Trademark prosecution and registration strategies: Brazil
by Gustavo Piva de Andrade e Peter Eduardo Siemsen
April 18, 2009
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Trademark prosecution in Brazil presents specific challenges – the most obvious and difficult of which is the substantial backlog at the Trademark Office
In the past 15 years the Brazilian IP system has undergone significant changes. For instance, Congress passed the current Industrial Property Act and Brazil signed the Agreement on Trade-Related Aspects of Intellectual Property Rights. These advances substantially improved the level of trademark protection in the country, in particular in terms of registration and fighting counterfeiting.
However, one large problem remains, which trademark practitioners have to deal with on a daily basis: the huge backlog at the Brazilian Trademark Office (BTO). This backlog delays the resolution of most trademark conflicts and demands a high degree of creativity from local counsel to resolve such disputes expeditiously and inexpensively.
This issue has become critical in a period of financial crisis such as that which we are enduring now. Accordingly, this article provides an overview of the Brazilian trademark prosecution system, as well as some practical advice for trademark owners as to the best ways to protect their brands in Brazil.
Trademark or no trademark?
Under Brazilian practice, any visually perceptible distinctive sign not included in any legal prohibition is registrable as a trademark. This means that to be registered as a trademark, a sign must comply with the three basic requirements of:
visual perceptibility;
distinctiveness; and
non-inclusion in any statutory prohibition.
The statute allows the registration of product and service marks, threeÂ-dimensional marks, certification marks and collective marks. Moving marks such as holograms are allowed, but in the absence of a special registration proceeding for this category, the BTO has been accepting a single application that covers the sequential visual representation of the movements which constitute the mark.
The visual perceptibility requirement is interpreted by the BTO as excluding from trademark protection some non-traditional marks such as sound marks and smell marks. Further, the Industrial Property Act lists 23 categories of sign that are not eligible for registration, including:
Generic and descriptive terms – lately, the BTO has been adopting a rather restrictive approach in respect to such signs and has been rejecting almost all applications for marks considered to be in the middle ground between descriptive and suggestive terms. The BTO does not apply the secondary meaning doctrine. However, some Brazilian courts have already recognized the concept of acquired distinctiveness and allowed the registration of descriptive signs that became distinctive through use.
Slogans – the statute does not permit the registration of signs that are used only as slogans. To overcome this prohibition, an applicant must show that the sign functions not only as an advertising slogan, but also as a mark distinguishing the applicant’s goods or services from other goods or services of different sources. For this purpose, it is advisable to present samples or pictures of the goods or services identified by the mark and to apply for the registration of the sign in its word-and-design form.
Isolated colours – Brazilian law has adopted the ‘colour depletion theory’ and expressly prohibits the registration of isolated colours as trademarks. Combinations of two or more colours, however, are registrable when arranged or combined in an unusual and distinctive manner.
In order to avoid rejections, we recommend that owners carefully check the registrability of their marks and confirm the latter’s inherent distinctiveness under local law prior to filing applications. In many circumstances, it is possible to enhance the signs’ distinctiveness or take action to give them distinctiveness with the aim of circumventing the statutory prohibitions. In others, it is worthwhile seeking protection under unfair competition law.
Obtaining trademark rights
Under Brazilian law, trademark rights are granted on a first to file basis. This means that trademark rights stem from registration, not use. Rights in a mark are therefore obtained through a valid registration duly granted by the BTO. Registration confers on the owner exclusive rights over the mark throughout the Brazilian territory. The registration also makes trademark infringement a criminal offence and entitles the owner to pursue legal remedies that would be unavailable in the absence of a valid registration. Lastly, registration is important for obtaining preliminary injunctions from the courts, as Brazilian judges feel more comfortable granting interim orders on the basis of official titles duly granted by the BTO. For these reasons, we strongly encourage owners to register not only their marks, but also their products’ trade dresses as trademarks with the BTO.
Owners should also be aware that despite the first to file system, the law confers on prior users the right to oppose third parties’ marks based on prior use. Thus, especially for core brands, trademark owners are encouraged to conduct internet searches prior to filing their applications.
