Decision 486 of 2000 of the Andean Community sets forth several events that may give rise to the rejection of trademark registration. Said events intend to protect the general interest that is involved in ensuring that no exclusive rights are granted over signs that are not appropriable by the applicant (absolute grounds for rejection) or to protect the private interest involved in prior registrations or other priority rights (relative grounds for rejection).
In addition to the absolute grounds for rejection and the relative grounds for rejection, the Colombian legal framework provides that the Trademark Office may deny registration when available evidence reasonably indicates that the registration has been applied to perpetrate, facilitate, or consolidate an unfair competition behavior by the applicant.
This event must be raised by the affected party as an argument of opposition, which must be supported in evidence that may allow the Trademark Office to reasonably conclude that the applicant has the intention to obtain the registration as an instrument to gain an unfair advantage in the market. A doctrinal discussion exists as to whether the Trademark Office may raise the unfair competition argument ex-officio if opposition from the affected party is not filed.
The Trademark Office is not competent to declare that unfair competition behavior has been committed. Its authority is limited to analyzing the evidence available and determining, based on the evidence, whether it is reasonable to conclude that the application for registration may be an element that contributes to the completion of an unfair competition behavior that may affect the market, the competitors, and the consumers.
The Trademark Office, in analyzing the unfair competition argument, must interpret the provisions of the Unfair Competition Law, and particularly determine if the evidence available reasonably indicates that the applicant is acting against the commercial good faith principle, intends to profit from the commercial reputation of a competitor, intends to create confusion among the consumers or to systematically imitate the commercial initiatives of the competition, except if its conduct is a natural response to the market dynamics.
Said analysis must be performed in the course of the last stage of the prosecution proceeding, namely the substantial review of the application, which follows the formal review, publication, and opposition stages.
Even though the applicant has the opportunity to file defense arguments against the unfair competition claim, the analysis of the evidence made by the Trademark Office is reflected only in the first instance decision. Therefore, it may only be contested by the applicant in the appeal, or subsequently through nullity actions, before the highest administrative courts.
Case law has indicated that the Trademark Office has a duty to reject registration when the evidence shows, through indirect evidentiary elements, that the applicant intends to gain a competitive advantage. To this effect said evidentiary elements must be sufficient to indirectly indicate to the examiner that the parties participate in the same market and that the applicant would benefit from registering a sign which would facilitate, without justification or economic effort, its entrance, consolidation, or increase in market share, and that said circumstances appear to affect the commercial efforts of the competitor.
Thus, the authority of the Trademark Office concerning the unfair competition argument may be interpreted to be preventive and to protect the healthy competition and the interest of consumers.
At Gamboa, Garcia & Cardona we are ready to answer your queries in connection with this interesting matter, and to assist you in the course of the trademark prosecution proceedings where the unfair competition argument may be raised to prevent the registration of a trademark.