GETTING INTO THE (IP) ZONE

The recent case of Herbal Zone v Infitech Technologies [1] is a cautionary tale for product manufacturers or importers who are careless about their intellectual property (“IP”). In many respects, it is a tale as old as time in IP circles; one which sees itself played out over and over as a result of a lack of focus on the protection of intellectual property and a failure to anticipate and prepare for the daily reality of business relationships turning sour.

The case concerned a male sexual performance enhancer marketed under the name PHYTO ANDRO FOR HIM in South Africa since 2006. Herbal Zone (Pty) Limited was the sole importer of the product into South Africa. It said that the product was manufactured by Herbal Zone International Sdn Bhd, a Malaysian entity. Between 2009 and 2014, Infitech (Pty) Limited was the sole distributor of the Phyto Andro for Him product in South Africa, in terms of a distribution agreement with Herbal Zone. The facts of the case as set out in the Supreme Court of Appeal judgement do not tell us why the relationship soured but, in 2014, in advance of the termination of the distribution agreement, the shareholders of Infitech formed Herbs Oils (Pty) Limited and began marketing and selling a competing product, also under the name PHYTO ANDRO FOR HIM and in similar packaging to the original product. Despite the fact that neither party had registered the trade mark, they both used the symbol for a registered trade mark (®) on their packaging next to the name of the product.

Taking matters into its own hands, Herbal Zone published an advertisement in a popular newspaper and also wrote to pharmacies who stocked the products, warning that Herbs Oils’ Phyto Andro product was “counterfeit” and “illegal” and threatening legal action against suppliers of the product. It also took action in terms of the Counterfeit Goods Act which resulted in certain of the Herbs Oils Phyto Andro products being seized but ultimately released (again, the judgement does not say why but presumably because the Counterfeit Goods Act is difficult to invoke unless there is a registered trade mark involved). Herbs Oils retaliated by suing Herbal Zone for defamation and Herbal Zone then found itself in a position where it had to counter-sue. It counter- applied for an interdict on the basis that Herbs Oil was passing-off its product as that of Herbal Zone’s.

The passing-off case is what took centre stage but it failed, essentially because Herbal Zone was unable to show that the reputation in the PHYTO ANDRO FOR HIM trade mark (although the court accepted that there was one) belonged to it. It is essential for such a case to succeed that the person seeking an interdict establish a reputation (in the form of goodwill) in the product name. There simply wasn’t any evidence pointing to who owned that reputation. Herbs Oils claimed that it had acquired the reputation from Infitech but the SCA quickly put paid to that argument as it had merely been a distributor of the product and had acknowledged in its distributor agreement that it did not own these rights. While the packaging of the product had initially said “manufactured for Infitech”, it was later changed to read “exclusively distributed by Infitech”.This would not have indicated to the public that Infitech was the proprietor of the trade mark.

On the other hand, however, Herbal Zone also could not show that it owned the requisite reputation. Rather, it appeared that all of its commercial communications created a significant amount of confusion between it and Herbal Zone International and that their respective roles in the manufacture and distribution of the product were as clear as mud. In many cases, no distinction was drawn between the two corporate entities and, in others, it appeared to be the case that Herbal Zone was merely a distributor for Herbal Zone International. Much like Infitech, therefore, it could not have acquired any rights in the name of the product. The claim for passing-off accordingly failed and, certainly at the date of writing this article, Herbs Oils continues to advertise its competing PHYTO ANDRO product, no doubt much to the despair of Herbal Zone.

So what should product manufacturers do to avoid these situations?

  1. Register, register, register! So many IP headaches can be avoided by applying to register your distinctive product name as a trade mark. The applicant should be the entity that will actually use the trade mark. If it is not, a proper (written) licence agreement should be in place between the owner of the trade mark and the entity or person who uses it, even if it is a related entity. Get legal advice or, even better, have the licence agreement drafted by a trade mark attorney. The law requires certain essential terms to be contained in such a contract.
  1. Craft product packaging and the wording reflected on it carefully and pay close attention to any packaging regulations (dependent on the nature of the product) and the description of who the trade mark owner/manufacturer/distributor are. Do these descriptions match the true factual position? Note that the ® symbol can only be used in respect of a registered trade mark. While a trade mark application is still pending, the symbol ™ can be used next to the mark.
  1. Where multiple, related entities are involved in the production, manufacture and marketing of a product, ensure that the roles of each are clearly defined and that these roles come through in any form of business communication (e-mail signatures, website content, letterheads, etc.).
  1. Enter into written agreements with any distributors of the product which make it clear that they can and will enjoy no rights in and to the product’s name or any other intellectual property relating to the product. That agreement should spell out clearly the circumstances in which the agreement may be terminated and also that, on termination, the distributor will immediately cease using the trade mark, or anything similar. Maintain control over the way in which the distributor uses the trade mark and advertises the product.
  1. If your rights are infringed, seek legal advice before taking any steps. While in some cases a public awareness campaign may be appropriate, these can easily cross the line into defamation and could result in your ending up being the one getting sued, rather than the other way around, meaning you will be on the back foot in the litigation.

These steps are simple and relatively inexpensive when viewed against the cost of potential litigation or the cost of being unable to stop a competitor from using your brand. Quite frankly, they are steps that product owners simply can’t afford not to take.

[1] (204/2016) [2017] ZASCA 8 (10 March 2017)

KELLY THOMPSON

Partner
Trade Mark Attorney

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OAPI adopts 11th edition of the Nice Classification for the registration of trade marks

The Trade Marks Registry of the African Intellectual Property Organization (OAPI), based in Cameroon, announced recently that the 11th edition of the Nice Classification system is to be applied when filing new trade mark applications in OAPI.

OAPI is a regional trade mark registration system in Africa, which can be utilised to register trade marks in one or more of the following, 17 member states:

Benin, Burkina Faso, Cameroon, Central African Republic, Chad, Comoros, Equatorial Guinea, Gabon, Guinea, Guinea-Bissau, The People’s Republic of the Congo, Ivory Coast, Mauritania, Mali, Niger, Senegal and Togo.

None of the member states maintain independent trade marks offices and registers and therefore trade marks need to be registered at the OAPI Registry if statutory protection is sought in any of the member states.  One registration covers all of the member countries and, although multi-class applications are possible, one multi-class application may not cover both goods and service classes.

All goods and services are classified in terms of the international Nice Classification system.  Generally speaking, the practicality of the classification system lies therein that trade mark proprietors are deemed to secure statutory trade mark rights in relation to the goods/services specified in their applications and contained in the class(es) in which they have registered their trade marks.

On 1 January 2017, the International Bureau of the World Intellectual Property Organization (WIPO) published the latest edition (the 11th Edition) of the Nice Classification system and the OAPI Registry allowed trade mark applicants to utilize this version with immediate effect, while still allowing Applicants to rely upon the previous (10th) edition as well.

The Registry announced that, from 30 April 2017, all new trade mark applications which are filed at the OAPI Registry, need to conform to the latest (11th) edition of the Nice classification system on the registration of trade marks.

OAPI acceded to WIPO’s Madrid Protocol on the international registration of trade marks, and although it is possible to designate OAPI in terms of an international (Madrid) registration, it is not recommended to do so, until such time as the underlying Bangui Agreement has been amended to recognize that international registrations have full force and effect in OAPI.  OAPI is considered to be a so-called ‘First-to-File-jurisdiction’, where common law and reputational rights are not formally recognized (except for well-known or famous marks as recognized for protection in terms of the Paris Convention) and where the first party to register a trade mark may be deemed to be the true proprietor thereof, despite the fact that this may not be the case.  In the light of this, it is important for brand owners to secure national registrations for their valued trade marks in OAPI in order to ensure that no question marks may exist in relation to the validity or enforceability of their trade mark rights.

At the OAPI Administrative Council meeting in December 2016, Mr. Denis Loukou Bohoussou of Côte d’Ivoire, was elected to the post of Director General for a period of five years, effective 1 August 2017.  Loukou Bohoussou’s predecessor, Dr. Paulin Edou Edou’s term of office ends on 31 July 2017. Under the leadership of Dr. Edou Edou, OAPI has acceded to a number of international treaties aimed at creating a modern and dynamic framework and to harmonise administrative procedures in the registration of titles.

For any information or queries in this regard, please contact africaip@adamsadams.com

By Stephen Hollis (Partner) and Lebohang Mosala (Associate)

 

STEPHEN HOLLIS

Partner
Trade Mark Attorney

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REPORT | IP DEVELOPMENTS IN AFRICA

Intellectual Property Law Firm, Adams & Adams, recently published the latest version of the Africa Update journal – an annual publication presenting intellectual property developments, including legislative changes and recent judgments, from across the continent.

The Update also includes news about the extension of the firm’s network of offices in Africa, along with details of visits to various countries to meet with IP officials, and reports and analysis of recent legislative and judicial developments from across the continent.

Adams & Adams’ achievements and continued growth on the continent have again been recognised internationally and recently the firm was awarded the Managing IP ‘Africa Firm of the Year’ for the third year in a row.

READ THE AFRICA UPDATE ONLINE

DOWNLOAD THE AFRICA UPDATE (36 Mb)

GERARD DU PLESSIS

Partner & Firm Chairman
Trade Mark Attorney

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SIMON BROWN

Partner
Trade Mark Attorney

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HOW STRONG IS YOUR IP ‘FORCE’?

The Star Wars ‘force’ is 40 years old this year and is undoubtedly one of the largest pop culture phenomena in the world. The brand extends beyond movies to clothing, toys, games, music, theme parks and television shows. One of the factors that has contributed to the success of the Star Wars franchise is the extent to which the maker of Star Wars, George Lucas, has sought to aggressively protect and enforce the Star Wars intellectual property.

LucasFilm (and Walt Disney) is renowned for taking on anyone who it deems to be infringing on the brand rights – even Ronald Reagan’s administration received a complaint for calling its strategic missile defence system “Star Wars.” In 2016, Lucasfilm sued the so-called “New York Jedi and LightSaber Academy” – a school that was offering classes on Jedi combat by expert “lightsaber and swordplay practitioners.” It’s claimed that the school’s use of the words “Jedi” and “lightsaber” and the “Jedi Order” logo all constitute infringement of Lucasfilm’s trade mark rights.

Lucasfilm and Walt Disney have filed numerous patents, designs and trade marks worldwide. The intellectual capital of a business or entertainment franchise constitutes a significant component of its total asset base; the value of the intellectual capital could exceed the value of the fixed assets of the business or its working capital. It has been recognised that the intellectual capital of a business provides the most potent – and most effective – impetus to its earning power. So vigorous and jealous guarding of IP rights is much like protecting your supplies and money from the raiding and pillaging Alkhara Bandits! You can find a list of Star Wars design patents and trade marks here.

What else can be learnt from the Star Wars IP story? Most businesses will protect their main brand name or logo in defending their primary IP rights, but secondary brand names and logos (“Jedi”, “Darth Vader” etc) that are not the main brand name, but which still uniquely identify the mark are also worth protecting.

Second, be uncompromising in enforcing your rights. Keep a look-out for IP infringement of your brand and don’t hesitate to act when someone is abusing your IP rights. Legal action may sometimes be expensive, but often all it takes is a friendly “letter” from your counsel. Not acting may cost your brand much more in the long-run – and nobody likes a diluted brand asset (Just ask Dooje Brolo!)

STEPHEN HOLLIS

Partner
Trade Mark Attorney

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COUNTING THE COST OF UNLICENSED SOFTWARE

IT-Online recently reported that South African companies paid more than R3,64-million for using unlicensed software in 2016, according to data from BSA | The Software Alliance.

The figure includes settlements (R1,66-million) and the cost of acquiring new software to become compliant (R1,98-million)

Darren Olivier (Partner) spoke to Gugulethu Cele (Kaya FM) about the report and the concept of software licensing.

DARREN OLIVIER

Partner
Trade Mark Attorney

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USING GACC TO STOP COUNTERFEITS LEAVING CHINA

An all too common reality is that intellectual property right (IPR) holders may be active in enforcement against counterfeit goods in a number of jurisdictions, but ultimately might find that such goods are being manufactured in China and exported to the rest of the world for sale.

While most countries only detain goods being imported into their country, the General Administration of Customs of China (GACC) has introduced a recordal system which empowers it to detain suspected infringing goods entering or leaving China.

The IPR holder can record various types of intellectual property with GACC, including trade marks registered in China, or international trade mark registrations extending to China, as well as designs, patents and copyright, although the bulk of goods detained are on the basis of trade marks, which are the easiest to recognise and recall.  According to its statistics for 2014, GACC revealed that 96.5% of detentions related to goods being exported from China.

While specific documentation must accompany the application (such as a power of attorney, certificate of incorporation, registration certificates, colour photographs of genuine goods, details of authorised exporters, distributors and licensees), the overarching guideline is to provide GACC with as much information as possible to enable it to make a preliminary determination as to whether the goods infringe any recorded intellectual property right.

GACC will issue its written acceptance or rejection within thirty working days of receiving the application. If granted, the recordal is valid for a period of ten years, or until the expiration of the intellectual property right, whichever is shorter, and is renewable.

If GACC is of the view that goods being imported or exported may infringe an intellectual property right which has been recorded on its electronic database, it will suspend the clearance of the goods and inform the IPR holder. The IPR holder is required to confirm the authenticity of the goods, lodge a written application for detention as well as make payment of a bond (or submission of a bank guarantee), within three working days of being notified. If the IPR holder fails to comply with any of these requirements, the goods must be released, irrespective of their authenticity.

If the IPR holder has complied with the requirements, GACC will detain the goods, investigate and make a determination on the matter within thirty working days, failing which the case must be referred to Court, or the goods released. If it deems the goods to be infringing, depending on the nature thereof, the goods will either be donated once the infringing portion has been removed, sold to the IPR holder, sold on auction, or destroyed. The IPR holder is liable for storage and destruction costs. Fines are sometimes also imposed on the consignor, at GACC’s discretion.

It is recommended that IPR holders be mindful of the recordal, paying careful attention to any changes in the application which must be reported to GACC within thirty working days, failing which the recordal may be cancelled. GACC also invites training sessions to keep up to date with changes in the IPR holder’s rights, including the launch of new products or change in product packaging.

