Comment
Submissions on the Discussion Paper
16. Nine submissions were received from eight submitters. Five submissions were from New Zealand patent attorneys and law practitioners; three were from Australia (one being from an Australian trade mark attorney and the other from an Australian business) and one from the International Trademarks Association based in New York. Of these nine submissions, eight submissions commented on the Madrid Protocol and six on the Nice Agreement. There was general support for acceding to both treaties.
Madrid Protocol
17. Seven submissions commented specifically on the Madrid Protocol and all, to varying degrees, supported New Zealand becoming party. Submitters generally acknowledged that overseas businesses, rather than local businesses, would be more likely to use the Madrid system and, therefore, benefit most from New Zealand's accession. Submitters commented that they considered New Zealand's accession was, however, inevitable; would assist to align New Zealand's trade mark regime with Australia and other leading trading partners; and would also add credibility to New Zealand's trade mark regime.
18. Officials predict that, based on the Australian experience, while the initial uptake of the Madrid system by New Zealand businesses would be slow, use will increase over time as businesses became more familiar with the benefits of the Madrid system. In the mean time, accession to the Madrid Protocol would provide overseas businesses the option of using the Madrid system to protect their trade marks in New Zealand and, therefore, to take advantage of financial savings it can provide. Use of the Madrid system for filing applications for trade mark registration overseas would be voluntary; accession to the Madrid Protocol would not replace existing means of international trade mark registration, which would remain available to applicants.
19. Submissions from the local patent attorney profession noted that in addition to potential financial savings that might be achieved through using the Madrid system, there were also a number of inherent disadvantages that can arise from using the Madrid system and that ultimately use of the Madrid system may end up costing businesses more than had it chosen to apply directly to overseas trade mark offices. As noted above, use of the Madrid system is voluntary. Officials consider that a business will need to choose on a case-by-case basis, aided by its trade mark agent's strategic guidance, whether it is more efficient and cost-effective to file direct national or regional applications, or take advantage of the alternative filing mode which the Madrid system provides.
20. The most significant concern to the patent attorney profession is a potential reduction in revenue for trade mark firms and possible flow on job losses, if overseas clients opted to use the Madrid system to obtain trade mark protection in New Zealand. One of the objectives of the Madrid system is, however, reducing a business's need to use overseas trade mark agents when seeking protection overseas. Based upon Australian experience, officials consider that it is unlikely that accession to the Madrid Protocol would lead to any significant long term affects on the overall size of the patent attorney profession or impact upon the availability of trade mark advice to New Zealand businesses.
21. Submitters did, however, concede that protecting the patent attorney profession and trade mark firms against the loss of overseas revenue should not be the determining factor in deciding whether or not New Zealand should become party to the Protocol.
22. There would be some one-off costs for IPONZ related to implementing the Madrid system arising from developing appropriate procedures to administer the Madrid system and training of staff in those procedures. Provision is made under the Madrid Protocol for trade mark offices, such as IPONZ, to recover on-going administrative costs arising from Madrid system. Trade mark offices may charge a "handling" fee and prescribe their own trade mark registration and renewal fees.
23. I recommend that New Zealand accede to the Madrid Protocol, subject to a satisfactory Parliamentary treaty examination process, and that drafting instructions be issued to the Parliamentary Counsel Office ("PCO") regarding the required amendments to the Trade Marks Act to give effect to and implement the Madrid Protocol. The National Interest Analysis is attached as Appendix A. A Bill to amend the Trade Marks Act has been given a priority level 5 on the legislative agenda (drafting instructions to PCO this calendar year). Once the amending legislation has been implemented, I recommend that New Zealand deposit its Instrument of Ratification with WIPO. I anticipate that this would occur before December 2008.
Nice Agreement
24. Six submissions were made in relation to the Nice Agreement. They broadly supported accession, although several did so on the incorrect assumption that New Zealand's accession to the Madrid Protocol required accession to the Nice Agreement. The Madrid Protocol requires use of the Nice Classification, but does not specifically require accession to the Nice Agreement itself.
25. Submitters noted that it is important for New Zealand to be part of and to be able to participate in the review and development of the Nice Classification, as this would enable New Zealand businesses to have a voice in such matters, which may be of particular importance from their perspective.
26. I recommend that New Zealand accede to the Nice Agreement. The National Interest Analysis is attached as Appendix B.
27. Before accession can occur, however, conversion of approximately 1,600 Third Schedule trade mark registrations that are currently not classified under the Nice Classification must occur. These Third Schedule registrations result in additional administrative costs for IPONZ in maintain a trade mark register comprising different classifications systems and add unnecessary complexity and cost to any search of the trade marks register by IPONZ and the public.
28. Under the Trade Mark Regulations, Third Schedule registrants may voluntarily request (without payment of a fee) that their registrations to be converted into the Nice Classification. There appear, however, to be few (if any) incentives for registrants to voluntarily convert their registrations. For some registrants, there may be costs arising from the conversion. For example, the services of a trade mark agent may be required to advise on the most suitable Nice class(es) and for some registrants the process of conversion may result in additional renewal costs where the registration needs to be converted into several classes under the Nice Classification.
29. Submitters expressed support for the conversion of these 1,600 Third Schedule registrations into the Nice Classification. They noted that having all trade mark registrations under the one classification system would result in more efficient and effective searches of the trade marks register. To achieve conversion of these registrations in a timely manner, submitters suggested that the Commissioner of Trade Marks ("the Commissioner") would need to initiate the conversion process and identify the most appropriate Nice class(es), for registrants to agree to conversion. Amendment to the Trade Mark Regulations would be required in order for the Commissioner to initiate and manage the conversion of these registrations in a timely manner.
30. There would be minor administrative costs to IPONZ associated with initiating the conversion of the 1,600 old trade mark registrations, and this cost would be met from existing appropriations.
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