Saturday, 28th May, 2011

Trade Marks Amendment Act 2011 (the Act)

The Trade Marks Amendment Bill received royal assent on 15 September 2011.

A variety of changes came into force the following day, with the rest of the Act, including the major amendments, coming into force on a date to be appointed by Order in Council.

It is expected the main changes (including the appointment of enforcement officers, the extended powers of customs officers and the implementation of the Madrid Protocol) will come into effect in late 2012. A summary of noteworthy changes now in force are outlined below.

Nice Classification

Rather than a "prescribed system of classification," goods and services must be classified according to the edition of the Nice Classification in effect at the time of the application for registration of the trade mark. This amendment reflects the government's decision to join the Nice Agreement.

Memorandum

An owner of a trade mark may request the alteration or removal of a memorandum that relates to the trade mark, provided that the alteration or removal does not in any way extend the rights given by the registration.

Commissioner's certificate that relates to certain assignments or transmissions

The power of the Commissioner to issue a certificate as to whether a proposed assignment or transmission is likely to deceive or confuse, is removed.

Licensees

All registration of licensees (including registrations made under section 37 of the Trade Marks Act 1953) are revoked. The ability to record licensees is removed. Now any licensee (not just registered licensees) can take infringement proceedings and record customs notices in some circumstances.

Exhaustion of rights conferred by registered trade mark

New s 97A (the section which allows parallel importing) provides:

97A Exhaustion of rights conferred by registered trade mark

(1) A registered trade mark is not infringed by the use of the trade mark (including use for the purpose of advertising) in relation to goods that have been put on the market anywhere in the world under that trade mark under any 1 or more of the following circumstances:

(a) by the owner:

(b) with the owner's express or implied consent:

(c) by an associated person of the owner. 

(2) For the purposes of subsection (1)(c), a person is an associated person of the owner if:

(a) they are in the same group of companies; or

(b) they are both bodies corporate and they consist of substantially the same members or are directly or indirectly under the control of the same persons; or

(c) either of them has effective control of the other's use of the trade mark; or

(d) a third person has effective control of the use of the trade mark by each of them.

(3) For the purposes of subsection (2),-

(a)  group of companies includes a holding company and its subsidiaries within the meaning of section 5 of the Companies Act 1993; and

(b) a person has effective control of the use of a trade mark if that person may authorise the use of the trade mark or has significant influence over how it is used, regardless of how that authorisation or influence arises (for example, whether directly or indirectly and whether by way of proprietary interest, contract, arrangement, understanding, a combination of those things, or otherwise).

Presumably, the amendment intends to prevent trade mark owners from assigning their trade mark registrations to local distributors, in order to circumvent reliance on the defence.

Customs Notices

New customs notice provisions provide that the Chief Executive may suspend an accepted customs notice if satisfied that:
  • The information held in respect of the accepted notice is not correct or is no longer current; or
  • There has been a failure to comply with a requirement concerning the giving of security or indemnity or both; or
  • There has been a failure to comply with an obligation under an indemnity given for an amount in respect of the accepted notice.

Before suspending an accepted notice, advice of the Chief Executive's decision to suspend must be given to the person who gave the customs notice or the current owner (in the event of an assignment). The Chief Executive must provide reasons, give the person to whom the advice is given not less than 20 working days to respond and consider any response provided within that time.

If the Chief Executive decides to suspend an accepted notice, written notice must be given to the person who gave the customs notice or the current owner.

The Chief Executive may reinstate an accepted notice suspended, if satisfied the grounds for suspension no longer apply.

The exceptions to the provision that an accepted notice remains in force for the period specified in the notice, are extended to include the situation where the registration (to which the notice relates) has been cancelled, revoked, declared invalid, or has expired.

The Act specifies that an accepted notice is not in force during the period of any suspension.

Commissioner and Assistant Commissioners

New provisions outline the functions of the Commissioner, powers of the Assistant Commissioners and the power of the Commissioner to delegate.

Regulations

New powers are provided for the Governor General, by Order in Council, to make a range of minor technical regulations as well as regulations for the purpose of giving effect in New Zealand to the Madrid Protocol.