Since GACC is not obliged to detain any infringing goods unless a valid recordal is in place, this system could be a useful tool to IPR holders as part of their intellectual property enforcement strategy. The progressive initiative is a welcome tool in the crusade against counterfeit goods.

TAYYIBA NALLA

Senior Associate
Trade Mark Attorney

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GODFREY BUDELI

Partner
Trade Mark Attorney

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REPORT | MADRID IN AFRICA

Memorandum on the effectiveness of International (MADRID) Registrations in Africa. 

  1. Introduction

The international trade mark registration system (known as the Madrid system) is administered by the World Intellectual Property Organization (WIPO) based in Geneva, Switzerland.  It is considered to be a one-stop solution for the registration and management of trade marks worldwide.  Brand owners from Madrid member countries can file one application, in one language and pay one set of fees to protect a trade mark in up to 114 countries (comprising 80% of world trade – and growing).

International (Madrid) Registrations allow for the centralized management of trade marks.  Licenses, registered users, changes of ownership and limitations of specifications of goods/services can be recorded in the International Register through a single procedural step.  The system is also flexible enough to cater for the licensing of rights or the transfer of ownership in a mark for only certain of the designated countries or for only some of the goods or services, or to limit the registered specification in respect of only some of the designated parties.  The geographical scope of an existing International Registration may be extended in the future by designating additional countries – even countries which only become Madrid members at a future point in time.

The Madrid system is available to a natural person who is a national of or domiciled in a Madrid member country or a legal entity which has a real and effective industrial or commercial establishment in a Madrid member state or region.

An International Registration needs to be based on a pending application or existing registration in a Madrid member country at the so-called ‘Office of Origin’ where that base application/registration is on record.  The national IP office will examine the application for the International Registration as to formalities only (i.e. whether the application for the IR corresponds with the base application/registration insofar as the mark, specification, ownership and other details are concerned) and, if found to be procedurally correct, the Registry will communicate the application to WIPO’s International Bureau in Geneva.  WIPO will examine the application for compliance with the requirements of the Madrid Protocol, which examination is also restricted to formalities only. If there are no irregularities with the application, the International Bureau will record the mark in the International Register; publish the International Registration in the WIPO Gazette of International Marks and notify each designated member country.  At this stage, no substantive rights have arisen.

Any matter of substance, such as whether the mark qualifies for protection or whether it conflicts with an earlier mark in a designated member country will be determined by that country’s national trade marks office in terms of applicable domestic legislation.  Any objection or opposition to the grant of the International Registration has to be communicated to WIPO by the national trade marks office within the strict, prescribed time limit allowed for in terms of the Madrid system (12 – 18 months, depending on the jurisdiction concerned), otherwise the International Registration will be deemed to be granted and effective by WIPO and the owner of the trade mark.

  1. Which African countries are Madrid members?

The following thirty seven (37) African countries are Madrid members:

Algeria, Botswana, Egypt, Gambia, Ghana, Kenya, Lesotho, Liberia, Madagascar, Morocco, Mozambique, Namibia, OAPI (The African Intellectual Property Organization, including the following member states: Benin, Burkina Faso, Cameroon, the Central African Republic, Chad, Comoros Islands, Republic of Congo, Equatorial Guinea, Gabon, Guinea, Guinea-Bissau, Ivory Coast, Mali, Mauritania, Niger, Senegal and Togo), Rwanda, Sao Tome and Principe, Sierra Leone, Sudan, Swaziland, Tunisia, Zambia and Zimbabwe.

  1. How effective is the Madrid trade mark registration system in Africa?

3.1 Recognition of International Registrations in terms of national laws

Of the 37 countries mentioned above, only nine (9) have properly “domesticated” the Madrid Protocol through appropriate amendments to their national trade mark legislation, together with the implementation of enabling regulations, namely Botswana, Gambia, Ghana, Kenya, Liberia, Morocco, Mozambique, Tunisia and Zimbabwe.  Even in these nine countries, practical issues exist with the processing of International Registrations which are discussed in more detail below.

One of the core issues with the national applicability of IP treaties such as the Madrid Protocol is that additional direction, procedures and mechanisms need to be put in place, on a national level, to ensure that the national IP Office is equipped to deal with and process International Registrations and also how to deal with objections, oppositions and so forth.  Even national trade mark legislation is not considered to be enacted properly until the so-called ‘enabling regulations’ have been promulgated. Enabling regulations supplement and complete trade mark legislation by formally determining the processes and procedures through which the provisions of the legislation can be practically implemented and fulfilled by the national trade marks office concerned.

Apart from procedural issues, it is important that national laws clearly recognize that International Registrations shall have the same force and effect as national registrations.  Without such express recognition, it will be up to the national courts to determine whether the rights arising from an International Registration should trump rights arising from national common law (in countries where common law rights arising from trade mark use are formally recognized) or prior trade mark registrations.

IP litigation is a growing practice area in Africa, but in virtually all of the African Madrid member countries, national Courts have not decided on many IP matters and precedents are few and far between.  More often than not, the presiding judge or adjudicator will not have the benefit of earlier judgements to rely upon when hearing and ruling on a dispute which may revolve around the national enforceability of an International Registration.  The presiding official may not even be experienced in IP law to begin with.  In a country where no formal domestication has occurred, the judge may find no reference to the Madrid system in the national IP laws whatsoever and this may pose a level of risk to the successful outcome of a litigation matter in the favour of the owner of an International Registration.

When involved in a trade mark dispute in a country where the Madrid Agreement or Protocol has not yet been domesticated, any IP-litigator would prefer to be able to rely upon nationally recognized statutory rights, rather than have to make constitutional arguments based on the applicability of international treaties through analysis of international law.

To illustrate how the lack of proper implementation of the Madrid Protocol can lead to difficulties arising on a national level, we now turn to some key African jurisdictions where the validity and enforceability of International Registrations remain in question.

In Ghana, full legal recognition was given to International Registrations in terms of a 2014-Amendment Act, but unfortunately this recognition was not implemented with retrospective effect, which casts some doubt over the validity of International Registrations designating Ghana from 2008 (when Ghana became a Madrid member) to 25 July 2014 (the date of enactment of the Amendment Act No. 876 of 2014).

In Algeria, a 2005-Amendment Act did make brief mention that trade mark registrations obtained through international treaties (to which Algeria is a member country) will be valid and enforceable.  No specific mention is made of the Madrid Protocol however and no regulations were enacted to inform the Registry how to process International Registrations or how to manage objections or possible oppositions.

In Egypt, national laws have not been properly amended and no enabling regulations implemented.  Although the Egyptian Registry has been accepting and processing International Registrations for many years, their enforceability against conflicting national registrations still has to be tested in their Courts.

In the regional system of OAPI, the Administrative Council (of the multi-country organization) ratified the Madrid Protocol unilaterally and on behalf of the organization’s 17 member countries in March 2015.  An amendment of the underlying Bangui Agreement was never attended to and uncertainty regarding the enforceability of Madrid marks designating OAPI exists.

  • Practical difficulties

3.2.1 Most Madrid members in Africa cannot process applications within WIPO’s timelines

Most African trade marks offices battle with logistical issues that have led to the development of crippling backlogs of cases which stretch back for many years.  As the records of most Registries have not yet been fully digitized, some of their records are contained in Register manuals.  In such instances, current status information can only be confirmed from the official file for a pending matter, which is often not immediately available.

Another hindrance is the lack of the regular publication of Trade Mark Journals (in some African Madrid member countries, an entire year could pass without a single publication occurring), which leads to backlogs of marks awaiting publication forming which can also stretch back for years.

One of the core obligations placed upon national trade marks offices through the Madrid system is that designations in terms of International Registrations should be examined in a specific time frame (a standard time frame of 12 months applies, which is extendable to 18 months upon application).  If the national trade marks office of a designated member country does not notify WIPO of an objection or opposition to the registration of a mark within the mentioned time frame, WIPO and the owner of the International Registration will consider the mark to be registered and enforceable in that member country.

Unfortunately, most African registries are incapable of complying with WIPO’s timelines for the processing of applications within 12 – 18 months.  Situations have therefore arisen where a national registry communicates an objection or opposition after the prescribed notice period expired has expired and by that time, WIPO no longer entertains such communications.  In such instances, WIPO and the brand owner believe that a valid registration was secured but in reality, the local Registry may have refused and removed the mark from the national register – without even communicating this properly to WIPO.  Several such instances have arisen in jurisdictions, including Kenya and Mozambique where the Madrid system is deemed to function efficiently and where the Registries’ records are mostly computerized.

3.2.2 A lack of user confidence and training on WIPO’s IPAS system

Before a country accedes to the Madrid Protocol, WIPO will typically assist the IP Office with the initialization of the process to digitize their records and they would implement their database management system, known as the Industrial Property Automated System (IPAS) which links the Registry’s digital database with WIPO’s systems.  This enables WIPO to upload all data relating to International Registrations on their systems in Geneva and to synchronize their database with those of designated member countries.  This reduces the risk of user error which could occur when staff at national Registries input data relating to International Registrations.

While this is a positive step to take, the difficulty is that the Registry officials in many African member countries often revert back to their previously utilized systems and manual records as a result of a lack of training on the electronic IPAS systems and difficulties in retaining skilled staff members and a resultant lack of user familiarity with WIPO’s systems at the Registries.  This does not bode well for the processing of Madrid designations, which depends largely upon the proper operation of the IPAS system at designated Trade Marks Offices.  Of course, this is a concerning situation as the owner of an International Registration designating a certain African jurisdiction may in the future, when they try to enforce their rights, find that an earlier conflicting mark was registered on a national level and not included in the IPAS system as the Registry reverted back to capturing national applications in a separate register.  This could lead to a situation where the owner of the International Registration might be restrained from using his mark in that jurisdiction, despite the fact that he secured a registration via WIPO/Madrid – especially in the so-called First-to-File jurisdictions.

Although WIPO is working hard to assist with training of Registry staff around the continent and to improve user confidence in the IPAS and Madrid systems, the practical reality is that operations at most registries in Africa are very rudimentary and simply nowhere near as streamlined and efficient as in more advanced jurisdictions in the rest of the world where the Madrid system works well.

At most of the Registries, the bulk of their records are still contained in manual records, despite ongoing digitization efforts, which could take many years to complete due to the sheer amount of records concerned.  Until the Registry’s records in an African Madrid member country have been fully digitized to ensure that Madrid designations are examined and compared with existing, similar marks on the national register, it remains recommended for trade mark owners to secure national registrations for their marks.  Especially when considering that many African (Madrid member) Registries are (according to WIPO) found to be reverting back to their formerly utilized and manual records due to various reasons.

To further compound these issues, knowledge of the procedural operation of the Madrid system has been found lacking at Registry level in many jurisdictions.  A lack of understanding of examination and opposition deadlines has led to many instances of confusion and miscommunication between the national trade marks offices and WIPO which, in turn, leads to situations where the holder of an International Registration is unaware that his rights were challenged successfully on a national level.  This has led to an increase in national filings in many Madrid member countries as international brand owners come to realize (after costly and risky litigation proceedings) that it remains the first prize in Africa to establish presences on the national registers for their core brands.

3.2.3 Practical examples

Some practical examples of situations leading to uncertainty and difficulties are set out below.

In Ghana, the Trademarks (Amendment) Act, 876 of 2014 entered into force in July of 2014, properly recognizing the Madrid Protocol in terms of its national legislation.  Reports were received that the Ghana IP Office was not aware of the publication of the Amendment Act and Madrid applications were not processed or recorded properly for quite some time.  Some doubt exists as to the validity of International Registrations designating Ghana between 2008 (when Ghana ratified the Madrid Protocol) and July of 2014 as the Protocol was not enacted with retrospective effect.  WIPO confirmed that the Ghana Registry had not communicated a single objection to an International Registration designating Ghana by December of 2014.  There is a concern that the Registry did not examine these International Registrations properly; that the registrations were granted by default and that they would not be enforceable.  Also, there is a concern that International Registrations were not properly captured on the records of the Ghana Registry as no regulations existed before July 2014 which informed the Registrar and his staff how to deal with Madrid applications.  To compound matters, the Ghana Registrar recently admitted that his office is not able to examine marks routinely within WIPO’s deadlines and he expressly reserved the right to refuse international registrations outside of WIPO’s timelines.  We are aware of situations where this has led to international registrations being refused or opposed outside of WIPO’s timelines and an owner of an international registration covering Ghana being left without any enforceable statutory remedy against infringement.

In Botswana, where appropriate legislative and regulatory amendments have been made to fully recognize international (Madrid) registrations, the Registrar of Trade Marks confirmed to WIPO at a workshop held in Gaborone in 2016 that they have not examined any of the 8 000 Madrid designations received in terms of the Madrid Protocol since Botswana became a member country in 2006.  The Registry officials were not sure how to examine and process these applications and simply allowed them to become registered by default.  The IPAS system was ignored by Registry officials and they went back to capturing new records in their Register books.  Additionally, once the Botswana Registry finally began uploading records onto the IPAS system in September 2016, they communicated in January 2017, that somehow all of the data that was entered and updated on the IPAS database has been lost.

In Gambia, the Registrar of Trade Marks recently confirmed that, due to backlogs of pending trade mark applications which stretch back until the early 1990’s, the current examination timeline in Gambia is 26 months.  The Gambian Registry clearly is not able to meet the strict 18-month examination timeline of the Madrid Protocol and it is expected to take many years before they might be in a position to do so.  The bulk of the Registry’s records are not computerized and Journal publications appear only once or twice a year (some years not at all).  In this jurisdiction, it is likely that international registrations may only be examined outside of WIPO’s timelines and possibly refused or successfully opposed at that time, which could leave the owner of the international registration with the mistaken impression that they secured statutory and enforceable trade mark rights in Gambia.

