IP News

The new Administrative Instruction (AI) on Trademark Registration Procedures No. 08/2023, which entered into force in Kosovo on August 14, 2023, addresses the most important changes brought by the new Law on Trademarks, in force as of July 2022.

Besides elaborating the novelties introduced by the new trademark law and clarifying certain aspects of various procedures, the new AI also states is that the Kosovo Intellectual Property Office (IPO) has accepted WIPO’s Joint Recommendation Concerning Provisions on the Protection of Well-Known Marks meaning that the IPO can now refuse an application for a mark that is in conflict with a well-known international trademark even if the latter is not registered in Kosovo.

Additionally, the Kosovo IPO has accepted the list of recommendations from the INTA Board Resolution on Bad Faith Trademark Applications and Registrations when assessing if an application was filed in bad faith.

Finally, according to the new AI, parties in an opposition procedure are now obliged to inform the IPO within 30 days from the date of the decision of the Complaint Committee of the Ministry of Industry, Entrepreneurship and Trade if a lawsuit against the decision has been filed with the competent Court. Otherwise, the IPO will consider the Complaint Committee’s decision as final.

By: Nora Makolli

For more information, please contact Nora Makolli. 

Kosovo’s new Law on Trademarks, which entered into force on July 28, 2022, aims to harmonize local legislation with Directive (EU) 2015/2436 to approximate the laws of the Member States relating to trademarks. The law also provides a basis for the implementation of Directive 2004/48/EC on the enforcement of intellectual property rights. The new law introduced numerous changes, the most significant of which are outlined below.

Elimination of Graphical Representation Requirement

Graphical representation is no longer required when filing a trademark application, meaning that a sign can be represented in any form that distinguishes the goods or services applied for from those of other undertakings and that enables the authorities to clearly establish the scope of protection that is sought.

Literal Interpretation of Class Headings

When filing a trademark application, it is now required to precisely define the list of goods and services for which protection is sought in such a way that enables the competent authorities to determine the extent of the protection sought on that sole basis.

Additional Absolute and Relative Grounds for Refusal

The law introduced additional absolute grounds for refusal – a sign cannot be registered if there is a conflict with an existing designation of origin, geographical indication, traditional term for wine, traditional speciality guaranteed or plant variety. In terms of relative grounds for refusal, a bad faith trademark application can now be opposed.

Exhaustion of Rights

Under the new law, trademark owners cannot prohibit the importation of genuine goods bearing their trademarks after they have placed them on any of the following markets:

• Kosovo;
• A member state of the European Union;
• A member state of the European Economic Area;
• A state of the Western Balkans region;
• A state with which Kosovo has a free trade or trade facilitation agreement.

The previous version of the law provided for the national exhaustion of rights. It remains to be seen how the new exhaustion regime will be interpreted by courts, in particular with regard to cases initiated under the previous law.

Trademark Infringement Scope Expanded

The law expands the scope of trademark infringement by establishing additional uses of similar or identical signs that may be prohibited by trademark owners, namely:

• Use of a sign as a company name;
• Use of a sign in advertising; and
• Use of a sign on packaging, labels, tags and security or authenticity features or devices, and placing these on the market.

Introduction of Disclaimers

If a trademark includes an element that might not be considered distinctive, the IPO may require the applicant to impose a disclaimer on the non-distinctive element in order to register such trademark.

The Non-Use Defense

In court proceedings, the defendant may now request that the plaintiff show the use of the trademark claimed to have been infringed. The plaintiff should prove that, during the five-year period prior to the date of filing of the infringement claim, the trademark was placed on the market in respect of the goods or services for which it was registered. In the absence of such evidence, the claim will be refused. The same defense applies to preliminary injunctions.

Appeals with the Market Inspectorate

It is now possible to enforce trademarks in an administrative procedure by filing an appeal with the Market Inspectorate against an infringer. The appeal procedure will be further elaborated in bylaws, which will be adopted by July 28, 2023.

Other Changes

Other changes relating to trademark enforcement include the following:

• The time frame to file an appeal against the IPO decision changed from 15 days to 30 days from the date of receipt of the decision;
   
• In order to prevent the continuation of infringement, the court may order the infringer to pay the trademark holder EUR 5,000-10,000 for a single instance of infringement;
   
• Under certain circumstances, the court may replace an order for the seizure and destruction of infringing goods with monetary compensation for the injured party;
   
• The criteria for the assessment of damages have been specified – when determining the amount of damages, the court will take into account all relevant aspects such as adverse economic consequences, including lost profits incurred by the injured party, any unjust profit made by the infringer and, where appropriate, other elements such as economic factors and the moral prejudice suffered by the right holder;
   
• In line with the EU Enforcement Directive, the new law provides that injunctions in infringement cases should be fair, equitable, proportionate and affordable; and
   
• The new law also includes provisions clarifying the time frames for initiating proceedings with the court. Infringement claims, claims relating to the seizure and destruction of goods and claims for damages may be filed within three years from the date the right holder became aware of the infringement and the infringer, and no later than five years from the date the infringement occurred.

