News in the Legislation
INTELLECTUAL PROPERTY RIGHTS IN THE EU BEFORE AND AFTER BREXIT
The forthcoming withdrawal of the UK from the European Union (EU), the process of which was launched earlier this year, poses important questions related to the effect of the so-called EU intellectual property rights with unitary effect. These are, for example, the EU mark, the EU design, the EU protected geographical indications, SPCs and others. The main issue raised in relation to BREXIT is whether the acquired unitary rights will be exercised on the territory of the UK after its withdrawal from the EU and, if so, under what conditions. For instance, how and on what legal basis the rights acquired under EU law will be enforced and protected in the UK, how will the renewal of their protection (e.g. on every 10 years for trademarks) be regulated, the related payment of renewal fees and other specific questions.
In September 2017, the European Commission (EC) published on its official website (https://ec.europa.eu) its position paper and outlined the basic principles on the impact of BREXIT on intellectual property rights with unitary effect which will be proposed to UK in the framework of negotiation of the terms of its withdrawal from the Union. The UKIPO also published on its official website (https://www.gov.uk) the UK government's position on the subject.
After carefully analyzing the UKIPO's position, the lawyers from Penkov, Markov and Partners are on the opinion that it has some differences with the position of the EC, although in their entirety both are setting the common goal of finding the best possible solution in securing the rights and interests of the right-holders. ‘Penkov, Markov and Partners’ have in common with the EC’s opinion by considering that the Commission's proposals protect the interests of the holders of IP rights with unitary effect in the EU to a greater extent.
It is of utmost importance to provide legal means by which the unitary rights already acquired within the EU will continue to have effect for the UK territory after BREXIT. Otherwise, the interests of the owners of EU trademarks, EU designs, UK SPCs and other intellectual property rights would be seriously harmed, assuming that unitary IP rights would simply cease to exist after BREXIT for the territory of UK. This would result in a situation where other entities, most often competitors of the right-holders, or just traders acting in bad-faith, and by doing so often infringing IP rights, would benefit from the created legal uncertainty. In such a scenario the right-holders will have to apply anew on a general basis for IP registrations in the UK, which, in some hypotheses such in the case of the registered design, would be even procedurally impossible due to the applicability of international agreements (Paris Convention, etc.).
The EC therefore proposes not to undermine the protection already provided with registered EU trademarks, EU designs, or for any other exclusive unitary right granted before BREXIT. Therefore, their holders to be able to enforce them in the UK after BREXIT as well, i.e. to continue to rely on those IP rights and to seek judicial and administrative protection equivalent to the rights already provided under the EU law. The EC suggests that the UK should undertake to adopt specific national legislation for this purpose, in particular, the automatic recognition in the United Kingdom of the existing (on the BREXIT date) intellectual property rights having unitary character within the EU. EC suggests that the automatic recognition should not be associated with additional costs to the holders of unitary rights, acquired before BREXIT, and that any administrative formalities associated with this should be kept to a strict minimum.
With regard to the pending applications and procedures on the BREXIT date, the EC recommends that applicants should have the right to claim priority from EU applications for intellectual property objects having unitary character in order to obtain equivalent national intellectual property rights in the UK.
Especially for the SPCs the EC suggests granting of legal protection for the territory of the UK equivalent to that provided under EU law for each UK certificate issued within the Union before BREXIT. When a SPC application has been filed with the relevant UK national authority before BREXIT in accordance with EU law and the procedure is not yet completed the applicant should be entitled to receive a SPC with effect in the UK.
Regarding the protection of databases (with copyright and rights related to copyright), the EC proposal is that once the databases have already been protected before BREXIT their producers and right holders, within the meaning of Directive 96/9, should continue to benefit from the same protection in the remaining 27 member states and in the UK after the withdrawal. In this respect the EC put arguments that the restriction provided in Art. 11, Para. 1 and Para. (2) of Directive 96/9, according to which only EU persons/ entities enjoy protection under the sui generis right should be waived in respect of natural and legal persons from the UK. Accordingly, the expectation is that the UK also shall not exclude rights of protection for databases of EU natural and legal persons on the basis of nationality or place of establishment.
