SCT Agrees on Measures to Protect Use of Trademarkson the Internet
Geneva, March 20, 2001
Press Updates UPD/2001/127
Measures that will provide a clear and predictable legal framework for those who use a trademark or other distinctive sign on the Internet were agreed by representatives of 84 member states of the World Intellectual Property Organization (WIPO) at a meeting of the Standing Committee on Trademarks (SCT) held from March 12 to 16, 2001. The draft provisions concerning the protection of marks and other distinctive signs on the Internet will be submitted for final adoption as a joint recommendation to the WIPO General Assembly in September 2001. The provisions are intended to make all rights in distinctive signs which are of a territorial nature, particularly, trademarks, trade names and geographical indications, "Internet compatible".
Every commercial entity relies upon signs to distinguish itself, or its goods and services, from those of its competitors. By building recognition and goodwill companies inspire confidence in their brands and this enables them to obtain certain commercial advantages within a competitive market place. In the off-line world, the protection of these signs is regulated on a territorial basis. For companies operating within virtual markets, however, the signs are an indispensable marketing tool which offer a presence as global as the Internet itself and for which, at present, there is no clear, consistent and predictable legal framework.
The draft provisions are designed to help national courts and other competent authorities apply existing laws to legal problems resulting from the use of signs on the Internet. In particular, they apply to issues resulting from the tension between territorial rights that govern the use of signs in the off-line world and a global communications medium, such as the Internet, which offers a potentially global presence for any sign used. The draft provisions address three main issues, namely:
1.The conditions under which the use of a sign on the Internet can be considered to have taken place within a particular country;
This question is of crucial importance because only use that can be deemed to have taken place within a particular country can contribute to establishing, maintaining or infringing an industrial property right protected in that country. The provisions establish the general principle that use of a sign on the Internet can only be considered to have taken place in a particular country if it has had a "commercial effect" or commercial repercussions in that country. A detailed list of factors which can be relevant in determining whether such use has had a "commercial effect" are outlined in the provisions.. These include, actual delivery of goods or service, language, interactivity of the web site, and registration of the web site under a country code top level domain (ccTLD).
2.Measures to enable owners of rights in identical or similar signs to use these signs concurrently on the Internet;
In the off-line world where the protection of signs, such as trademarks, trade names and geographical indications are territorial (i.e. they have legal effect only within the country in which they are granted), different owners can hold industrial property rights in identical or similar signs in different countries. This can create problems if the sign is used in cyberspace because rights that coexisted in the off-line world suddenly come into conflict on the Internet. Such use might, therefore, be considered to infringe another right which is protected under the law of a country in which the right of the Internet user is not recognized.
To address such potential conflicts, the provisions introduce a "notice and avoidance of conflict" procedure which benefits right holders and other legitimate users, such as those who use their personal name or a sign which is considered generic or descriptive in a country to which they have a close connection, provided they use their sign in good faith. As a consequence, they cannot be subjected to any injunction, or held liable for any damages occurring before notification. Users would, therefore, not be forced to undertake a worldwide search for conflicting registered or unregistered rights before using their sign on the Internet, an obligation that would place a heavy burden in particular on small and medium-sized enterprises (SMEs) wishing to take full advantage of the global virtual market. Once notified of a conflicting right, to avoid liability, the user is required to take certain measures to avoid the conflict. In this regard, the provisions advocate the use of disclaimers to enable legitimate users to avoid liability.
3.Ways in which courts may take account of the territorial basis of industrial property rights in signs when determining remedies.
An injunction to cease every use of a sign on the Internet would go far beyond the territory in which a conflicting right in that sign exists. When determining remedies, therefore, it is necessary to take the territorial limitation of marks or other rights in signs into account. Under the provisions courts are required to be creative in considering limitations of use to avoid a commercial effect in the state or states in which the infringed right is protected, and to avoid any confusion with the owner of that right through the use of e.g. disclaimers or gateway web pages. Under the provisions it is not possible to prohibit the use of a sign on the Internet completely if the user of that sign is acting in "good faith" and owns a right in a sign or is otherwise permitted to use that sign.
The next meeting of the SCT is scheduled to take place from September 10 to 14, 2001.
For further information, please contact the Media Relations and Public Affairs Section at WIPO:
- Tel: (+41 22) - 338 81 61 or 338 95 47
- Fax: (+41 22) - 338 88 10
- Email: publicinf@wipo.int.