The Status of Intellectual Property in Russia and Ukraine

Updated: July 27, 2023

This update was prepared by members of INTA’s Emerging Issues Committee—Embargoes, Sanctions, and Treaty Compliance Subcommittee. It is based on the information they were able to obtain at the time of publication. It is intended to provide broad information on issues of relevance to the intellectual property community with the understanding that, under the circumstances, any of the information may change at any time. Although every effort has been made to verify the accuracy of this article, readers are urged to check independently on matters of specific concern or interest.

Nidia Osorio, Nidia Osorio & Co., Bogota, Colombia
Chair, Emerging Issues Committee—Embargoes, Sanctions and Treaty Compliance Subcommittee

Jon Parker, Gowling GWLG, Dubai, United Arab Emirates
Emerging Issues Committee—Embargoes, Sanctions and Treaty Compliance Subcommittee

Ryan Fox, Kilpatrick Townsend & Stockton, San Francisco, California, USA
Emerging Issues Committee—Embargoes, Sanctions and Treaty Compliance Subcommittee

Alyona Chernoknyzhnaya, IPR Group, Kyiv, Ukraine

Alexander Christophoroff, Ivanov, Makarov & Partners, Moscow, Russia

Valerie Villar, Nidia Osorio & Co., Bogota, Colombia

Olivia Molina, Ojam Bullrich Flanzbaum, Buenos Aires, Argentina

The evolving situation in Russia and Ukraine has affected the countries’ respective intellectual property (IP) offices. Below, in three sections, are updates covering:

1. Operational measures taken by the IP offices/governments, actually or potentially affecting filing, prosecution, and maintenance of IP rights, specifically trademarks and designs;
2. Sanctions issued by various governments affecting the above-mentioned operational measures; and
3. International and bilateral treaties at risk, based on publicly known news and/or facts.

Dates are included throughout to show when information was updated. This page will be reviewed and updated quarterly.

Source: Examination of Applications for Trademarks, Geographical Indications and Industrial Designs of Ukrpatent Continues to Work (Ukrpatent)

* Russia’s law became effective on December 31, 2022, and the instrument of accession was deposited with WIPO on 11 May 2023. The Geneva Act comes into force on 11 August 2023 [source].

¹Russian Federation—physical filings are available, but are subject to higher fees than e-fillings.

Status in Ukraine (as of July 24, 2023)

As of November 8, 2022, the responsibility for IP matters in Ukraine moved a newly created national IP authority—the Ukrainian National Office for Intellectual Property and Innovations (UANIPIO). As of that date, the Ukraine Intellectual Property Institute (Ukrpatent) ceased all activities in relation to the protection of IP in Ukraine.

This came about through the ordinance of the Cabinet of Ministers of Ukraine, dated October 28, 2022 (No 943-r “Some issues of the National Intellectual Property Authority”).

The new UANIPIO was only able to accept hardcopy documents initially, and all other services were temporarily suspended. However, as of November 28, 2022, online filing was launched. It is now possible to file through the online system. Officials have notified users that while online filing is now possible, the electricity supply remains unstable, so this can impact service. The transfer of functions from UKRPatent to UANIPIO continues to progress. Bank account details for UANIPIO have also been published.

In February 2023, the UANIPIO fees were approved and published, coming into force on February 20, 2023 [source].

Press releases show a significant number of filings have been made in the the period between November 8 and the end of 2022 [source], with almost 4,000 IP-related applications filed (of which over 2,300 were trademark filings). In late February 2023, Ukrainian Government officials met with the WIPO Director General to discuss the steps the UANIPIO is taking to safeguard IP rights during the ongoing war [source].

The website for UANIPIO has been launched at https://nipo.gov.ua/ (the English language version is at https://nipo.gov.ua/en/).

In April 2023 the Head of the IP Office, Olena Orliuk, mentioned that NIPO was working with other government organizations within Ukraine to develop mechanisms for dealing with sanctioned assets, including IP assets of sanctioned entities/people.[1] These mechanisms have not yet been brought into effect. The Ukrainian Government has also approved a draft law,[2] the aim of which is both to strengthen the current Ukrainan IP laws and to bring them closer to EU legislation. At this time, it is not known when these changes may come into force.

