The new Malaysia Trademark Act 2019 and the key changes it aspires to bring
Not published yet ago K. SaraswathyIf you have heard about patents and copyright, then you most probably have also heard of trademarks. A trademark is basically a visual identity of your business. It is a type of intellectual property consisting of a recognisable sign, design or expression which identifies products or services of a particular source from those of others. Once a business or organisation registers a trademark under its name as the proprietor, any unauthorised usage of that mark by someone other than the registered proprietor will be in violation of the registered proprietor’s trademark.
For example, lets say you open a new burger joint and decide to name it “McDonald’s”, you will clearly be in violation of the McDonald’s trademark. However, if you decide to name your joint “McRamly” or “McBurger”, then it is highly likely that you won’t be infringing the trademark laws as according to a Federal Court decision following a lengthy legal battle between a Mamak restaurant named “McCurry” and McDonald’s, which stated that McDonald's does not have a monopoly over the use of ‘Mc". However, you still cannot name your joint as “McDonald’s”.
[READ MORE: Here's how Malaysian trademark law protects YOU from getting conned]
If you are an entrepreneur, currently planning on starting a business, an artist or even a media company, you may want to take note of these key changes so that you don’t become the next person facing a lawsuit for trademark infringement (also find out your position if the lawsuit is groundless).
Current Law governing trademark protection in Malaysia
In Malaysia, Trademark law, till date, is governed by the Trademarks Act 1976 and Trademark Regulations 1997. Even though both the Act as well as the Regulations have received a decent number of amendments over the years, however, a fresh Trademark Act is sought to be brought in order for Malaysia to fulfill its International obligation. Thus, Malaysia is currently intending to accede to the Protocol Relating to the Madrid Agreement Concerning the International Registration of Marks (Madrid Protocol), adopted in Madrid on June 27, 1989, to take advantage of the 21st century mega trademark development impacting global business and online entrepreneurship. Malaysia is one of two members of Asean yet to accede to the Madrid Protocol. This strategic move is a follow-up to Malaysia’s commitment to the Asean Intellectual Property Rights Action Plan 2011-2015 that requires member states to progressively accede to the Madrid Protocol pertaining to the Madrid Agreement.
In fact, The Trade Marks Act 1976 (Act 175) was enacted based on the United Kingdom Trademark Act 1938 but that country has abolished it and from studies, the ministry [The Ministry of Domestic Trade and Consumer Affairs] found Act 175 required thorough revision.
The Bill was first presented in July 2019
The first reading of the Trademarks Bill 2019 was presented at the Parliament on April 9 and was debated on 2nd July before passing it in the Dewan Rakyat. Following this, the Trade Descriptions (Amendment) Bill 2019 and Trademarks Bill 2019 were passed with a simple majority following debate among eight MPs. The Protocol is expected to come into force in December 2019 and is intended to repeal the Trade Marks Act 1976, to bring it up to date with current times and treaty obligations. The Bill is a total revamp and overhaul of the current Trade Marks Act 1976.
The new Trademark Act 2019
A total revamp of Trade Mark Act or the introduction of a new act will put Malaysia on a new frontier of trademark development, on international and national fronts.In order to do this there are several changes that will take place following the coming into effect of the new Trademark Act 2019, whereby some of them may dictate and change your ideas while you plan the logos designs and products of your new businesses. Here, we will look into the key features that are added to the new Act.
1. Madrid Protocol and single filing procedure of international applications
First, let us explain what is a Madrid Protocol.
The Madrid Protocol is an international registration system which provides for the registration and administration of trademarks in up to 104 contracting parties through a single procedure, with a single administration, in a single language.:
Hence, with the introduction of the new Trademark Act that accedes to the Protocol, local businesses can now protect their trademarks internationally, in a more cost-effective manner. This means, the local companies can now file an International Application at the International Bureau. From there, these companies can designate the countries they are interested in. This also makes foreign business entities to designate Malaysia for protection of their trademarks.
