The agreement, struck at an extraordinary meeting of OHIM’s Administrative Board and Budget Committee in Brussels last week, comes as part of an attempt to address OHIM’s surplus, which stands at €300 million and is growing.
It will now be put to the European Commission, as part of a joint proposal from member states and OHIM. If the Commission accepts the deal, it is likely to publish a proposal and impact assessment to change the fee regulation, which could be approved by member states’ representatives before the end of this year.
The Commission last year argued that fees for users should be cut to stop the backlog growing, and the levels of fees should be reviewed automatically. It also proposed a study on the functioning of the CTM system.
But some member states expressed concerns at the impact of fee changes on national IP systems.
The deal agreed last week is a compromise, and incorporates a number of measures designed to balance the OHIM budget and deal with the surplus.
According to a statement published after the meeting, a new proposal on fees emerged during the discussions that would reduce the registration fee “bringing the combined value of the application and registration fees down to around €1000”.
At present, applicants must pay a €750 application fee and a €850 registration fee for an application covering up to three classes. An extra €150 is paid if electronic filing is not used.
Member states also discussed having a biannual review of the Office’s financial situation by the Commission, instead of an automatic fee reduction mechanism.
But there are also benefits for member states in the agreement. Notably, it provides for 50% of CTM renewal fees to be distributed to member states, a policy that would replicate the situation whereby EPO member states receive 50% of renewal fees for European patents.
The agreement adds that “the transfer of 50% of renewal fees should be done in a way that would ensure that the funds would be available to the Member States’ National Offices and would be used for the purposes closely related to the protection, promotion and/or enforcement/combat counterfeiting of trade marks”.
However, such a change to renewal fees would require a change to the basic CTM Regulation, which could take a long time. As an interim measure, therefore, member states propose creating a cooperation fund of €50 million.
The cooperation fund would be “used for projects closely related to harmonization and the protection, promotion and/or enforcement of trade marks and designs”. It would be phased out once the transfer of renewal fees begins.
The vast majority of states also supported a proposal to allocate €190 million of the surplus to a reserve fund for the Office. The rest of the surplus (some €60 million at present) should be used “in the interests of users”.
João Miranda de Sousa, director of external relations at OHIM, who was closely involved in the discussions, said: “The conclusions are the result of a lot of discussion. The result is a compromise.”
Other sources close to the discussions told Managing IP that further meetings with users and other interested parties are taking place in Brussels this week, after which more details are expected to be available.
Users are likely to welcome proposals to reduce fees, but will want to see more information about the transfer of funds to national offices, particularly as national offices do not administer CTM renewals. “The work is very much beginning,” one practitioner said.
In a letter to the European Commission last month, Jérôme P Chauvin of BusinessEurope said: “We cannot support any suggested diversion to national offices or other bodies of money paid by users to OHIM for CTM registrations including ideas to share future renewal fees for CTMs.”
But, speaking at the MARQUES Annual Conference in Noordwijk, the Netherlands, before the Brussels discussions last week, OHIM President Wubbo de Boer said that, while he sympathised with this position, he would support a compromise approach.
Miranda de Sousa told Managing IP that the transfer of renewal fees should be seen in the context of the whole package of measures: “We believe the end result is positive for users.”
