By ECTA International Trade Committee

EU has recently noticed that the Russian Government and Russian courts have been taking actions to illegitimately strip intellectual property rights from holders in Member States, giving the Russian industry an unfair competitive edge and boosting Russia's revenues, which in turn support its war efforts in Ukraine. To counteract this, Council Regulation (EU) 2024/1745 (Regulation) of 24 June 2024 “amending Regulation (EU) No 833/2014 concerning restrictive measures in view of Russia’s actions destabilizing the situation in Ukraine” imposes restrictions on accepting intellectual property registration applications in the Union from Russian nationals, residents, and companies.

Applications for registering IP rights of Russian Applicants shall not be accepted

Article 5s of the Regulation provides that intellectual property offices and other competent institutions constituted under the law of a Member State, or the Union shall not accept:

(a) new applications for registration of trademarks, patents, industrial designs, utility models, protected designations of origin, and geographical indications filed by Russian nationals or natural persons residing in Russia, or by legal persons, entities or bodies established in Russia, including if jointly filed by a Russian national or natural persons residing in Russia, legal persons, entities or bodies established in Russia with one or more non-Russian natural or legal person resident or established outside of Russia;

(b) any requests or submissions filed by Russian nationals or natural persons residing in Russia, or by legal persons, entities or bodies established in Russia during the registration procedures before such intellectual property offices related to any of the intellectual property rights referred to in point (a).

These restrictions shall not apply to nationals of a Member State, of a country member of the European Economic Area or of Switzerland, or to natural persons having a temporary or permanent residence permit in a Member State, in a country member of the European Economic Area or in Switzerland.

This means that intellectual property offices and other relevant institutions should not accept such applications. However, the offices are not required to formally refuse these applications, allowing for the possibility of re-filing once the restrictions are lifted. To enforce this restriction, the offices should be able to request necessary information from applicants to verify their eligibility.

Additionally, the Regulation also requires EU companies to include in their contractual arrangements with third-country commercial parties an obligation that their transferred intellectual property rights, trade secrets, or protected materials and information will not be used, by them or their sublicensees in connection with high-priority items sold, supplied, or exported to Russia or for use in Russia. Companies must report any detected breaches to the national competent authorities. For contracts made before 25 June 2024, the obligation is considered fulfilled if the contract contains a general clause prohibiting the use of the specified intellectual property and trade secrets, along with adequate remedies for breaches.

Do the new restrictions apply to pending applications and registrations?

The Regulation does not explicitly mention whether the new restrictions apply to applications or registrations filed before the implementation of these rules. The text specifies that intellectual property offices and other competent institutions:

1. Shall not accept new applications for registration of various intellectual property rights (trademarks, patents, industrial designs, etc.) filed by Russian nationals or entities after the implementation of the rules.

2. Shall not accept any requests or submissions from Russian nationals or entities during the registration procedures after these rules are in effect.

The emphasis is on "new applications" and actions "during the registration procedures," implying that these rules should apply to applications and requests made after the date of enforcement. Accordingly, it should be interpreted that existing applications or registrations filed before the implementation of these rules are not directly addressed by these provisions.

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