On July 17, 2018, the Ukrainian Supreme Court ruled in Zentiva k.s. v. Alliance Krasoty
that the provisions of the Association Agreement with the European Union should prevail over the national law with respect to the standard for revocation of a trademark due to non-use.
Czech pharmaceutical company Zentiva k.s. filed a non-use revocation action with respect to the trademark bio CRYSTAL, which was registered in the name of Ukrainian company Alliance Krasoty on March 25, 2013. Reg. no. 168112.
The key issue in the case was the inconsistency among the legislative provisions that have been traditionally applied. Ukraine’s national law states that a trademark registration can be revoked when the trademark is not used for three or more consecutive years, calculated from the registration date; however, the EU-Ukraine Association Agreement, which came into force on September 1, 2017, extended the term for non-use revocation to five years.
Despite the Agreement being signed in 2015, its provisions were not implemented by the Ukrainian government until September 2017. Thus, Ukrainian intellectual property practitioners and trademark owners had been anxiously awaiting the first judicial ruling as to which of the two terms should apply.
Zentiva referred to the national law and insisted that the three-year period should be applied; however, the court of first instance dismissed the claim, stating that, according to Ukraine’s Constitution, international agreements are part of national legislation. The court further stated that, under Article 19 of the Law of Ukraine on International Treaties, in case of divergence between the norms of the national law and an international agreement, the international standards are applicable. The court of appeal and Supreme Court both affirmed this decision.
The judgment makes clear that the standards set forth in the EU-Ukraine Association Agreement should apply; furthermore, the decision is likely to affect other disputes concerning inconsistencies between the national legislation and the EU-Ukraine Association Agreement, thus setting an important precedent.
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