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Malaysia: Does the new Trademarks Act 2019 advantage plaintiffs?




The Trade Marks Act 1976 (the current act) which has been the main source of trademark registration rights in Malaysia is finally coming to the end of its life. While the current act has been largely successful in setting out the framework for trademark protection and enforcement in Malaysia, it has been felt for some time that significant changes needed to be made to ensure that Malaysia continued to stay abreast of and provide for the evolving nature of protection needed by trademark owners.

Earlier this year, the Trademark Bill 2019 was tabled and it has now completed all the parliamentary stages in both Houses. The new Trademarks Act 2019 (the new act) is anticipated to come into force late this year. Among the most touted introduction of the new act and the regulations which are anticipated, is the provision for international trademark registration under the Madrid Protocol system. The process which allows trademark owners to apply for trademark protection in up to 122 member countries by filing one single application would soon be available to Malaysian trademark owners. The potential drop in cost and formality requirements would no doubt encourage trademark owners to expand their global trademark portfolio thereby providing for increased protection over a wider spectrum.

The new act also provides the long-awaited recognition of non-conventional trademarks. The new act essentially defines shapes, sounds, colour and scents as signs and expands the definition of a trademark to include any sign capable of being represented graphically. The corollary of this would be the increase of potential trademarks and elements which would not have been accorded protection under the current regime.

On the procedural front, apart from the introduction of Madrid filings, multi-class filings would be allowed under the new act.

While these appear to be some of the more obvious procedural and substantive changes, the new act revamps the provisions dealing with trademark infringement. On the face of these new provisions, it appears as if there are advantages to the plaintiff as to a certain extent it does away with some of the rigidity under the current act.

Under the current act, apart from showing that the infringing mark is identical and/or confusingly similar to the registered trademark, the trademark owner would have to show that the infringing mark is applied to the same goods or services covered by the registration. Any variation from the specification would mean that infringement would not be made out. While the specification of goods and/or services remains important, the new act is more realistic and less rigid in that infringement could still arise in the case of use of an identical or similar mark in relation to goods or services which are similar to those covered by the registered mark.

The new act further expands the scope of potential infringers to include secondary users, which would now mean that, among others, a party applying the trademark on behalf of another, or merely stocking for purposes of offering or exposing for sale could also be liable for trademark infringement.

Another nuanced change in the new act would be a somewhat shift in the burden of proof of showing that the offending use is trademark use. Instead of placing that burden on the trademark owner, it is now up to the potential defendant to show that the use of the trademark was used as a descriptor or other non-trademark use.

Imminent infringement is also provided for in the new act, a remedy previously available potentially in passing-off actions.

Notwithstanding these changes which purportedly provide significant advantages to trademark owners, trademark owners need to be mindful of some other provisions in the new act when contemplating infringement actions. For instance, the possible defences for trademark infringement under the new act have been extended to include inter alia use for non-commercial purpose and news reporting.

The introduction of actions for groundless threats of infringement proceedings now mean that demand letters are no longer obvious steps prior to infringement actions although parties applying the infringing trademark, importing goods bearing the infringing trademark or supplying services bearing the infringing trademark may not avail themselves of this potential cause of action.

All in all, while it seems that the changes brought in by the new act will now make it easier for trademark owners to bring and sustain actions for trademark infringement, such actions must be considered in light of the expanded scope of defences as well as the potential action for groundless threats. All in all, this is a positive development for the protection and enforcement of trademark rights while balancing the interest of preventing unjustified monopolistic rights.

Indran
Shanmuganathan
Sim Sook Eng

Shearn Delamore & Co
7th Floor, Wisma 
Hamzah-Kwong Hing
No 1 Leboh Ampang, 50100 Kuala Lumpur, Malaysia
Tel: +603 20272727
Fax: +603 20785625


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