If the system is not functioning properly in African countries where appropriate legal amendments have been made and where the Registries are considered to be efficient (such as Kenya and Mozambique), no real user confidence can be established in other countries such as Lesotho, Madagascar, Namibia, Rwanda, Sao Tome & Principe, Sierra Leone, Sudan, Swaziland, Zambia where records remain largely non-digitized and where appropriate legal amendments are still outstanding and where Registries’ records are not yet computerized and they are struggling to cope with administrative backlogs stretching back several decades.

An additional cause for concern is that many African countries are considered to be so-called ‘First-to-file-jurisdictions’ where common law rights (arising from the use of a mark in trade) are not formally recognized and where the first party who successfully registers a mark gains exclusive rights to the use of that mark, notwithstanding that another party may have been using the mark in trade prior to the registration of the mark.  In these jurisdictions, it is vital for brand owners to ensure that their valued trade marks are registered on a national level.  We are aware of instances where the owners of international (Madrid) registrations were under the mistaken impression that they secured enforceable rights in some of these jurisdictions, only to discover at a later stage (when they try to enforce their marks) that the national IP office allowed an opposition or that the Registry refused their mark outside of WIPO’s timelines and that they in fact do not have enforceable rights.  To compound the issue, third parties (including local distributers, in some instances) have gone ahead and registered their marks locally, leading to costly and complicated legal battles to regain control of their brands from third parties.  Just as anti-counterfeiting is a scourge of commerce in African trade, so is the adoption of established brands by unauthorized third parties.   The following countries in Africa are considered to be First-to-File countries:

Algeria, Angola, Djibouti, Egypt, Ethiopia, Lesotho, Liberia, Libya, Madagascar, Morocco, Mozambique, OAPI (Cameroon, Central African Republic, Chad, The Republic of the Congo, Comoros, Benin, Gabon, Ivory Coast, Mauritania, Mali, Guinea, Niger, Senegal, Togo, Burkina Faso (formerly Upper Volta), Guinea-Bissau and Equatorial Guinea), South Sudan, Sudan, Swaziland and Zambia.

  1. Conclusion

The bottom line is that the Madrid system does not function as efficiently and effectively in Africa as in other parts of the world where Registries have clear legislative mandates and regulatory guidance on how to process International Registrations, not to mention more developed trade mark laws; digital records; the regular publication of Marks Journals and streamlined registration systems.  Also, in Africa, most countries are at differing stages of economic and legislative development and a one-stop solution which might work in a region such as the EU, where the member countries have similar laws and stages of development,  will not necessarily be a workable solution in Africa.  It will take many, many years before most of the African Madrid member countries have successfully digitized their records; implemented appropriate legislation and regulations to give full force and effect to Madrid registrations; improved examination and publication timelines; addressed issues relating to the retention of skilled staff members; dealt with their existing backlogs of cases and have established the efficient, streamlined and effective trade mark registration systems which are necessary for them to comply with their obligations in terms of the Madrid Protocol.  WIPO has identified that some African Registries revert back to their previous systems (including the keeping of manual Register books in preference to WIPO’s digital IPAS database system) which effectively results in the establishment of two separate registers (one national register which is updated manually and the IPAS database that receives data from WIPO).  As it stands, brand owners take a risk when relying on the Madrid system when attempting to secure enforceable trade mark rights in Africa.

STEPHEN HOLLIS

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Trade Mark Attorney

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SIMON BROWN

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MEGAN MOERDIJK

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CASHING IN ON MADIBA’S LEGACY

The City of Cape Town announced its plan to create the Madiba Legacy Route to enhance tourism in Cape Town.

Provincial MEC for Economic Opportunities, Alan Winde, said up to 100 000 jobs could be created as a result of this plan. This raises the question: Is Madiba’s name free for everyone to use?

Nishan Singh, attorney and partner at Adams & Adams says Madiba’s name is owned and protected by the Nelson Mandela Foundation.

NISHAN SINGH

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Trade Mark Attorney

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AESTHETIC OR FUNCTIONAL | PROTECT YOUR DESIGN

Adams & Adams’ involvement with Elle SOLVE is part of a drive to foster the uniquely imaginative capacity of SA’s creatives – and to help those gifted individuals realise real economic benefit in respect of their intellectual property rights. We see it as an imperative that this showcase of individualism is protected. In terms of the artist we also need to provide a solution to the problem of general devaluation and under-appreciation of artistic works. This begins with the artist who needs to know his or her rights in terms of creativity.

South Africa is home to many talented designers whose work is highly regarded both locally and internationally.  Design protection is, however – to their detriment – often underestimated by local designers.

Making design protection a part of your creative repertoire should be part of your creative course of action. Registered design protection provides protection for the appearance of articles intended to be multiplied in an industrial process.

Both aesthetic and functional designs can be registered in South Africa. Functional designs are those with features necessitated by the function of the article. Aesthetic designs, which are extremely important in creative design, pertain to appearance of the article including shape, configuration, pattern or ornamentation.

Examples of articles suitable for aesthetic design protection include, furniture, lighting, textiles, door handles etc.

In order to ensure your design is protected it must be new. This means that the design should not have been revealed to the public before filing an application for registered design.  Although novelty (or “newness”) is a requirement before filing an application, the South African Designs Act does allow you to disclose your design before a design application – provided you file a design application within six months of the disclosure.

Designers need to take cognisance of the process of design protection in foreign countries however.  Several countries will not enable design protection if it has been disclosed prior to filing.  It is preferable then that South African design applications be filed prior to any public disclosure of the design protection.

Intellectual property is a vital aspect of your balance sheet, and registering your designs has an important role to play in your financial well being.  A registered design may be traded like any other asset.  You can sell it, or licence it others.  It therefore allows you to prevent others from using, making, importing or selling articles which look the same or similar to yours – safeguarding your professional reputation against copycats.

Don’t donate your creative works to others – register your designs!

MARIËTTE DU PLESSIS

Partner
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DISPUTE RESOLUTION REVIEW | SOUTH AFRICA

The Dispute Resolution Review provides an indispensable overview of the civil court systems of 40 jurisdictions. It offers a guide to those who are faced with disputes that frequently cross international boundaries. This ninth edition follows the pattern of previous editions where leading practitioners in each jurisdiction set out an easily accessible guide to the key aspects of each jurisdiction’s dispute resolution rules and practice, and developments over the past 12 months. The South African Chapter has been authored by Jac Marais, Andrew Molver and Renée Nienaber from Adams & Adams.

Key developments in South Africa over the past year followed global trends and included:

  • Clarification of the effect of a pending application for a restraining order and the scope of issues capable of referral to court in terms of Section 20(1) of the Arbitration Act;
  • Further progress towards more active judicial management of the dispute resolution process;
  • Approval of the International Arbitration Bill; and
  • The Community Schemes Ombud Services Act coming into effect.

To read the full South African submission, CLICK HERE, or for the full Dispute Resolution Review publication, CLICK HERE.

DisputeResolutionReview3D

JAC MARAIS

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ANDREW MOLVER

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RENEE NIENABER

Senior Associate
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WHAT ARE TRADE SECRETS? HOW TO PROTECT THEM

A Trade secret is information that is useful in the industry and that is kept confidential. It is information that imparts value to its holder and one that provides a competitive edge over its competitors. Should information that constitutes as a trade secret be leaked, it could have a major negative effect on the business. Information such as customer lists, information received by an employee regarding business opportunities valuable to an employer and information provided to an employee in confidence in the course and scope of his employment could be identified as confidential[1].

Even negative information such as failed remedies or manufacture of products and failed research could be protected as a trade secret as it could save a competing business high costs if they have a what not to do guide.

 Article 39 of the TRIPS Agreement[2], provides that member states shall protect “undisclosed information” against the unauthorised use “in a manner contrary to honest commercial practices” as long as the information is:

  1. a secret in a sense that it is not generally known among or readily accessible to persons that generally deal with the type of information;
  2. has commercial value because it is secret; and
  3. has been subject to reasonable steps by the person in control of the information to keep it a secret.

This is the general guideline in determining whether information is a secret and if it can be protected as a ‘trade secret’. Member countries may have identified more criteria but Article 39[3] serves as a basis for the member states of the TRIPS Agreement[4]

The advantages of trade secrets are that trade secrets do not have to be registered and have no limited protection frame, there are no registration costs and there are no formal compliance requirements that have to be met. However, the disadvantages are that trade secrets can be reverse-engineered once the secret is made public and then anyone is at liberty to use the information.

The enforceability of the trade secrets is generally not easy and may prove to be costly – not ideal for small entities and start-ups. Nonetheless, trade secrets can still be a useful tool for small and medium businesses that do not have the resources to protect their intellectual property assets by other forms of protection such as trade marks and patents which require registration.

How to protect your trade secrets

A trade secret owner should employ as many precautions as reasonably possible such as:

  1. restricting access to confidential information physically and electronically to only those individuals that need to know the information;
  2. marking documents that they constitute confidential information;
  3. making use of non-disclosure and confidentiality agreements;
  4. maintaining information with password protection;
  5. disposing confidential information by shredding or other means designed to destroy the information;
  6. conducting exit interviews with departing employees to ensure the return of all confidential information in the employee’s possession and to emphasise confidential obligations;
  7. ensuring that there are restraint of trade provisions in the employment contracts;
  8. establishing due diligence and on-going third party management procedures;
  9. instituting and information protection team;
  10. make trade secret protection a priority[5].

It is important to note that confidential information not classified as a trade secret may be used by an employee for his own benefit or for the benefit of others after the termination of his employment to the extent that it was not copied and/ or deliberately memorized for use after   of the employment contract[6]. In this case[7], the applicant sought to interdict an ex-employee from joining a competitor on the basis that the respondent would unlawfully make use of the applicant’s trade secrets. The court held that the applicant had failed to prove that any of the information was confidential. It was decided that the audio and lighting production of the IDOLS TV show required little originality input since all the relevant information was already in the public domain.

In the event that it becomes apparent that trade secrets have been exposed, the trade secret owner can approach the courts to claim against the infringer on the basis of breach of contract which allows the wronged party could claim for damages from the infringer for breaching confidentiality agreements or based on unlawful competition which allows the wronged party to claim for an interdict in order to refrain the infringer from continuing the unlawful act. Furthermore the wronged party can claim for damages they have incurred due to the act of the infringer and claim costs they have incurred in instituting proceedings. Proof of damages and causation is imperative to succeed with an action under unlawful competition.

Proving damages can prove to be quite difficult. Below are different options that can be exercised in quantifying the economic harm in misappropriated trade secrets[8].

  1. Lost Profits and unjust enrichment calculations[9] – this involves determining how much more increased sales the company would have made had the trade secrets not been revealed;
  2. Reasonable royalty[10] – this remedy is suitable where it would be difficult to prove the extent of the patrimonial loss. This is determined by recovering the reasonable royalty that would have been paid by a licensee ; and
  3. Transaction specific Reasonable Royalty[11]– relates to the royalty that would have been paid for a specific product or service.

Trade secrets are an important form of intellectual property just like trade marks, patents, copyright and designs. It is imperative that any business takes the initial steps in identifying the trade secrets of the business and thereafter, incorporate protection mechanisms within the business such as ensuring that documents are stored securely and in places where there is limited access. Furthermore agreements with employees should be in place as well as education about what constitutes confidential information as well as the consequences of revealing the confidential information.

 by Maureen Makoko | Associate


[1] Meter Systems Holdings Limited v Venter and Another 1993 (1) SA 409

[2] Agreement on Trade-Related Aspects of Intellectual Property Rights

[3] Idem

[4] Idem

[5] WIPO MAGAZINE Eight steps to secure trade secrets (2016) http://www.wipo.int/wipo_magazine/en/2016/01/article_0006.html

[6] Strike productions (Pty) Ltd v Bon View Trading (Pty) Ltd & Others (10/21704) [2011] ZAGPJHC 1

[7] Idem

[8] Hoffman J, Ewing B and Thompson M.A.  How Much Are Your Trade Secrets Worth? Here’s how To Figure it Out 2014 https://eiexchange.com/content/30-how-much-are-your-trade-secrets-worth-heres-how-to-figure-it-out

[9] Idem

[10] Idem

[11] Idem

 

MAUREEN MAKOKO

Associate
Trade Mark Attorney

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DARREN OLIVIER

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BRANDS & SOCIAL MEDIA INFLUENCERS | ARE YOU AT RISK?

Although Andy Warhol proclaimed in 1968 that, in the future, everyone would be world-famous for fifteen minutes, it is unlikely that he could possibly have imagined today’s social media crazed world and the multiple platforms that exist to enable anyone, anywhere, to become a celebrity. In today’s world, being “famous for being famous” can be a full-time occupation and “Youtuber” would appear to be an acceptable career choice for many millennials.

One ramification of this has been the rise of the “social media influencer”. A social media influencer is someone with credibility in a particular industry and a wide reach, usually in the form of a large following on social media. Brands engage with an influencer who has reach in their particular industry, that person promotes the brand to his or her followers and the brand enjoys the benefit of what is effectively a personal endorsement to hundreds, thousands or even millions of persons directly in its target market. The social media influencer is, of course, generally paid to promote the product, either in money or in kind. It is not uncommon, for example, for clothing brands to gift free items to celebrities or established fashion bloggers with the expectation that they will then post photographs on social media of themselves wearing the items on Instagram or other social media, with an appropriate mention of the brand.

The use of social media influencers is but one form of what has been termed “native advertising” which is paid media that matches the form and function of the platform upon which it appears. The issue, as one might imagine, is that these endorsements, which constitute paid-for advertising, often appear among hundreds of other organic social media posts and may not be perceived as sponsored content by those who view them. Therein lies their very appeal to advertisers, especially in the modern consumer landscape that craves authenticity and personal connections. But, similarly, therein lies the potential to deceive consumers and fall foul of the law.

The USA’s Federal Trade Commission, which is tasked with tackling unfair business practices and consumer deception in the USA, is very clear on this issue. It has published detailed guidelines which spell out that any material connection between an advertiser and endorser must be disclosed in a clear and conspicuous manner. While wording such as “company x gave me this product for free” in a review would be ideal, it seems that using a hashtag such as “#sponsored” or even “#advertisement” might be sufficient for the FTC’s purposes. The FTC has even said that, given that a tweet is a mere 140 characters, commencing it with “#AD:” could get the message across.

