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Intellectual property highlights in the Baltics

By March 13, 2023 No Comments
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How will the Unified Patent Court work? What are the most outstanding trademarks in Estonia? What are the recent amendments to Latvian IP law? What is the distinctive character of domains from the perspective of Lithuanian law? Find the answers to these questions and explore other highlights in this overview prepared by our Intellectual Property team, covering Estonia, Latvia and Lithuania.

Baltics’ news:

Estonia:

Latvia:

Lithuania:

Baltics’ news

Unified Patent Court will have jurisdiction in all three Baltic states

The Unified Patent Court (UPC) will soon become a reality and patent holders in the European Union will soon get the option to add Unitary Patents (UPs) to their patent portfolios. All three Baltic States (Estonia, Latvia and Lithuania) are participating countries, having ratified the agreement on a Unified Patent Court (UPCA).

According to the latest news, the UPCA will enter into force on 1 June 2023. However, before that, on 1 March 2023 the so-called Sunrise Period starts. The Sunrise Period is a three-month period which gives European patent (EP) owners a possibility to submit “opt-out” requests to remove granted EP patents and published EP applications from the jurisdiction of the UPC from Day 1. It is also possible to submit an “opt-out” later during the transitional period, but only in case no proceedings have commenced yet at the UPC.

In practical terms, using an opt-out option means that the UPC will have no jurisdiction concerning any litigation related to this patent or SPC originating from an opted-out EP. For EP owners it is crucial to therefore decide on their strategic needs, and also consider the necessity of opting out in relation to protecting their rights in the Baltic States.

12th edition of Nice Classification enters into force

On 1 January, the 12th edition of the Nice classification entered into force. The Nice classification is an international classification for goods and services applied for the registration of trademarks. Specifications of goods and services for trade mark applications filed after 1 January 2023 must be filed in accordance with this version of the Nice Classification.

The new versions introduce a number of new goods and services. For example, the addition of downloadable digital files authenticated by NFTs, as well as the extension from cryptocurrencies to crypto assets (which would include NFTs).

The newest Nice Classification is available here.

Estonia

Decline in industrial property registration applications in 2022

Industrial property registration statistics for 2022 were published in late January by the Estonian Patent Office. The statistics included a report on the patents, utility models, trademarks, industrial designs and geographical indications that passed through the Estonian Patent Office. It showed that there had been a substantial drop in registration applications for all types of industrial property in Estonia.

The most notable change can be seen in applications for both local and international trademarks, as well as international industrial designs and patents. At the same time, the decline was relatively small regarding applications for registration of local patents and industrial designs. No geographical indications were registered in Estonia in 2022.

More information on the statistics from the Estonian Patent Office in 2022 is available here.

Estonia has chosen its most outstanding trademarks for 2022

The most outstanding trademark from Estonian trademarks registered via the Estonian Patent Office in 2022 was chosen. The idea was to find a trademark that was particularly playful with language, beautiful-sounding and inventive, or otherwise verbally and visually striking and memorable.

The Estonian Patent Office’s trademark of 2022, i.e. the public’s favourite trademark, was MÄÄ, owned by a company that manufactures eco-friendly fertiliser pellets from sheep’s wool. A special award from the Estonian Chamber of Commerce and Industry and Institute of the Estonian Language was given to the trademark VAGA, owned by a company that manufactures acoustic design panels from recycled sea plastic. Both trademarks underline the importance of innovation, creativity and environmental protection.

More information on trademark competition is available here.

Supreme Court confirmed that dance studios are obliged to pay for using music during training sessions

The Estonian Supreme Court decided not to hear the appeal brought by a local dance school against the Estonian Performers’ Union and, thus, the decision of the court of second instance will remain in effect. The parties to the proceedings were engaged in a dispute over whether dance studios are obliged to pay remuneration to performers and phonogram producers for the use of music during training sessions.

The court based its decision on Article 72 of the Estonian Copyright Act, which provides that if a phonogram published for commercial purposes or a reproduction thereof is used for communication to the public, the performer and the producer of phonograms are entitled to obtain equitable remuneration. The dance studio, however, tried to argue that in this case the exceptions established in the law applied, including on the free use of copyright-protected works for educational purposes. The court determined that the studio used music to generate income and promote its entrepreneurial activities.

This decision has set a precedent which proves that the use of music for dance training sessions requires remuneration to performers and phonogram producers.

The decision of the circuit court is available in Estonian here.

