Trade marks: the good, the bad and the ugly, ugly
After many years of anticipation and after several false
alarms, it seems that Canada will soon be overhauling its trade
mark law. The Canadian Trademarks Office is anticipating that
the new law will be in force in early 2019. While the
Trademarks Office previously, on several occasions, anticipated
that the new law would come into force earlier, they seem
considerably more committed this time.
These will be the most significant changes to Canadian trade
mark law in more than 50 years. With these changes, Canadian
trade mark applications will be simplified, looking
increasingly like European applications and somewhat less
similar to US applications.
A summary of some of the main changes:
- Simplified applications
Trade mark applications will be simplified and will
no longer include a date of first use. Details of use and
registration of the mark abroad will also no longer be
Canada will become a member of the Madrid
- New non-traditional marks
The definition of a trade mark will be greatly
expanded to cover anything that functions as an indicator of
source and will include any "sign, or combination of signs"
that serve that purpose.
As a result, protection will be available for traditional and
non-traditional marks, including a word, a personal name, a
design, a letter, a numeral, a colour, a figurative element,
a three-dimensional shape, a hologram, a moving image, a mode
of packaging goods, a sound, a scent, a taste, a texture or
the positioning of a sign.
- Divisional applications
It will finally be possible to divide applications
in Canada, which will be of strategic assistance during
prosecution and in some oppositions.
- No more Declarations of Use
A Declaration of Use will no longer be required.
This will apply to all pending applications.
- Term harmonised with other countries
The term of registration will be reduced from 15 to
- Letters of Protest
Third party correspondence (i.e. Letters of Protest)
will be permitted during prosecution.
- No more registration fee
The government registration fee will be
The Nice Classification of goods and services will
be adopted (classification is currently voluntary).
Fees per class
Consistent with the rest of the world, fees per class will
Some examples of the new fees include:
- Trade mark application filing fee
The filing fee will be $330 CAD for the first class
plus $100 CAD for each additional class instead of the
current $250 CAD filing fee regardless of the number of
Multi-class applications should therefore be filed prior to
the implementation of the new law to avoid this significant
fee increase for multi-class applications.
- Registration renewal fee
The registration renewal fee will be $400 CAD for
the first class plus $125 CAD for each additional class
instead of the current fee of $350 CAD regardless of the
number of classes.
Registrations renewed prior to the implementation of the new
law will not be subject to the higher, per-class fees.
Accordingly, renewals should be considered prior to the
implementation of the new law.
What should Americans consider prior to implementation of
new Canadian trade mark law?
A few key strategies can be employed during the months that
remain before the new law takes effect in order to both obtain
maximum benefit from the current legal landscape for trade
marks in Canada and to positively position American brand
owners for the upcoming new law:
- File multi-class applications before new
law is implemented to save fees.
- Renew registrations before the new law is
implemented to save fees.
- File applications to register sound marks
now. Currently, they can be registered with no evidence of
distinctiveness. Under the new law, applicants will have to
- Protect your important brands in Canada as
soon as possible, before a troll does.
Beware of trolls
Historically, trolls (or squatters, or pirates) were not a
problem in Canada. Sadly, the trolls have arrived.
In some cases, trolls apply to register trade marks in one
country that are used by brand owners in other countries with
the goal of forcing those owners to negotiate with the trolls
when they enter the new market. In light of Canada's current
trade mark application requirements, this was not previously a
serious problem. However, with the announcement that the trade
mark amendments will eliminate the use requirements to obtain a
trade mark registration, trolls have started to capitalise on
the impending changes.
New data shows that seemingly baseless applications filed by
trolls are already on the rise.
All-class applications filed per year
What is happening?
In 2017, there was a sharp increase in the number of
applications filed in all 45 classes. Trade mark applications
listing all 45 classes immediately evoke suspicion since it is
unlikely that any one individual or business has a genuine
intention to use a trade mark in association with every class
of goods and services.
As of December 2017, there were 427 of these all-class
applications on the Canadian database. Of those, four were
filed in 2015 and six were filed in 2016. The remaining 417
all-class applications were filed in 2017, representing a huge
increase in comparison with the preceding years. The majority
of these all-class applications appear to be held by known
trade mark trolls. Among the suspicious applications are those
seeking to monopolise established brand names such as EUIPO,
Fashion Week, and Pan Am, given names such as Pedro, Melanie,
and Claire, and generic words such as TAXI, PERK, CHOCOLATE,
DEAL, and EXCELLENT. These applications are currently
While the ultimate intentions of these trade mark trolls are
unclear, this activity is troubling and is already creating
problems for brand owners. There have been many instances of
these troll applications being cited against the legitimate
applications of brand owners. Overcoming these citations can be
Why have the trolling activities already started? There are
Firstly, all of the applications mentioned above were filed
based on proposed use in Canada. Currently, applicants who file
based on proposed use must eventually declare that they have
used the mark in Canada prior to obtaining a registration.
However, once the new trade mark law comes into force, it will
no longer be necessary to file any declarations of use.
Secondly, as noted above, Canada does not currently have a
per-class filing fee. Rather, the fee to file a trade mark
application is the same whether it contains one class or 45.