As expected, all deadlines in Ukraine IP matters have been further suspended until August 18, 2023.It is expected to be extended for a further 90 days prior to the expiration of the current deadline.

Sources:

From 00:00 on November 8, 2022, SE UKRPATENT Will Stop All Its Activities As National IP Office (UKRPATENT, November 7, 2022)

Bank details

Electronic filing resumes (in local language only)

Status in Russia (as of July 25, 2023)

The Russian IP Office (Rospatent) and the Eurasian Patent Office (EAPO) are operating as usual and have not announced any unusual extensions or reinstatements.

In terms of patents, the Patent Prosecution Highway (PPH) procedures involving Rospatent are partially unavailable, as some patent offices are not cooperating with Rospatent.

Update on Management of IP Rights in the Country

In mid-April 2022, a draft law to “…protect the national interests of the Russian Federation, including enduring the security of the state and financial stability, as well as the legitimate interests of organizations, creditors, employees and society, by proposing a mechanism for appointing an external administration to manage organizations…” was registered and sent to the Chairperson of the State Duma.

The draft law is aimed at protecting the rights and legitimate interests of citizens in the Russian Federation in relation to organizations in the Russian Federation in which foreign persons directly or indirectly own more than 25 percent of shares, through the appointment of an external administration. The external administration would last 18 months and can be extended further.

The draft outlines how the appointment could be implemented in two ways, either through transferring the shares of the organization to the external administration for trust management, or the transfer of powers of the head of the organization to the external administration. The appointment would likely be explored if there is a failure to manage the company, if it stops or suspends trading, or if there is a significant reduction in the value of the company.

Under the draft law, where an affected organization is liquidated or starts bankruptcy procedures, there will be powers for the liquidator to replace assets through reorganizing the company by forming a spin-off. Where a spin-off company is created as a result of the replacement of assets, the new company shall have the property and property rights of the organization transferred to it. The shares in the new company can be sold at auction and if there is no buyer, or if the minimum price is not met, then the shares in the new company are acquired by the Russian Federation at a minimum price.

If the draft becomes law, it could mean that in some circumstances, the Russian authorities will have the ability to assume control of such entities, and ultimately transfer the assets including IP rights to a new company, which could then be bought by others in Russia, or move into the ownership and control of the Russian Federation.

The Russian Duma considered and adopted the draft law on May 24, 2022. The draft law was then passed to the President of the Russian Federation, the Council of Federal Assembly of the Russian Federation, and to committees within the Duma for consideration and possible amendments. The deadline for submission of amendments was June 22, 2022.

As of September 2022, there have been no updates following the expiry of the submission of amendments deadline. Further changes may yet be made to the draft law, but the expectation is that any further amendments would be minimal since it has already been adopted by the Duma.

As of July 2023, there have been no updates following the expiry of the submission of amendments deadline—it remains in draft form. Further changes may yet be made to the draft law.

If enacted with minimal changes, this law could have significant impact for organizations that are operating in Russia (and where a foreign partner owns, directly or indirectly, more than 25 percent of shares). In cases where a Russian business is having its activities disrupted due to the impact of sanctions on a foreign partner, the business could be targeted for the appointment of an external administration, which could ultimately lead to the ownership of the Russian business (and its assets including IP rights) being transferred to new owners in Russia, or to the Russian Federation itself.

Sources: Draft federal law “On the external administration for the management of the organization” (Russian Federation)

Please note: The above updates refer solely to the operational status of each country’s respective IP office. They do not reflect the implications of sanctions for brand owners based abroad.

Jurisdiction: Russia
Date: June 3, 2022

Scope: Russian President Vladimir Putin signed Decree No. 322 “On Temporary Regime For Performance of Obligations Towards Certain Rightsholders” on May 27, 2022, prohibiting Russian residents from making license payments to foreign bank accounts of rights holders residing in “unfriendly states” or otherwise supporting sanctions against Russia.

