A New Year’s resolution for your business? Filing a trademark application before changes to the Trade-marks Act

Every business has intellectual property, whether you know it or not.

In particular, your business name and the branding that you’ve built around your products and services are a valuable asset. That branding, which might include words, logos, designs, sounds or other types of distinguishing features can act as a “trademark.” A trademark distinguishes your business and services from those of others.

If you haven’t done so already, now is a great time to file a trademark application to protect your brand, due to major changes to Canada’s Trade-marks Act that are anticipated to take effect in early 2019.

In Canada, you do not need to register a trademark in order to have rights to your content, though a registration confers many benefits. One of those benefits is that a registered mark enjoys rights across the country, compared to an unregistered mark, whose rights extend only to the geographic region where the owner can actually prove that the mark has acquired reputation and goodwill through years of use.

Registrations also expand the scope of remedies available to an owner in court, should you need to assert your mark against a third party who is using a confusingly similar mark. Owning a registration can also assist in fighting off domain name squatters or other parties with dubious intentions. Moreover, a registration is often highly valued by lenders and potential purchasers of your business down the road. 

Because of the upcoming amendments to the Trade-marks Act, there are a number of reasons why you should consider filing a trademark application with the Canadian Intellectual Property Office (CIPO) now.

First, it’s expected that the changes to the Trade-marks Act will result in a more crowded CIPO Register. This is because trademark “use” will no longer be a requirement to obtain a registration. The elimination of this requirement could result in third parties, including foreign corporations (like the dreaded “trademark troll”), obtaining registrations even though they do not have a genuine interest in actually using a mark in Canada.

A crowded Register can make it more difficult and costly for the rightful owner to obtain a registration. In fact, we have already seen a recent influx of organizations filing for dozens (and even hundreds) of trademark applications for a wide variety of marks, within a matter of days. Their strategy may be a type of “trademark squatting”; i.e., they hope that their application or registration blocks a later-filed - though legitimate - brand owner’s application.  Then once the legitimate owner’s application is blocked by the troll’s application or registration, the troll demands a “ransom” from the business to either abandon or assign the mark to them.

Another reason to file an application now is that the Trade-marks Office currently only requires evidence of distinctiveness of a trademark to be filed by the owner in limited cases. “Acquired distinctiveness” arises through extensive use and advertising of the mark, which needs to have occurred for a number of years prior to the filing date of the application.

However, after the amendments take effect, it is expected that more owners will be required to prove distinctiveness, if the Examiner is of the view that the mark is not inherently distinctive (e.g., if it consists of numbers, letters not forming words, punctuation marks, colour and shape combinations, sound marks, moving images, etc.). If such an objection is made to an application, this step in the examination process could prove to be a difficult and costly obstacle to registration for some owners.

A further reason to consider filing now is that at present, the Trade-marks Office fees are expected to increase. For example, CIPO does not currently require additional fees depending on the number of classes of goods or services which are claimed in an application; but after the amendments take place, there will be an increase in fees. Filing now may result in significant savings depending on the size of your portfolio.

Of course, there are also significant benefits that come with the amendments to the Act, and there will be cases where it makes sense to wait to file until after the amendments take effect. Either way, now is a great time to reach out to a trademark professional to discuss these changes and how best you can protect your brand going forward.

Sarah is a registered Trademark Agent and lawyer practicing in McMillan’s Technology & Intellectual Property Group. She focuses on clearing and prosecuting trademarks for clients and manages domestic and  international brand portfolios of her clients. She also advises on intellectual property matters arising in corporate transactions and litigation and represents copyright users before the Copyright Board with respect to music royalties. Learn more about Sarah here.