However, once the changes are implemented, Canada will adopt a
fee-per-class system for new applications. As a result, there
are significant cost advantages to filing multi-class
applications now rather than waiting until the amendments come
into force. Once the new law comes into force, the cost to file
a 45 class application will rise from $250 to $4,730 CAD.
What to do?
As the implementation of the amendments approaches, we will
undoubtedly continue to see an increase in trolling activity.
Accordingly, it is important for companies to review their
Canadian portfolios now to ensure that all important marks are
protected, whether by filing new applications or maintaining
existing registrations. Similarly, American brand owners should
consider proactively filing applications in Canada as soon as
(or even before) they contemplate entering the Canadian
It is also important to regularly monitor the Canadian
Trademarks Office database to identify trolling applications as
soon as possible, so that more options are available to defeat
them. Since the trolls have already arrived and appear to be
sophisticated, brand owners should be prepared to engage in
oppositions and expungement proceedings in order to protect
their trade marks.
Patents: changes associated with the Canada-European Union
Comprehensive Economic and Trade Agreement (CETA)
Amendments to the Patent Act and associated regulations came
into force on September 21 2017, giving effect to Canada's
obligations under CETA. There are significant changes,
particularly with respect to pharmaceutical patent law.
Firstly, certificates of supplementary protection (CSPs)
were introduced, providing for restoration of patent term to
account for marketing delays resulting from lead time required
to obtain regulatory approval. The maximum term of a CSP is two
years, substantially less than the maximum five-year patent
term extension available under US law to account for marketing
time lost awaiting FDA approval. This is the only form of
patent term extension or restoration available in Canada.
Unlike US patents, the term of Canadian patents is not subject
to adjustment to account for patent office delay.
It is important for American applicants to be aware that a
CSP is only available if the Canadian application for marketing
authorisation is filed within 12 months of the first
application for marketing authorisation in any of the United
States, the European Union or any member country thereof,
Australia, Switzerland, or Japan. It therefore may be necessary
to revise regulatory approval plans for Canada in order to
benefit from a CSP.
Only a single CSP can issue in connection with a marketing
authorisation. A priority regime, based on the date of patent
grant, determines CSP eligibility when there are multiple
applicants. American applicants therefore should consult with
their Canadian representatives with respect to measures for
expediting grant of patents for which a CSP will be sought.
The CETA changes also comprehensively alter the regime that
has governed pharmaceutical patent litigation in Canada for
nearly 25 years. The summary proceedings previously in place,
in which an innovator seeks an order from the Federal Court,
enjoining the Minister of Health from issuing marketing
authorisation to a second person, has been replaced by a full
right of action, with accompanying procedural guarantees and
discovery obligations. The new regime is intended to provide
equivalent and effective rights of appeal to all litigants (the
previous summary proceedings were moot once marketing
authorisation issued), and to end the practice of dual
litigation, wherein a full patent infringement action followed
Changes associated with the Patent Law Treaty (PLT)
Amendments to the Patent Act and Patent Rules are
anticipated to come into force perhaps as soon as 2019, largely
for compliance with the PLT. These amendments will simplify and
harmonise a number of administrative practices. Separate from
the PLT requirements, the Patent Act and Rules will be amended
to provide improved protection for applicants and patentees
during force majeure events such as floods or power failures,
which prevent them from communicating effectively with the
Significant changes under the amended Patent Act and Rules
that will be of interest to American applicants and
practitioners include the following:
- Reduced requirements to obtain a filing
It will be possible to defer payment of the filing
fee and a translation of the application into English or
French. It will also be possible to defer filing a
specification at all by instead making reference to a
previously regularly filed application.
- 24/7/365 electronic filing
A filing date may be secured on a day when the
Patent Office is closed for business (e.g. Saturday or
Sunday) if the application is filed by electronic means.
- Addition to specification or addition of
A procedure is introduced whereby the applicant may
add to the specification or add a drawing, without loss of
the original filing date, if the addition is wholly contained
in a priority document, and the addition is made within two
months from filing, or within two months from notice by the
commissioner of patents that part of the application appears
to be missing.
- Restoration of priority
Restoration of priority is introduced, such that it
will be possible to claim priority to a previously regularly
filed application filed up to 14 months before the Canadian
(or PCT) filing date, if the request is made within the same
time period, and the applicant states that the failure to
file the application in a timely manner was
- Shortened term for national phase entry
A PCT application must enter the Canadian national
phase within 42 months from the priority date, although an
additional late fee is payable if the applicant enters the
national phase more than 30 months from the priority date.
Under the proposed Rules, the late entry option is removed.
If the applicant fails to enter the national phase by the 30
month deadline, it is still possible to do this within 42
months of the priority date, but only upon submitting a
declaration that the failure to enter the national phase in a
timely manner was unintentional and a statement of the
reasons for the failure. The commissioner of patents has to
determine that the failure was unintentional.
- Extension of time limits in unforeseen
The amended patent regime will provide greater
flexibility to deal with floods, power failures, and other
events by permitting the commissioner of patents to extend
time periods on account of unforeseen circumstances, if the
commissioner is satisfied that it is in the public interest
to do so.