An example from Kim Kardashian West’s Instagram Page. It is questionable whether merely thanking the brand would be considered a sufficient disclosure. This particular post was “liked” by over 1.4 million people.

An example from Kim Kardashian West’s Instagram Page. It is questionable whether merely thanking the brand would be considered a sufficient disclosure. This particular post was “liked” by over 1.4 million people.


Winner of South Africa’s Masterchef Season 2 competition, Kamini Pather, has attracted an Instagram following of over 26 000 people and has seemingly cashed in on the social media influencer scene, pairing up with various different brands. This post uses the hashtags “#sponsored” and “#ambassador” to disclose her relationship with the make-up brand MUD.

Winner of South Africa’s Masterchef Season 2 competition, Kamini Pather, has attracted an Instagram following of over 26 000 people and has seemingly cashed in on the social media influencer scene, pairing up with various different brands. This post uses the hashtags “#sponsored” and “#ambassador” to disclose her relationship with the make-up brand MUD.

But how will this issue be dealt with in South Africa where our regulators have yet to turn their attention to specific rules governing this form of advertising? The answer is likely to be found in the Consumer Protection Act 68 of 2008 (the “CPA”) and the Advertising Standards Authority’s Code of Advertising Practice (“ASA Code”) both of which set general standards relating to the advertising of products and/or services to ensure the public is not being misled.

Both the CPA and ASA Code provide very broad definitions of “advertising” and “advertisement” and these would likely apply to advertising by way of social media. When bloggers or influencers post on social media in relation to an advertiser’s products or services, those posts could also be regarded as advertisements, because they are intended to market, promote, advertise or publicise the advertiser or the relevant goods or services. Accordingly, this would also require compliance with the CPA and the ASA Code.

The CPA requires that advertising must take place in a fair and reasonable manner and that no misrepresentations be made. Goods or services must not be marketed in a manner that is likely to reasonably imply a false or misleading representation concerning those goods or services. Similarly, the ASA Code requires truthfulness and honesty in advertising. Could an argument be made that a paid-for advertisement which is not clearly labelled as one is misleading? Probably. After all, a consumer is far more likely to be induced to purchase a product that has been given a rave review by someone he or she knows or admires.

Although the CPA and ASA Code do not specifically deal with situations where influencers post content on social media in order to market or promote a brand or its goods/services, the ASA Code also requires that “advertisements should be clearly distinguishable as such whatever their form and whatever the medium used”.

The ASA Code also states that, in electronic media, particular care should be taken to distinguish clearly between programme content and advertising. Where there is a possibility of confusion, advertising should be identified in a “manner acceptable to the ASA”. While the ASA seems yet to have received any complaints regarding unidentified social media influencer endorsements, it seems likely that it will also insist on similar disclosures to those required by the FTC and that wording, whether in the form of a hashtag or something more substantial, will be needed to clearly identify a post as advertising content.

This being the current state of play, it is advisable that brands and social media influencers (both could be liable in the event of a breach) ensure that all posts contain an indication to the effect that the relevant posts are advertisements. This must be clear enough to avoid any misrepresentations or misleading of the public. One could insert the following at the end of the post: “(Sponsored ad)”. One could also consider using “#sponsored_ad”. Other wording may also be considered acceptable and ultimately, in the event of a challenge, it would be up to the advertiser to show that consumers in South Africa clearly understand that the wording used reflects the nature of the relationship between the brand and the influencer.

It is also important to bear in mind that any form of compensation or inducement, whether in monetary terms or some other form such as a discount, tickets to an event or free products, will likely trigger the need to disclose the relationship with the advertiser. Accordingly, in all of these circumstances, it is recommended that a clear message be inserted at the end of the post to the effect that the post is a sponsored advertisement.

The bottom line is that consumers have a right to know when something is a paid-for testimonial, rather than the personal and unbiased view of the endorser. And it is brands and social media influencers who bear the responsibility of making that disclosure clearly.

Kelly Thompson | Partner (Adams & Adams)

 

KELLY THOMPSON

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DR CONGO | POLITICAL UNREST SHUTS IP OFFICE

The Intellectual Property Office in the Democratic Republic of Congo (DRC) is currently closed due to political and civil unrest in Kinshasa. An umbrella group of opposition parties, known as the Rassemblement (“Rally”) has called for a general strike, the so-called “Ghost town operation”, to apply pressure on President Joseph Kabila to enter into negotiations surrounding a power-sharing deal and to permit elections to take place later in the year.

Kabila’s mandate expired in 2016, but he refused to step down from office and to allow general elections to take place, which lead to violent and tragic protests in September of 2016.  At the time, a power-sharing deal was tabled to restore order, in terms of which Kabila agreed to step down as president in December 2017, when elections were scheduled to take place.

Renewed riots erupted on Tuesday, 4 April 2017, after negotiations between government and the mentioned opposition group broke down. The unrest and strike caused a near standstill in commercial activity in the capital of Kinshasa and the city of Lubumbashi and most government offices, including the IP Office in Kinshasa, have been closed as a result.

It is anticipated that situations of unrest will continue to arise intermittently during the course of the year and leading up to the scheduled elections. Of course, the unrest would likely escalate dramatically if Kabila does not honour the agreement to step down and allow elections to take place in December, after 17 years at the helm of the DRC presidency.

Teams at Adams & Adams are constantly monitoring the situation closely and will communicate any updates on the situation in the DRC and the operational status of the IP Office.

For further updates, information and queries on copyright law, trade mark, patent and design filings in the DRC and across Africa, please contact africaip@adamsadams.com.

STEPHEN HOLLIS

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LITA MITI-QAMATA

Senior Associate
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REINHARDT BIERMANN

Associate
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ZIMBABWE | RATIFICATION OF THE MADRID PROTOCOL

On 13 March 2017, the promulgation of implementing regulations in Zimbabwe set in motion the process of ratification of the Madrid Protocol, some two years after Zimbabwe became a member. Zimbabwe was announced as the 94th member of the Madrid system in December 2014. The regulations which give recognition to the Madrid Protocol were published in the Government Gazette Vol XCIV, No. 16 dated 13 March 2017 and are cited as the Trade Marks (Madrid Protocol) Regulations, 2017.  The effect of the regulations is that a trade mark registered by the Zimbabwean Trade Marks Office in accordance with the Madrid Protocol is accorded the same effect as a trade mark registered under the national Trade Marks Act.  The Trade Marks Act (Chapter 26:04) and Trade Marks regulations apply to the holder of an international registration designating Zimbabwe and to an applicant for an international registration originating in Zimbabwe.

Although the new regulations make it possible for owners of international registrations (obtained via WIPO’s Madrid system) to designate Zimbabwe, it is nonetheless to be recommended that brand owners continue to secure registration of their valued trade marks on a national basis in Zimbabwe. Trade marks filed through the Madrid system will remain speculative in Zimbabwe until such time as the Zimbabwean IP Office (ZIPO) has digitized all of their records (and uploaded them to WIPO’s IPAS system by which Madrid designations are recorded) and ZIPO is equipped to examine applications within WIPO’s strict timelines.  This process is likely to take some time owing to Registry backlogs, staffing issues and a lack of proper investment of funds by the Zimbabwean Government into the improvement of ZIPO’s operations.

For further updates, information and queries on copyright law, trade mark, patent and design filings in Zimbabwe and across Africa, please contact africaip@adamsadams.com

SIMON BROWN

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LAUREN ROSS

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STEPHEN HOLLIS

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ZIMBABWE | JUDICIAL LAWS AMENDMENT BILL. A MOVE WITH THE TIMES?

The Judicial Laws Amendment (Ease of Settling Commercial and Other Disputes) Bill of 2016 is currently pending Zimbabwean parliamentary debate. The purpose of the Bill is to amend sections of the High Court Act, the Magistrates Court Act and the Small Claims Court Act with a view to speed up and to facilitate the settlement of disputes, particularly disputes of a commercial nature.

The Bill proposes that the Intellectual Property Tribunal, which was constituted in terms of the Intellectual Property Tribunal Act, be declared a specialised division of the High Court. The Bill also provides for hearings in court or in chambers to be conducted by way of use of electronic devices or other means of communication subject to agreement between the parties, if a party cannot to be physically present at the hearing.  This is referred to in the Bill as “virtual sittings”. Provision is also made for  the electronic authentication of Court documents and electronic access to records filed with the Courts.

The Bill is perceived as an attempt to bring legal proceedings in Zimbabwe up to speed with the realities of the digital era and to facilitate the settlement of matters in a speedy and effective manner.

For further updates, information and queries on copyright law, trade mark, patent and design filings in Zimbabwe and across Africa, please contact africaip@adamsadams.com

Contribution by

David Legge | Associate

Somayya Khan | Partner

SOMAYYA KHAN

Partner
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TRADITIONAL KNOWLEDGE AS A TRADE SECRET

In June 2016, The Protection of Traditional Knowledge, Genetic Resources and Expressions of Folklore Act, 2016[1] (“the Act”) came into force in Zambia. The Act’s preamble indicates that the aim is to:

  • provide for a transparent legal framework for the protection of, access to, and use of traditional knowledge, genetic resources and expressions of folklore which also guarantees equitable sharing of benefits and defective participation of holders;
  • recognise the spiritual, cultural, social, political and economic value of traditional knowledge, genetic resources and expressions of folklore;
  • promote the preservation, wider application and development of traditional knowledge, genetic resources and expressions of folklore;
  • recognise, protect and support the alienable rights of traditional communities, individuals and groups over their traditional knowledge, genetic resources and expressions of folklore;
  • confer rights on traditional communities, individuals and groups;
  • promote the conservation and sustainable utilisation of the country’s biodiversity resources;
  • promote fair and equitable distribution of the benefits derived from the exploitation of traditional knowledge, genetic resources and expressions of folklore;
  • promote use of the traditional knowledge, genetic resources and expressions of folklore; and
  • to prevent the granting of patents based on traditional knowledge, genetic resources and expressions of folklore without the consent of a traditional community, individual or group

The Act has incorporated a new system into the law such as to register traditional knowledge. The registration does not require that the traditional knowledge be disclosed to the public[2] and   furthermore, much like with trade marks, the Registrar will issue an Intellectual Property Journal on protected traditional knowledge as well as include any licenses or contracts related to the traditional knowledge[3]. The Act has been well received in Zambia as it creates economic development in the country and will encourage international investors to invest in the community as well as to register their own traditional knowledge. Furthermore, the local people will have comfort knowing that their traditional knowledge is protected as well as knowing that there are mechanisms in place if there is misuse of their traditional knowledge.

What exactly is traditional knowledge?

Traditional Knowledge (TK) is knowledge, know-how, skills and practices that are developed, sustained and passed on from generation to generation within a community, often forming part of its culture or spiritual identity[4]. TK can be found in a wide variety of contexts including: agriculture, scientific, technical, ecological and medicinal knowledge as well as biodiversity-related knowledge[5].

For example:

Mukundu

MUKUNDU

The Ila people, also called Baila, Sukulumbe or Shukulumba are Bantu speaking located in the area west of Lusaka being the capital of the Republic of Zambia. Most of the Ila grow food to feed their families and to cover physical and educational needs[6]. The Ila make use of natural plants and trees to make medicines such as the Acacia nigrescens tree (mukundu),  the bark of which is decocted and the lotion used for sore gums[7] and  the Julbernardia panuculata (mutondo)

 of which the leaves can be boiled and the steam inhaled to relieve colds.

TK can be afforded two types of protection namely:

  1. Defensive protection- which aims to stop people who are not a part of the community from acquiring the intellectual property rights over the TK; and
  2. Positive protection- which grants rights that empower communities to use and benefit from the traditional knowledge[8].

These skills and innovations of indigenous and local communities do not form a separate category of intellectual property law and as such, have to be protected by other means of intellectual property rights. Trade secret is one of the forms of intellectual property that can be used to protect TK.

MUTANDO

MUTANDO

What are trade secrets?

A Trade secret is information that is useful in the industry and that is kept confidential. It is information that imparts value to its holder and one that provides a competitive edge over its competitors. Should information that constitutes as a trade secret be leaked, it could have a major negative effect on any business. Information such as customer lists, information received by an employee regarding business opportunities valuable to an employer and information provided to an employee in confidence in the course and scope of his employment could be identified as confidential[9]. Even negative information such as failed remedies or manufacture of products and failed research could be protected as a trade secret as it could save a competing business high costs if they have a what not to do guide.

Article 39 of the TRIPS Agreement[10], provides that member states shall protect “undisclosed information” against the unauthorised use “in a manner contrary to honest commercial practices” as long as the information is:

  1. a secret in a sense that it is not generally known among or readily accessible to persons that generally deal with the type of information;
  2. has commercial value because it is secret; and
  3. has been subject to reasonable steps by the person in control of the information to keep it a secret.

This is the general guideline in determining whether information is a secret and if it can be protected as a ‘trade secret’. Member countries may have identified more criteria but Article 39[11] serves as a basis for the member states of the TRIPS Agreement[12]

The advantages of trade secrets are that trade secrets do not have to be registered and have no limited protection frame, there are no registration costs and there are no formal compliance requirements that have to be met. However, the disadvantages are that trade secrets can be reverse-engineered once the secret is made public and then anyone is at liberty to use the information. The enforceability of the trade secrets is generally not easy furthermore, it may prove to be costly.

Traditional knowledge as a trade secret

In conjunction with the requirements set out by Article 39, traditional knowledge can be protected as a trade secret if:

  1. The information is a secret

Customary laws of communities often require that certain knowledge should be disclosed to certain recipients. For example: A group of North American indigenous communities, the Tulalip Tribe, have an application under the Patent Cooperation Treaty (PCT) on the use of traditional Chinese medicine to reduce the level of fat in the blood which is a collection of their traditional knowledge. A part of the traditional knowledge has been exposed for the patent review and the rest has been kept a secret[13].

  1. Reasonable steps have been taken to protect it

The information must be reasonably protected. Even if the whole community knows about it, it does not lose its secrecy provided that the rest of the outside people do not have much knowledge about it such as in the example of the Tulalip Tribe.

