Indeed, it is important to highlight that in a market crowded by the presence of several operators, trademarks act as distinctive signs capable of communicating to the consumer – or to the market in general – a specific message which could be evocative, emotional or related to certain features or qualities of the product or service it is associated to. Trademarks indicate that a product or service comes from a specific company and not from its competitors.
Can we actually talk about unregistered trademarks’ protection?
Regulation about unregistered trademarks can be inferred indirectly from the combination of two laws, article 2571 of the Civil Code and article 12(1) of the Industrial Property Code.
Article 2571 c.c. establishes that whoever used a non-registered trademark can continue to use it to the extent that it was previously valid, besides the registration obtained by others.
On the other hand, article 12 IPC maintains that any sign which is different from the trademark can represent an invalid prior art if it is well-known to the market and not only in a purely local contest.
In the light of the above, we can say that the founding elements of unregistered trademarks are the effective use and the reputation.
According to a part of the doctrine, the effective use represents the fundamental requirement of the right upon the sign itself, while the reputation (not a merely local one) is the basic premise for protection against an identical or similar trademark registered afterwards.
As for unregistered trademarks, the right owner should use the distinctive sign so as to get acknowledgment of his/her property upon the sign, because there isn’t any other evidence supporting the sign’s ownership. In a possible lawsuit, the only proof that the alleged trademark owner could use is related to the effective use of the sign for certain products or services. Such evidence will have to highlight clearly both the pre-use as a business name and that as a trademark, besides obviously demonstrating the consequent reputation of the sign.
The case law denies the possibility to have a unregistered trademark if the use is not intentional and continuous, but only seldom, uncertain or experimental, occasional or a one-time sale thing.
However, not all unregistered trademarks benefit from the same protection: what differentiates them is the level of reputation.
The Industrial Property Code defines the pre-use limits by distinguishing trademarks with local reputation and trademarks with general reputation.
The local pre-use gives the unregistered trademark owner the chance to continue using it for the same kind of product or service and within the same territory, that is to say in the framework of the use already made, without possibly forbidding the subject filing the same trademark afterwards to use it in the local territory as well.
This necessarily constitutes a sort of duopoly system allowing the coexistence – only locally – of the pre-used trademark with the newly registered one.
Yet in practice it is also possible that a product identified by a certain trademark, even if commercialized in a limited area, is also well-known outside of it, especially nowadays with the more and more advertisement, the increasing mobility of consumers and the e-commerce which are considerably narrowing the cases of purely local reputation.
Which protection tools in Italy and EU?
So, if an unregistered trademark owner wants to obtain protection for this right, he/she can do it with an invalidity action grounded against the trademark filed afterwards, at least as far as Italy is concerned.
On the other hand, in the EU, the owner of a previous unregistered right (like indeed unregistered trademarks) can oppose the registration of trademark filed later, according to article 8(4) RMUE, in case such previous unregistered right is protected in the system of its owner’s Member State.
A curious aspect is that only within the EU there are some differences so that some Member States do not consider any protection for unregistered trademarks, such as France, Spain, Benelux, Cyprus, Croatia, Estonia, Hungary, Lithuania, Poland, Romania and Slovenia.
The choice of the Italian law system (and of the EU, too) to guarantee protection to unregistered signs having a general reputation raises some doubts, especially about the legal certainty, besides maybe looking like discouraging registration. Probably, at least regarding Italy, unregistered trademark protection represents the will of the legal system to offer some kind of protection to the Italian business scenario, characterized by a massive quantity of very small and micro companies which have been able to survive throughout ages, as well as to spread their story in the national territory or a major part of it.
Why should we choose unregistered trademarks?
The lack of registration, or a delayed registration after the beginning of the commercial activity, could originate from the entrepreneur’s intention to test the success of a product or wait for the business to get started and then be capable to bear the registration costs.
A trademark registration surely represents an economic burden for small and medium enterprises which often fall back on other identification tools providing less safety and legal certainty, but undoubtedly representing cheaper options, such as a domain name registration for a website, a particular shop sign to distinguish a physical shop or a simple use of the trademark as company name.
Thus, in this perspective, the use of unregistered trademarks can appear as the most reasonable choice.
However, if it is true that giving up registration can initially help to save costs, it is not possible to neglect the risks of such a choice that can turn out to be even more expensive in the future, when trying to protect or defend the trademark later on.
Just to make an example, prior art searches that, even being discretionary, we always suggest before filing a new trademark, do have a certain cost depending on the type of search (identity or similarity), but they help checking and confirming that the chosen trademark is available for registration, thus avoiding or preventing possible conflicts with prior marks.
On the contrary, if you select the option of having an unregistered trademark and then find out that a third party has filed or registered an identical or similar trademark, it is possible to ask for your unregistered trademark protection only with a judicial nullity proceeding that has much higher costs in itself than a simple filing or a prior art search.
This is the only available solution at the moment, at least until invalidity proceedings at UIBM are initiated, which may be in 2023 according to the most recent trademark reform for the implementation of the EU Directive 2015/2436.
Basically, even taking into account that these are essentially business choices, it is clear that a trademark registration offers greater advantages compared to the choice not to register it. In fact, even if it undoubtedly entails an initial investment, registration then guarantees to its owner an exclusive right which is certain and can be proved with a simple registration certificate. In order to proceed with the filing of a trademark application, it is always recommendable to seek advice from professionals in the field, experts in identifying the best possible strategy.