By: Kujtesa Nezaj-Shehu

For more information, please contact Kujtesa Nezaj-Shehu.

Kosovo’s new Law on the Protection of Trade Secrets, which entered into force on June 14, 2022, is largely harmonized with the Directive (EU) 2016/943 on the protection of undisclosed know-how and business information (trade secrets) against their unlawful acquisition, use and disclosure. The new law defines what trade secrets are, what constitutes their infringement, and the interim and final measures and remedies available in the event of infringement.

Definition

Trade secrets are defined as information that fulfills all the following criteria:

• It is secret in the sense that it is not, as a whole or in the precise configuration and assembly of its components, generally known among, or readily accessible to, persons within the circles that normally deal with the kind of information in question;
• It has commercial value because it is secret; and
• It has been subject to reasonable steps to keep it secret by the person lawfully in control of the information.

Unlawful Acquisition, Use and Disclosure

The acquisition of a trade secret without the consent of its holder is considered infringement whenever achieved by:

• Unauthorized access to, appropriation of, or copying of any documents, objects, materials, substances or electronic files lawfully under the control of the trade secret holder, containing the trade secret or from which the trade secret can be deduced; or
• Any other conduct which, under the circumstances, is considered contrary to honest commercial practices.

The use or disclosure of a trade secret is considered unlawful whenever carried out without the consent of the trade secret holder by a person who is found to meet any of the following conditions:

• Having acquired the trade secret unlawfully;
• Being in breach of a confidentiality agreement or any other duty not to disclose the trade secret; or
• Being in breach of a contractual or any other duty to limit the use of the trade secret.

The acquisition, use or disclosure of a trade secret is also considered unlawful whenever a person, at the time of the acquisition, use or disclosure, knew or ought to have known that the trade secret had been obtained directly or indirectly from another person who was using or disclosing the trade secret unlawfully.

The production, offering or placing on the market of goods infringing a trade secret, or the import, export or storage of such goods for the purpose of offering or placing them on the market, as well as offering and providing services by which a trade secret is used is also considered an unlawful use of a trade secret, if the person carrying out such activities knew, or ought, under the circumstances, to have known that the trade secret was used unlawfully.

Interim and Final Measures

The trade secret holder can request that the court order any of the following interim measures against the alleged infringer:

• Cessation or temporary prohibition of use or disclosure of the trade secret;
• Prohibition of the production, offering, placing on the market, use, import, export or storage of infringing goods;
• Seizure or delivery to the trade secret holder of the suspected infringing goods, including imported goods, so as to prevent their entry into or circulation on the market.

Final measures and remedies in the event of infringement of trade secrets include:

• Cessation of infringement or prohibition of use and disclosure of a trade secret;
• Prohibition of the production, offering, placing on the market or use of infringing goods, or the import, export or storage of infringing goods for those purposes;
• Adoption of the appropriate corrective measures with regard to the infringing goods, such as depriving the goods of their infringing quality, their destruction or, where appropriate, their withdrawal from the market, provided that the withdrawal does not undermine the protection of the trade secret in question;
• Destruction of all or part of any document, item, material, substance or electronic file containing or embodying the trade secret or, where appropriate, the delivery to the trade secret holder of all or part of those documents, objects, materials, substances or electronic files;
• Damages; and
• Publication of the judgment.

The limitation period for claims related to misappropriation of trade secrets is six years counting from the moment when the trade secret holder became aware of the infringement or the damages caused by it, as well as the identity of the infringer.

By: Kujtesa Nezaj-Shehu

For more information, please contact Kujtesa Nezaj-Shehu. 

The new patent and industrial design laws entered into force in Kosovo on February 4 and February 5, 2022, respectively, while the new law on the protection of semiconductor topographies entered into force on January 17, 2022.

An important change brought by the new Law on Patents relates to supplementary protection certificates (SPCs). While the previous law included provisions related to SPCs, they never entered into force because they were subject to Kosovo’s potential EU membership. Under the new law, the SPC provisions are not subject to Kosovo’s eventual EU accession. The SPC chapter includes provisions regarding the SPC subject matter, examination and application processes, exceptions to SPC rights and conditions for obtaining and invalidating an SPC. 

Exhaustion of patent rights remains national. However, the new patent law provides that rights may be exhausted if the patented product is placed on the market by the right holder or with their consent, therefore opening a possibility for the courts to interpret a possible implicit consent by the right holder.

The new law also clarifies the restoration and continuation procedures, which were sometimes found ambiguous.

The new Law on Semiconductor Topographies clarifies the subject matter for the protection of semiconductor topographies as well as the exclusive rights and limitations granted by such protection.

The exclusive rights start either on the date when the topography is first commercially exploited anywhere in the world (provided that the application for the topography registration is submitted within two years from that date) or on the date the application for the topography registration is submitted to the local IPO. The rights are valid for ten years counting from the year following the end of the calendar year in which they were established.

The exhaustion of rights has been introduced – once any protected topography or any semiconductor product produced using the protected topography is placed on the Kosovo market by the right holder or with their consent, the rights are exhausted.

