2. The Madrid System of International Registration of Trade Marks
Background
18. The Madrid system of international registration of trade marks (the "Madrid system") is governed by two treaties: the Madrid Agreement Concerning the International Registration of Marks (the "Madrid Agreement") that dates from 1891; and the Madrid Protocol Relating to the Madrid Agreement (the "Madrid Protocol"), which came into operation on 1 April 1996. The Madrid system is administered by the International Bureau (the "IB") of WIPO.
19. The Madrid system offers a trade mark owner the possibility of having a trade mark protected in one or more member countries by filing one application for registration of a trade mark (an "international application") directly with the local trade marks office (which is referred to under the Madrid Protocol as the "Office of Origin") and designating one or more overseas countries where protection is sought.
20. An international application is equivalent to an application for registration of the same trade mark being made directly in each of the countries designated by the applicant. The trade mark office of a designated country has a limited period of time (either 12 months or 18 months) in which to refuse to register the trade mark. If the trade marks office does not refuse protection of the trade mark with in this period the trade mark is deemed to be registered in that country. The Madrid system also simplifies greatly the subsequent management of the trade marks, since it is possible to record subsequent changes or to renew the trade mark registration in each country through a single procedural step.
21. Accession to the Madrid Protocol would provide New Zealand trade mark owners with the option of using the Madrid system to register their trade marks overseas, whilst giving overseas trade marks owners the option of using the Madrid system to protect their trade marks in New Zealand. Trade marks owners are not, however, obliged to the Madrid system and there may be circumstances when a trade mark owner may not wish to use the Madrid system. The advantages and disadvantages of using the Madrid system are discussed below.
Comparison of the Agreement and the Protocol
22. The Madrid Protocol was adopted in 1989 and came into operation in 1996. It introduced new features into the Madrid system with the aim of overcoming some of the barriers preventing certain countries from acceding to the Madrid Agreement. The main improvements are:
- allowing an applicant to file the international application in English, French or Spanish; under the Madrid Agreement an international application must be filed in French;
- allowing an applicant to choose between basing an international application upon either an application filed with the Office of Origin or an registration in the Office of Origin; under the Madrid Agreement an international application may only be based upon a registration in the Office of Origin.
- providing each member country in which the applicant seeks protection to elect a period of 18 months (and longer in the case of oppositions) to declare that protection cannot be granted in its territory; under the Madrid Agreement the period is 12 months;
- the trade marks office of each member country may receive higher fees than under the Madrid Agreement;
- an international registration obtained under the Madrid Protocol may be transformed into a national registration in the respective member countries in which the international registration has effect, each benefiting from the date of the international registration and, where appropriate, its priority date; this possibility does not exist under the Madrid Agreement; and
- the Madrid Protocol makes it possible to establish links to regional trade mark registration systems, such as the Office for Harmonization in the Internal Market of the European Communities (by designating the European Communities in an international application, it is possible to obtain the effects of a European Community registration).
23. It is for these reasons that this discussion paper considers New Zealand accession to the Madrid Protocol, rather than the Madrid Agreement.
How Does the Madrid Protocol Work?
Making an Application
24. An international application under the Madrid Protocol must be based upon either an earlier application or an existing registration in the Office of Origin for the identical trade mark and be in relation to the same goods or services. The international application must specify (i.e. designate) the member countries of the Madrid Protocol in which protection is sought. The international applicant must also live in, be a national of or carry on business in, the member country where the international application is filed.
25. The local trade mark office, as the Office of Origin, certifies that the international application details are the same as on the national application or registration and sends it to the IB.
International Bureau
26. The IB does not examine the international application for substantive matters, but undertakes only a check for fees, formalities and the classification of goods or services.1 If there are any irregularities in the international application, the IB notifies the Office of Origin and/or the applicant. If no irregularities are found in the international application, the IB grants the international registration, notifies the Office of Origin and sends a certificate to the applicant. The IB also publishes the registration in the WIPO Gazette of International Marks and forwards the details of the international registration to all the designated countries.
27. The IB also handles changes to the international registration, such as changes to the holder's details, changes in ownership, renewals and communications with the holder of the international registration, Office of Origin and designated countries.
