Bill means less trade on others' marks

BUSINESSES will be better protected against infringement of their trade marks by a new Act to be passed by Parliament later this month. The Government estimates that British business will save pounds 60m over the next 12 months as a result, and pounds 30m a year thereafter.

The Trade Marks Bill will replace existing legislation dating from 1938, which lawyers complain is cumbersome and expensive, and fails to meet the needs of today's international market.

It will be easier to register trade marks, the existing test for distinctiveness being replaced by a wider definition that includes recognition of shapes, blends of colours and even smells. A trade mark will be registered in all countries that sign the Madrid Convention (EFTA countries, the European Union and others, but not the US) just by being registered in Britain. Action for infringement of trade marks in these countries will no longer mean using local lawyers working under their national laws.

Ann Hunt, a partner in solicitors Alison and Humphreys who specialise in trade mark law, said: 'Existing procedures are expensive and hard to understand. The new Bill is more flexible. Brand images that were not registrable may now be registered when the new Act comes into force.'

It will also be much easier to take legal action against traders who are improperly using a trade mark. It removes the requirement on a plaintiff to prove that the public is confused. At present this can require plaintiffs to undertake expensive market research. The Bill will also enable owners of trade marks to prevent their unauthorised use on T-shirts.

There has been significant lobbying in recent months by some manufacturers, such as Coca-Cola, calling for the Bill to be extended to deal with lookalike products. The Government has rejected the calls, though Patrick McLoughlin, technology minister at the Department of Trade and Industry, admitted further legislation might be necessary.

Additional measures to combat counterfeiting were included at a late stage in the passage of the Bill, enabling seized goods to be disposed of by trading standards officers who demonstrate to a court that the goods are counterfeit. Previously they could only be seized as part of a successful court action against a trader.

Norman Pattullo, a director of Murgitroyd and Company, trade mark agents, said: 'Companies that currently use trade marks that are not registered should consider applying for registration early in order that their rights will be established over third parties. Otherwise the rights in that mark may be granted to another company.

'For companies with international aspirations or activities it is advisable that they obtain early registration in the UK to provide the basis for an international registration at such time as the Madrid Convention is joined by the UK, or priority may be lost to a competitor in the UK or abroad.'

The Bill is expected to receive Royal Assent before the summer recess and should be implemented by the year end.