Philippines - Use Your Trademark

Many trademark owners get frustrated upon being informed that in order to maintain their trademark applications or registrations in the Philippines, a declaration of actual use (DAU) has to be filed.  The Philippines had acceded to the Madrid Protocol on July 25, 2012, and the Intellectual Property Office of the Philippines (IPOPHL) is currently reviewing its Trademark Rules and drafting possible amendments to said Rules to facilitate registration.  However, the requirement of the filing of the DAU is in the basic law itself (Republic Act No. 8293 or the IP Code) and must therefore be complied with, and can only be amended by legislation of the Congress of the Philippines, which takes some time. 
 
Legal Basis for the DAU
 
The relevant laws for the DAU are the IP Code, the Trademark Regulations, IPO Order No. 21 s. 2001, and BOT Memorandum Circular No. 3, series of 2009.  Under the IP Code, there are two DAU’s to be filed:  the 3^rd year DAU, and the 5^th year DAU.  Section 124.2 of the IP Code provides that “the applicant or registrant shall file a declaration of actual use of the mark with evidence to that effect, as prescribed by the Regulations within three years from the filing date of the application.  Otherwise, the application shall be refused or the mark shall be removed from the Register by the Director.”  For the 5^th year DAU, Section 145 of the IP Code states that “a certificate of registration shall remain in force for 10 years:  Provided, that the registrant shall file a declaration of actual use and evidence to that effect, or shall show valid reasons based on the existence of obstacles to such use, as prescribed by the Regulations, within one year from the fifth anniversary of the date of registration of the mark.  Otherwise, the mark shall be removed from the Register by the Office.”
 
IPO Order No. 21 series of 2001, allows for filing a request for a single six-months extension to file the 3^rd year DAU.  Under BOT Memorandum Circular No. 3, the 3^rd year DAU may be filed at any time before the granted extension expires.  The actual use of the mark may commence during this extension period.   A declaration of non-use, if applicable may be filed within three years from date of filing, but the Bureau of Trademarks (BOT) will not  accept a declaration of non-sue during the single six-months extension period.
 
For the 5^th year DAU, this may be filed within one year from the fifth year anniversary of the registration date of the mark.  No further extension is allowed.  A declaration of non-use may be filed.
 
 
Declaration of Non-Use
 
Section 152 of the IP Code provides for the grounds when non-use of a mark is allowed, hence, the basis for the declaration of non-use, to wit:
 
(a) non-use of a mark may be excused if caused by circumstances arising independently of the will of a trademark owner.  Lack of funds shall not excuse non-use of a mark (152.1);
(b) use of the mark in a form different from that in which it is registered, but which does not alter the distinctive character of the mark, shall not be a ground for cancellation or removal of the mark, and shall not diminish the protection granted to the mark (152.2);
(c) use of the mark in connection with one or more of the goods or services belonging to the class covered by the registration shall prevent its cancellation or removal in respect of all the other goods or services in said class (152.3);
(d) use of a mark by a company related to the applicant or registrant, or where such use is controlled by the registrant or applicant with respect to the nature and quality of the goods or services, provided that such use shall not deceive the public, inures to the benefit of the applicant or registrant, and shall not affect the validity of the mark or registration (152.4).
 
There are very few recorded cases as to the circumstances beyond the control of the trademark owner which would be acceptable basis for the filing of the declaration of non-use.  So far, decisions of the Director of Trademarks show that non-use based on pendency of product registration approval by the Food and Drug Administration for pharmaceuticals, cosmetics, medical devices, has been allowed by the BOT.  Sudden termination of a licensing or distributorship agreement where the licensor-trademark owner is forced to look for a new licensee/distributor has also been accepted.  It must be noted, however, that these grounds could give rise to the issuance of subsequent office actions asking for actual proof of use of the mark.
 
Actual Cases of Cancellation
 
 In the case of Mattel vs. Francisco et al., G. R. No. 166886, July 30, 2008 involving the mark “BARBIE”, filed by Respondent Jimmy Uy covering the goods confectionery products such as milk, chocolates, etc., the Supreme Court citing Rule 204 of the Trademark Regulations which provides that the DAU must be filed without any need of notice, and since Respondent had admitted in his Comment and Memorandum that he has effectively abandoned or withdrawn any rights or interest in his trademark by his non-filing of the required DAU, there is no more actual controversy to be decided.
 
In IPC No. 14-2004-00114, entitled C. Hager & Sons Hinge Manufacturing Co. vs. Philman Commercial Inc., the IPOPHL issued its decision dated 25 April 2006 rejecting the trademark application of the latter for the mark “HAGER & DEVICE” for failure to file the 3^rd year DAU.
 
Other Issues Relating to DAU
 
Claim of priority date.  The three year period for the filing of the 3^rd year DAU commences on the Philippine application date, and not on the date of the corresponding priority foreign application filing date.
 
Types of Evidence of Use.  The following shall be accepted as evidence of use:  (a)  actual labels of the mark,  or photographs thereof, (b)  downloaded pages from website, and if the goods or services are only available online, the web address must be indicated, (c) brochures or advertising materials, provided the goods are placed on the market, or the services are available in the Philippines.  One copy of the evidence of use is sufficient.
 
Conclusion
 
The filing of the DAU is presently mandatory, to maintain the application or registration.  A Declaration of Non-Use may be filed, provided the reasons arise from circumstances beyond the control of the applicant or registrant.  Failure to do so, would result in the application or registration being deemed withdrawn, and if the trademark owner wishes to continue protecting its mark in the Philippines, it has no alternative but file a new application.
 

Atty. Editha R. Hechanova is CEO/President of Hechanova & Co., Inc. a company handling trademark and patent prosecution, copyright and domain name registrations, searches, and other non-contentious intellectual property matters, and is also the managing partner of the Hechanova Bugay & Vilchez law offices which specialise in intellectual property, corporate, and immigration law.  She graduated from the University of the East with a business degree, major in Accounting, magna cum laude.  She is a Certified Public Accountant.  She obtained her law degree from the Ateneo de Manila University, and has a Certificate in Business Economics from the University of Asia and the Pacific.   She passed the Patent Agent Qualifying Examination (PAQE), and is a certified patent agent.  Her experience covers both contentious and non-contentious intellectual property matters, e.g., licensing, due diligence, trademarks and patents prosecution, copyright, patent and trademark litigation.
 
Atty. Hechanova is an accredited Court Annexed Mediator at the Court of Appeals, and an accredited mediator and arbitrator at the Intellectual Property Office.  She has been cited as Leading Lawyer in the field of Intellectual Property Law in the Philippines by the AsiaLaw Magazine, an international publication, from 2002 to 2012.
 
Atty. Editha R. Hechanova can be contacted by phone on +63 2 812 6561 or alternatively via email at editharh@hechanova.com