Designated Country
28. After the IB advises designated countries of the international registration, each designated country examines the international application in accordance with its domestic trade mark legislation. If any objections arise during the examination process, or oppositions are filed by third parties, the designated country is obligated to notify the IB, which then informs the international registration holder of the grounds of the objection or opposition.
29. If no objections are raised and the application is otherwise in order, the designated country gives effect to the international registration, as if it were a trade mark registered as a result of a national application. Registration is for an initial period of ten years and registration may be renewed for further periods of ten years.
30. A flow diagram showing how the Madrid Protocol works can be found in Appendix A. If New Zealand agreed to join the Madrid Protocol, IPONZ would become the Office of Origin for New Zealanders seeking trade mark protection overseas using the Madrid Protocol. New Zealand would be a designated country for overseas businesses seeking protection in New Zealand under the Madrid Protocol.
"Central Attack"
31. For the first five years any registration granted through the use of the Madrid Protocol is dependent upon the home country application being granted and remaining valid. Should the home country application be refused, or the subsequent registration be revoked or declared invalid for any reason, then all overseas registrations obtained through the use of the Madrid system are automatically revoked. This procedure within the Madrid Protocol is known as the "central attack".
32. In the event of this happening, the Madrid Protocol provides a grace period of three months to allow a trade mark owner to transform their Madrid system registrations into ordinary national trade mark registrations. These transformed registrations are given the same filing priority date as the original international registration and the local official fees, such as renewal fees, become payable. In short, the benefits of maintaining a registration through the Madrid system are automatically lost upon transformation of the international registration.
33. Five years after the international registration is granted, the international registration becomes independent of its national basis and a central attack is no longer possible.
Costs
34. The following fees are payable for filing of an international application:
- a basic application fee of 653 Swiss francs (approximately NZ$700) or 903 Swiss francs (approximately NZ$940) where any reproduction of the trade mark is in colour;
- where a designated country is one in respect of which an individual application fee is payable, that fee;
- a complementary fee of 73 Swiss francs (approximately NZ$80) for each designated country for which no individual application fee is payable;
- a supplementary fee of 73 Swiss francs (approximately NZ$80) for each class of goods and services beyond the three classes (if, however, all the designated countries are ones in respect of which an individual fee is payable, no supplementary is payable); and
- a handling fee charged by the Office of Origin for receiving and forwarding the international application to the IB.
35. The following fees are payable for renewing an international registration:
- a basic renewal fee of 653 Swiss francs (approximately NZ$700);
- where a designated country is one in respect of which an individual renewal fee is payable, that fee;
- a complementary fee of 73 Swiss francs (approximately NZ$80) for each designated country for which no individual renewal fee is payable; and
- a supplementary fee of 73 Swiss francs (approximately NZ$80) for each class of goods and services beyond the three classes (where however all the designated countries are ones in respect of which an individual fee is payable, no supplementary is payable).
36. Renewal fees may be paid direct to the IB. Where the Office of Origin collects the renewal fees and forwards them to the IB, that Office may fix and charge a handling fee for this service.
Further Information
37. For further details on how the Madrid Protocol works visit Madrid System for the International Registration of Marks [link to WIPO website]. The website provides detailed information on the Madrid Protocol including: administrative guides; information about Members; notices; filing information; forms; fees and a fee calculator; legal text and an online database of international registrations.
38. Additional information about the Madrid Protocol is also available on a number of websites, including:
39. For independent commentary on the Madrid Protocol, you may wish to refer to the following documents:
40. Any opinions or views expressed on any of these websites are not necessarily those of the Ministry of Economic Development or the government. These links have been provided for convenience only and should not be taken as endorsement of those websites or the information provided on those sites nor of the organisations or people referred to.
Advantages of Using the Madrid System
41. International registration has several advantages for the owner of a trade mark seeking overseas protection. After either filing an application for registration or registering the trade mark with the Office of Origin, the owner is only required to file one application, in one language and pay fees to one office, instead of filing separately in the trade mark offices of the various countries party to the Madrid Protocol. Businesses looking to expand their markets overseas are able to benefit from the reduction in transaction and compliance costs associated with registering a trade mark and maintaining that registration through the Madrid system.
42. The Madrid system also avoids the need to employ a trade mark agent in each country to file an application and, therefore, the initial associated costs. Similar advantages exist when a registration has to be renewed, modified or assigned to another party.
