Key aspects of trademark enforcement in Australia
Many countries have similar systems for the registration and enforcement of trademarks. However, there will inevitably be differences, often borne out of the different jurisprudential bases on which these systems are based. This article looks at trademark enforcement in Australia and highlights some aspects of the Australian legislation which differ from the US system. It also examines the main border protection methods available in Australia to trademark owners.
This article first appeared in the March/April 2007 issue of the World Trade Mark Review.
Border protection measures
Customs provisions under the Trademarks Act 1995 (Cth) and the Copyright Act 1968 (Cth) allow Australian Customs to seize goods that infringe trademarks and copyright when they are imported into Australia. Lodging a notice of objection with Customs is a cost-effective means of tackling goods which infringe IP rights before they enter the Australian market.
Notices of objection
Under the Trademarks Act and the Copyright Act, a trademark owner, an authorized user of a trademark, a copyright owner or the owner’s exclusive licensee may lodge a notice of objection with Australian Customs objecting to the importation of:
- goods that have a trademark applied to them which is substantially identical or deceptively similar to a registered trademark nominated in the notice of objection; and/or
- copies of nominated copyright works, if those copies would have constituted an infringement of copyright had they been made in Australia by the importer.
A notice of objection provides Customs with details of genuine trademarks or copyright works and details of who owns the trademarks and/or works. If a notice of objection has been lodged and Customs becomes aware of a shipment of goods which it suspects are not genuine and which it believes are intended for commercial use, it will seize and hold the goods for a limited period.
Trademark notices of objection are valid only in respect of the goods for which the relevant trademark is registered.
If a trademark is comprised of a stylized word mark or a device mark in which copyright subsists (which is a separate question), it would also be appropriate to lodge a notice of objection in relation to those copyright works. The advantage of a copyright notice of objection is that it can be lodged immediately, whereas the trademark notice cannot be lodged until the relevant mark is registered. As this process can take at least five months, and in some cases many months more, border protection can be achieved at an early stage through a copyright notice of objection.
A notice of objection is valid for four years. A notice may also be re-lodged to ensure ongoing protection. The notice, if it is no longer needed, may be withdrawn at any time. Separate notices of objection are required for trademarks and copyright. However, each notice can refer to multiple trademarks or copyright works. A notice of objection cannot act retrospectively for goods that have already been imported. Furthermore, a notice of objection in either case is unlikely to be effective against imports of genuine goods. In the case of trademarks, it is well settled that trademark registrations in Australia cannot protect against the importation of genuine goods. Indeed, Section 123 of the Trademarks Act specifically provides a defence to infringement where a trademark is applied to goods with the consent of the owner. In the case of copyright, the Copyright Act has detailed provisions which prevent the use of copyright subsisting in non-infringing labels, packaging, instructions for use and the like to prevent the importation of the principal goods to which they relate.
The seizure process
Where a notice of objection is in place and Customs seizes goods, it will send a notice of seizure to the importer and the objector and hold the goods for 10 working days. In certain circumstances Customs may agree to extend the seizure period to 20 working days.
During that period:
- the objector may commence legal action;
- the objector may consent to the release of the goods; or
- the importer may voluntarily forfeit the goods, provided civil legal action has not commenced.
If the objector does not commence legal proceedings within the stipulated timeframe, Customs must release the goods to the importer unless they have been voluntarily forfeited. If the goods have been voluntarily forfeited, Customs will dispose of the goods by destruction or donation to a charity or in accordance with a court order. The court will make an order regarding the goods at the conclusion of any legal proceedings that may be initiated.
The Trademarks Act contains detailed enforcement provisions in Section 120. Of importance for present purposes is the fact that the infringement test for direct infringement is much broader than the test in the United States.
Under Australian law, a person will infringe a trademark registration if the person uses as a trademark a sign that is substantially identical or deceptively similar to the trademark in relation to goods or services in respect of which the trademark is registered. The two differences from the US test are that:
- the use must be “as a trademark”; and
- there is no requirement of the likelihood of confusion.
As an aside, the lack of a requirement to show a likelihood of confusion explains why Australian practitioners tend to draft broad specifications of goods or services in respect of which a trademark application is made, whereas US practitioners are required to adopt a narrower specification of goods or services.
A mark is used as a trademark when it is used to denote the person using it as the origin of the goods or services in respect of which it is used. This element has implications in particular for parallel imports and descriptive use.
The absence of a requirement to establish a likelihood of confusion means that in matters of direct infringement an action could be brought solely on the basis of evidence of proof of registration and unauthorized use of the relevant mark. This substantially curtails the cost of an action for direct infringement under which a likelihood of confusion is required to be proven.
The Australian act also deals with indirect infringement. This occurs where a mark which is substantially identical or deceptively similar to a registered mark is used in relation to goods or services of the same description as those in respect of which the trademark is registered, or goods or services which are closely related to the registered goods or services, as the case may be. However, if the alleged infringer establishes that the use of the mark in those circumstances is unlikely to deceive or cause confusion, there will be no infringement.
A mark which is well known in Australia will be infringed where a person uses a mark which is substantially identical or deceptively similar to the wellknown mark in Australia in respect of unrelated goods or services, where the use would be likely to be taken as indicating a connection between the unrelated goods or services and the owner of the registered wellknown mark. The owner of the well-known mark must also establish that its interests will be adversely affected.
Intention to use and non-use
One final point to make in respect of the enforcement of trademark registrations in Australia is that there should be both:
- at the time of application, a good-faith intention to use the trademark in Australia, to authorize use of the trademark in Australia or to assign the trademark to a body corporate for use by the body corporate in Australia; and
- after registration, actual use.
This is because in the absence of these elements, the validity of the trademark registration would be questionable.
After a mark has been registered for five years from the date of application, it is subject to removal by a third party if the third party can establish that, in a continuous period of three years ending one month before the day on which the non-use application is filed, the registered owner did not use the trademark in good faith in Australia in relation to the goods or services in respect of which it is registered. In this respect, a trademark will be ‘used in Australia’ if goods have been offered for sale in Australia under the mark or if the mark has been used in an advertisement for the goods in the course of trade. However, preliminary discussions between the trademark owner and possible distributors or consultants are unlikely to be sufficient to defeat a non-use application.
The brief messages to be taken from this article are twofold. The first is that trademark owners in Australia should consider lodging notices of objection with Australian Customs where they anticipate that there may be imports of infringing goods. The second is that trademark owners should ensure that they can establish a good-faith intention to use at the time of application and sufficient use of the mark in Australia after registration in order to protect the validity of the mark for enforcement purposes.