The Decree applies to payments made to the following types of foreign IP right holders:

• Persons from states that have imposed sanctions on Russia (“Unfriendly States”) including persons under their control
• Persons who have supported or publicly called for the imposition of sanctions against Russia and Russian persons
• Persons who have either restricted the use of IP belonging to them in Russia or who have discontinued their business operations in Russia
• Persons who have spoken negatively or publicly disseminated false information about Russia, its armed forces, and Russian state bodies

The Decree establishes that a foreign IP rights holder may transfer rubles from the special O-type account to a bank account outside of Russia only upon authorization from the Governmental Commission on Foreign Investments Control.

Also, unless the foreign IP rights holder has formally consented to the opening of an O-type bank account in its name, Russian persons (licensees) have the right not to make any royalty payments to such foreign person (although retaining the legal right to continue using the relevant IP) until such consent is obtained.

At the same time, the Decree does not apply to the following:

• Foreign IP right holders from Unfriendly States, which duly perform their obligations under their contract with a Russian resident (i.e., who have not discontinued supporting their contractual obligations in Russia)
• IP-related contracts necessary for the importation of medicines, medical devices, industrial, agricultural, and food products into Russia
• IP-related contracts necessary for the provision of communication services (including internet access) and the production or use of computers, software, and servers in Russia
• IP-related payments made by Russian individuals that do not exceed RUB 100,000, if the licenses are purchased to be used for personal purposes

Sources:

• Update: new Russian decree restricts ability of foreign rights holders to collect license payments (Morgan Lewis, May 31, 2022)
• Russia introduces ruble-based payment procedure for IP related contracts (Baker McKenzie, May 30, 2022)

Jurisdiction: Australia
Date: February 24, 2023
Scope: Australia imposes autonomous sanctions in relation to Russia in response to the Russian threat to the sovereignty and territorial integrity of Ukraine. They were first imposed in 2014 and were extended in 2015 and 2022.

The Russia sanctions regime imposes the following sanctions measures:

Restrictions on the export or supply of certain goods

It is prohibited to supply, sell or transfer any of the following goods directly or indirectly to, for use in, or for the benefit of Russia:

• arms or related material
• aluminium ores (including bauxite), alumina and related products
• certain luxury goods
• items suited for use in the  categories of oil exploration or oil production projects in Russia

Restrictions on the import, purchase or transport of certain goods

It is prohibited to import, purchase or transport any of the following goods if they were exported from, or originated in, Russia:

• arms or related materiel
• any goods which originate in or have been exported from the specified Ukraine regions
• oil, refined petroleum products, natural gas, coal and other energy products
• gold exported from Russia

Restrictions on certain commercial activities

It is prohibited to deal with financial instruments issued by, or provide loans or credit to:

• specified publicly‐owned or controlled Russian banks
• specified Russian companies predominantly engaged in activities relating to military equipment or services
• specified publicly‐owned or controlled Russian companies involved in the sale or transport of crude oil or petroleum products
• majority owned subsidiaries or entities acting as agents for any of the above

Restrictions on the provision of certain services

It is prohibited to provide:

• any service which assists with, or is provided in relation to, the supply, sale of transfer of goods listed under ‘restrictions on the export or supply of certain goods’ above, except the items suited for use in certain categories of oil exploration or oil production projects
• financial assistance or a financial service which assists with, or is provided in relation to, the import, purchase or transport of goods listed under ‘restrictions on the import, purchase or transport of certain goods’ above
• an investment service which assists with, or is provided in relation to, the activities listed under ‘restrictions on certain commercial activities’ above
• a service to Russia, or to a person for use in Russia, which assists with, or is provided in relation to:
  • a military activity
  • the manufacture, maintenance or use of arms or related matériel
• certain services to Russia, or to a person or entity for use in Russia, that are necessary for certain types of oil exploration or production projects in Russia, including drilling or well‐testing services.

Restrictions on providing assets to, and dealing with the assets of, designated persons or entities

Travel bans on declared persons
The Australian Government has also imposed targeted financial sanctions on a further 147 individuals including Russian senators and family members of President Putin and Foreign Minister Lavrov. Australia has now sanctioned close to 750 individuals and entities in response to Russia’s invasion of Ukraine.

