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Amendments to the Industrial Property Act as amended by ZIL-1E

On 14 March 2020, the Act Amending the Industrial Property Act (ZIL-1E; "amending act") was published in the Official Gazette of the Republic of Slovenia, modifying in particular important elements in the field of trademarks, and to some extent also with regards to patents and designs.

We wrote about the draft amending act in March 2019, and for the most part the amending act remained the same as the previously published proposal. Therefore, we recommend reading our blog post from last March, and here we are adding a few additional points that either differ from the original published draft amending act or are, in our opinion, an interesting step from the previous provisions of the law. Of course, not all changes to the ZIL-1 are covered in these two blog posts.

The amended act entered into force on the fifteenth day after its publication in the Official Gazette, ie. on 29 March 2020. In addition to the amendments already discussed in the previous blog post, paragraph 4 was added to Article 114 of the ZIL-1, which lists the persons who have standing for filing an action for a declaration of nullity of a mark due to the fact that it was registered in contravention of Article 44 of the ZIL-1 (based on the filing date of the application). In that case, the said action may be brought by:

a) the proprietor of the earlier mark;

b) the holder of a previously unregistered trade mark which is used for commercial purposes;

c) the proprietor of the mark, who, without his consent, has been registered in his name by his broker or agent;

d) the person entitled to use the designation of origin or geographical indication;

e) the holder of another previously acquired right.

As mentioned in the first blog post, the amending act introduces some of the basic elements related to intellectual property rights as real rights that can be pledged and transferred. Thus, for example, it explicitly states that the transfer of an entire business also includes the transfer of a patent, design or mark, unless otherwise agreed or unless otherwise indicated by the circumstances. The above has been true in practice so far already, as potential patents, models and trademarks form part of the assets of the company, which when transferred as a whole, is automatically transferred together with the owned assets unless otherwise provided for in the agreement. The very same applies to patent, design, or trade mark applications. It is, however, for example not foreseen that pledges of intellectual property  rights should be entered in the trade mark register at the IP office and that it would therefore be publicly apparent whether a particular trade mark is pledged or not. Access to this information will continue to be available only through the exercise of the possibility in Article 7 (which remains unchanged) of the ZIL-1, according to which, subject to certain restrictions due to secrecy, the Office is obliged to give everyone access to the file relating to the application and to information on applications and rights granted or registered.

Interestinlgy, the new Article 44 of the ZIL-1 states more clearly that the Office does not consider reasons for the refusal of a trade mark ex officio, but only upon objection of a relevant person. Although this has been the case before, many proprietors of trademarks were convinced that the office itself would be aware of these reasons (in particular, that the same or similar registered trademark already exists) and inform them accordingly. Trademark proprietors were (and still are), of course, required to be more diligent and follow up on trademark applications evem before the change of ZIL-1, since their earlier trademark is only considered upon their objection. The introduction of trademark monitoring by the proprietor is therefore strongly recommended.

In addition to the provisions on the use of the trademark, it may be interesting to point out the novelty in Article 47 of ZIL-1, which enables »the customs authorities to act even if the goods are on the territory of the Republic of Slovenia but are not intended for this market and are not in the process of release for free circulation in the Republic of Slovenia. If such goods are discovered and temporarily detained by the customs authorities, the proprietor of the trade mark will have to commence proceedings to determine whether the trade mark right has been infringed, ie. to bring an action for infringement of the right before a competent court. If the court finds in the proceedings that the declarant or the proprietor of the goods has proved that the proprietor of the mark has no right to prohibit the placing on the market in the final country of destination (since he has no mark in that country), he will dismiss the action and the customs authorities will cease to hold the goods and they will therefore be left to the holder of the goods or the declarant.” Therefore, it may be possible to assert rights in the Republic of Slovenia if the goods are retained here, but it will be relevant what rights the holder of the mark has in the country of destination and not in the Republic of Slovenia.

The penal provisions of the ZIL-1 have also been modified to some extent, not only to adjust the currencies of the prescribed penalties from SIT to EUR, but also to change the prescribed amounts. Namely, the amending act distinguishes between legal entities and sole proprietors, and imposes a minimum penalty of EUR 4,000 on legal entities (previously the proposed fine was SIT 100,000 or EUR 417.29).

Matters on which a legal action or legal proceedings were instituted prior to the entry into force of this amending act shall be settled according to the regulations existing to date. Other matters, regardless of whether the right has been registered prior to the amending act coming into force, will be settled according to the amended ZIL-1.