.
The definition of trademarks has been expanded in the New Law to cover more of non-traditional trademarks such as; 3D trademarks, single color, holograms, sound and smell.
The New Law provided a list of marks that cannot be registered as trademarks. While the list is almost the same as the one provided in the Current Law, the New Law has expanded the prevention to include any trademark that is identical, similar, imitation, translation, phonetic translation or transliteration of a previously registered trademark or well-known trademarks.
In addition, the New Law specifically prevented the registration of a 3D trademark that is the shape of the products covered under the registration or the shape that is necessary functional shape.
The criteria for considering a trademark as well-known has been clarified under the New Law. The criteria include; (i) the extent to which it is known to the concerned public as a result of its promotion, (ii) the period of its registration, its use, (iii) the number of countries in which it is registered or well-known, (iv) its value, or (v) the extent of its impact on the promotion of goods or services that use the well-known Trademark to distinguish them.
It appears that the New Law will allow for multi-class application. However, this will be further decided and confirmed in the executive regulations, which has yet to be issued.
Although the practice at the UAE Trademarks Office has allowed for the registration of series trademark, the New Law has specifically allowed the registration of series trademarks. Series trademarks are defined as trademarks that are similar in all its essential elements and have some differences that do not affect the substantial element of the trademark such as the colour or the specifications, provided that it is within the same class.
An interesting development brought by the New Law is the establishment of a Grievances Committee (“Committee”) in the Ministry, which will be headed by a specialised judge to be nominated by the Minister of Justice, along with two specialised members to be appointed by the Minister of Economy. The Committee will hear all objections to decisions issued by the Trademarks Office with respect to applications, oppositions and cancellations. Having a judge heading the Committee is very important considering the matters it will hear and decide.
The process before the Committee will be decided by the executive regulations, which has yet to be issued.
All decisions issued by the Committee shall be subject to appeal before the Federal Court of Appeal instead of the Court of First Instance under the Current Law. This development makes perfect sense, considering that the Committee will have a judge and two experts. This will significantly decrease litigation time, as it will be only for two stages appeal and high court, instead of three stages as it is now under the Current Law.
Prior use right has long been adopted in the UAE through Court precedents, it has now been crystalized under the New Law. The New Law has clearly provided for the rights of a prior user of a trademark to cancel a trademark that was registered within 5 years unless such registration was accepted, expressly or impliedly, by the prior user of the trademark.
Similar to the situation under the Current Law, a trademark will become immune if registered and used for 5 years without any challenges to its ownership. However, the New Law excluded a trademark that was registered in bad faith from this immunity. This complies with the Paris Convention and Court precedents in the UAE.
Contrary to the Current Law, where the jurisdiction for cancellations of trademarks is with the competent court, the New Law moved this jurisdiction to the Ministry of Economy. Regardless of the reasons for the cancellation (similarity, bad faith, non-use…etc.), the Ministry shall have the jurisdiction to look into all cancellation requests.
The New Law allowed the assignment a trademark with or without consideration, which was not clear under the Current Law.
With respect to trademark licenses, the New Law has clearly stated that it is not required to be registered with the Ministry. Registration of license agreement was subject to debate under the Current Law, as it used to affect the license effect against third parties, this has now been clarified, and there will no longer be any effect for not registering the license.
The New Law provided time frames that differ from the Current Law:
While the Ministry has been conducting notifications through email for a while now, this is now regulated by the New Law.
This is a brand new addition to the IP legislations in the UAE. Geographical Indications (GIs) were not regulated previously in the UAE, although it was addressed in the Current Law only in terms of the marks that cannot be registered.
GIs are defined in the New Law as any any indication showing that a good has originated in the territory of a member country of the World Trade Organisation or in a region, location, or place of that region if the good’s quality, reputation, or other characteristics are primarily due to its geographical origin.
A GI can be a sign or a number of signs in any form, including words, geographical names, personal names, numbers, colour or colours.
The New Law addresses the conflict between GI and trademarks and prevented the registration of a GI if it causes confusion with a trademark application or with a trademark that has been used in good faith in the country.
Customs seizures has been regulated in the New Law, which is not the case under the Current law. The New Law provides that Customs authorities may on its own or on the request of the right owner stop the clearance of a shipment for (20) days, for any products that are in violation of the New Law. However, some exceptions are provided which cover; (i) small quantities of a non-commercial nature of goods that are placed in the personal baggage of travellers or are sent in small parcels, and (ii) goods offered for trade in the markets of the exporting country by the owner of the Trademark or with his consent (this is mainly parallel imports).
Details and procedures of Customs actions will be detailed in the executive regulations.
Detailed procedures for provisional measures have been provided in the New Law. provisional measures include; (i) obtaining detailed report on the infringement; (ii) seizure on the materials, tools and equipment used in the infringement; (iii) preventing the goods that are the subject matter of the infringement from entering commercial channels and preventing their export, or (iv) preserving any evidence related to the subject matter of the infringement.
Provisional measure shall be issued by the judge of urgent matters, and it may be issued ex parte. A bank or monetary guarantee might be requested by the judge. A case in substance shall be filed within (20) days after the issuance of the Court order, otherwise it will be considered cancelled.
Penalties for trademark infringement have been increased. Pursuant to the New Law, fines become between AED100,000 to AED1,000,000 for the following crimes; counterfeit, imitation, using in bad faith a trademark owned by another, possession of material for the imitation or counterfeit of a registered trademark, knowingly exporting or importing of counterfeit products.
A slightly lower fine of AED 50,000 – 200,000 is stipulated for crimes that are related to the sale or possession of counterfeit products or infringing products or the use of a trademark that cannot be registered.
This is a significant increase of the fines from the Current law, which although were set at a minimum of AED 5,000, UAE Courts used to impose the minimum.
Should you need any further information or advice with respect to the New Law and the changes it brought, please feel free to contact us.
Partner, Head of Competition and Intellectual Propertyo.firstname.lastname@example.org
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