- Notice of certain deadlines prior to abandonment
The Patent Office will be obliged to provide notice
that certain deadlines have been missed before an application
is deemed to be abandoned. This will include failure to pay,
request examination, or to pay a maintenance fee on a pending
application. Notice will similarly be required before a
patent is deemed to have expired for non-payment of a
- Due care standard for reinstatement in some
Canadian patent applications become abandoned if
action is not taken by the prescribed deadline. At present,
the application may be reinstated by request, paying a fee,
and taking the omitted action within 12 months of the date of
abandonment. That is, reinstatement is as of right. Under the
amended Act and Rules, the requirements for reinstatement
will be more stringent in certain cases where abandonment
only occurs after notice of the missed deadline –
namely missed payment of the examination fee or a maintenance
fee. In such instances, a due care standard will apply if
reinstatement is effected more than six months from the
original deadline. The applicant must state the reasons for
the failure to take the action that led to abandonment, and
the commissioner must determine that "the failure occurred in
spite of the due care required by the circumstances
having been taken." What constitutes due care is currently
unknown. Reinstatement under the due care standard may be
subsequently challenged in Federal Court.
- Payment of maintenance fees
Currently, only the Canadian patent agent may pay a
maintenance fee on a pending application. This will change
such that anyone, such as an annuity service, can pay
maintenance fees on pending applications, as is presently the
case for issued patents.
- Third party rights
An exception from infringement of a patent is
introduced for otherwise infringing acts that a third party,
in good faith, first committed or made "serious and effective
preparations" to commit during a prescribed period after an
applicant or patentee failed to request examination or pay a
maintenance fee by the original deadline. It will be for the
courts to clarify what constitutes "serious and effective
preparations" to commit an infringing act. The application of
third party rights may be avoided by taking action within six
months of the original deadline.
Already in force since June 2016 are amendments to the
Patent Act and Trademarks Act, establishing privilege for
communications between clients and their patent and trade mark
agents. Importantly, such privilege extends to communications
between foreign patent and trade mark agents and their clients
in jurisdictions which similarly recognise such privilege.
Accordingly, this protection may extend to communications
between American patent and trade mark attorneys or agents and
their clients, if those communications are privileged under US
American trade mark and patent owners should make
preparations now in order to best accommodate and benefit from
these changes to Canadian IP laws. Indeed, in some instances,
action may be warranted before the new laws come into
Trade mark applicants may wish to take advantage of the
current low trade mark application filing fees and registration
renewal fees available before the new law is in force. As well
as this, companies may wish to ensure that their important
brands are protected in Canada to protect against trolls.
Patent applicants must be mindful that it will no longer be
possible to enter the Canadian national phase of a PCT
application as a matter of right more than 30 months from the
priority date. Pharmaceutical patentees seeking a CSP will need
to ensure that their application for marketing authorisation in
Canada follows within 12 months of the first application for
marketing authorisation abroad, and should aim to expedite
prosecution of the relevant Canadian patent application.
The preceding is intended as a timely update on Canadian
intellectual property and technology law. The content is
informational only and does not constitute legal or
professional advice. To obtain such advice, please communicate
with Smart & Biggar's offices directly.
||David Schwartz is a
partner in Smart & Biggar’s Ottawa
office. His practice focuses on patent law in the fields
of biotechnology, pharmaceuticals and chemistry, as well
as plant breeders’ rights. David advises on
regulatory matters relating to the Patented Medicines
(Notice of Compliance) Regulations, data protection under
the Food and Drug Regulations and matters concerning the
Patented Medicine Prices Review Board. He appears
regularly in oral proceedings before the Patent Appeal
Board and has handled first-to-invent conflicts under the
pre-1989 Patent Act. David has testified on patent law
reform before both the House of Commons Standing
Committee on Industry, Science and Technology and the
Senate National Finance Committee, and has lectured on
patent law at Queen’s University and the
University of Ottawa. In 2013 he was named LMG Life
Sciences Canadian Patent Attorney of the Year and Best
Lawyers 2016 Biotechnology Law Lawyer of the Year in
Ottawa. David is a past president of the Intellectual
Property Institute of Canada.
||Philip Lapin is a
partner in Smart & Biggar’s Ottawa
office. He is the chair of the Smart &
Biggar’s trademark operations group and is
recognised as one of Canada’s leading trade
mark lawyers. With more than 20 years of experience,
Philip is responsible for managing and providing
strategic advice concerning the trade mark portfolios of
many Canadian and multinational corporations. He has
handled the clearance, prosecution and registration of
thousands of trade marks, and has particular expertise in
trade mark opposition and cancellation proceedings before
the Trademarks Office. In addition, Philip files,
prosecutes and advises clients with respect to all
aspects of Canadian industrial design law and practice.
He is listed in World Trademark Review 1000,
Euromoney’s Expert Guides: Guide to the
World’s Leading Trademark Law Practitioners
and Managing Intellectual Property’s IP
Stars Handbook: Trademark & Copyright.