Bonjour Mesdames, Messieurs,

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Ladies and Gentlemen, I would like to begin by expressing my heartfelt appreciation to the Hungarian Patent Office and in particular to President Bendzsel and Mr Ficsor for inviting me to this Conference and thus enabling me to be with you today. It has offered me the perfect opportunity to visit this wonderful city of Budapest again. My presentation today is on the relationship between the Benelux system and the Community system. Before addressing the issue itself, I would like to say a few words about the Benelux and my Organisation by way of general introduction. First of all, I must emphasise the fact that I am and will always be in favour of the CTM. It was designed for companies with commercial activities on the level of the Community: as a result our companies now pay lower fees to obtain registration of a European trade mark, administrative formalities are less onerous and it provides a single registration valid for the whole European Community territory. But I do have some misgivings, one of which is basic criticism on the way the system works. In no way should this be construed as expressing an anti-European attitude. I wanted to mention this at the start of my presentation as some people are averse to sound debate and for want of their own opinion, try to say that any criticism on the way the CTM works is a sign of opposition to the CTM itself. Well, in my case this is far removed from the truth! I just wanted to make that clear! And now a few words on the Benelux: the population is only 27 million in an area of just 77,000 square km. So it is not very big. Nevertheless we manage to speak four official languages! With regard to trademarks and designs: our three countries no longer have national legislation – instead trade mark law is governed by the Benelux Convention on Intellectual Property (IP) and my Office is entrusted with its execution. To give you an idea of our workload: in 2008 we handled 24,000 Benelux filings, 13,500 Benelux renewals and 6,000 international registrations with effect in the Benelux. For designs, the figures are even more modest! All the indicators are showing a downward trend, which is largely due to the success of the CTM. At the same time, the number of CTM registrations coming from the Benelux is steadily growing: there have been 30,262 registrations since the CTM came into force in 1996, a figure which ranks the Benelux in seventh place on the international listings by state, far outstripping China and Japan! So it appears that Benelux companies are increasingly opting for the CTM and turning their backs on the Benelux trademark! One of the main reasons for this swing towards the CTM, at least in my opinion, lies in the fact that the term “territorial use” has not been legally defined for the CTM. And moreover, has been very narrowly interpreted by a non-competent authority. 1- The CTM was adopted by the Council on 20 December 1993 in the form of EC Regulation 40/94 which I will refer to here simply as the „Regulation‟. Article 15, paragraph 1 of the Regulation says the following and I quote : “If, within a period of five years following registration, the proprietor has not put the Community trade mark to genuine use in the Community in connection with the goods or services in respect of which it is registered, etc etc,...” This article was clarified by a Joint Declaration of the Commission and Council of Ministers on 22 October 1995. I will refer to this
document as the „Declaration‟ (OJ-OHIM 5/96, pp.612-623) and it says the following: “The Council and the Commission consider that genuine use in the sense of Article 15 in a single country constitutes genuine use in the Community”. The Declaration has no legal effect, nevertheless it is applied by OHIM in their procedures before the Office (cf. The Manual concerning Opposition – Part 6, p 13 ). In fact, in its website update of 20 June 2008, OHIM states, and I quote: “genuine use may be established when the trade mark is used just in part of the Community, such as a Member State or part of a Member State”. According to recent checks by colleagues of mine, it would appear that since then, this reference to a single state or even to part of a state has been deleted but not quite systematically! 2- First of all let us remember that drafting the Regulation itself took several decades and the wording of Article 15 was revised twice before the final version as it appears in the Regulation today. This notion of use has never been reconsidered since the date of the Declaration even though the Community since then has considerably expanded its borders. From twelve Member States in 1995, today the Community has grown to twenty-seven Member States, covering some 4 million square km with a population approaching 500 million people. It is possible – even probable – that more Member States will join in the future. Consider Ukraine, Turkey, Croatia, Bosnia and Herzegovina, Serbia, Montenegro, Albania, the former Republic of Macedonia and, most recently, Iceland. Political analysis and discussion have begun and will continue in the years to come. If all these states were to join, the total territory of the EU would increase by a further 5 to 6% and the population by 27%. 3- OHIM‟s correct application of this Declaration means that a CTM holder in Luxembourg, the country where I was born, simply by exercising his CTM in Luxembourg can claim exclusive rights to his CTM throughout the entire Community. But Luxembourg occupies only 0.05% of Community territory and has just 0.08% of the Community‟s population. The CTM nevertheless applies equally to the other 99.2% of the Community‟s population. 4- This is the same as local use, but on a European scale. It is out of all proportion because of (1) the vastness of the territory and the market covered by the CTM and (2) the exclusive rights of the trade mark holder against third parties. This disproportion is even more apparent if we bear in mind that this right used locally may be invoked against any company wishing to register an identical or similar trade mark in its own country or in other countries of its choice, even if the CTM holder has no intention of ever using his trade mark in that or those countries. 5- From all this we are right in arguing whether the system as designed by the Regulation and interpreted by the Declaration might be used as an instrument to compartmentalise the internal market whereas the aim laid down in the First Directive 89/104/EEC of the Council of 21 December 1988 to approximate the laws of the Member States relating to trade marks (which I will refer to simply as „the Directive‟), was specifically to remove all the, and I quote, “disparities which may impede the free movement of goods and freedom to provide services and may distort competition within the common market.” Is this system still compatible with the wish of the European legislator as expressed in the second recital of the Regulation? That wish,
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Bonjour Mesdames, Messieurs,

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