The topic of how Letters of Consent are treated in trade mark proceedings around the world often comes up in discussions with clients. A recent piece explored how these may now be accepted in Japan and Korea. So, strap in whilst we take you on a tour around the world, with how Letters of Consent are received in mind.

Essentially, there is a divide between different countries as to whether Letters of Consent are treated as: a) effectively redundant, b) acceptable or c) a possibility, but a detailed look at the circumstances is required.

The first approach, notably adopted in the UK and the EU, is where trade mark applications are not examined on the basis of prior rights. Here, the rationale is that trade mark rights are private rights to be enforced by their owners. It’s up to them to object to - or allow - an identical or confusingly similar trade mark for identical or similar goods or services to co-exist on the Register or the marketplace. It is the trade mark owners that are considered to be in the best position to determine their market realities, not the IP Office.

The situation is similar in countries that accept bare Letters of Consent. Although they may examine on the basis of prior rights – and in Ireland and Sweden, for example, the Offices take the view that prior rights examination helps small businesses – if consent is issued then that’s a decision of the cited mark owner and it should be accepted.

The third approach is taken in territories where an Office also fulfils a broader role and has a duty of consumer protection. They should not allow an identical or confusingly similar trade mark to exist because this would create confusion among consumers if they were to co-exist on the marketplace.

Our global tour will now take us to Australia, Canada, China, Hong Kong, Mexico, New Zealand, Singapore, Thailand, Turkey and the USA. Our colour coding may be obvious: green = consent is good, amber = while it should be fine, don’t be complacent and red = you will struggle or you’ll need to back up consent with a well formed agreement.

Australia

IP Australia will give considerable weight to a Letter of Consent, having discretion to accept an application under their “other circumstances” provisions. It was commented by Justice French in Registrar of Trade Marks v Woolworths [1999] FCA 1020 at [47]:

“The policy of the 1995 Act can be said to some extent to have shifted the balance of the objectives of trade mark law more towards the identification and protection of commercial products and services than the protection of consumers, although the latter remains an objective”.

Canada

Applicants are permitted to submit Letters of Consent or consent agreements (the latter being preferred) that explain any circumstances that could establish that there is no likelihood of confusion. These need to shed new light on the test of confusion.

The Canadian Office advises that the following information may be relevant:

• The parties have operated their businesses in different areas;
• The pending application had acquired distinctiveness and a reputation in Canada, as it was frequently and continuously used in Canada for a number of years;
• There is no real confusion between the trade marks and they co-exist, and...
• If coexistence abroad is mentioned, the following factors are considered relevant to determine if there is a likelihood of confusion:

You will see that the Canadian approach is largely to mirror any marketplace co-existence.

China

The situation with consents in China is unpredictable with both the Office and the courts moving towards a more cautious approach to accepting consents. They have even questioned the power of signatories to Letters of Consent in judgments.

Google LLC (Google) Trademark Review and Adjudication Board (TRAB) (Nexus case) ((2016) SPC Retail No. 102)) is a rare positive for consents with two NEXUS trade marks for "hand-held computers and portable computers" and "computers for bicycles” respectively being allowed to co-exist. This did require multiple appeals and so this was likely expensive.

I received a favourable decision in April 2021 following the submission of a Letter of Consent. While the marks were not identical, success with consents at lower-level tribunals is not impossible but is now extremely difficult and cannot be taken for granted.

Hong Kong

Consents are acceptable in Hong Kong. The Office’s trade mark examining manual even goes as far as to say, “consent is king”.

Mexico

Changes to Mexico’s law in August 2018 provided an express provision to accept Letters of Consent.

New Zealand

In New Zealand, an application must be accepted if consent is provided by the owner(s) of cited mark(s).

Singapore

The Office in Singapore has the discretion to accept Letters of Consent. In our experience, they are usually acceptable.

Thailand

The Thai authorities take a very conservative approach to consent. While there has been a 2009 court case accepting consent, examination guidelines permit an Examiner to accept consent in limited circumstances and where the parties have a history of assigning confusingly similar marks between each other.

Turkey

Letters of Consent will overcome citations in Turkey. They will need to be notarised.

USA

There is no rule that says that consent will overcome a citation. Naked (bare) consents are far less likely to be persuasive. A far more formal consent agreement is likely to be required, rather than just a simple Letter of Consent. Factors that the USPTO will take into account are:

• Whether the consent shows an agreement between both parties;
• Whether the agreement includes a clear indication that the goods and/or services travel in separate trade channels;
• Whether the parties agree to restrict their fields of use;
• Whether the parties will make efforts to prevent confusion, and cooperate and take steps to avoid any confusion that may arise in the future; and
• Whether the marks have been used for a period of time without evidence of actual confusion.
  
  

Other options

Consent is not the only option. Where marks and/or goods/services are dissimilar, legal arguments may overcome citations.

In Common Law countries, in particular, honest concurrent use is an option, albeit with an evidential burden.

Where citations are old enough to be vulnerable to cancellation on the grounds of non-use then cancellation actions can be considered – if the marks are not in use, of course. They can be a tactic even where a trade mark is in use in countries where the burden of proof lies with the trade mark owner. An owner may not get their ducks in a row for proving they have used. Be wary that although cancellation actions can be cost-effective where managed by an IP Office, they may be very much less so if cancellations are by Court action.

In some territories, there’s an “assign back” practice where an application would be assigned to an earlier rights holder and, once the objection is overcome, the application could be transferred back to the original applicant. Be cautious in territories where assignments may have more scrutiny.

Conclusion

With different approaches to consent, choosing a path can feel like a minefield. Stobbs can of course help you do so tactfully and strategically. Whatever path you choose, if a worldwide agreement is concluded, make sure that it includes clauses that enable a flexible approach to be taken on a country-by-country, case-by-case basis.