Sources:

• Russia sanctions regime (Australian Government—Department of Foreign Affairs and Trade, accessed, February 24, 2023)
• Additional Sanctions on Russia (Minister for Foreign Affairs, April 22, 2022)
• Russia sanctions regime (Australian Government—Department of Foreign Affairs and Trade, accessed April 11, 2022)

Jurisdiction: Canada
Date: October 28, 2022
Scope: Canada has matched EU and U.S. sanctions on the same entities and persons, targeting major Russian banks and key Russian individuals, including on President Putin himself and his inner circle. All Canadian banks are prohibited from transacting with the Russian Central Bank and all Canadian businesses and citizens are banned from conducting any business involving Russian sovereign debt.

The Special Economic Measures (Russia) Regulations, the Special Economic Measures (Ukraine) Regulations, and the Special Economic Measures (Belarus) Regulations impose dealings prohibitions on listed persons. In most cases, these measures prohibit persons in Canada and Canadians outside Canada from engaging in any activity related to any property of the listed persons or providing them with financial or related services.

On March 3, 2022, Canada removed the entitlement of Russia and Belarus to the Most-Favored-Nation Tariff treatment under the Customs Tariff.

On March 23, 2022, Canada further amended the Special Economic Measures (Russia) Regulations to add 160 members of the Russian Federation Council, who are now subject to a broad dealings ban. With these names, all members of the Russian Federation Council are now sanctioned by Canada.

On March 24, 2022, Canada further amended the Special Economic Measures (Russia) Regulations to prohibit the export certain goods and technologies to Russia. The Restricted Goods and Technologies List includes a broad range of items in the areas of electronics, computers, telecommunications, sensors and lasers, navigation and avionics, marine, aerospace and transportation. This decision will help to undermine and erode the capabilities of the Russian military.

On April 5, 2022, Canada further amended the Special Economic Measures (Russia) Regulations to prohibit the provision of all insurance, reinsurance, and underwriting services for aircraft, aviation and aerospace products either owned by, controlled by, registered to, chartered by, or operated by entities and individuals who are resident, incorporated, or domiciled in Russia. This amendment also listed an additional nine oligarchs and their family members, as well as regime associates.

On May 18, 2022, Canada further amended the Special Economic Measures (Russia) Regulations to prohibit the export of certain luxury goods and goods that could be used in the manufacturing of weapons to Russia, to prohibit the import of certain luxury goods from Russia, and to list an additional 14 oligarchs, close associates of the Russian regime, and members of their families.

On June 7, 2022, Canada further amended the Special Economic Measures (Russia) Regulations to prohibit the provision of 28 services to the Russian oil, gas and chemical industries, including technical, management, accounting, and advertising services.

On July 7, 2022, Canada further amended the Special Economic Measures (Russia) Regulations to list an additional 29 individuals who are Russian disinformation and propaganda figures and 15 entities involved in disinformation activities. Canada also prohibited the import of certain gold products from Russia, including unwrought gold, semi-manufactured gold, gold powder, monetary gold and jewelry made of gold.

Sources:

• Canadian Sanctions Related to Russia (Government of Canada, October 28, 2022)
• Canada imposes sanctions on 203 individuals complicit in attempted annexation of certain areas of Donbass, Ukraine (Government of Canada, April 27, 2022)
• Sanctions – Russian invasion of Ukraine (Government of Canada, April 19, 2022
• The Sanctions Imposed So Far on Russia from the U.S., EU and U.K. (com, April 6, 2022)
• Update on Canadian Sanctions and Other Economic Measures Against Russia (JDSupra, April 5, 2022)

Jurisdiction: European Union
Date: July 3, 2023
Scope: On June 23, 2023, the EU Council adopted a new package of economic sanctions. One of the most relevant measures is the following:

The package introduces a new anti-circumvention tool that allows the EU to restrict the sale, supply, transfer, or export of specified sanctioned goods and technology to certain countries whose jurisdictions are considered to be at continued and particularly high risk of circumvention.

The European Union Intellectual Property Office (EUIPO) has halted all cooperation actions with Rospatent and the Eurasian Patent Office (EAPO).

The EUIPO pledged support to Ukrainian users and issued a one-month extension of time limits (which began on February 24, 2022) in proceedings before the office for all parties that have a residence or a registered office in Ukraine.

