Big Changes to Canada’s Trademark System

Significant changes are coming to Canada’s trademark system. Amendments to the Federal Act that governs trademarks in Canada, including the registry system, are expected to come into effect in late 2015 or early 2016. Many of the changes will be positive, but the changes also a pose threat to Canadian trademark owners.

Among other things, the amendments will enable Canada to accede to some international trademark treaties, including the Madrid Protocol and the Nice Agreement (“Nice” being the city in France).

Currently, a Canadian business wishing to obtain trademark protection outside Canada, must file a separate trademark application for each country of interest, which is costly and time consuming. Once the Madrid Protocol has been implemented, a Canadian business that has a registration or pending application in Canada, will be able to obtain an “international registration” that may be extended, at any time, to any of the more than 90 Madrid Protocol countries. US businesses have enjoyed this privilege for over a decade.

However, the Madrid Protocol will also work in reverse; it will make it easier for a foreign trademark owner to obtain a Canadian trademark registration, which may adversely affect Canadian businesses. If, a trademark that is the subject of a Madrid Protocol application is confusing with a previously registered or applied-for mark, then the registration or application will automatically be an impediment to the Madrid Protocol application. However, if the Canadian business has not bothered to apply to register its mark, then the Canadian business would have to take positive steps against the Madrid Protocol application or resulting registration, which may be costly.

The Nice Agreement establishes a classification system for goods (35 classes) and services (11 classes). Currently, a Canadian trademark applicant pays only a single Government fee, no matter how many different types of wares and services are listed in the application. Although it hasn’t been confirmed, it is widely assumed that once the Nice classification system has been implemented in Canada, at least some Government trademark fees will be charged on a per-class basis, as this is how fees are charged in other jurisdictions that have adopted the Nice classification system (including the US). Thus, the charges for Canadian trademark applications covering wares and/or services that fall into multiple classes, are likely to increase.

Another significant change is the removal of the “use” requirement. Until now, Canada’s trademark registry system been based on the idea that registration serves primarily to confirm trademark rights that arise through actual use of a mark in commerce. Under the current Act, a Canadian trademark applicant must affirm that there has been use of the mark with the applied-for wares and/or services, before the mark will proceed to registration.

The removal of the use requirement will benefit Canadian businesses having a legitimate intention to use their applied-for marks, but who experience delays in commencing such use. However, the removal of the use requirement also creates the possibility of trademark squatting, that is, the registering of marks solely for the purpose of selling them.

In light of these upcoming changes, it would be prudent for Canadian trademark owners to give serious consideration to either establishing, or shoring up, their position on the Trademark Register.