European Economic and Social Committee Section for the Single Market, Production and Consumption Single Market Observatory Record of the proceedings of the public hearing on "The Community trade mark and design systems: An added-value for local market actors" on Monday 28 June 2010 at the Office for Harmonisation in the Internal Market (OHIM) Alicante INT/SMO Fiche CESE 6130/2010 EN/o EN
- 1 - Introductory session Ms Liina Carr, Vice-President of the Single Market Observatory (SMO), welcomed the participants on behalf of Mr Jorge Pegado Liz, President of the Observatory, who could not attend the hearing. She thanked the Office for Harmonisation in the Internal Market for their kind and efficient assistance as well as Ms María Candelas Sánchez Miguel, Spanish Group II (Employees) member of the SMO from the CC.OO. Trade Union, for having made this possible in the first place. She thanked the Chamber of Commerce of Alicante and the Economic and Social Council of the Comunidad Valenciana for their willingness to participate and interact. This illustrated the fact that at all levels European, national and regional stakeholders are aware of the decisive role they can play in the design of our society. She informed the audience about the role and activities of the European Economic and Social Committee insisting on its tripartite set-up. She said that the remit of the Office for Harmonisation in the Internal Market perfectly matched that of the Section for the Single Market, Production and Consumption as it dealt with intellectual property rights, fair competition, innovation and the promotion of products and services that were often initiated by SMEs. Ms Carr added that the Section had its specific Observatory in order to follow the development of the Single Market while focusing on "Better Regulation" or "Smart regulation" as it is now called. It runs a database on European self- and co-regulatory initiatives 1 that had been developed in conjunction with and at the request of the European Commission and co-operated closely with the other institutions, universities and Brussels-based think tanks on "Better Regulation" issues. Interventions Mr Peter Lawrence, Vice-President of the Office for the Harmonisation in the Internal Market (OHIM), said that the Community Trade Mark (CTM) was an instrument of the Single Market launched 15 years ago. He underlined the strong interest by 1 http://www.eesc.europa.eu/?i=portal.en.self-and-co-regulation.
- 2 - companies for registering marks and brands and hence the real success of the Office. He added that OHIM was currently reflecting upon extending its remit to encompass such issues as counterfeiting. Mr Juan Bautista Riera Sánchez, Vice-President of the Chamber of Commerce of Alicante, said that the Community Trade Mark reinforced the confidence of businesses in their facing world markets and that the positioning of the CTM abroad was essential. He drew the attention of the participants to the existence of national trade marks, which rendered the specificity of the individual Member States (gastronomy in France, fashion in the case of Italy or Germany in the field of technology). However, he insisted on the need for Europe to project a coherent image. He added that labels of origin equalled a guarantee against counterfeiting especially when dealing with the Asian markets. He called for more coherence at European level in this respect and wished the EESC and its Single Market Observatory would turn their attention on this issue. Mr Rafael Cerdá Ferrer, President of the Economic and Social Council of the Comunidad Valenciana, insisted on the involvement of various interest groups in the functioning of the Single Market and in their using its many available instruments. While the Spanish Economic and Social Council was established long ago, the Economic and Social Council of the Comunidad Valenciana was created in 1988 in order to facilitate the active participation of the actors of the local economic and social life in decision-making thus acting as an instrument for a democratic debate. In 2006 the Comunidad Valenciana was granted a new autonomy statute, which induced a reorganisation of the Council's activities including the use of both Spanish and Valencian as working languages. Mr Cerdá Ferrer described the Economic and Social Council of the Comunidad Valenciana as a consultative body involved in local decision-making e.g. on economic and environmental issues - with the participation of employers and trade unions and other relevant interest groups among other things through surveys and debates. The Council published an annual report on its activities that focused on economic and social issues including labour law and infrastructure policies. In this latter respect, it had been dealing with the Mediterranean Corridor and had co-operated with the regional Economic and Social Councils of this area. It was also involved as a mediator in labour disputes and the social dialogue. Mr Cerdá Ferrer said that the Economic and Social Council of the Comunidad Valenciana gave an award on marks in 2004 and rewarded a thesis on this issue in 2008. In doing so it ultimately promoted research and reflexion on CTM as a Single Market instrument downsized to the regional level.