2. It now includes trademarks on colour, sound and even scent!
Yes, you heard that right!
Under Section 2(1) of the new bill, the definition of sign has been widened and now includes:
"any letter, word, name, signature, numeral, device, brand, heading, label, ticket, shape of goods or their packaging, colour, sound, scent, hologram, positioning, sequence of motion or any combination thereof.”
In other words, the Bill provides recognition to non-traditional trademarks such as shape of goods or their packaging, sound, scent, colour, holograms, positioning and sequence of motion, provided that it is capable of:
- being graphically represented; and
- distinguishing goods or services from those of others.
As in comparison with the present Trade Marks Act 1976, which under Section 3 defines the term "mark" as including:
"a device, brand, heading, label, ticket, name, signature, word, letter, numeral or any combination thereof.”
So before you get all excited for having unraveled the mystery ingredient from your competitor, you may want to make sure that you are not infringing their trademark, as the new trademark law has widened the range of what are considered to fall under trademarks now.
3. There are now remedies available if someone makes groundless threats of infringement proceedings
If you didn’t already know, there is actually a group of people and/or companies known as the “patent trolls” who generally find ways to make money on patent infringement lawsuits. In December 2016, the Malaysian High Court held in Diesel SpA v Bontton Sdn Bhd [2016] MLJU 1350 that the Malaysian courts only had grounds to grant negative declarations even if at all the Parliament amended the Trademarks Act 1976 to provide a remedy for groundless threats of infringement.
The Trademarks Bill 2019, identifying this issue as a possible threat in Malaysia, has sought to provide remedies for groundless threats of infringement proceedings. Hence, Section 61(2) of the new bill elaborates upon the remedies available against groundless threats of infringement proceedings in the form of declaration, injunction or damages. So, if a company or organisation accuses you of infringing their trademarks on baseless grounds, you may rely on more remedies than you may have been able to rely on previously. And with time, maybe the issue of patent trolls will be solved too!
4. Reduction of the registration conclusive period
The Bill shortened the registration conclusive period from 7 years to 5 years, making it more difficult to challenge a registered mark once 5 years have lapsed.
5. Penalties for false representation/ misrepresentation
Under Section 104 of the new bill, any person who is found to falsely represent that a trademark is a registered trademark, makes a false representation as to the goods or services for which a trademark is registered, with the knowledge of it being false, will be liable to a fine not exceeding ten thousand ringgit.
In the current law, Section 9 of the 1976 Act states should anyone be so foolish as to make, or cause another to make, a false entry in the register (including a certified copy of the register deposited in a regional office), he would be guilty of a criminal offence, and liable, on conviction, to a fine of up to RM5,000.00 or to up five years imprisonment, or both. The same penalties could be exacted for making a false document purporting to be a copy of an entry in the register.
Apart from substantive legal changes, there are also a number of procedural and regulatory changes introduced through the Bill
Trademarks are more than just a legal issue. That’s why, apart from focusing on the legal changes, the Parliament had also brought a number of procedural and regulatory changes in the new Bill. These changes briefly include:
- Certificates of registration will not be issued as of right but only upon request by the registered proprietor. Now, a notification of registration by the Registrar will be issued.
- Mandatory procedural requirements must be met in order to obtain a filing date. The requirements will be further specified in the Regulations.
- The application date of a trademark application shall be the filing date, irrespective of whether priority of a Convention application is claimed. However, the priority date will serve as the basis for determining the precedence of rights. Currently, the priority date is deemed to be the application date, but such deeming provision is absent in the new Bill.
You may want to take note of these if you are planning on registering trademark after the new trademark law comes into effect.
As always, reach out to professional advice
While it may all seem pretty straightforward on paper, registering trademarks may not be so easy after all. They involve regulations and requires a certain amount of knowledge, especially when it comes to legal matters and procedures. So, it’s always best to reach out to professional advice.
