Navigating IP rights in Ukraine and Russia 

3.5.2024

Both Ukraine and Russia have experienced significant changes in their IP landscapes as a secondary effect of the war. We look at what rights holders need to be aware of. 

The Ukrainian Patent Office has in fact continued to register, maintain and enforce IP rights since the war broke out. The courts are operating too.

However, certain changes in practice have been introduced. Copies of documents are now accepted in lieu of original ones, and certificates are issued only in electronic format. Under the martial law that is currently in force in Ukraine, all IP deadlines can be suspended or restored within 90 days of the repeal of that law. 

“While the IP system in Ukraine is still operational, processes are understandably often delayed and decision making is almost always postponed. Connecting with local parties is challenging,” explains Riikka Palmos, Senior Partner and Director of Trademarks at Papula-Nevinpat. She’s been specialising in IP for Ukraine and Russia since the 1990s. 

“The war has led to growth in illegal manufacturing and an increase in the number of counterfeit products on the market in Ukraine. Customs authorities and police are active in the battle against this.” 

“The situation in Ukraine underscores the importance of safeguarding IP rights – even in challenging times,” says Palmos. “IP protection is also crucial for the reconstruction of the country. Notably, applications for IP rights are on the rise – including from foreign applicants – giving local businesses and Ukrainian citizens hope for a better future.” 

A mixed picture in Russia

When it comes to Russia, foreign applicants have been concerned as to whether their IP rights are still respected in the country. Despite these uncertainties, recent court decisions indicate that the Russian IP legal system is functioning properly. The courts are issuing legal decisions and respecting international IP treaties. 

IP applications in Russia have actually increased in the past two years, with local companies filing more than before the war started. Foreign filings have decreased by 25-30% over the same period. As some international postal connections are poor, sending original documents may be difficult. Financial restrictions also complicate payments to Russia.

As no official state of war has been declared by Russia, force majeure rules do not apply. The protection, registration and maintenance of IP rights thus continue as normal. IP rights are not under sanctions either. 

“The flip side of this is that the sanctions are not considered a due basis for exceptions to requirements. Rospatent still requires original powers of attorney, for example,” says Palmos. “On the positive side, recent actions by the Russian courts indicate that rights holders from countries deemed unfriendly to Russia are not precluded from defending and enforcing their IP rights in Russia.” 

However, evidence exists that local parties are eager to take over foreign businesses. There is a notable increase in cancellation actions targeting foreign trademark registrations. Unauthorised use of foreign trademarks is on the rise too. 

Immediately after the war began, hundreds of trademark applications were filed by businesses for trademarks owned by foreign trademark holders, or for confusingly similar trademarks. Many of these marks were owned by companies leaving Russia. 

“Rospatent has systematically refused all these bad-faith applications. Fewer are being filed and some have also been withdrawn or abandoned. Brands that would have been affected by these filings include Coca-Cola, Gucci, Instagram and Mercedes-Benz,” says Palmos. 

New trade routes, increased counterfeiting

Despite Russia being under heavy sanctions, foreign products continue to reach Russian consumers through various channels. These include parallel imports and orders from online stores. Goods also reach Russia through member states of the Eurasian Economic Union. 

“There is a notable shift in Russian consumer preferences, with many foreign brands being replaced by alternatives from Asia, Turkey and Russia itself. The risk of counterfeit products entering the country has increased significantly,” says Palmos.

A notable case is the experience of the German brand Bosch. The company closed its factories in Russia and ceased deliveries to the country, but Bosch-branded products – both real and counterfeit – continue to circulate on the market. Bosch has filed more than 100 infringement claims against both individuals and companies.    

“Many of the cases involving obvious counterfeit Bosch goods are being resolved through summary judgements, indicating settlement in favour of Bosch without a full trial,” says Palmos. 

Another prominent case is that of Beautymarket LLC, a Russian entity that filed a trademark application for ‘Latisse’ in class 3. The application was rejected by Rospatent due to potential confusion with a well-known eyelash-growing stimulator from US company Allergan Inc. This rejection happened despite Allergan’s trademark expiring in 2019. 

Beautymarket LLC then filed an appeal to the Russian IP court, which ruled in the applicant’s favour and ordered Rospatent to file the trademark. Rospatent appealed that decision and ruled against the applicant. This was ultimately upheld by Russia’s Supreme Court. 

“The interesting aspect of this case is that Rospatent appealed on its own initiative. Allergan was not a party to the process at all. This is significant, in that the goods of a foreign company without a valid registration – and from a country deemed unfriendly – were still protected in Russia,” says Palmos. 

How to maintain existing rights in Russia?

 Trademark holders with rights in Russia need to stay vigilant to local developments. Photo or video evidence of suspected infringement should be obtained, if possible. Rights holders may then need to send cease-and-desist letters, or even file infringement actions. 

“Remember that Russian trademark law requires the registered mark to be used within three years from registration, or within three years preceding the filing of a cancellation action,” says Palmos. “While these use requirements may be difficult to fulfil in circumstances where business may have been interrupted, the use only needs to be proven in the face of a possible cancellation action.” 

“It’s important to note that use difficulties due to sanctions may not be accepted as a justified reason for non-use. Similarly, parallel imports are probably not accepted as use of a trademark,” she adds. 

Against this challenging background, Palmos recommends brands to consider alternative rights-protection strategies – including licensing or re-filing. However, rights holders need to keep in mind that Rospatent does not allow the re-filing of an identical trademark, so it needs to be styled differently. The list of goods and services should also differ.  

“Trademark holders should familiarise themselves with the abuse of right rule, as the Russian IP authorities take it very seriously,” she cautions.  

“Re-file your rights as early as possible. Do not ignore a letter of consent inquiry from a Russian company, as it probably means you are already involved in an upcoming dispute.” 

 “Make sure your contact details at Rospatent are up to date so that you receive all enquiries and notifications. Otherwise, there may be a risk of losing rights without prior notice,” concludes Palmos. 

 You can also watch the webinar on the subject here.

 

  

News

Papula-Nevinpat in WIPR: IP rights in Ukraine, survival in difficult circumstances and sparks of hope

Read the article about the current IP rights' situation in Ukraine in the latest issue of the World Intellectual Property Review (issue 1/2024) written by European Trademark Attorney Riikka Palmos.

Foreign applicants filed fewer patent applications in Russia last year compared to 2022

A decrease in filings from US applicants has led to China emerging as the top country of origin for foreign patent applications in Russia. Read more about the patent filing statistics.

The landscape of IP rights in Russia amidst geopolitical tensions, The Trademark Lawyer 2/2024

Papula-Nevinpat's Riikka Palmos has written an update on the landscape of IP rights in Russia amidst the geopolitical tensions.

Navigating IP rights in Ukraine and Russia 

Both Ukraine and Russia have experienced significant changes in their IP landscapes as a secondary effect of the war. Read to learn what rights holders need to be aware of.