- 3 - Ms Liina Carr concluded by saying that the Committee wished to keep the connection with the Economic and Social Council of the Comunidad Valenciana alive with a view to future cooperation. Mr Ignacio De Medrano Caballero, Deputy Director of the Institutional Affairs and External Relations Department at OHIM, briefly sketched he history of the Office, the largest of all EU agencies. The concept emerged in the early 1960's though nowadays 25 national similar offices existed in the EU 2 whereby appeals were to be addressed to the European Court of Justice or, at national level, to the relevant court. He pointed at the difference between trade marks and designs though both could be combined: marks were the visual recognition of a company whereas designs which appeared at a later stage involved the protection of creative items (e.g. in the fashion sector). Mr De Medrano said that OHIM the only EU trade mark and design registration agency was also open to non EU companies 3 on the basis of the UN Madrid Protocol. He informed the participants that the registration of marks had been stagnating over the last years possibly in the wake of the crisis but he expected a significant increase in 2010 indicating some 100 000 registrations per year, most of which were submitted by email (i.e. e-business). The increase in productivity at OHIM had led to a reduction of both registration costs and procedures, which in turn was beneficial to SMEs. Mr De Medrano concluded by saying that OHIM would co-operate with other agencies on intellectual property (IP) 4 issues and was also involved in cooperation with such global players as the US, Japan and China. Ms Ester Olivas Cáceres, Head of the Trade Department at the Chamber of Commerce of Alicante, presented the activities of the Chamber pointing at such policies as adapting local tourism to various types of consumers, e.g. elderly people, whereby the objective was to improve service and infrastructure quality so as to differentiate products according to specific market niches. This meant that the label of origin was indeed an essential factor, hence the vital role of OHIM. She insisted on the importance of the Alicante area in global Spanish figures as was illustrated by the fact that it was responsible of 2.8% of Spanish exports. She also drew the attention to such difficulties as water resources management. She called for some form of cooperation with the European Economic and Social Committee. 2 3 4 The Benelux countries have one single agency in common. E.g. the USA as the main user of OHIM services! The European Commission will issue a document on intellectual property rights in the course of 2011.
- 4 - Debate Mr Panagiotis Gkofas, member of the SMO, was aware of the fact that there were two registration options, i.e. at national and EU level, and wished to know if skipping the national option was realistic especially in view of the incurred costs for SMEs. He also asked OHIM if they would provide guidance legal advice and services. He was also interested to know if different criteria applied to EU vs. Non EU companies and if a company could contact OHIM directly or if it needed to go through the national authority in the first place. As for designs, he wondered if they covered internal and external projects. Ms Inger Persson, member of the SMO, asked about the testing of registered trade marks referring to the current discussions in Sweden on submitting products and services to tests before registration. Ms María Candelas Sánchez Miguel, member of the SMO, underlined the successful connection between OHIM and innovation. She was very much appreciative of the fact that the agency eventually worked in all languages, which meant that SMEs for instance would not be affected by linguistic barriers. Mr Ján Oravec, member of the SMO, was interested to know what phenomena could explain the stagnation in registrations especially between 2007 and 2009. He wished to have confirmation that the 'Community route' was faster and cheaper than the national one. Referring to the difference between national and EU registration fees, Mr De Medrano Caballero said that if company were to target more than 3 large Member States the 'Community route' would be more appropriate but ultimately the companies themselves decided which option seemed the best. On the question of legal services he said that the mission of OHIM was limited to registering trade marks and designs though it would provide information by way of a help desk. He added that national offices offered advice to their businesses which planned to register a brand. He mentioned the IPR help desk 5 as a source of assistance to SMEs. Mr De Medrano Caballero said 5 http://www.ipr-helpdesk.org/.