Famous marks
The law confers broad protection on famous marks and classifies them into two categories: highly renowned marks and well known marks. Highly renowned marks are those which are registered in Brazil and which have achieved such an extraordinarily high degree of fame among the Brazilian population that they deserve protection in all fields of activity. The owner of a highly renowned mark is therefore entitled to enforce its rights in all classes of products and services. For instance, MCDONALD’S, MERCEDES-BENZ and Nike’s swoosh design have been declared highly renowned by the BTO.
Marks that are well known in their field of activity under the terms of Article 6bis of the Paris Convention for the Protection of Industrial Property deserve special protection in Brazil, regardless of the existence of a valid registration or application at the BTO. This provision is extremely useful in situations where a company applies for the registration of the mark without the legitimate owner’s authorization. lt is also largely enforced by the courts white the application for the wellÂknown mark is still pending at the BTO (a common enough situation given the BTO’s backlog).
Attacking third parties’ marks at the BTO
Trademark owners have two opportunities to attack a third party’s mark at the BTO: through an opposition proceeding or through an administrative nullity action. The opposition takes place before the allowance of the application into registration and must be filed up to 60 days after the publication of the application in the IP Journal. The administrative nullity action occurs after the registration has been granted and must be commenced up to 18o days after the publication of the granting notice. If these opportunities are missed, the legality of the third party’s registration can be challenged only in court. For this reason, owners are encouraged to keep a close eye on the BTO and keep in mind that some local firms offer this service for free or at competitive prices.
The statute also regulates the filing of cancellation actions for non-use of the mark. The cancellation action may be filed by any person with legitimate interest within five years of the registration date. The registration is cancelled if:
the use of the mark has not started;
the use of the mark has been interrupted for more than five consecutive years; or
the owner has been using a version of the mark that differs from the one registered, which implies an alteration of the mark’s original distinctive character.
The BTO’s fight against its backlog
The BTO has recently implemented many administrative measures in an attempt to reduce its backlog. The office has:
hired 60 new trademark examiners in the past few years;
improved its trademark searching system;
simplified the reclassification of marks filed before 2000 (ie, prior to the adoption of the Nice Classification); and
adopted several measures gradually to become a paperless office.
Since September 2006 the BTO has been accepting online applications and now handles all trademark files electronically. Petitions can be filed online and the respective documents are made available on the Internet as soon as the notices are published in the IP Journal.
These efforts have already produced some encouraging results and have reduced the average examination time of a trademark application from six years to two years. The backlog, however, still persists in relation to objections and appeals. Oppositions, administrative nullity actions and appeals may take up to five years to be examined.
Thus, it has become almost mandatory to conduct availability searches and take effective clearance steps before filing. To avoid objections, applicants may approach prior owners to obtain letters of consent or enter into coexistence agreements. To avoid rejections, applicants may add other distinctive elements to the sign and apply for registration of the mark in a composite or word-and-design form. These simple measures usually prove to be helpful.
Madrid Protocol
Although Brazil is not yet a member of the Madrid Protocol, govemment policies over the past few years have indicated that membership is on the cards. However, most practitioners fear that the BTO is not ready to comply with the protocol’s requirements – despite the BTO’s protests to the contrary.
A particular concern in this respect is the BTO’s current inability to comply with the i8-month examination period demanded by the protocol and the resulting litigation that delays might generate. In spite of this, the Brazilian government seems to have made its decision, so once the BTO is able to comply with the minimum standards demanded by the protocol, Brazil will probably sign the protocol.
Conclusion
Brazil has a modern trademark statute and the current environment for trademark protection is certainly more owner friendly than it was 15 years ago. The country, however, still faces significant challenges in this area. The most critical aspect is eliminating the BTO backlog. The Brazilian authorities seem to have realized this and recent progress at the BTO indicates that the task is surmountable. Hopefully, the BTO will continue its efforts to reduce the average examination period for trademark applications, thereby providing owners and practitioners with a more favourable trademark prosecution environment in the forthcoming years. Meanwhile, trademark owners are encouraged to optimize their filing strategies so as to avoid rejections, objections and unnecessary costs.
