Mr. A, who is preparing to run a restaurant, recently received a notification from the Korean Intellectual Property Office (KIPO) that his trademark registration was denied due to the existence of a similar registered trademark. However, considering that the prior trademark owner was using the trademark (restaurant) in a geographically distant location and that the products sold were different, Mr. A was allowed to register his trademark. This was based on the judgment that there was no likelihood of confusion or misunderstanding between the trademarks. Nevertheless, under current law, Mr. A was unable to use the trademark and had to discard all pre-made signs and tableware.
Concerns of small business owners like Mr. A, who cannot register their intended trademarks due to similar prior registered trademarks, are expected to decrease. This is because, going forward, it will be possible to register identical or similar trademarks with the consent of the prior trademark owner.
On the 10th, KIPO announced that a partial amendment to the Trademark Act, centered on the ‘Trademark Coexistence Consent System,’ recently passed the National Assembly plenary session and is scheduled to be implemented from April next year.
The Trademark Coexistence Consent System allows the registration and use of identical or similar applied trademarks only when both the prior registered trademark owner and the prior applicant consent.
However, in cases where both the trademark and the designated goods are identical, trademark registration is not allowed. Additionally, to protect consumers, if either of the coexisting trademarks is later used for fraudulent purposes causing consumer confusion or misunderstanding, the registration can be canceled.
Under the current system, applications for trademarks identical or similar to prior registered or prior applied trademarks are typically rejected.
KIPO explains that rejected trademarks based on this reason account for more than 40% of all rejected trademarks, and among these, 82% are trademarks applied for by small and medium-sized enterprises (SMEs) and small business owners. Thus, the damage caused by trademark registration rejections due to prior registered or applied trademarks is concentrated among SMEs and others.
For the same reason, there has been growing demand in the market to expand the scope of allowable trademark registrations to reflect reality. This is because the business risks faced when trademark registration is not completed are significant.
However, with the introduction of the Trademark Coexistence Consent System, KIPO expects that SMEs and small business owners will be able to use trademarks stably, as they can continue to use (register) the intended trademarks with the consent of the prior trademark owner.
Moreover, by obtaining prior consent from the prior trademark owner for the use of similar trademarks, potential future trademark disputes can be prevented in advance.
Major foreign countries such as the United States and Singapore have already introduced and implemented systems similar to the Trademark Coexistence Consent System. Recently, Japan also passed a similar amendment to its law in the National Assembly.
KIPO plans to implement the Trademark Coexistence Consent System domestically starting from April next year.
Additionally, to broaden the scope of the system’s application, KIPO explained that even applications filed before the implementation date but whose registration status is not yet determined at the time of implementation will be eligible for retroactive application.
Lee In-sil, Commissioner of KIPO, said, “The Trademark Coexistence Consent System will enhance the convenience of trademark users and reduce the examination burden on examiners. Since this is a newly introduced system, KIPO will do its utmost to minimize confusion in the field and maximize its effectiveness.”
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