Russian countermeasures on intellectual property rights
Russia has announced and implemented several countermeasures against so-called "unfriendly states". Some of these countermeasures involve intellectual property rights (IPR), meaning that entities of so-called "unfriendly states" now face countermeasures limiting the protection of their IPR in Russia. Entities of such states that do not anticipate continuing to do business in Russia can expect to see their intellectual property utilised in Russia without compensation.
We summarise the main points of these developments below. In addition, we provide an overview of recent developments regarding measures adopted by the European intellectual property offices.
Russia has suspended the protection of patents, utility models and industrial designs
The Russian government has adopted a decree allowing Russian local entities and individuals to use inventions, utility models and industrial designs held by owners from "unfriendly states" without the consent from the owner and liability for compensation (Presidential Decree No 299, 6 March 2022). See the list of "unfriendly states" in our 9 March 2022 update here.
The decree is based on an exception pursuant to the Russian Civil Code, allowing the Russian government to, in cases of extreme necessity associated with the defence and security of the state, allow the use of IPR without the owner's consent against a proportional compensation to the owner of the IPR. However, in case of use of IPR covered by the decree, the owner has the right to 0 % compensation.
The consequence of the decree is that inventions, utility models and industrial designs owned by entities from "unfriendly states", which have previously formally been protected in Russia under intellectual property rights, now may be used by Russian companies or individuals, without any compensation to the owner.
Russian courts and Rospatent allowing infringement of trademark rights
Of today, the Russian government has not adopted a decree lifting the protection of trademarks and copyrights. Such countermeasures are being considered by the government related to certain goods, but has not yet been announced, according to the Russian news outlet Tass.
However, in a recent decision (case no A28-11930/2021), a Russian court dismissed a trademark infringement claim from a UK-based company and authorised the use of a version of the trademark Peppa Pigg (a popular cartoon series), without consent to the trademark owner. The Russian court seems to base the decision to authorize the free use of the Peppa Pig character and trademarks on the sanctions imposed on Russia and informal countermeasures against an "unfriendly state".
Considering the recent Peppa Pig decision, there are reasons to except that trademark owners from "unfriendly states" will meet challenges if trying to enforce their rights in Russia against local entities and individuals.
Related to this, there have already been reports of local Russian entities using and applying to register trademarks similar to well-known trademarks, such as McDonald's and IKEA. If such imitation logos are allowed and registered, despite the similarities with another well-known trademark, entities from "unfriendly states" which hold well-known trademarks in Russia may risk losing their exclusive rights and being replaced by local imitators.
Expropriation of intellectual property rights without compensation as a breach of investor rights
The Russian Federation is party to a number of Bilateral Investment Treaties ("BITs"), which generally prohibit the expropriation of investments made by investors of the other contracting party without prompt and adequate compensation. Also, the BITs generally allow investors of the other contracting party to seek redress from the State who is in breach of its obligations in international arbitration, bypassing local courts. The 4 October 1995 Norwegian-Russian BIT expressly recognises intellectual property rights as well as technology, know-how and good-will as investments in the meaning of the BIT. Consequently, a party whose intellectual property rights are used without consent and compensation in Russia may want to consider whether his rights are protected by a BIT and whether arbitration proceedings against the Russian Federation under that BIT may be a helpful remedy.
Measures adopted by regional European IP offices
In addition to the countermeasures adopted by Russia, we call attention to the measures adopted by national and regional intellectual property offices in response to Russia's military aggression against Ukraine. Below is a brief description of the measures adopted by the regional European offices.
The European Union Intellectual Property Office (EUIPO), the office handling EU trademarks and EU industrial designs, has halted all cooperation actions with the Russian Federal Service for Intellectual Property (Rospatent) and the Eurasian Patent Organisation (EAPO). Furthermore, EUIPO has adopted extensions of time limits for parties in proceedings before the Office having their residence or registered office in Ukraine, and will continue to review the need for further extensions and additional measures as we move forward. Read more about EUIPO's measures here.
The European Patent Office (EPO), the office handling European patents, has frozen all cooperative activities with the national offices of Russia (Rospotatent) and Belarus and the Eurasian Patent Organisation (EAPO). Read more about EPO's measures here.
For information about other countermeasures adopted by Russia, see our 9 March 2022 update here and our 5 April 2022 update here.