  1. The information has economic value

Traditional Knowledge is seen as an asset as it could be used to develop products which would be profitable. It therefore has great economical value.

If the above requirements have been met, then traditional knowledge can be protected as a trade secret and any misappropriation of the information can allow the owner of the information to seek relief through various means such as obtaining an interdict to prohibit further misappropriation of the information.

Conclusion

Trade secrets are an important form of intellectual property and can be the better form of protection not only for TK but also any confidential information within a business. It is imperative that initial steps be taken in identifying the trade secrets of the business and thereafter, incorporate protection mechanisms within the business such as;

  1. making trade secret protection a priority;
  2. ensuring that documents are stored securely and in places where there is limited access;
  3. ensuring that there are non-disclosure and confidentiality agreements in place to protect the confidential information;
  4. educating third parties and employees about what constitutes confidential information as well as the consequences of revealing the confidential information;
  5. marking documents that they constitute confidential information; and
  6. restricting access to confidential information physically and electronically only to those individuals that need to know the information.

 

[1] Act No. 16 of 2016

[2] Section 15 of Act No. 16 of 2016

[3] Section 11 of Act No. 16 of 2016

[4] WIPO Traditional Knowledge http://www.wipo.int/tk/en/tk/

[5] Idem

[6]  Ila in Zambia https://joshuaproject.net/people_groups/12208/ZA

[7] Fowler D.G (2002) Traditional Ila Plant Remedies from Zambia 35-48

[8]  Pandey V Protection of Traditional Knowledge as Trade Secrets (2013) http://www.mondaq.com/india/x/279342/Patent/Protection+Of+Traditional+Knowledge+As+Trade+Secrets

[9] Meter Systems Holdings Limited v Venter and Another 1993 (1) SA 409

[10] Agreement on Trade-Related Aspects of Intellectual Property Rights

[11] Idem

[12] Idem

[13] Pandey V Protection of Traditional Knowledge as Trade Secrets (2013) http://www.mondaq.com/india/x/279342/Patent/Protection+Of+Traditional+Knowledge+As+Trade+Secrets

MAUREEN MAKOKO

Associate
Trade Mark Attorney

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DARREN OLIVIER

Partner
Trade Mark Attorney

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THE GAMBIA | DEADLINE FOR RENEWAL OF TRADE MARKS

In terms of the Gambian Industrial Property Act 12 of 1989 (“IP Act”), trade marks registered under the Trade Marks Act, 1916 (repealed) shall be due for renewal within 14 years from the filing date of the application for registration or 10 years from the enactment of the IP Act, whichever period expires first.  The IP Act came into force on 2 April 2007.

Registered and pending marks filed between 3 April 2003 and 1 April 2007 were due for renewal on 2 April 2017.

For further updates, information and queries on copyright law, trade mark, patent and design filings in The Gambia and across Africa, please contact africaip@adamsadams.com

MEGAN MOERDIJK

Partner
Trade Mark Attorney

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NICKY GARNETT

Partner & Head of Africa Patents
Attorney

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‘LAWS OF SA’ DATABASE INCLUDED IN US LIBRARY OF CONGRESS

The Faculty of Law at the University of Pretoria (UP) recently announced that the ‘Laws of South Africa: Consolidated Legislation’ – a database project – has been selected by the United States Library of Congress for inclusion in their historic collection of internet materials related to the Laws of African Jurisdictions Web Archive. This project was initiated and is now managed by UP’s OR Tambo Law Library under the leadership of the Library Manager, Ms Shirley Gilmore.
According to UP’s Director of the Department of Library Services, Mr Robert Moropa, this development boosts the international visibility of the University of Pretoria.
The Faculty expressed their gratitude to sponsors Webber Wentzel, Werksmans, Adams & Adams and SAICA for their support of this important project

GERARD DU PLESSIS

Partner & Chairman
Trade Mark Attorney

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UGANDA | INDUSTRIAL PROPERTY REGULATIONS PASSED

On 10 February 2017 the Industrial Property Regulations were gazetted by the Ugandan government bringing the Industrial Property Act, 2014 (“the Act”) into full effect. Despite the fact that the Act came into force in February 2014, it has had a somewhat limping effect for the past three years due to the lack of implementing regulations. The effect of this is that patents have been filed with the Registry but until now there have been no provisions guiding the Registry on how to register industrial designs, utility models and technovations.

This article provides an explanation of the rights afforded to the new, somewhat less common categories of intellectual property protected by the Act in Uganda, namely: industrial designs, utility models and technovations.

Industrial designs

The protection offered by a registered industrial design is gaining prominence across the globe, admittedly in the shadow of its more popular forms of intellectual property law such as patents, trade mark and copyright. An industrial design is defined by the Act as “useful article which is ornamental or aesthetic that may consist of three dimensional features like a shape or surface of an article or a three dimensional feature such as patterns, line or colours”. Excluded from the definition is any design which serves solely to obtain a technical result which is within the realm of patents and utility models in Uganda.

Industrial designs must be new and afford the proprietor of the design to preclude third parties from performing certain acts such as reproducing, importing and selling the product in Uganda for a period of up to fifteen years.

Utility models

Where the definition for patents are defined as “the title granted to protect an invention” by the Act. Utility models seek to protect a much broader class of “inventions” such as appliances, utensils, tools, electrical and electronic circuitry, instruments, handicraft mechanisms or other objects that gives some utility, advantage, environmental benefit, saving or technical effect not previously available in Uganda.

In that the utility models are still required to be an invention in terms of the Act it is not clear how the overlap between patents and utility models will play out in practice. Utility models afford the proprietor of the design to preclude third parties from performing restricted acts for a period of ten years.

Technovations

Uganda is the first country that we are aware of affording rights to what they define as a technovation. Technovation is defined by the Act as “a solution to a specific problem in the field of technology, proposed by an employee of an enterprise in Uganda for use by that enterprise, and which relates to the activities of the enterprise but which, on the date of proposal, has not been used or actively considered for use by that enterprise”.

The effect of this new form of intellectual property protection is that an employee can protect their solution to a problem by filing a request for a technovation certificate with their employer which the employer grants to the employee if the requirements of the Act are met. If the employer uses the technovation (or communicates it to a third person) the employee (technovator) is entitled to a remuneration will be determined by collective bargaining agreement or by mutual agreement between the parties.

For further updates, information and queries on copyright law, trade mark, patent and design filings in Zambia and across Africa, please contact africaip@adamsadams.com

Download Regulations Outline here.

ALICIA CASTLEMAN

Partner | Trade Marks Department
Trade Mark Attorney

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NICHOLAS ROSSLEE

Associate
Attorney

HAT-TRICK FOR ADAMS & ADAMS | AFRICA FIRM OF THE YEAR

London | At the recent Managing IP Global Awards banquet, held at The Savoy, South Africa’s Adams & Adams was confirmed as the leading law firm in Africa for 2017 – the third year in a row for the firm. Partner at the firm, Darren Olivier was on hand to accept the award and to celebrate the firm’s phenomenal achievements in uniting and advancing the business of good intellectual property in territories across the African continent.

“This is a fantastic accomplishment for us and we are immensely grateful to the members of MIP, who have recognised our efforts and our firm’s ascendancy in Africa,” says firm Chairman, Gérard du Plessis, of the award. “We are also indebted to our local and global clients who continue to trust our professionals with their commercial interests and intellectual property rights on the continent.”

Notwithstanding the spectre of a tumultuous 2016 worldwide, there is much to be optimistic about insofar as Africa’s rise on the world stage goes. While development obstacles abound, the World Bank’s Africa Pulse Report projects that annual economic growth for Sub – Saharan Africa will remain at an expected average of 4.5%, whilst the EY Global Attractiveness Study for 2016 highlights some economic “bright spots” on the continent. “In respect of intellectual property law in Africa, there are encouraging improvements in most territories, with laws and regulations constantly in the process of evolution and development,” adds du Plessis. “And allied to this, the development of intellectual property offices across the continent, including the automation and digitisation of these agencies, remains imperative. In our minds, Africa’s time waits for no one.”

Adams & Adams continues to expand its critical African Network with the establishment of an Associate office in The Gambia – also servicing Liberia and Sierra Leone. Plans are underway to open an office in Ethiopia, as well as Zimbabwe, in the near future. This will bring to 19, the number of Associate offices in the different African countries that form part of the Adams & Adams Africa Network.

“Our focus has always been to add value to our clients’ IP portfolios. We target strategic associations with local partners whose ethics and commitment to clients mirror those of our own,” explains Simon Brown, Partner and Chair of the Africa Strategy Committee. “The heart of this approach is to enhance the level of experience for our clients and to provide assurance to clients who entrust us with their work, knowing that their matters will be handled with the same expertise and oversight whether in South Africa or by our Associate firms.”

In 2016 Adams & Adams partnered with Managing IP to introduce the inaugural Africa Roadshow in New York, with the aim of updating clients and interested parties on economic and intellectual property developments on the continent. This was followed by the firm’s hosting of the successful BRICS IP Forum in London. In 2017, Partners will welcome colleagues and registrars from across Africa for the fifth annual Africa Network Meeting – a unique event on the IP landscape. Says du Plessis, “The year ahead offers much hard work for our teams, but much potential as well.”

GERARD DU PLESSIS

Partner & Chairman
Trade Mark Attorney

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SIMON BROWN

Partner and Chair of Africa Strategy
Trade Mark Attorney

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DARREN OLIVIER

Partner
Trade Mark Attorney

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THE ART AND LAW OF PAINTING

Allegory.  Abstract meanings.  Colour.  Light.  Perspective.

Johannes Vermeer dedicated one of his works to The Art of Painting.  It has been called the most complex Vermeer work of all.

Paintings, like that of Vermeer[1], are protected by copyright in South Africa, in terms of the Copyright Act.  Paintings are expressly listed as a form of artistic work in the Act.

The Copyright Act reserves the right to copy.  In fact, it reserves exclusively for the owner of the copyright, various acts or dealings with the intention of rewarding the expression of creativity and embodiment of skill and effort.

In the case of artistic works, these reserved acts include reproducing the work in any manner or form, publishing the work, including it in a film or television broadcast and making an adaptation thereof.

Therefore, only the owner of the copyright in a painting may make a copy of it.  The making of a reproduction (or adaptation) in any manner or form, which is done without the owner’s authorisation, amounts to copyright infringement.

Who is the owner?  In the case of paintings, the artist generally automatically becomes the first owner of the copyright, unless one of very specific exceptions listed in the Act applies.

In order for copyright to transfer, an agreement to this effect needs to be concluded.  Copyright does not transfer with the physical object but remains with the artist unless or until he or she agrees in writing that the ownership of the copyright should transfer.

The result of this is that, when you buy a painting, you buy and acquire only the physical object.  You do not acquire any rights of copyright and you may therefore not do any of the acts reserved for the owner, including making copies.

Copyright infringement attracts liability, including a claim for damages.  Trading in such infringing copies, knowing that they are so infringing, attracts both civil and criminal liability.

If any work of art is to be copied in any way, the owner of the copyright should be approached for permission to do so.

Werina Griffiths | Partner

 

[1] Copyright in artistic works lasts only for 50 years following the death of the author

WERINA GRIFFITHS

Partner | Trade Mark Litigation
Trade Mark Attorney

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GLOBAL ADVERTISING LAWYERS ALLIANCE TO HOST ADVERTISING LAW SEMINAR IN BIG APPLE

The Global Advertising Lawyers Alliance (GALA) announced today that it will hold an international advertising law seminar, “Social Media in the United States and around the Globe” in New York City on 30 March 2017. The event, which will be held at The Penn Club, is taking place in conjunction with GALA’s 15th Annual Global Meeting which is taking place in New York City from 30 March – 1 April 1 2017.

The seminar, which will focus on best practices for social media marketing compliance around the global, will include two panels, “Social Media in the USA” and “Social Media Globally.”  The program will features speakers from seven countries.

“As the issues faced by global advertisers become more complex, we’re very pleased to be able to bring together two incredible panels of experts from around the world,” said Jeffrey A. Greenbaum, Managing Partner at Frankfurt Kurnit in New York and GALA’s Global Chairman. “During these sessions, we hope to be able to give insights to advertisers that will help them market to consumers more effectively in their own countries and across borders.”

The Social Media in the USA panel will feature:

  • Laura Brett, Assistant Director, National Advertising Division
  • Joseph Lewczak, Partner, Davis & Gilbert (USA)
  • Brian Murphy, Partner, Frankfurt Kurnit (USA)

The Social Media Globally panel will feature:

  • Jenny Pienaar, Partner Adams & Adams (South Africa)
  • Ariela Agosin, Partner, Albagli Zaliasnik (Chile)
  • Irina Anyukhina, Partner, ALRUD (Russia)
  • Michel Bejot, Partner, Bernard Hertz Bejot (France)
  • Hande Hancer Celik, Partner, Gun + Partners (Turkey)
  • Peter LeGuay, Partner, Thomson Geer (Australia)

For more information about the program, click here. Admission is free, but space is limited. To register, please contact sbess@galalaw.com.

JENNY PIENAAR

Partner | Trade Mark Litigation
Trade Mark Attorney

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THE CHALLENGE OF POLICING YOUR BRAND ONLINE

Seats are limited for the Advertising & Marketing Law Conference to be held in Johannesburg on 09 May and on 11 May in Cape Town – organised by Marketing Mix Conferences.

Partner at Adams & Adams, and AdLaw expert, Jenny Pienaar has been invited to join panel discussions and to brief the audience on the challenge of policing brands in the digital space. As part of her presentation, Jenny has elected to focus on the following relevant online adlaw subjects:

Hashtags: The popularity of using hashtags as part of advertising campaigns and the advantages and risks in registering hashtag trade marks.

AdWords: The commercial value of search engine AdWords, and the use of third party trade marks as part of paid advertising strategies.

Native Advertising: A discussion on the use of native advertising and consumer perceptions relating to promoted news items online.

Hyperlinks: Copyright in online news articles, and the use of hyperlinks to acknowledge sources.

The legal experts at Advertising & Marketing Law SA 2017 have selected what they believe to be the most topical and influential issues, be it interpreting latest regulatory guidelines, and recent court precedents.

