Interested NGOs, representatives of foreign investors in Kazakhstan1 and patent attorneys have campaigned for amendments to the IP legislative acts of the Republic of Kazakhstan in order to reduce the amount of time it takes to register a trademark; to simplify the procedure for registration of IP rights transfer agreements; and to make the regulation in general more "user-friendly" for titleholders. As a result, the Law on Amendments to Certain Legislative Acts of the Republic of Kazakhstan on the Issues of Legal Regulation in the Area of Intellectual Property was adopted with effect from 20 April 2015.
Exhaustion and parallel import
The Trademark Law now establishes a regional principle of 'exhaustion'. This change is related to the harmonization of the national legislation with the provisions of the Agreement on the Eurasian Economic Union (EAEU). A number of actions in respect of a product, which has been lawfully introduced into civil circulation in the EAEU by a trademark owner itself or upon its consent, does not constitute an infringement of the exclusive right to the trademark. Prior to the adoption of the amendments, the trademark law provided for a national principle of exhaustion, which was contrary to the obligations of the Republic of Kazakhstan under the EAEU Agreement.
The regional (as well as the national) principle of exhaustion implies that it is not possible to import, without the permission of the trademark owner (parallel import), a trademark product into the EAEU, but deprives the trademark owner of the right to subsequently control the circulation of the product in the Union's territory.
On 11 March 2015, it was proposed at the meeting of the working group of the Eurasian Economic Commission to develop exceptions from the regional principle of exhaustion of trademark rights for certain categories of goods in the territory of the EAEU. If these amendments are adopted, in exceptional cases the international principle of exhaustion of rights will be in effect and the parallel import of goods into the EAEU will be allowed. According to some media, parallel imports could be allowed in respect of pharmaceuticals, medical products and automotive parts.
Simplified registration of assignment and licensing agreements
The Singapore Treaty on the Law of Trademarks 2006 came into force for the Republic of Kazakhstan on 5 September 2012. It allows for simplified procedures for amending trademark registrations, registering trademarks, licensing agreements and assignment agreements as well as for trademark renewal and some other procedures. In practice, however, there have been difficulties in the application of the treaty. The rules of the Singapore Treaty have not yet been fully implemented into the national legislation.
Currently, the trademark law provides that the expert examination and registration of agreements on the transfer of trademark rights (assignment and licensing agreements) is to be carried out in accordance with the provisions of the Singapore Treaty, if one of the parties to the agreement is an individual or a legal entity of a foreign member state of the Treaty. Where both parties to a trademark transfer agreement are Kazakhstan persons, the provisions of the Treaty do not apply.
The Singapore Treaty rules prohibit the expert organization from requesting submission of an assignment agreement or licensing agreement itself or a translation thereof or specification of the financial terms thereof. Therefore, the registration of license agreements must now be carried out on the basis of an application specifying the parties to the agreement, the scope of the transferred rights and other information. However, the expert organization may require submission of evidence in respect of any statement contained in the application for registration. Such documents may include:
- a certified (by a public notary or any other competent authority) extract from an assignment or licensing agreement identifying the parties and the scope of rights being assigned/licensed;
- an uncertified application for the registration of a license or assignment agreement, the content of which corresponds to the application form signed by both the owner and the assignee/licensee.
Neither the Law on amendments to certain RK legislative acts on IP legal regulation nor the trademark law provide for direct application of other provisions of the Singapore Treaty not dealing with the registration of assignment or licensing agreements.
The introduced amendments regarding the application of the Singapore Treaty are progressive as a whole and accommodate the interests of titleholders with respect to reducing and simplifying various registration procedures with the state authorities. However, it is too soon to assert that comfortable conditions have been created for business. The Treaty allows some freedom to patent agencies in determining a list of documents which may be enquired from titleholders during registration. Only the practice of the expert organization and the authorized body will show to what extent the interests of titleholders are respected.
Abolished certificates of trademark registration
After the entry of the Law into force, registration certificates will no longer be issued to trademark owners, and the exclusive right to a trademark will be certified by a registration entry in the State Register of Trademarks of the RK and confirmed by an extract from such Register.
Simplified procedure for the transfer of the right to obtain a trademark registration
From the date the Law enters into force, applicants will have the right to apply for the assignment of a trademark application without executing and registering an assignment agreement. Instead, they will be able just to file an application with the expert organization. Previously, in order to assign a trademark application, it was necessary to execute and register an assignment agreement.
Reduced timing of the trademarks registration
The Law establishes timeframes for all stages of the expert examination of an application for trademark registration and specifies in detail the timing of the approval of preliminary and final expert opinions by the Ministry of Justice, and the timing of the delivery of such opinions to the applicants. This amendment is significant and will contribute to a reduction in the time taken to register a trademark.
Change in the list of absolute grounds for refusal in trademark registration
The list has again been changed. Now, the registration is refused if a trademark consists exclusively of designations which are nondistinctive or represent the international unpatentable names of pharmaceuticals (e.g., amoxicillin, ampicillin). The direct associative connection with goods or services for the designation of which trademarks are used has been excluded from the list of absolute grounds. Previously, the existence of such ground for refusal precluded the registration of almost all trademarks that could howsoever be associated with the applied goods and/or services.
Mandatory registration of a franchising agreement
The RK Civil Code sets the rule for the mandatory state registration of a franchising agreement. It specifically states that franchising agreements are subject to registration with respect of intellectual property items, the exclusive right to which arises from the moment of their registration (inventions, utility models, industrial designs, selection achievements, trademarks and integrated circuit topographies, if registered). Earlier, the Franchising Law established that such agreement had be executed in a simple written form. Now, the provisions on the registration of a licensing agreement will apply to the procedure for the registration of franchising agreements.
1 European Business Association of Kazakhstan (EUROBAK) and the American Chamber of Commerce in Kazakhstan (AmCham).
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