One of the first things intellectual property consultants will check when handling a trademark case involving a foreign-registered trademark is whether this foreign country is a ‘first-to-file’ or a ‘first-to-use’ country.
It is not difficult to guess which party will get the rights over a trademark in a first-to-file jurisdiction. If party A files an application for the trademark registration Indonesia on January 1 and party B lodges his application for registration of the same trademark on January 2, party B will be denied the rights over the mark. This makes quick registration of a trademark in first-to-file countries very important. After all, it generally does not matter whether party B has been using the trademark for a long time and has invested large amounts of money in advertising and promotion. As long as party A has filed his application for registration of the trademark first, he will at first instance be regarded as the rightful holder of the trademark.
Does being the first to file always grant someone the rights over a trademark in first-to-file countries?
Party B in our example can still try to have the trademark registration on behalf of party A canceled. He can do so if he can prove party A knew about the creation and use of the trademark by another party at the time party A filed his application for registration of the trademark on his own behalf. In this case, party A would have acted in bad faith when trying to have the trademark registered under his own name. This is often difficult to prove though and involves a lengthy and costly legal procedure. Whether that is worth it depends on various factors, such as the amount of money someone has invested in the marketing of the trademark and someone’s personal motivation for taking such legal steps.
The first-to-file system around the world
The first-to-file system is followed by Indonesia, but also most European states, China, Russia, and Brazil normally grant the first person to file for registration of a trademark the rights over it. WIPO (for international applications through the Madrid System) and EUIPO (for European Union marks) also follow the first-to-file system.
While in first-to-file jurisdictions the party who first filed an application for trademark registration generally has the strongest legal standing, this does not have to be the case in countries using the first-to-use method. Though a trademark registration in these countries still offers you a strong legal position in trademark conflicts, someone who can prove he used the trademark before the registrant did will most likely still obtain the rights over the mark.
When is someone the first to use in the legal sense of the word?
Though ‘first-to-use’ translates as ‘the first party to use a trademark will be granted the rights over it’, national sources of law often further specify what can and can not be regarded as ‘first use’. In the United States, for example, a trademark is considered as being ‘used’ when it is being used in actual commerce; merely designing a mark, therefore, is insufficient. On top of that, the legal standing of a trademark creator only using his mark for trade in his own town is relatively weak.
Why trademark registration in a ‘first-to-use’ jurisdiction is still important
Conflicts over trademark rights in ‘first-to-use’ countries often arise from arguments about the moment of first use of the mark by parties. Determining the exact moment when a trademark can be regarded as being legally ‘in use’ by a claimant is a tough job. Finding convincing evidence for when this moment took place is even more difficult. The registration of a trademark gives someone a stronger legal position against other parties in case such conflicts arise. Besides this, international organizations such as WIPO or the European Union’s Trademark Office often work with the ‘first-to-file’ method. Someone wishing to file an application for international registration of his trademark through the Madrid System, for example, must hold a prior national trademark registration. In order to claim priority right when applying for registration of a trademark in a foreign country, an existing national registration is required as well.
The first-to-use system around the world
The first-to-use system is mainly followed in Anglophone countries like the United States, Canada, and Australia. There are however also plenty of non-English speaking nations that use the first-to-use system. Some examples include Saudi Arabia, India, and Italy. The United Kingdom, on the other hand, is both an Anglophone country and a first-to-file jurisdiction.