Bryanston Country Club, Johannesburg | 9 May 2017| CLICK HERE TO BOOK

Sports Science Institute, Newlands, Cape Town | 11 May 2017 | CLICK HERE TO BOOK

JennyP

Jenny PIENAAR

Partner 
Trade Mark Attorney

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SÃO TOMÉ & PRÍNCIPE | NEW INDUSTRIAL PROPERTY CODE

A new Industrial Property Code approved under Decree – Law 23/2016 is effective immediately in São Tomé & Príncipe. The new Industrial Property Code defines protection for, inter alia, patents, inventions, utility models, trade marks, geographic indications and designations of origin.

Following São Tomé & Príncipe’s accession to the Banjul Protocol effective from February 2016, the new Code also recognises and makes provision for regional (ARIPO) applications in terms of the Banjul Protocol and international applications in terms of the Madrid Protocol.

Kindly contact Adams & Adams for comments on the developments and changes brought about by the new Code.

Lisa van Zuydam | Senior Associate

Mandy Swanepoel | Partner

Mandy_Gordon

Mandy Swanepoel

Partner
Trade Mark Attorney

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EGYPT | INCREASE IN PATENT OFFICIAL FEES

On 13 February 2017, the President of the Academy of the Scientific Research and Technology issued Executive Decree, No. 1 of 2017. The Decree, effective as of 13 February 2017, affects the official fee that is levied for the examination of patent applications in Egypt – now increased from EGP 7000 to EGP 17 530. The official fees will be reviewed annually in light of the US Dollar currency exchange fluctuations.

For further updates, information and queries on copyright law, trade mark, patent and design filings in Egypt and across Africa, please contact africaip@adamsadams.com

Nicky_Garnett

Nicky garnett

Partner – Head of Africa Patents
Attorney

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Nthabisheng_Phaswana

nthabisheng phaswana

Partner
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ADMINISTRATION OF JUSTICE TRUMPS PROCEDURAL TECHNICALITIES IN KENYA

The Kenyan Industrial Property Institute (KIPI) recently had to consider the effect of a party requesting an extension to file its evidence some fifteen days after the deadline to do so had already expired.

The matter involved an application for the trade mark KINGSTONE in the name of Sichuan Yuanxing Rubber Co. Ltd (“the Applicant”) and an opposition by Bridgestone Corporation (“the Opponent”). The Applicant failed to file its statutory declaration within the prescribed period and, fifteen days after the missed deadline, filed an application for an extension of time to do so. The Opponent had already, by that time, applied for the KINGSTONE application to be abandoned.

The issue for determination was whether the Registrar of Trade Marks should exercise its discretion in terms of Section 102(6) of the Kenyan Trade Marks Act in favour of the Applicant. Section 102(6) allows the Registrar to extend the time for performing any act under the Trade Marks Rules even if that time period has already expired. The Applicant alleged that its failure to timeously request an extension to file its statutory declaration was due to an oversight on the part of its legal counsel, the effect of which should not be visited on the Applicant. The Registrar granted the extension, reasoning that fifteen days was not an inordinate delay and taking into account that the Opponent would not be prejudiced and that the interests of justice dictated that the matter should be heard on its merits.

KELLY THOMPSON

Partner & Chairperson of Trade Mark Litigation
Trade Mark Attorney

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KIM RAMPERSADH

Senior Associate
Attorney

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SANGE APPOINTED MD OF THE KENYA INTELLECTUAL PROPERTY INSTITUTE

The recent appointment of Mr Sylvance A. Sange as the new Managing Director of the Kenya Industrial Property Institute (KIPI) has been welcomed by industry professionals worldwide. Sange has been confirmed as the director for a three-year term, as published in the Kenyan Government Gazette on 20 January 2017. Adams & Adams have worked closely with Mr Sange from his time as a Patent and Trade Mark Examiner at KIPI. The Institute has been supportive of a number of the firm’s IP initiatives geared to developing and reinforcing IP professionalism on the continent, including the Adams & Adams Africa Network Meeting (AAANM) – an annual summit that brings together the top IP practitioners and administrators from over 25 African countries.

Mr Sange first shared his shrewd vision for Kenyan and African IP development when he attended the Africa Network Meeting in Pretoria in 2014, office and was able to share the vision that he has for KIPI and Africa. This followed the opening of the Adams & Adams Kenya office in 2013 – testimony to the importance of the Kenyan market, both economically and from an IP perspective. Kenya continues to be at the forefront of harnessing its IP laws and bringing them up to par with other leading international jurisdictions. On 11 November 2016 the Statute Law (Miscellaneous Amendments) (No. 2) Bill 2016 was published with the aim of making minor amendments to the Industrial Property Act No. 3 of 2001, the Copyright Act No. 12 of 2001 and the Anti-Counterfeit Act No. 13 of 2008.

Darren Olivier & Menzi Maboyi (Adams & Adams South Africa) with Mr Sylvance Sange, centre, (MD of KIPI)

Darren Olivier & Menzi Maboyi (Adams & Adams) with Mr Sylvance Sange (centre), new MD of KIPI

Recently a team from Adams & Adams travelled to Kenya and was cordially received by Mr Sange at the KIPI offices.

For further information and queries on trade mark, patent, and design filings in Kenya and across Africa, please contact africaip@adamsadams.com

ARIPO | INCREASE IN PATENTS OFFICIAL FEES

With effect from 1 January 2017, patents official  fees have been increased by between 5 and 15%. The decision was adopted by the ARIPO Administrative Council at its annual meeting held in Harare, Zimbabwe from 5 – 7 December 2016. During the annual meeting,  the Administrative Council  also approved amendments of the Harare Protocol which regulates the filing and prosecution of patents, utility models and industrial designs,  and consequently  adopted  new fees for services  contained in the  amendment.

For further information and queries on trade mark, patent, and design filings through ARIPO and across Africa, please contact africaip@adamsadams.com

Nicky_Garnett

nicky garnett

Partner – Head of Africa Patents
Attorney

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Nthabisheng_Phaswana

nthabisheng phaswana

Partner
Attorney

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THE LAW OF PROMOTIONAL COMPETITIONS | Ts & Cs APPLY

Anyone who has ever entered a competition will know these two phrases very well: “the judges’ decision is final” and “no correspondence will be entered into”. Trouble is, these may not in fact be lawful conditions because they could infringe consumers’ rights.

It might also be unlawful when organisers of a competition say, in the fine print, that they “reserve the right” to change the terms and conditions or even to suspend or cancel the competition altogether.

According to attorney Danie Strachan, under the Consumer Protection Act these well-known elements of the “Ts&Cs” that seem to apply to most competitions might actually violate consumers’ rights to “fair, just and reasonable terms and conditions”.

Strachan, a partner at Adams & Adams, has just received a doctorate in law, focussing on promotional competitions and, among other issues, the pitfalls that consumers and organisers should take care to avoid.

Strachan said since the Consumer Protection Act took effect in 2011, promotional competitions have fallen mostly under that law, though they were also still partly regulated by the legislation on lotteries. This in turn meant when there were disputes over aspects of promotional competitions, the courts would look at whether the rights of participants as consumers were properly considered and protected by the organisers.

Many charities did not realise that under the new laws they were not entitled to use promotional competitions to raise funds, and that in 2008 the Supreme Court of Appeal had actually declared a competition unlawful on the basis that it was not a promotional competition, but rather a fund-raiser for charities under the umbrella of the South African Children’s Charities Trust.

To qualify as a promotional competition, it was essential that the competition must be aimed at “promoting a producer, distributor, supplier, or the sale of any goods or services” and it cannot be conducted for any other purpose, such as fundraising.

The fact that consumers are protected under the law when they enter competitions like this means, for example, that it would be unlawful for the organisers to show a picture of the vehicle being offered as a prize and for it to turn out that the vehicle offered to the winner was something quite different. That would amount to misleading the people who entered the competition. Similarly, if the organisers said participants could “win a year’s supply of milk” it would be misleading if in fact the prize was a maximum of one litre of milk a day. To avoid legal action, the organisers must spell out precisely what was being offered as well as the terms and conditions that applied.

What about the lucky winner? – Organisers of many competitions insist that the winner be photographed and that image is then used for further marketing material. In fact however a competition rule that “requires” the winner to allow the organisers to use their photograph in this way would be invalid. The consumer who enters such a competition must always have the choice to refuse to participate in further marketing or to have their photograph taken.

Another issue dealt with by Strachan is the broader question of privacy for everyone who enters competitions. Obviously the organisers will be trying to extend the range of their marketing efforts to as many consumers as possible; but that doesn’t mean they are entitled to infringe the right to privacy of the people who enter the competition. While the law may allow suppliers to “conduct direct marketing” that complies with the consumer laws, they have to stop sending directing marketing to consumers who requests them to do so.

Will there be any serious consequences for a supplier who simply ignores the law on questions like this? Strachan points out that if the supplier won’t comply the matter could be investigated by the National Consumer Commission, either through its own initiative or following a complaint by a consumer. The commission could then issue a “compliance notice” if it believed the law had been infringed. If there was no response, the commission could apply to the National Consumer Tribunal to impose a fine. And it might be quite severe: up to R1-million or 10 percent of the offender’s annual turnover. The dispute might also be referred for prosecution, with a possible fine and/or imprisonment of up to 12 months if there is a conviction.

Strachan says all this shows organisers should be careful that they set up and run their competitions in a lawful way. “If this is not done they could face significant penalties.” But, he warned, however harsh they were the penalties would only work as a deterrent if the law were actively enforced. Thus, the National Lotteries Commission and the National Consumer Commission should monitor promotional competitions, investigate non-compliance and ensure that steps were taken against offenders. Only then would consumers be effectively protected.

For assistance in drafting promotional competition guidelines, contact Danie Strachan | Danie.Strachan@AdamsAdams.com

[Article by Carmel Rickard]

DanieStrachan

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THE COHABITATION INTERPRETATION

When asked at a recent Comic Con about the future living arrangements of their characters, Amy and Sheldon on the hit TV series The Big Bang Theory, Jim Parsons (Sheldon) quipped “Right now, there is such a new world of living together and what that means, and working that out.” 21st Century relationships come in all shapes, forms and sizes, but what are the risks of being in a long-term relationship that is not formally recognised as a lawful marriage?

“At the outset it is important to stress that there is no such thing as a common law marriage or spouse”, says Shani van Niekerk, an Associate at Adams & Adams. “The amount of time that a couple lives together does not translate into a default marriage. We’ve had clients ask us about a “six-month rule”. It’s a total myth unfortunately.”

The consequence is that at the dissolution of the relationship, or in the event that a cohabitant dies without leaving a Will, partners are left very vulnerable and without the legislative protection which married individuals enjoy. For example, when a cohabitant dies without leaving a valid will, the partner has no right to inherit under the Intestate Succession Act. A cohabitant also cannot rely on the Maintenance of Surviving Spouses Act to secure maintenance should a partner pass away. There’s no legal obligation on either person to maintain the other – meaning no enforceable right to claim maintenance from each other.

So what can you do to protect your interests in a cohabitation relationship? Shani suggests taking a leaf out of Sheldon’s script. “The only way to be protected in our law is to enter into a cohabitation agreement. Such an agreement is in the best interests of both parties in a relationship and clarifies the expectations of the partners.”

A cohabitation agreement regulates the rights and duties between partners, and could almost be compared to an ante-nuptial contract in a civil marriage. The agreement can provide for the division and distribution of assets if the relationship ends, the rights and obligations towards each other with regards to maintenance, and parties’ obligations and respective financial contributions towards the joint home. A cohabitation agreement will be legally binding as long as it contains no provisions that are immoral or illegal, however it is important to note that a cohabitation agreement will not be enforceable insofar as third parties are concerned.

In a long-term relationship where marriage is not considered or possible, a cohabitation agreement is the smart way to live together without the fear of the future. Chatting to an experienced family law attorney and getting a cohabitation agreements drawn up may help you avoid the financial risks and potential trauma of a possible break-up.

Contact Adams & Adams for help in setting up your agreement, telephone 012 432 6000 or email:

Shani van Niekerk (Associate) | Shani.vanNiekerk@AdamsAdams.com

David Scheepers (Partner) | David.Scheepers@AdamsAdams.com

David_Scheepers

david scheepers

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IP COMMENTARY | MAURITIUS DRAFT INDUSTRIAL PROPERTY BILL

The Mauritius Draft Industrial Property Bill is open for comment [Download Here]. We are in the process of studying the draft, but in the meantime we are able to offer the following initial comments pertaining to Trade Marks in the Bill. This is a Bill which seeks to consolidate all aspects of IP into a single piece of legislation.

A brief summary of the changes is outlined below:-

  • Definition of a trade mark has been extended to also cover collective and certification marks. Specific grounds for the invalidation of a certification mark were added, but no similar provisions for collective marks are included.
  • Grounds for refusal of a trade mark expanded, the most notable being that a mark shall not be registered if it consists exclusively of the shape of the goods or where the shape is necessary to obtain a specific technical result.
  • Registration of a trade mark on the basis of honest concurrent use or other special circumstances may be permitted.
  • The Bill provides that if a filing formality deficiency is notified, the applicant has two months to correct that deficiency.  The filing date then becomes the date of correction of the deficiency, rather than the original filing date.
  • The Bill also provides for the division of an application into two or more applications, which will then be treated independently, retaining the original filing date.  (Useful when facing citations)
  • A remedy for unregistered marks is provided – The earlier user of a trade mark that is neither registered nor the subject of a pending application, will entitle the owner to oppose a confusingly similar trade mark by presenting the relevant evidence of such use.
  • International exhaustion of rights – the right to be accorded by the registration of a trade mark shall be exhausted once the product is put in the market by the registered proprietor or with his consent in Mauritius or any other country in the world.
  • The Bill provides for additional defences to trade mark infringement, similar to the South African Act. The defences added include:
  1. Specific provisions dealing with exhaustion of rights.
  2. If a mark is used to truthfully indicate the goods or services originating from the owner of the trade mark.
  3. Use of a trade mark to provide information regarding the intended purpose, use of compatibility of the product or services, including spare parts.
  4. Indications of a descriptive nature
  5. Own name / place of business provisions similar.
  • The proviso to the defences is that:
  1. Use must be compatible with honest practice and the mark must not be used in a manner that causes confusion.
  2. The use must not take unfair advantage of, or be detrimental to, the distinctive character or repute of the mark.
  • The Bill amends the provisions dealing with trade mark infringement. It seems that only use of the identical mark in respect of the identical goods / services is covered (section 98(1)). The provisions dealing with similar marks or goods / services where not retained. This seems to be an omission in the Bill.
  • The Bill makes provision for partial cancellation, and expressly states that a cancelled trade mark registration is void ab initio.
  • New terminology – The head of the IP Office will be the Director as opposed to Controller under the current Act. The Bill also provides for the establishment of the Intellectual Property Council to serve as a co-ordinating body between private and public stakeholders for the effective national IP policy and enforcement.
  • The scope and composition of the Tribunal for the adjudication of IP matters defined.
  • New provisions are made for registration of Geographic Indications, defined as an indication which identifies any goods as originating in the territory of a country, or a region or locality in that country, where a given quality, reputation or other characteristic of the good is essentially attributable to its geographic origin. The nature of the right, scope and duration outlined.
  • The provisions relating to International Registrations via the Madrid Protocol are set out, although Mauritius has yet to join the Madrid system.
  • The Bill introduces a statutory prescription period of 5 years for any proceedings in terms of the Bill.