On the other hand the position of the UKIPO is that while the UK is a member of the EU the EU registered trademarks and designs will continue to have effect on its territory. When the UK leaves the EU, the unitary IP rights will continue to be valid in the remaining EU member states. After BREXIT businesses in the UK will be able to acquire EU trademark or EU design rights for the 27 member states on a general basis, and for UK territory through national applications for marks or designs submitted to the UKIPO, or using the Madrid International Trademark System. As regards the international design registration system, the UK government declares its readiness to accede to the Hague Agreement in the future. Currently, the protection for registered design in the UK cannot yet be obtained under the international system.
The conclusion is that the final decision on the legal effect of BREXIT on the scope of EU intellectual property rights with unitary character will be political one and will be included in the withdrawal agreement signed between the Union and the UK.
In view of the ambiguity of future UK regulation by the time the withdrawal agreement enters into force it would be advisable for the business to utilize the Madrid International Trademark System in order to ensure timely the provision of legal protection of their trademarks in the UK in addition to the EU trademark system, if interested in doing so.
Amendments to the Civil Proceedings Code
On October 18th 2017 the National Assembly adopted a Bill amending the Civil Proceedings Code (CPC), based on a joint draft bill created on the basis of the proposals submitted by the Bulgarian Socialist Party, Volia, GERB, and Obedineni Patrioti.
Some of the significant changes in the civil proceedings regulation include:
With respect to the court fees charged
· On claims for the protection of property rights over immovable the amount of the court fee shall be calculated on the basis of one-fourth of the immovable’s tax evaluation.
· For several claims aiming at the protection of one and the same interest only one court fee shall be collected irrespective of the number of defendants.
· For actions incorporating several claims, which seek to protect several interests the court fee shall be calculated on the basis of the value of each of the claims.
· In enforcement proceedings the total amount of the fees cannot anymore exceed an amount calculated as a percent of the minimal wage. Once this upper limit is achieved, any requested for the undertaking of new enforcement actions shall be at the expenses of the creditor. In this respect, it is provided that the administrative fees on appeals of the actions of the enforcement agents shall not be included in the total of the fees.
These regulations aim to create additional guarantees for the access to justice for certain claims, as well as they are in favor of debtors with small amounts of the debt, whereas the amendments are motived by the long-lasting proceedings in which the costs significantly exceed the main receivables itself.
As regards to the cassation proceedings
One of the most significant amendments in the CPC is the widening of the grounds for admission of appeal before the cassation.
The grounds for admitting cases to cassation shall include cases which are resolved in contradiction with the acts of the Constitutional Court, the Court of Justice of the European Union in Luxembourg, or have a conflict with the case law of the Supreme Cassation Court, or the case law of the formerly unified Supreme Court.
In addition, the appeal instance decisions which are probably null or inadmissible, or which are obviously incorrect are provided as as admissible for cassation.
On the other hand, a matter solved in contradictory manner by the courts shall no longer be a ground for appeal.
For overcoming some contradictory understandings it is expressively provided that only the interpretation decisions of the Supreme Cassation Court constitute case law with mandatory character, rather than the practice on particular cases.
In regard to the regulation of the summoning
Due to the problems arising in the practice and the potential for abuse within the current regulation of the summoning through posting of notification, this procedure shall be exceptional only when the individual cannot be found after at least three visits within a one-month period, with an interval of one week between each of the visits, whereas one of the visits needs to be on non-working day.
After the visits and in case the individual does not appear to receive the papers or the summon the court will ex officio check the person’s registered address and if there is a discrepancy the court shall order new due summoning of the person on the permanent address.
In case that the person does not appear again summoning could be effected through its employer.
These regulations do not apply if the summoning official collects information from the manager of the condominium, from the mayor or otherwise that the person does not live on this address.
In the enforcement procedure the enforcement agent will appoint special representative of the debtor if established that the person does not have a permanent address.
As regards to the regulation of deadlines
Finally, as regards to the procedural deadlines it is provided that they shall be suspended during the national holidays and during the judicial vacations – 15th of July – 1st of September.