The protection of trade secrets for semiconductors has also been introduced – the applicant can now label any required material or its part as a trade or business secret, but this right cannot be exercised for more than half of the number of layers in the semiconductor product. The registration and invalidity procedures have also been thoroughly clarified.

The substantive and procedural provisions of the new Law on Industrial Designs remain the same as before. The changes introduced by the new law relate to enforcement and are identical to the new enforcement provisions in the new patent and semiconductor topography laws. Although the three laws are separate, the intention was to harmonize their enforcement chapters.

The main changes relating to enforcement in all three new laws are the following:

• The time frame to file an appeal against the local IPO decision changed from 15 days to 30 days from the date of receipt of the decision;
• Under certain circumstances, the court may replace an order for the seizure and destruction of infringing goods with the monetary compensation for the injured party;
• Provisions regarding the right to information and evidence have been redefined in favour of right holders – they are now entitled to receive more information if their requests are justified;
• The criteria for the assessment of damages have been specified – when determining the amount of damages, the court will take into account all relevant aspects such as adverse economic consequences, including lost profits incurred by the injured party, any unjust profit of the infringer and, where appropriate, other elements such as economic factors and the moral prejudice caused to the right holder;
• The new laws include several provisions which were previously covered by the Law on Contested Procedure, such as ordering the placement of security for damages, or, in case the injunction is revoked or expires due to any act or omission by the right holder, or if no infringement is found, ordering the plaintiff to provide adequate compensation for any damage caused by these measures;
• In line with the EU Enforcement Directive, the new laws provide that injunctions in infringement cases should be fair, equitable, proportionate and affordable;
• With the aim of reducing the scale of infringement, the punitive provisions introduced higher penalty amounts.

In addition, new patent and design laws now include provisions clarifying the time frames for initiating proceedings with the court. Infringement claims, claims relating to the seizure and destruction of goods, as well as claims for damages may be filed within three years from the date the right holder became aware of the infringement and the infringer, and no later than five years from the date the infringement occurred.

By: Kujtesa Nezaj-Shehu and Florentina Grubi-Vula

For more information, please contact Kujtesa Nezaj-Shehu or Florentina Grubi-Vula.

While Kosovo faces many legal challenges regarding the infringement of intellectual property rights, parallel import – the importation and sale of branded goods without the trademark holder’s consent – has become a particularly complex issue to tackle. Even though there have been recent court decisions against parallel importers, rights holders still face difficulties when enforcing their rights when the goods in question are deemed to be genuine. 

Kosovo applies the principle of national exhaustion. According to the Kosovo Law on Trademarks, trademark holders can oppose the importation of genuine goods bearing their trademarks by third parties without their consent. The law explicitly states that the use of trademarks without the rights holder’s authorization constitutes trademark infringement and thatthe trademark right is exhausted only when the good or service bearing the trademark is sold in Kosovo under the authorization of the trademark holder.

However, the Kosovo Law on Customs Measures for Protection of Intellectual Property Rights does not allow Customs to seize original goods imported to Kosovo without the trademark holder’s consent, which complicates enforcement. Additionally, local case law has been inconclusive. 

A significant step forward was made recently when the Court of Appeals in Prishtina issued a ruling on November 7, 2018 confirming the right of the trademark holder to ban the unauthorized importation and sale of goods bearing his/her trademark, regardless of the goods’ authenticity. Namely, the defendant imported apparel items bearing the trademark of a well-known multinational fast fashion company. Kosovo customs officials detained the goods, suspecting they were counterfeits. The trademark holder confirmed that the goods were indeed counterfeits, and the first instance court ruled in favor of the plaintiff.  

The defendant filed an appeal stating that the goods were purchased from an authorized dealer, but the Court of Appeals ruled in favor of the plaintiff, claiming that it is sufficient to ascertain that the importation and placing of the goods on the market occurred without the rights holder’s authorization.

Another noteworthy case in Kosovo involved a local importer who intended to import a significant number of bottles bearing a well-known whiskey brand without the trademark holder’s consent. The local importer removed the identification code from the bottles and the goods were seized by Kosovo Customs under the suspicion of being counterfeit, but were later released because it was determined they were genuine.

The plaintiff argued that such unauthorized use constituted trademark infringement and emphasized that exhaustion of rights did not occur in line with Articles 8 and 12 of the Kosovo Trademark Law. The whiskey producer further stated that the goods were imported without trademark owner’s consent, through channels different from their authorized representative’s, and that the product was damaged by the removal of the product code. Furthermore, the damaged product was placed on the market, creating confusion regarding the product’s origin and damaging its quality standards.

While the court of first instance ruled against the plaintiff, the Court of Appeals in Prishtina ruled that such unauthorized import constituted trademark infringement. The case ended up in the Supreme Court, which upheld the appellate court’s decision on December 9, 2015 confirming that trademark infringement indeed occurred and that parallel import is prohibited in Kosovo.

However, court practice has been inconsistent and needs significant improvements. There are still many gaps in legislation regarding parallel imports and exhaustion of rights which allow for various inconsistent interpretations. It remains to be seen how the situation will evolve in the coming years.

By: Florentina Grubi

For more information, please contact Florentina Grubi.