Update on New Zealand Trademark Law
John Hackett -
Angela Wray -
New Zealand is preparing itself to host the Rugby World Cup in 2011 (RWC 2011). As with all major events, ambush marketing and counterfeiting are issues for official sponsors and brand owners to contend with. These issues are discussed below, followed by an update on New Zealand’s trademarks legislation and the move to “green” branding.
The Rugby World Cup 2011 and the Major Events Management Act 2007
Rugby is New Zealand’s national sport, and the RWC 2011 will capture a massive audience both nationally and internationally. With less than 18 months until kick-off, many businesses are thinking about how they can benefit from the RWC 2011.
While major sponsors and brand owners can rely on their copyright, trademark, common law rights or fair trading legislation to stop others from misappropriating their rights during the RWC 2011, the Major Events Management Act 2007 (Major Events Act) provides a new layer of protection to combat unauthorised exploitation at major events in New Zealand.
The RWC 2011 is one of the events protected by the Major Events Act. Businesses must avoid: making any representation that would indicate an association with the event; using any protected words or emblems; undertaking street trading activities, including giving away goods or services, in clean zones; advertising in clean zones or transport routes, or advertising in areas that can be seen from clean zones.
The Major Events Act also includes prohibitions on pitch invasions; employment of enforcement officers to undertake enforcement of the Major Events Act; border protection measures; and ticket scalping provisions.
Enforcement can involve fines, forfeiture of goods, and criminal charges.
The New Zealand Customs Service recently detained 1,000 counterfeit RWC 2011 T-shirts from China under the Major Events Act, under the prohibition on making any representation that there is an association between the goods and the RWC 2011.
The importer consented to the forfeiture of the goods. The National Enforcement Unit (NEU) and Crown Solicitor decided to lay criminal charges – a significant step, as this is the first time criminal charges have been laid under the Major Events Act.
The Major Events Act may be the most effective way to protect the event as additional criminal charges provide a significant deterrence factor to potential counterfeit importers and ambush marketers.
As RWC 2011 draws closer, it is likely that we will see more goods being stopped at the borders.
And, if the government provides significant funding increases, we may also see the NEU patrolling within the borders to find infringing goods or representations.
Update on New Zealand's Trademarks Amendment Bill
The Trademarks (International Treaties and Enforcement) Amendment Bill (“the Bill”) is awaiting its second reading in the New Zealand Parliament. The Bill amends the Trademarks Act 2002 (the Trademarks Act) and the Copyright Act 1994 (the Copyright Act).
When the Bill comes into force, it will provide important and positive changes to some areas of New Zealand’s trademark and copyright law. The changes will allow New Zealand to join both the Madrid Protocol and the Nice Agreement, and better combat the importation of counterfeit goods. The Bill also addresses certain technical issues that have arisen in the Trademarks Act since it came into force in 2003.
New Zealand to Join the Madrid Protocol
The Bill aims to give effect to the government’s decision to accede to the Madrid Protocol Relating to the Madrid Agreement (the Madrid Protocol). This will allow New Zealand trademark owners to file international trademark applications in other Madrid Protocol member countries based on New Zealand applications or registrations through the Intellectual Property Office of New Zealand (IPONZ). The Madrid Protocol will also enable overseas trademark owners to designate New Zealand in their international applications.
New Zealand to Join the Nice Agreement
The Bill gives effect to the government’s decision to accede to the Nice Agreement concerning the International Classification of Goods and Services for the Purposes of the Registration of Marks (the Nice Agreement). The Nice Agreement has already been applied in New Zealand for many years under the Trademarks Act 1953 (now repealed) and the Trademarks Act 2002. The Bill clarifies that the latest version of the Nice Classification must be used with all new trademark applications.
IPONZ is currently reclassifying 1,300 live trademarks registered in New Zealand before 11 December 1941 under the third schedule to the Nice Classification system.
The Bill allows for regulations to be made so that New Zealand’s obligations under the Singapore Treaty can be put into effect. This will mean New Zealand law is in line with the standards and rules set out in the Singapore Treaty.
The purpose of the Singapore Treaty is to make national trademark registration systems easier to use, as well as decrease business compliance costs for trademark owners. This is done through simplifying and harmonising the national registration procedures of the Treaty members.
Stronger Border Protection
The Bill provides stronger border protection measures to help combat counterfeiting and piracy. The Bill provides the New Zealand Customs Service (Customs) and the Ministry of Economic Development (the Ministry) with more resources as well as search and seizure powers. The Bill creates an enforcement unit within the Ministry.
The Ministry and Customs will have the power to enforce the criminal offence provisions under the Trademarks Act and the Copyright Act related to counterfeit goods and pirated works. These additional powers of Customs and the Ministry are intended to be used in conjunction with prosecutions to help reduce and deter offending.
Removal of Licensees from the Trademarks Register
The Bill removes provisions that allow licensees to voluntarily register their interest against a trademark. Licensees currently on the register will be cancelled and removed from the register.
The Bill also amends the definition of a licensee. Currently, a licensee is someone who is registered as a licensee or registered user. A licensee will now mean any person whose use of the trademark is authorised by, and subject to the control of, the trademark owner. This means any authorised user of a trademark can begin infringement proceedings, as long as it is within the terms of their authorisation. As this is an important change, trademark licensees and licensors should review their licence agreements to make sure they are still appropriate.
Role of Commissioner of Trademarks Defined
Following the Select Committee review the Bill now defines the role of the Commissioner of Trademarks more clearly by defining the functions and power of delegation of the Commissioner and the functions of the Assistant Commissioners.
Parallel Importation of Goods
Currently, on the wording of the Act, overseas trademark owners can assign their New Zealand trademark registration to local distributors or licensees who may then be able to prevent the importation of authentic goods. While untested in New Zealand, Australian decisions on similar provisions suggest that this can be used as a way to stop the parallel importation of a trademark owner’s goods. The Bill amends the law so this potential loophole is closed.
"Green" Branding
Businesses throughout New Zealand, and indeed throughout the world, are looking at ways they can make and promote their goods and services as being environmentally friendly. Consumers are becoming more environmentally aware and, in some cases, choosing sustainable products over others.
However, businesses and brand owners need to be careful when branding and marketing their goods and services so as not to make misleading statements about issues such as environmental sustainability, recycling, carbon neutrality, energy efficiency, use of natural products or the impact on animals and the natural environment. Making false or misleading statements in this way is known as “green washing”, and may breach the New Zealand Fair Trading Act, which prohibits misleading or deceptive conduct in trade.
Being caught “green washing” can be expensive. If the claims are found to breach the Fair Trading Act, an individual can face a fine of up to $60,000 and a company up to $200,000.
Even more importantly, if a business has been built on the back of a “green” platform, the adverse publicity for a company found to have engaged in “green washing” could be disastrous to the business.
If businesses are thinking about any green marketing in New Zealand, they need to make sure anything that could be viewed as a “green” or “eco” claim is accurate, factually based, not overstated and able to be substantiated.