(Source: Official Gazette)
New Ordinance regarding the Industrial Property representatives
A new Ordinance for the Industrial Property Representatives (Decree of the Council of Ministers No. 161 of 04.08.2017, promulgated, State Gazette No. 64 of 08.08.2017) was adopted. The Ordinance regulates the profession of Industrial Property representatives as a regulated profession in accordance with Directive 2006/123/EU on services in the internal market and Directive 2005/36/EU on the recognition of professional qualifications. The Ordinance will enter into force as of 09.09.2017.
The changes introduced are the following. The professional qualification of an Industrial Property representative will be acquired only after a successful examination before the Patent Office. In this respect, the possibility of entry in the register of representatives ex officio is dropped. The requirement for a 2 year working experience prior to the admission exam is also waived. The Ordinance regulates the procedure for recognition of EEA representative’s professional qualification of a representative and the procedure for occasional or temporary provision of services in the Republic of Bulgaria. For the exercise of their profession, the representatives will be permitted to join in partnerships.
We believe that with the presented opportunities for the Bulgarian Industrial Property representatives to operate in EEA countries, including through partnerships with foreign IP representatives, we will expand the capabilities of our team to better serve our clients in the field of Intellectual Property, both in the country and abroad.
The CPC has adopted the obligations offered by "Lukoil Bulgaria" EOOD, "Eco Bulgaria" EAD, "Shell Bulgaria" EAD, "OMV Bulgaria" OOD, "NIS Petrol" Ltd. and "Petrol" AD.
The CPC has adopted a decision, whereby it has recognized the measures proposed by the fuel retailers investigated for cartel aimed at cessation of the conduct consisting in a prohibited agreement and /or concerted practice regarding offered by them prices. In which connection, proceedings have been initiated. These measures consist in the obligation to adopt internal rules, including:
• prohibition of contacts and exchange of any information with companies - competitors and their employees;
• prohibition of any contact between employees of their own and of rival gas stations;
• prohibition of discussion, obtaining or providing commercial information within the work carried in the non-profit organization "Bulgarian Petroleum and Gas Association";
• disciplinary sanction - dismissal for employees who do not comply with the confidentiality of commercial information.
The team of "Penkov, Markov & Partners" International Law Firm has extensive experience particularly in the establishment of such rules on avoidance of concerted practices not only for our clients, as well as for various associations and associations of traders in Bulgaria. We always advise on the implementation of the best international practices and corporate programs and compliance regulations. The preparation and conduct of training programs for the employees of our clients (focused on competition law, data protection, etc.) Is the safest way of avoiding such violations, which is why we have developed a system of training and special methodology for adaptation of the rules for compliance with the Protection of Competition Act of our clients.
Although the definition of the restrictions from above allows some interpretations on the scope of the prohibited contacts, the Commission's decision reaffirms the importance and the advisability of our services.
There is no unlawful cartel of the retail chains for the sales of their own brands
The Commission for Protection of Competition (CPC) established the lack of cartel between the retail chains regarding the sales of their own brands. The proceeding was initiated due to implied allegations for coordinated market behavior of the retail chains and possible determination of the delivery and sales prices of goods branded by the chains.
The competition team of Penkov, Markov and Partners – Mr. Vladimir Penkov, Mr. Svetlin Adrianov and Mrs. Yura Mincheva successfully defended the interest of one of the retail chains in the complex with a view to its proceedings specifics and regulation peculiarities investigation of the CPC which went on for about a year.
Our team has built successful defending strategy towards the groundless statements of CPC for illegal actions and meanwhile carried out training for the chain’s personnel for detailed clarification on the activities which could be considered as breach of the competition rules. Broadly discussed were the good commercial practices as well as the specific guidelines and practices of the European Commission at investigations for cartel agreements. At the end of the day the efforts of our team resulted in convincing the CPC that our client is in no breach of the rules for protection of competition and at the same time our client was updated on the regulations and mechanisms which should be applied by his personnel to avoid such infringements.