Official Marks to be Subject to Summary Expungement

In extensive amendments to the Trademarks Act enacted in 2019, a new provision was introduced for the summary expungement of official marks from the trademark register. In anticipation of this amendment coming into force in 2023, the Canadian Intellectual Property Office (CIPO) has issued a DRAFT practice notice for public comment.

The practice notice sets out the criteria and procedures that it proposes to apply to requests for the summary expungement of official marks. The deadline for comments is August 29, 2022.

What is an “official mark”?

Per section 9(1)(n) of the Trademarks Act, the “badge, crests, emblem or mark” adopted by the following entities may be eligible for protection as so-called “official marks” in Canada:

  • any level of government in Canada;
  • an agency of any level of government in Canada;
  • the Canadian military;
  • foreign and domestic universities;
  • foreign governments; and
  • “public authorities”.

While most categories of eligible entities have not attracted much debate, the definition of a “public authority” has been the subject of frequent disputes. In the past, many charitable organizations and foreign public authorities were allowed to record official marks in Canada.

However, the courts have since determined that, for the purposes of the Trademarks Act, a “public authority” is limited to:

  1. an entity that is subject to a significant degree of control by a Canadian government; and
  2. whose activities benefit the public.

In this context, a government must, either directly or through its nominees, exercise a degree of ongoing influence over the entity’s governance and decision-making. Non-profit or charitable status does not, on its own, make an entity eligible to record official marks.

Limited Examination

Applications for official marks are only subject to examination to determine: (a) whether the applicant qualifies as an eligible entity; and (b) whether the applicant has adopted the official mark prior to filing the application. The latter determination is made by examining specimens filed by the applicant which may include screenshots from a website on which the official mark is prominently displayed.

Unlimited Scope, No Opposition & Perpetual

Unlike traditional trademarks, official marks enjoy a monopoly for all goods and services in the Canadian marketplace. The applications are not subject to potential opposition by third parties and, once recorded, official marks never require renewal.

With no requirement to renew and no efficient means to expunge such recordals as invalid, many official marks remain on the register long after the subject mark has been abandoned or the registrant ceases to exist.

Conflict with Trademarks

For the applicants and registrants of traditional trademarks, official marks can be a source of frustration.

Section 9(1) stipulates that no business may be adopt or register a mark that is “consisting of, or so nearly resembling as to be likely mistaken for” an official mark. However, there are no restrictions on the recordal of official marks that conflict with trademarks. Even descriptive terms may be recorded as official marks.

When an official mark is recorded, any conflicting trademark applications still pending will be refused and any conflicting trademark registrations will be restricted to the goods and services for which they were previously registered.

When a pending trademark application is denied as conflicting with an official mark, the application may only be allowed if: (a) the owner of the official mark provides their written consent or withdraws the official mark; or (b) the official mark is expunged from the register as invalid.

Expungement

Until the pending amendments come into force, the only means to expunge an official mark from the trademark register is to seek a Federal Court order.

When the amendments come into force, the draft practice notice issued by CIPO stipulates that:

  • there is no requirement for the requesting party to demonstrate that they are an “interested” party;
  • the requesting party is required to provide information or evidence that the registrant is not a “public authority” or that the registrant no longer exists;
  • notices respecting requests and decisions will be sent to both the registrant and the agent of record, if any;
  • in response to a notice issued for summary expungement, the registrant will be required to file information or evidence that they are a “public authority” under current law;
  • the registrant will NOT required to file evidence that the official mark has been adopted or continues to be used;
  • the requesting party will not be entitled to cross-examine on any evidence filed or submit written argument and there are no oral hearings;
  • the requesting party will only be sent a copy of the final decision when issued;
  • certain official marks will be exempt from summary expungement requests, including:
  1. official marks registered to municipal, provincial and federal governments (including departments, crown corporations and agencies);
  2. official marks first recorded less than one year prior to the request; and
  3. official marks subject to another summary expungement request still pending or concluded less than one year prior to the request;
  • the registrar retains the discretion to refuse a request if the content of the request and the official mark raise no doubt that the registrant is a “public authority”;
  • the registrant will be required file their response withing 3 months after the summary expungement notice is issued;
  • the registrant may be entitled to one 3 month extension of time to file its evidence in certain limited circumstances and retroactive extensions of time will only be available if it determined that missing the deadlines as “not reasonably avoidable”;
  • if the registrant fails to provide sufficient evidence that it is a “public authority” and continues to exist or to file any evidence, the official mark will be “inactivated”;
  • if an official mark is “inactivated”, summary expungement notices will be automatically issued by CIPO for all other official marks recorded by the same registrant.

Conclusion for Applicants/Requesting Parties

For applicants facing objections to their pending trademark application based on an official mark, this new summary expungement procedure will be a powerful tool to overcome such objections when the official mark is effectively ‘deadwood’ on the register. With respect to the procedure proposed by CIPO, the primary concern is likely that they will not be entitled to participate in the decision-making process by filing written argument or participating in an oral hearing. Where the evidence submitted by the registrant raises some doubt, the requesting party may be in a position to provide valuable assistance to the examiner in making their final determination through written and/or oral argument.

There is also reason to doubt the wisdom of exempting municipal, provincial and federal governments, including crown corporations and agencies, without evidence that they continue to exist. Municipalities sometimes merge and dissolve. There may also be reason to doubt that certain entities identified as a “crown corporation”, “department” or “agency” qualify as such or continue to exist.

For applicants facing objections to their pending trademark application based on an official mark, it would be beneficial to be able to also challenge official marks for non-use. Unfortunately, the legislative amendments don’t provide CIPO with that authority, but an official mark that is not being actively used is deadwood as much as an official mark improperly recorded by a party who does not qualify as a public authority.

Conclusions for Registrants of Official Marks

For the registrants, this new summary expungement procedure may represent a significant risk to the validity of their entire portfolio of official marks if their status as a public authority is put in doubt with respect to a single official mark. For registrants at risk such as charities and foreign public authorities granted official marks in the past, it may prudent to be proactive and file trademark applications to replace the recordal of official marks that are critical to their current business activities to avoid any lapse in protection.

For registrants, there is also a significant risk that they will not receive any summary expungement notices issued by CIPO because the address on file is out of date and there is no agent of record. Since the recordal of official marks are perpetual and not subject to challenge through CIPO, there was little need until now to update such contact information. Registrants may therefore only learn that their official marks have challenged long after the proceedings have concluded and the official mark has been “inactivated”. A retroactive extension of time is not likely to be available in such circumstances. To avoid this risk, registrants would be well-advised to ensure that a trademark agent is recorded for all their official marks since agents are generally quite diligent in updating their contact information with CIPO.