For further information and feedback or advice, contact our team now.

Megan Moerdijk | Partner

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Kagisho manyashi

Senior Associate
Trade Mark Attorney

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wensel Britz

Senior Associate
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RISE TO THE CHALLENGE | CEO SLEEPOUT™ 2016

 

PLEDGE YOUR SUPPORT

On the 28th of July – the coldest night of the year – the both the Adams & Adams Chairman and COO will take part in the CEO SleepOut™ initiative. Leaders from every industry will sleep on the Nelson Mandela Bridge in an effort to raise funds and awareness around the plight of the homeless, and those who do not have ready access to education in South Africa. Gérard du Plessis (Chairman) and Dave Forbes (COO) have risen to the challenge and are leading our firm’s charge in raising money for the beneficiaries of the CEO SleepOut™. Visit the 2016 Sun International CEO SleepOut™ website and pledge your support by making a donation to Gérard and Dave today : CLICK HERE


RADIO INTERVIEW

Adams & Adams COO, Dave Forbes talks to Jacaranda FM about the significance of the firm’s involvement in the second Sun International CEO SleepOut™


BROADCAST INTERVIEWS

Adams & Adams Partner,  Darren Olivier chatting to Maggs on Media on eNCAnews about the ‪2016 Sun International CEO SleepOut™

Sun International CEO SleepOut™ discussion with Darren Olivier and Thuli Madonsela on CNBC Africa

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PRESS STATEMENT

ADAMS & ADAMS’ ATTORNEYS RETURN FOR ANOTHER SLEEPOUT™ FOR CHANGE

Firm accepts challenge as a Stakeholder Partner in the 2016 Sun International CEO SleepOut™

Leading intellectual property and commercial law firm, Adams & Adams, has proudly announced its participation, as Stakeholder Partner, in The Sun International CEO SleepOut™ for the second year in a row.

In making the announcement, Adams & Adams’ Chairperson, Gérard du Plessis explained the firm’s rationale for extending its involvement in the innovative campaign; “In a recent global CEO survey, more than three-quarters of the CEOs interviewed worldwide agreed that business success in this century would be defined by more that just financial profit. Big business can help solve some important problems in the world today, and I believe we have found the ideal platform and partner in The CEO SleepOut™ initiative – a drive that helps us balance our bottom-line objectives with the need for responsible business practices.”

As a Stakeholder Partner since the first CEO SleepOut™ in 2015, Adams & Adams has been profoundly involved in both the fundraising and outcomes aspects of the initiative. The firm’s involvement last year, which included participation by clients, suppliers, staff and partners alike, resulted in it raising a contribution of well over R500 000 – the third highest contribution of all participants.

“Adams & Adams’ participation as a Stakeholder Partner was invaluable in the setting up of The CEO SleepOut™ and it’s various divisions,” said SleepOut™ SA CEO, Ali Gregg. “Importantly, we have a group of people and corporates whose first responsibility is to the identified beneficiaries we support, and a group that understands the value of creating opportunities for donors to develop empathy with those they are assisting.”

“This is a significant movement for positive change on the South African landscape at the moment, and we are both humbled and thrilled to be a champion for the challenge again,” added Gérard du Plessis.

RWANDA | IP LEGISLATION UPDATES

Rwanda recently hosted the World Economic Forum (WEF) in Kigali in May, with the theme, ‘Connecting Africa’s Resources through Digital Transformation’. In a recent Bloomberg article, Mark Bohlund (African Economist) said that Rwanda has led the way in nurturing an attractive business environment by cutting red tape, providing tax incentives and improving governance. Rwanda’s Development Board predicts that foreign direct investment would probably rise by 36% this year, and as interest grows in doing business in the country, it is important for companies to be mindful of protecting their intellectual property rights in Rwanda.

A few changes have been made to Rwanda’s Intellectual Property Laws. While Law no. 31/2009 remains in force, a new law, namely, Law no. 005 of 2016 and various Ministerial Orders have introduced some amendments to the existing Law, all of which came into force on 20 April 2016, when they were published in the Official Gazette. The main changes entail the recognition and protection of Plant Breeder’s Rights and changes to the time periods relating to the opposition of certain industrial property applications. An overview of the changes is set out below.

Protection of Seeds and Plant Varieties

Law no. 005 of 2016 Governing Seeds and Plant Varieties in Rwanda now provides for the recognition and protection of seed and plant varieties in Rwanda. Previously, Law no. 14/2003 of 23 May 2003 was in force, governing the production, quality control and commercialisation of seeds but there was no intellectual property protection for seed and plant varieties and plant breeder’s rights. Law no. 005 has been enacted as the “related special law” referred to in Article 289 of Law no. 31/2009 and it has repealed Law no. 14/2003. Anyone who was dealing with activities relating to seeds and plant varieties prior to 20 April 2016 have been given a 12 month period (calculated from 20 April 2016, the date of publication of Law no 005 in the Official Gazette) to comply with the requirements set out in terms of the Law Governing Seeds and Plant Varieties in Rwanda.

In terms of Law no. 005, a Committee has been established to evaluate, certify, register and withdraw plant varieties in relation to the national plant variety list in Rwanda. All certified plant varieties are registered on the abovementioned list, which will be published by the Minister of Agriculture on an annual basis in the Official Gazette. An application for registration of a plant variety would need to be submitted to the competent Committee. The Seed Certification Authority appoints a plant variety Registrar who is granted the powers of Judicial Police Officer by the Minister in Charge of Justice. Seed inspection and testing are to be carried out by seed inspectors and seed analysts. A seed inspector is also granted the powers of a Judicial Police Officer in Charge of Justice.

Law no. 005 sets out the requirements for quality seed production, processing and marketing and the relevant recognised seed categories. It also sets out the requirements for quality seed producers, conditioners and dealers and deals with the importation and exportation of seeds. Seeds that are produced or sold must now have a seed quality certificate, granted by the authority in charge of granting licences for importation and exportation of plants in Rwanda. All seeds for which a certificate is sought are tested by a recognised seed laboratory. Seeds that are not produced in Rwanda are allowed to be imported if they have been subjected to certification schemes that are of equal or higher standard than the certification scheme applied in Rwanda and which are internationally recognised. The expenses in this regard will be borne by the seed importer. However, in the case of emergency resulting into seed shortages in Rwanda, the Minister of Agriculture has the right to allow the use of seeds which have lower standards than those set up by the law in Rwanda.

New plant varieties are protected in terms of Law no 005, where the plant breeder has applied for protection and which meets the required conditions. Any Rwandan or foreign plant breeder is eligible to apply for plant variety protection for a variety that he/she has bred. The date of receipt of the application is considered as the filing date. The requirements are that the plant variety must be (a) new, (b) distinct, (c) uniform and (d) stable. Law no 005 explains these requirements in some detail and a plant breeder’s rights entitle him/her to sell, multiply or distribute his/her plant variety or to designate any other person to do so. The plant breeder’s rights will be registered and maintained on the register by the Registrar of plant breeder’s rights. A plant breeder’s right is granted for a period of 20 years from the date of granting of the plant breeder’s right (i.e. not from the date of application thereof) but for trees and vines, such a period is 25 years from the date of granting of the right.

The Registrar has the power to approve or reject the protection of a plant variety, to withdraw the plant breeder’s right certificate, to nullify the plant breeder’s right and to remove from the register, a protected plant variety. Any interested person may have access to the plant breeder’s rights register with permission from the Registrar.

Decisions made regarding the granting, nullification, cancellation and rejection of plant breeder’s rights are published in the Official Gazette. Where the requirements are met, the plant breeder should be informed within 30 days that his/her plant variety is protected and is given a plant breeder’s right certificate. The grant of a plant breeder’s right certificate will be published and provision is made to object to an application for registration of a plant breeder’s right, after publication. A ministerial order will determine the procedure to lodge an objection in this regard. Any person who is not satisfied with any decision made by the Registrar in terms of Law no 005 may appeal to the management of the Registrar’s institution within 30 days. If a party is not satisfied with the decision made on appeal, he/she may refer the matter to the competent court.

A plant breeder’s right does not apply to, inter alia, acts done privately for non-commercial purposes and acts done for experimental purposes. A plant breeder’s right is not restricted, however, the Minister may authorise any person, upon application, for a compulsory licence, to use a protected plant variety without the plant breeder’s authorisation for the following cases of public interest: (a) social welfare, (b) national security, (c) environment protection. In such cases, the plant breeder will receive fair remuneration.

A plant breeder’s right or an application for the right may be assigned by means of a written document, signed by both parties. The holder of a plant breeder’s right may give someone the authorisation to use such a right in compliance with the provisions on plant breeder’s rights. Any person contravening the provisions of Law no 005 will be liable to pay a fine.

Opposition period relating to trade mark applications and geographical indications

Article 3 of Ministerial Order no. 25 of 17 March 2016 (effective from the date of publication on 20 April 2016) has formally amended the opposition period to oppose a trade mark application and geographical indication to 60 days and repeals Article 3 of Ministerial Order no. 5/10 Minicom of 25 August 2010 which stated that the opposition period of industrial property rights was 30 days. For the past 19 months, however, the Rwandan Registry has implemented a 60 day opposition period in practice. From October 2014, the Industrial Property Journals just started publishing applications indicating a 60 day opposition period. No practice directive was issued by the Registry introducing the change to the opposition period at the time and Article 3 of Ministerial Order no. 25 of 17 March 2016 now provides clarity on the issue.

Ministerial Order no. 25 of 17 March 2016 does not mention whether the opposition period is extendable and what the extension period would be, if applicable, and this will need to be raised with the Registry and clarified in due course.

Article 3 of Ministerial Order no. 25 of 17 March 2016 also provides that upon receipt of an opposition, the applicant for registration of a trade mark application or geographic indication has 14 days to submit a written response to the competent authority about the content of the opposition. Prior to the publication of Ministerial Order no. 25 of 17 March 2016, no specified period had been stipulated in terms of the IP legislation regarding the timeframe within which an applicant is required to respond to an opposition.

Article 4 of Ministerial Order no. 25 of 17 March 2016 now expressly provides that an opposition for intellectual property registration must contain the following information: (a) identity of the applicant, (b) object of opposition, (c) detailed reasons for the opposition, (d) material evidence of the grounds for opposition, (e) power of attorney, if needed and (f) the date and signature of the applicant.

International Registrations designating Rwanda in terms of the Madrid Protocol

Rwanda joined the Madrid Protocol on 17 August 2013 and currently there are reservations around actually designating Rwanda in terms of an International Application because Rwanda has not amended its domestic legislation to recognise intellectual property rights in terms of the Madrid Protocol and there are, apparently, no formal guidelines as to how the Rwandan Trade Marks Office will prosecute International Applications designating Rwanda. Many practitioners therefore recommend that trade mark proprietors should continue to register their trade marks at national level in Rwanda. However, it has been submitted that Article 290 of Law no. 31/2009 already envisages the recognition of the Madrid Protocol in terms of Rwanda’s domestic legislation. Article 290 provides the following: “the provisions of any international intellectual property treaty to which the Republic of Rwanda is party, shall apply. In the case of conflict with the provisions of this Law, the provisions of the international treaty shall prevail over the latter”.

In light of the above, International Applications designating Rwanda in terms of the Madrid Protocol are, apparently, being considered by the Rwandan Registry. Once the Rwandan Trade Marks Registrar receives notification from the WIPO International Bureau, the International Application designating Rwanda proceeds to examination and, if accepted, will be published in Rwanda’s Industrial Property Journal for opposition purposes. If no opposition is lodged, the International Application designating Rwanda will proceed to registration and a notification to that effect will be made to the International Bureau.

Ministerial Order no. 24 of 17 March 2016 (as published on 20 April 2016) sets out the official fees payable for the registration of various intellectual property rights and repeals the previous Ministerial Order no. 6/10/Minicom of 25 August 2010. Ministerial Order no 24 has made provision for, inter alia, the fees payable for International Applications in terms of the Madrid Protocol.

Miscellaneous changes

While provision was made for the publication of applications for opposition purposes in terms of Law no. 31 of 2009, Article 5 of Ministerial Order no. 25 of 17 March 2016 (as published on 20 April 2016) now also provides for the publication of every registered intellectual property right in the Official Gazette and on the website of the Office of the Registrar General. The Rwandan Registry is currently in discussion with the office in charge of the Official Gazette to begin the process of implementing the publication of registered rights.

Ministerial Order no. 26 of 17 March 2016 (as published on 20 April 2016) determines the form and content of a power of attorney required in relation to industrial property rights. Article 3 stipulates that the power of attorney must contain the following information: (a) the name and address of the grantor, (b) name and address of the intellectual property right, (c) the subject and scope of the power of attorney, (d) determination of the place where the power of attorney will be executed, (e) commitment by the grantor of the power to be bound by the acts of the agent within the power of attorney, (f) signature by the grantor with the company’s seal, (g) date on which the power of attorney takes effect and (h) for a grantor whose habitual residence or principal place of business is located outside the Republic of Rwanda, the power of attorney must be certified by a notary.

