30 January 2012

Trade Marks and Scottish independence

The debate has been raging for a while now but the next two years should see a referendum on Scottish independence from the United Kingdom. The coalition government in Westminster want this to happen soonish, the devolved Scottish Government want to wait until 2014 - by no coincidence the 800th anniversary of Scottish victory over the English at the Battle of Bannockburn and when Glasgow hosts the Commonwealth Games and, presumably, Scotland is experiencing a feel good factor.

My cynicism aside, I am not a committed unionist although I do have a ticket to "Team GB's" opening match in Manchester at this year's Olympic Games; this team may
only be made up of English players, however. I have no problem with Scottish independence or with Scotland remaining a part of the United Kingdom, although independence could lead to greater democracy "south of the border" and some elimination of the West Lothian question.

There would be lots of issues to iron out should Scotland vote for independence. One which does not capture the imagination as much as pandas is trade mark rights - what would happen to them?

The truth is we don't know and there may be no need to even speculate if Scots end up voting for the status quo. However...

Would independence for Scotland come within the European Union? There is some debate on whether Scotland would need to apply for membership, which would require a commitment to join the Euro. (There are even reports the remainder of the UK would need to reapply although these seem far fetched to me.) If Scotland does need to apply there are even reports that Spain would veto such a bid. I think this would end up being a PR disaster for the Spanish government that would only galvanise separatist movements and it is hardly in the spirit of European human rights. In any case, I can see EU membership being automatic - after some negotiations, for example, relating to voting rights - as Scotland is already within the European Union and has compliant laws. It's not exactly a precedent but the old East Germany jumped into the EU following German reunification; 16 million people being allowed into the EU without fuss. I don't see 5 million Scots being an issue especially as they are EU citizens already.
  
I would therefore speculate that Community Trade Marks will continue to cover Scotland as a continuing member of the European Union.

National rights will present a different story. From a legal perspective, the UK is currently three legal jurisdictions anyway: 1. England and Wales, 2. Scotland and 3. Northern Ireland. Scots law is a hybrid law. It is not pure Common Law as used in England and Wales (and Northern Ireland) and which the British Empire exported to other parts of the world. When it comes to trade marks though, UK legislation is "Federal" and unitary in that it covers England, Wales, Scotland and Northern Ireland. It also covers the crown dependency of the Isle of Man which is another distinct legal jurisdiction.

I would speculate that the UK Register will be duplicated into a Scottish Register. This would be easy to do as the UK Register is completely computerised and I'd anticipate Scotland enacting trade mark legislation and setting up a Trade Marks Office essentially identical to that in place now. I would suggest that revalidation of UK rights to Scotland will not be required because whilst it could see a large volume of revalidation applications (and perhaps related official fees) these would tail off quite soon after. It would also discriminate particularly against local Scottish businesses who only use their trade marks in Scotland and who would be forced to pay again.

There should also be no issue with agents (i.e. a need to appoint an agent in Scotland) as the UK currently allows an Address for Service anywhere in the EEA or Channel Islands. EU obligations would see that this is followed so a firm in, say, London could be an agent before the Scottish Trade Marks Office. (The Scots could theoretically close the door on agents from the Channel Islands.)

Replication of the UK Trade Marks Act would make Scotland Madrid Protocol compliant and Continuation of Effects requests would need to be made to WIPO (for United Kingdom designations only - designations of the European Community automatically cover all member states including new ones). This would create an anomaly as the only type of trade mark which would require some form of action on. This would impact on foreign owners, but our last precedent with Montenegro was a Continuation of Effects official fee per registration of 64 Swiss francs (£45 in today's money) so it is hardly going to hit them hard financially.

Prediction time and I don't think the referendum will gain a sufficient enough majority for independence, but if it does I do not anticipate it causing headaches for those in the trade mark community. Actually, trade mark practitioners in England would have more of an issue if Wales were to vote for independence in the future (which there is little appetite for) as the IPO is based in Wales and a new Office would need to be set up in England (or Northern Ireland).

I won't mention Spain again, but an independent Flanders has some possibility. Presumably this would remain a part of (a perhaps renamed) Benelux (and the EU) for trade mark purposes and would represent the most painless succession possible for trade mark professionals - we would not have to do anything!