REGISTERED USERS ON THE WAY OUT
by
Hugues G. Richard
LEGER ROBIC RICHARD, Lawyers
ROBIC, Patent & Trademark Agents
Centre CDP Capital
1001 Square-Victoria - Bloc E – 8th Floor
Montreal, Quebec, Canada H2Z 2B7
Tel.: (514) 987 6242 - Fax: (514) 845 7874
www.robic.ca - info@robic.com
In Canada, a proper interpretation of the common law would seem to
indicate that generally speaking, a trade mark can only been used by its
owner. Use by a third party will (unless special circumstances are shown)
jeopardize the distinctiveness of a trade mark. If a mark has lost its
distinctiveness, it can no more be considered a trade mark. Thus in Canada
trade mark licensing is a tricky business.
However, the owner of a trade mark registered under the Canadian Trade
Marks Act can allow others to use it, if he avails himself of the provisions of
section 49 of the Act. This section constitutes a statutory amendment of the
common law inasmuch as it deems that the use by a third party of a
registered trade mark will not affect its distinctiveness if that third party has
been registered as a registered user.
This situation has created serious problems for many trade mark owners,
especially foreign owners, who are not all familiar with the harsh
consequences of use in Canada of a trade mark by a person who is not a
registered user. Through the years, the registered user provisions of the Act
have been under attack and even more so since the governmental fees to
be paid upon registering the users have gone up considerably in the last few
years (now $100.00 per user for one mark, plus $25.00 for each additional
mark).
It would seem that the Government is now willing to have the Act amended
so that the registered user requirements are abandoned. In fact, the
Canadian Government has thrown the ball in the camp of professionals
working in the field of trade marks for them to come up with a new proposal
which would do away with the obligation of registering third party users but
which would nevertheless maintain some deeming provisions to avoid
creating a vacuum which would bring back the application of the strict
common law rules.
The Patent and Trademark Institute of Canada has been playing a leadership
role in trying to arrive at a consensus in the trade mark profession. This
consensus is close at hand. The majority view would be that section 49 be
abolished and replaced by provisions somewhat similar to those known in the
United States of America. In other words, inasmuch as the trade mark owner
would control directly or indirectly the character or quality of the wares or
services to which the license applies, then the use, advertisement or display of
the trade mark by the licensee under the owner's control would be deemed
always to have had the same effect as use, advertisement or display by the
owner.
Those representing the minority view would wish to see a voluntary recordal
system which would give rise to a presumption of use by the owner of the
trade mark when the user is actually a registered third party. Those who are
against this latter proposal think that it will create similar problems as does the
current situation, since most trade mark owners will feel compelled to register
their licensees.
The Canadian Government is committed to abolish section 49; it is to be
hoped that the Canadian trade mark profession will not miss this opportunity.
Published at (1988), 2 W.I.P.R. 220-221 under the title Trade Mark Bar Seeks to
Eliminate Act's Registered User Provisions.
© LEGER ROBIC RICHARD / ROBIC, 1988.
ROBIC, un groupe d'avocats et d'agents de brevets et de marques de commerce voué
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