It was not previously required for a power of attorney to be notarised and simple signature would have been sufficient, but now notarisation is necessary. Article 4 of Ministerial Order no. 26 of 17 March provides that the language of the power of attorney must be in one of the official languages provided by the Constitution (i.e. in either English, French or Kinyarwanda). No translation is required.

by Catherine Wojtowitz

PRESS PLAGIARISM | MONEYWEB v M24

Moneyweb, a provider of an online news publication, brought an application in 2013 against a competitor, Media 24, before the Local Division of the Gauteng High Court in Johannesburg, based on copyright infringement. Moneyweb’s complaint was that seven articles published on its website were substantially copied and published on Media24’s financial news website, Fin24.

The Court issued a decision on 5 May 2016 declaring that Media24 had infringed the copyright in only one of the seven articles in which Moneyweb (Pty) claimed copyright.

In deciding the matter, the Court primarily had to consider three issues, namely:

  1. whether copyright subsisted in Moneyweb’s articles as original literary works;
  1. if so, whether Media24 had reproduced “a substantial part of the relevant article[s]” thereby infringing Moneyweb’s copyright; and
  1. whether certain defences under the Copyright Act were available to Media24.

In order for copyright to subsist in the articles, Moneyweb was required to prove that the articles were original. Originality in this context does not require creativity but rather that the articles were created as a result of the author’s own skill, judgment or labour and not slavishly copied from existing material. The Court examined the circumstances surrounding the creation of each article separately and found that Moneyweb had failed to prove originality in the creation of four of the articles. Three of the articles, however, were found to be original.

Media24’s first defence was raised in terms of Section 12(8)(a) of the Copyright Act, which provides that no copyright shall subsist in “news of the day that are mere items of press information”. The Court rejected its defence on the basis that, since the three articles were found to be original, they could not be classified as “mere items of press information”.

The court then had to decide whether the portions of the articles that had been copied were substantial and accepted that the correct test involved an assessment of the quality or importance of the copied content and not simply the quantity of the copied text. The Court found that Media24 had only reproduced a substantial part of one of Moneyweb’s articles. The article in question was more or less a verbatim copy of Moneyweb’s article and the Court found that Media24 had “taken more than a substantial part; it had taken the core” of the article. The publication of Media24’s article, therefore, was found to have infringed Moneyweb’s copyright. In connection with the other two articles, the Court found that the content that had been copied was not substantial (in quality or quantity) and, therefore, that the publication of the articles did not infringe Moneyweb’s copyright.

The second defence raised by Media24 was that its conduct constituted “fair dealing” within the meaning of Section 12(1)(c)(i) of the Copyright Act. This provision states that copyright shall not be infringed by any fair dealing with literary works for the purposes of reporting current events provided that the source shall be mentioned as well as the name of the author, if it appears on the work.

Although the Court found that Media24 had complied with the requirement to name the source and author by providing a hyperlink to the original article, it rejected the defence on the basis that Media24 could not prove that its near-verbatim copy of Moneyweb’s article was fair.

Despite succeeding with one of its claims, the Court ordered Moneyweb to pay 70% of Media24’s legal costs since the latter had been “substantially successful in defending the claims”.

The second leg of the case will decide Media24’s liability for damages arising from its infringement of the article concerned.

by Kareema Shaik | Senior Associate

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PLEASE CALL ME | ANSWERS FOR BUSINESS

What does the ‘Please Call Me’ Constitutional Court Judgment mean for large and small businesses? Guests joined our panelists, Darren Olivier (Partner | Adams & Adams) and Pavlo Phitidis (Aurik Business Accelerator) as they unpacked the complicated matter and applied it to the context of good corporate governance.

The almost hundred page judgment from the constitutional court makes for exciting, and laborious reading – at least to an IP attorney. Exciting in the sense that it documents a brilliant idea coming from a modest yet determined man in the accounting department of a telecoms behemoth and his fifteen year battle for justice all the way to constitutional court, and laborious to anyone not interested in 80 pages dedicated to the difference between estoppel and ostensible authority, if indeed there is one.

In short, Mr Makate invented a concept whereby one could send a message on a cell phone to someone to “please call me” at little charge and which was especially useful in the lucrative prepaid mobile phone market especially when one ran out of airtime, which was often the case. He relayed that to his manager and then to his head of product development asking for 15% of profits compensation for the idea. The company agreed to let the CEO determine the compensation if they could not reach an agreement.

The company then celebrated his idea and made billions then refused to pay him claiming that the idea was theirs, that his claim had prescribed and that the head of product development had had no authority to bind the company.

The case was dismissed in the High Court, leave to appeal to the Supreme Court of Appeal was rejected and Mr Matake then sought justice in the Constitutional Court. On Tuesday that court handed down a decision vindicating Mr Makate, castigating Vodacom and ordering that the company abide by its agreement to pay Mr Makate, and negotiate in good faith to determine the exact amount necessary to be paid.

Despite the very long judgement and the hype around this case the lessons to be learnt from it are fairly simple. If you have a great idea outside the course and scope of your employment:

  • document it
  • get an sense of whether it can be patented or how the five different forms of IP can be used to protect it (most lawyers will not charge you for this)
  • use a properly drafted NDA when you disclose it
  • speak to the right person (and even take your attorney along)
  • don’t be naïve – sense the opportunity to reveal your entire idea at the right time

Darren Olivier

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STRICTER TRADE MARK RULES FOR DAIRY PRODUCTS

On 28 March 2016, the new Regulations relating to the Classification, Packing and Marking of Dairy Products and Imitation Dairy Products Intended for Sale in the Republic of South Africa (“the Regulations“) came into effect. The Regulations were issued by the Department of Agriculture, Forestry and Fisheries (“DAFF”), and repeal the previous Dairy Products and Imitation Dairy Products Regulations. The Regulations bring about a number of changes in the classification and marking of dairy products and imitation dairy products that are sold in South Africa, and industry members have had to review their product packaging, to ensure that the packaging complies with the new requirements.

From a trade mark perspective, one of the changes brought about by the Regulations relates to the allowable letter size of certain elements on the container of a product, in proportion to the class designation that appears on the product pack (the “class designation” refers to the type of product, for example “Low Fat Milk”, “Unsalted butter”, “Full fat cheese spread”, etc). Regulation 25(7)(a) provides that no word or expression that appears on the container of a dairy or imitation dairy product may be bigger than the letter size of the class designation that appears on the main (or front) panel of that product, unless it is a registered trade mark or trade name. This provision is stricter than the previous corresponding provision of the repealed Dairy Products and Imitation Dairy Products Regulations, which allowed for both registered and unregistered trade marks to be displayed on pack in a letter size bigger than the letter size of the class designation.

Against this background, in terms of Regulation 25(7)(a), the only words that are allowed to be displayed bigger than the class designation on pack, are registered trade marks. Other elements that are not registered trade marks, for example descriptive words (such as “Chocolate flavoured”, “1 litre”, or “Shake well”) and unregistered trade marks, must be displayed in a letter size that is smaller than, or equal to, the letter size of the class designation.

The packaging of some products on the market currently indicate unregistered trade mark elements in a letter size that is bigger than the letter size of the class designation of the specific product on pack. In the circumstances, and in order to comply with Regulation 25(7)(a), industry members affected by this provision are required to amend non-conforming product packaging to be in line with Regulation 25(7)(a), by appropriately reducing the letter size of those elements on pack.

An alternative approach would be to obtain registered trade mark rights in the package elements that are affected by Regulations 25(7)(a), where appropriate. Although some manufacturers may prefer this option, in order to allow their product packaging to remain unchanged, this route it is not without its difficulties, and may not be a suitable approach in all instances, as discussed below.

In terms of the Trade Marks Act of 1993, in order to be registrable, a trade mark must be capable of distinguishing the goods of a person, in relation to which it is registered or proposed to be registered, from the same goods of others in the trade (i.e. that mark must not be descriptive of the goods in relation to which it is used or proposed to be used, and for which registration is sought). It follows, therefore, that dairy product manufacturers will not be able to obtain registered trade mark protection for wholly descriptive elements that appear on pack. Consequently, those elements must be displayed in a letter size that is smaller than, or equal to, the letter size of the product class designation on the main panel of the pack, in order to comply with Regulation 25(7)(a).

Another issue, assuming that a certain product package element that is affected by Regulation 25(7)(a) is capable of registration in terms of the Trade Marks Act, is the fact that it takes, on average, about two to three years to obtain registered trade mark protection for a trade mark, from the date of filing a trade mark application with the Trade Marks Registry. Many dairy product manufacturers who have started aligning their product packaging to be in line with the Regulations, by filing trade mark applications for relevant unregistered trade mark elements that are affected by Regulation 25(7)(a), are still waiting for the Trade Marks Registry to examine those trade mark applications for registrability. Consequently, for many businesses in the industry, compliance with Regulation 25(7)(a) at this stage poses practical difficulties, as a result of the delays at the Trade Marks Registry.

Against this background, and in order to accommodate the industry, DAFF has issued a dispensation in respect of Regulation 25(7)(a). In essence, the dispensation provides that the letter size of trade marks that are still in the process of registration and that have not yet proceeded to registration (i.e. marks that are the subject of pending trade mark applications) may be displayed on pack in a letter size bigger than the letter size of the class designation that appears on the main panel of the product, provided that:

  • in the case of products that are already on the market, it can be shown that an application to register the trade mark was filed prior to 28 March 2016, and that the trade mark does not contravene any other provision ofthe Regulations; and
  • in the case of new products to be launched in the trade, an application to register the trade mark was filed prior to the launch of the product and that the trade mark does not contravene any other provision of the Regulations.

The dispensation also stipulates that, in the event that a trade mark application is unsuccessful (i.e. the Registrar of Trade Marks is unwilling to register the relevant mark as a trade mark), the label of the product must be amended to be in accordance with the Regulations (and, specifically, Regulation 25(7)(a)), as soon as possible. The effect would, therefore, be that the relevant product label would have to be amended to make the relevant unregistrable element the same size as, or smaller than, the letter size of the class designation that appears on the main panel of the product.

It should be noted that the dispensation is not absolute. DAFF may withdraw permission, in terms of the dispensation, to use a trade mark which is the subject of a pending application in a letter size bigger than that of the class designation on pack, should it receive a valid complaint which justifies the withdrawal of such permission. Furthermore, the dispensation will be in force for a limited period only, and will terminate when the next amendment to the Regulations is published in the Government Gazette. This date is uncertain, and the period that the dispensation will be applicable is, therefore, also uncertain.

by Jeanette Visagie | Associate

[Verified by Jenny Pienaar | Partner]

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KING IV™ ANALYSIS SEMINAR

The Institute of Directors Southern Africa (IoDSA) and the King Committee recently invited public commentary on the draft King IV Report on Corporate Governance for South Africa. As a proud partner and sponsor of this Report, Adams & Adams hosted a commentary session in Sandton recently. The Report is the fourth edition, setting out the philosophy, principles, practices and outcomes which serve as the benchmark for corporate governance in South Africa. An update of the previous version became necessary as a result of various developments in corporate governance since King III came into effect in 2009.

The King IV Objectives [Download the Draft Report Here]

The intention of King IV is to:

  • promote good corporate governance as integral to running a business or enterprise and delivering benefits such as (i) an ethical culture; (ii) enhancing performance and value-creation by the organisation; (iii) enabling the governing body to exercise adequate and effective control and (iv) building and protecting trust in the organisation, and its reputation and legitimacy;
  • broaden the acceptance of good corporate governance by making it accessible and fit for application by organisations of a variety of sizes, resources and complexity of strategic objectives and operations;
  • reinforce good corporate governance as a holistic and inter-related set of arrangements to be understood and implemented in an integrated manner, and
  • present good corporate governance as concerned with not only structure and process but also an ethical consciousness and behaviour.

Some King III and King IV Differences

  • The 75 principles in King III have been replaced with 16 principles in King IV.
  • The “apply or explain” requirement will now be “apply and explain”.
  • The test for the independence of directors has been widened.
  • Sector supplements have been included with specific corporate governance guidance to SMEs, non-profit organisations, public sector organisations and entities, municipalities and pension funds.

View THE KING IV INSIGHTS

Event Photos Here

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Competition Commission appoints panel for retail inquiry

Following on from the Competition Commission’s publication late last year of its Terms of Reference for the Market Inquiry into the Grocery Retail Sector, the Competition Commission (“Commission”) on Thursday, 18 February 2016, appointed Halton Cheadle to head the panel for the Commission’s Market Inquiry into the Grocery Retail Sector. Lulama Mtanga and Lumkile Mondi were appointed as panellists.

The Market Inquiry aims to determine whether or not there are features within the Grocery Retail Sector which may prevent, impact or distort competition within the market. To this end, the Commission has, inter alia, identified the following areas of investigation:

1. how the expansion, diversification and consolidation of national supermarket chains, impacts on small and independent retailers in townships, peri-urban and rural areas;

2. how regulations, including municipal town planning and by-laws, impacts on small and independent retailers in townships, peri-urban and rural areas;

3. how buyer groups impact on small and independent retailers in townships, peri-urban and rural areas;

4. how a number of identified value chains impact on the operations of small and independent retailers
in townships, peri-urban and rural areas;

5. the dynamics of competition between local and foreign national operated small and independent retailers in townships, peri-urban and rural areas;

6. what impact long term exclusive lease agreements has on competition within the grocery retail
market sector.

Now that the Panel has been appointed, we await the publication of its administrative guidelines.
The Commission has previously indicated that it hopes to complete the Market Inquiry by May 2017.

The Grocery Sector Market Inquiry is the third Market Inquiry initiated by the Commission after the Amendment to the Competition Act, 89 of 1998, which provided the legal framework for market inquiries. The Healthcare Market Inquiry and the LPG Inquiry are ongoing.

Issued by Adams & Adams | 22 February 2016

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