- 5 - that e-business tools allowed for easy registration of brands also for companies that had no office in the EU, which however needed to appoint a representative to deal with the registration request. He added that more than 90% of all registrations were made on-line and that national bodies were competent as far as the testing of products was concerned. OHIM tried to strike a balance between on the one hand allowing all official languages to be used for the registration procedure while, on the other, restricting themselves to 5 working languages. Online tools had clearly reduced manual interaction making registration user-friendly, fast and direct. Mr De Medrano Caballero added that OHIM's back office management had enormously improved the work flow and facilitated the merging of certain fees, which had resulted in shorter registration times. This in turn was a concrete transposition of the principles of Better Regulation and of reduction of administrative burden. Mr Di Carlo drew the attention to the 2000 and 2001 update of OHIM's working methods with the multiplication of e-tools, including databases, which eventually facilitated users' access and improved the quality of services offered by OHIM, including guidance and support. These services were now free of charge and allowed for a reduction on the final registration fee due to simplified procedures. He added that users could test OHIM's e-tools and report with an update every three months and an annual measurement of users' satisfaction - so as to allow the agency to make improvements on their system accordingly. This in turn would enhance the transparency of the procedures and make it possible for them to track the evolution of the registration. Mr Di Carlo said that the European Commission was undertaking a survey of the performance of the trade mark system, including a screening of the interaction between national and EU procedures. The cost of registration had gone from EUR 2 000 to EUR 900 since May 2009. He informed the participants that in the wake of this survey a legislative proposal on the review of the CTM would be tabled in 2011 and wished that the Committee would be involved, possibly through its Single Market Observatory. He added that trade marks needed to be used within five years after registration before being deleted and that the concept of "genuine use" must be in compliance with the Single Market principles. The CTM was fee-operated to cover the management of registrations and a biannual evaluation by the Commission. He insisted on the interoperability or compatibility of national, EU and international procedures on the grounds of common standards for services. Mr Di Carlo finally said that a Cooperation Fund with an envelope of EUR 50 million had been set up to harmonise procedures and instruments between OHIM and the national registration offices. He referred to the Committee's opinion (CESE 636/2010) on the Communication from the Commission to the Council, the European Parliament and the
- 6 - European Economic and Social Committee. Enhancing the enforcement of intellectual property rights in the internal market (COM(2009) 467 final) as being of particular relevance to OHIM. Mr Wauthier Robyns de Schneidauer, member of the SMO, asked if companies could also register business procedures or services. Ms Rose D'Sa, member of the SMO, thought that the reduction of registration fees coincided with the current crisis and wondered if there would be a need to increase these fees in future to avoid underfunding. Mr Di Carlo replied that decisions in relation to OHIM's activities were made by the European Commission along the lines of the comitology procedure. Mr Jean-Pierre Faure, Head of the SMO secretariat, raised the question of geographical brand names such as the ADRION brand which designated a cross-border initiative in the tourism sector covering a number of regions in the Adriatic and Ionian area. He wished to know if OHIM was competent in such matters. Mr De Medrano Caballero confirmed that such collective trade marks fell under OHIM's competence. The Spanish SOLVIT centre Mr Jorge García-Figueras, Head of the Spanish SOLVIT centre at the Ministry of Foreign Affairs and Cooperation, reminded the participants that since the SOLVIT network was dealing with cases of misapplication of EU laws by national administrations these were key to solving disputes. He said that 85.5% of all cases involving some 1 000 clients - were solved. The Spanish SOLVIT centre was being advertised among SMEs through the Chambers of Commerce. The SOLVIT homepage can be accessed at http://ec.europa.eu/solvit/ and the contact details of the Spanish centre can be seen at http://ec.europa.eu/solvit/site/centres/addresses/index.htm#spain.
- 7 - Mr Ján Oravec wished to know what SOLVIT could say about the 15% of cases that were not solved. Mr Jorge García-Figueras replied that in a number of cases national laws possibly posed a problem. In this context, the European Commission could ask the relevant Member State to review its legislation. Conclusions by Mr Wubbo De Boer, President of the Office for Harmonisation in the Internal Market (OHIM) Mr Wubbo De Boer, President of the Office for Harmonisation in the Internal Market, said that some 300 000 companies had registered trade marks since the creation of OHIM. 200 000 of them were European businesses most of which were SMEs. This latter fact showed how important the Office was for small and medium size enterprises. He pointed at the specificity of the EU in allowing companies to freely choose either the EU or the national protection systems. He added that the success of OHIM was largely due to their user-friendly procedures, which in turn was a brilliant example of Single Market instrumentation. He said however that national offices feared that OHIM might concentrate all registrations though he doubted that things would go that far. He called for closer cooperation and for more coherence between national and EU registration systems.
- 8-10 key findings 1. OHIM is currently reflecting upon extending its remit to encompass such issues as counterfeiting 2. Europe needs to project a coherent image also in terms of trade marks in spite of the existence of national trade marks. The EESC's support on this issue would be most valuable 3. Some form of cooperation between the Chamber of Commerce of Alicante and the European Economic and Social Committee should be developed (e.g. through the CESlink network the EESC-based on-line community of national ESC's) 4. Concerning the registration of trade marks, the 'Community route' would be more appropriate but ultimately the companies themselves decided which option seemed the best 5. The intellectual property rights (IPR) help desk is a source of assistance to SMEs: http://www.ipr-helpdesk.org/ 6. The European Commission is undertaking a survey of the performance of the trade mark system, including a screening of the interaction between national and EU procedures 7. In the wake of this survey a legislative proposal on the review of the CTM will be tabled in 2011 and the Committee should be involved, possibly through its Single Market Observatory 8. There is full interoperability or compatibility of national, EU and international procedures on the grounds of common standards for services 9. A Cooperation Fund with an envelope of EUR 50 million has been set up to harmonise procedures and instruments between OHIM and the national registration offices 10. Closer cooperation and more coherence between national and EU registration systems would benefit SMEs. INT/SMO Fiche CESE 6130/2010 EN/o