Reserve trademarks are marks whose use is only planned for the future, or those that were registered solely for the “reservation” of a term that might become strategically important for marketing in the future.
Select Your Preferred Appointment Now:Free initial consultationGrace Period and Obligation to Use
Caution! Generally, the statutory protection period for registered trademarks is 10 years and can be extended indefinitely. However, this only applies to marks in use.
After the registration of the mark, it must be “genuinely used as a trademark” within a grace period of five years. If a mark is not “genuinely used as a trademark” within five years, anyone can request the cancellation of reserve trademarks.
This obligation to use is intended to prevent the trademark registers from being “clogged” with unused marks.
Information on the different types of trademarks can be found in our article “Types of Trademarks”.
Discontinuation of Use
The same applies if the trademark owner begins using the mark but later discontinues it, and more than five years have passed since the discontinuation of use.
Partial Use
Within the five-year period, marks enjoy full trademark protection regardless of their use. Even in the case of partial use, the scope of protection within the five-year period is not reduced to the actual lesser type of use. Partial use, for example, occurs when the mark was registered for entire Nice classes, although only some subcategories are relevant for trademark use.
If proof of genuine use of the mark in a class cannot be provided, the mark can also be cancelled for individual classes.
For example, the application for cancellation of an Austrian word and figurative mark, which was registered for Nice Classes 25, 28, 29, and 32, was granted for Nice Classes 28, 29, and ultimately also 32. This was because the trademark owner could only prove genuine use of the mark for Class 25.
More information on the Nice Classes can be found in the article “Nice Classes”.
Select Your Preferred Appointment Now:Free initial consultation“Genuine Use of the Mark”
There is a large body of case law that deals with what exactly is to be understood by “genuine use of the mark” and when marks are considered reserve trademarks. Anyone who is not keen on studying this jurisprudence should consult an expert.
The Trademark Protection Act lists some examples of what qualifies as “use”. For example:
- affixing the sign to goods, their packaging, or to objects on which the service is performed or intended to be performed;
- offering goods under the sign, placing them on the market, or possessing them for the aforementioned purposes, or offering or providing services under the sign;
- importing or exporting goods under the sign;
- using the mark as a trade name or company name or as part thereof;
- using the sign in business papers, announcements, or advertising;
- if the sign is used in comparative advertising in a manner contrary to the provisions of the Federal Act against Unfair Competition.
Is that not confusing enough yet?
Use is “as a trademark” when the mark is used to distinguish the goods and services of the trademark owner from the goods and services of other undertakings.
So far, so good. But when is the use also “genuine”?
Use is “genuine” when its scope goes beyond a mere token use serving only to maintain rights. For this, all circumstances must be examined that can prove that the mark is actually used commercially.
Select Your Preferred Appointment Now:Free initial consultationScope and Frequency of Use are Decisive for Reserve Trademarks
To assess whether a registered mark is genuinely used as a trademark and therefore not a reserve trademark, the scope and frequency of use are crucial. According to case law, a mark used solely for the purpose of preserving rights is not genuinely used. The use must – in accordance with the main function of the mark – guarantee the consumer or customer the origin identity of the goods or services. Likewise, it must enable them to distinguish these goods or services from other goods or services without a likelihood of confusion. It is not sufficient to merely use the mark within one’s own company. Rather, the use must take place in the market. The standard for assessment is the average informed, attentive, and discerning consumer.
No Minimum Level of Use for Reserve Trademarks
There is no minimum level of use to distinguish between reserve trademarks and genuinely used marks. Even a minor but economically justified use can be sufficient to prove genuineness. Likewise, low sales figures do not per se argue against genuine use. What quantitative threshold constitutes genuine use is always a matter of individual circumstances and thus cannot be determined abstractly in advance.
Select Your Preferred Appointment Now:Free initial consultationPreparatory Acts are not Genuine Use
Even a relatively short-term use of the sign within the relevant five-year period can be sufficient. The prerequisite is that there was a genuine intention to use and that the use of the sign is not merely a token use. Mere preparatory acts for use do not yet qualify as genuine use. These include, for example:
- the ordering of labels
- marketing considerations
- or the mere trial delivery of goods bearing the mark
The burden of proof for the use of the mark and for the existence of a justification lies with the trademark owner.
Cancellation of Reserve Trademarks
If a registered mark has only been used for goods or services that cannot be assigned to any of the terms in the goods/services directory, then the mark is entirely unused and ripe for cancellation. Use for a good or service that is merely similar to the registered goods or services, or falls under a common, unregistered generic term, does not maintain rights. In the case of specifications of a good or service registered in the goods or services directory, use for another specification of the good or service can only maintain rights if both goods or services fall under a generic term contained in the goods or services directory. If, however, they are different specifications of goods or services that cannot be assigned to a generic term in the directory, then no use has occurred.
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