Latvia

Amendments to the Trademark Law and the Law on Industrial Property and Procedures

On 21 February 2023, the President proclaimed amendments to the Trademark Law and the Law on Industrial Property and Procedures.

More about the amendments in our previous IP highlights here.

The Amendments will enter into force on 7 March 2023.

Amendments to Copyrights Law

On 12 January 2023, the Parliament conceptually supported amendments to the Copyright Law on the first reading. The amendments are designed to transpose Directive (EU) 2019/790 of the European Parliament and of the Council (the digital single market directive), as well as Directive (EU) 2019/789 of the European Parliament and of the Council (the broadcasters directive). Both directives introduce significant changes to copyright regulation, affecting authors, performers and users of works.

One of the most important changes is the implementation of the principle of appropriate and proportionate remuneration. Namely, the author will have a right to fair remuneration for the alienation of economic rights to the work, and for granting the rights to use the work. The remuneration will be considered proportionate if it corresponds to the economic value of the work or the rights of use and if it will form a reasonable part of the benefit obtained by the use of work or rights.

In order to ensure that remuneration is fair, a transparency obligation will also be introduced, which will obligate the successors and licensees to provide the author at least once a year with relevant and comprehensive information regarding the use of the rights or work.

The amendments also introduce other important changes, such as:

  • the right to terminate a contract if the use of the work or performance has not started within a period of two years;
  • the employer’s legal right to use the employee’s work for the purpose for which it was created;
  • it will not be possible to prohibit the modification of a computer programme on the basis of personal rights;
  • new related rights for press publishers regarding the online use of press releases by information service providers;
  • online-content-sharing service providers will be responsible for materials uploaded by users
  • and other changes.

It is expected that amendments should be further reviewed and adopted by the Parliament without undue delay, as Latvia has already missed the implementation deadline of the digital single market directive.

Read more about amendments to the Copyright Law in our newsflash here.

Lithuania

The Supreme Court of Lithuania has decided on the criteria for proving the distinctive character of internet domains

The dispute arose between two competitors selling substantially similar goods: heating equipment. The companies operated through e-commerce stores with almost identical domain names: www.gerikatilai.lt (www.goodcaldrons.lt” in English) and www.geraskatilas.lt (”www.goodcaldron.lt” in English)

The Claimant, in this case, owns the domain www.gerikatilai.lt and the registered trademark “GERI KATILAI.LT” (however, the trademark registration took place after the registration of the Respondent’s domain). The Claimant requested the Respondent to cease carrying out unfair competition by using the domain www.geraskatilas.lt, and to transfer the ownership of this domain to the Claimant.

The Supreme Court of Lithuania has made the following conclusions:

  • Proving the distinctiveness of a mark in the sense of the Law on Competition does not fundamentally differ from the standards for establishing the distinctiveness of trademarks according to the trademark laws.
  • The fact that the mark GERI KATILAI,” belonging to the Claimant, has been and is being used does not in itself justify that it has acquired a distinctive character as a result of  its use.
  • The confusion of marks that differ only by two letters, indicating plural or singular forms (“gerikatilai.lt” and “geraskatilas.lt”), is natural, but this does not in any way indicate that the mark “GERI KATILAI” has acquired a distinctive feature through the use.
  • Distinctive use may be proved by providing data on (i) the number of accesses to the web owner’s website, (ii) the ranking of this website in terms of the frequency of visits from different countries, (iii) the number of times the disputed mark or its derivative marks have been searched for via internet search engines.
  • Non-distinctive signs are not protected by trademark or competition law provisions.
  • Considering that the Claimant’s trademark registration took place after the Respondent’s domain registration, the substantiation of the infringement due to the Claimant’s trademark rights cannot be justified as a legitimate reason to prohibit the Respondent’s use of its domain. The trademark owner’s rights may be enforced only in a limited capacity in forbidding the use of the mark “GERIKATILAI.LT” in the Respondent’s business activity, but only if the Claimant is able to prove its distinctiveness.

The Supreme Court remanded the case to the lower court with an instruction to evaluate whether the mark “GERI KATILAI” has a distinctive character.

The takeaway from the Supreme Court ruling is that despite general (non-distinctive) domain names being appealing for companies, this kind of use is also attractive to competitors. Proving a general domain name’s distinctiveness is a challenging and complex process, requiring evidence-based arguments. Registering a domain name as a trademark, especially a non-generic one, puts the companies in a slightly more favourable position than their opponents.

Check out the December edition of intellectual property highlights.

Our international Intellectual Property team is at your disposal, should you need advice on any legal issues you are facing.