43. At a later stage, however, it may still be necessary to employ a trade mark agent to handle any substantive issues arising from examination of the international registration by a national trade mark office in a designated country. These services may also be necessary if a third party opposes registration or seeks to have international registration expunged in one or more of the designated countries.
44. To date there are 67 countries who have joined the Madrid Protocol. These include many of our leading trade partners, such as Australia, United States, European Community (including a number of individual countries such as the United Kingdom, France, Germany and Italy), Japan, the Republic of Korea, China and Singapore.
Disadvantages of Using the Madrid Protocol
45. Communication which does not involve the IB, such as between the holder of an international registration and a third party is outside the scope of the Madrid Protocol. The applicant or holder is therefore still required to maintain an address for service in each designated country and bear any associated costs for doing so.
46. The Madrid system has a number of technical features that may work to the disadvantage of a business using the Madrid system, compared with filing separately in overseas countries. While a more detailed discussion of these particular features can be found on several of the websites given above, some of these features are exemplified below.
47. The fee structure of the Madrid Protocol is such the benefits in the reduction of application and renewal fees would be directly proportional to the number of member countries where trade mark protection is required. For example, a business looking to register a trade mark in one to three member countries is likely to find the Madrid system more expensive to use than a direct application to the national trade mark office of each of those country.
48. Another potential disadvantage for a business using the Madrid Protocol relates to the scope of products and services that may be covered, particularly where the original registration with the Office of Origin has or is required to have a narrow description of goods or services. The scope of coverage of an international registration under the Madrid Protocol is tied to the scope of the home application/registration for at least five years of life of the international registration. This may cause difficulties when a business is looking to develop and expand its products and services in an overseas market.
49. A business that has registered a trade mark through the Madrid Protocol may only sell or transfer those registrations to another trader who is also domiciled in a member country. For example, since New Zealand is not joined the Madrid Protocol, an Australian business cannot sell any of its international registrations obtained though the Madrid system to a New Zealand business. The international registrations belonging to the Australian company would need to first be transformed into ordinary national trade mark registrations in each country before being assigned to the New Zealand business.
Implementation
50. If New Zealand were to join the Madrid Protocol, it would need to deposit an instrument of accession to the Protocol with the Director General of WIPO. Before this could happen, a review of the Trade Marks Act and the Trade Marks Regulations 2003 ("the Regulations") would need to be completed and amendments would need to be made to both the Act and the Regulations to implement the obligations and requirements under Madrid Protocol.
51. The Madrid Protocol does not prescribe the grounds upon which an application to register a trade mark may be refused or for which a registration may be cancelled, revoked or declared invalid. These grounds are left to the national law of each country. No amendment would therefore be required to Part 2 (registrability of trade marks) of the Trade Marks Act. New Zealand would also retain the ability to modify the grounds for registrability under the Trade Marks Act to address domestic issues.2 Accession to the Madrid Protocol would not therefore limit the government's ability to achieve specific policy objectives in the area of trade marks, such as to respond to the Treaty of Waitangi claim Wai 262. In other words, if New Zealand were to join the Madrid Protocol, IPONZ would examine international registrations for the substantive registrability requirements in the same way that it would examine ordinary applications filed under the Trade Marks Act.
52. If the government were to make a decision to accede to the Madrid Protocol, the likely timetable, as set out in Appendix B, could see the Madrid Protocol entering into force around June 2008.
Withdrawal or Denunciation
53. Any party to the Protocol may five years after accession to the Protocol, denounce the Protocol by written notification to the Director General of WIPO. Denunciation takes effect one year after the day on which notice is received.
54. The owner of international registration in a denouncing state who seeks to keep his or her trade mark registered in the denouncing state must file an application to transform the international registration into ordinary trade mark registration. This is also available if the owner is no longer entitled to file international applications in other countries because of the denunciation. In these cases, the mark is to be treated as though it had been filed on the date of its international registration.
Questions
1. What are the benefits for business of New Zealand joining the Madrid Protocol? Please quantify if possible. How might the benefits for a New Zealand business differ when compared to foreign business?
2. What is the likelihood of a business using the Madrid system, if it was available in New Zealand?
3. Are there any reasons why New Zealand should not join the Madrid Protocol?
Back to Top