Financial sector:

• Restricted access to EU primary and secondary capital markets for certain Russian banks and companies
• Prohibition on transactions with the Russian Central Bank and the Central Bank of Belarus
• SWIFT ban for certain Russian and Belarusian banks
• Prohibition on the provision of Euro-denominated banknotes to Russia and Belarus
• Prohibition on public financing or investment in Russia
• Prohibition on investment in and contribution to projects co-financed by the Russian Direct Investment Fund

Energy:

• Prohibition on imports from Russia of coal
• Prohibition on imports from Russia of oil, with limited exceptions
• Price cap related to the maritime transport of Russian oil for third countries
• Prohibition on exports to Russia of goods and technologies in the oil refining sector
• Prohibition on new investments in the Russian energy sector

Transport:

• Closure of EU airspace to all Russian-owned and Russian-registered aircraft
• Closure of EU ports to Russian vessels
• Prohibition on Russian and Belarusian road transport operators from entering the EU
• Prohibition on exports to Russia of goods and technology in the aviation, maritime and space industry

Defense:

• Prohibition on exports to Russia of dual-use goods and technology items that could contribute to Russia’s defense and security capabilities
• Prohibition on trade in arms and civilian firearms
• Prohibition on trade in ammunition, military vehicles, and paramilitary equipment

Raw materials and other goods:

• Prohibition on imports from Russia of iron, steel, wood, cement and plastics
• Prohibition on imports from Russia of gold
• Prohibition on imports from Russia of seafood, spirits, cigarettes, jewellery and cosmetics

Services to Russia or Russian persons:

• Prohibition on crypto asset wallet, account, and custody services
• Prohibition on provision of architectural and engineering services
• Prohibition on provision of IT consultancy services and legal advisory services

Media:

The EU has suspended the broadcasting activities of eight Russian state-owned outlets:

• Sputnik
• Russia Today
• Rossiya RTR/RTR Planeta
• Rossiya 24/Russia 24
• TV Centre International

The EU also adopted sanctions against 217 individuals and 18 entities. These include a full transaction ban on four key Russian banks (Bank Otkritie, Novikombank, Sovcombank, and VTB).

Regarding asset freezing in the EU, 877 people and 62 entities are subject to an asset freeze and a travel ban because their actions have been determined to undermine Ukraine’s territorial integrity and sovereignty. The list of sanctioned persons and entities is kept under constant review and is subject to periodic updates by the Council.

Sources:

• Sanctions – The European Union’s 11th sanctions package (Gard, July 3, 2023)
• EU restrictive measures against Russia over Ukraine (European Council – Council of the European Union, February 24, 2023)
• EU response to Russia’s invasion of Ukraine (European Council, May 3, 2022)
• EU adopts fifth round of sanctions against Russia over its military aggression against Ukraine (European Council, April 8, 2022)
• Fifth package of sanctions in view of Russia’s military aggression against Ukraine: EU adopts restrictive measures against an additional 217 individuals and 18 entities (European Council, April 8, 2022)
• Europe Warns Russia Faces New Sanctions for ‘War Crimes’ (Bloomberg, April 3, 2022)
• EUIPO Decision No. EX-22-4 (EUIPO, March 30, 2022)
• EUIPO statement on Ukraine (EUIPO, March 9, 2022)
• S. follows Canada, Europe on Russian aircraft ban (Reuters, March 1, 2022)
• EU restrictive measures against Russia over Ukraine (since 2014) (European Council, 2022)
  

Jurisdiction: France
Date: April 6, 2022
Scope: France is targeting luxury goods owned by Russian citizens in the country. The goal is to seize financial assets, real estate, yachts, and luxury vehicles that belong to Russian personalities under European sanctions.

France announced it would expel 35 Russian diplomats following the mass killings in Bucha, Ukraine.

Sources:

• What sanctions are being imposed on Russia over Ukraine (BBC, April 6, 2022)
• France seizes Russian oligarch’s yacht amid EU sanctions (aljazeera.com, March 3, 2022)
• The list of global sanctions on Russia for the war in Ukraine (CNN, February 28, 2022)

Jurisdiction: Japan
Date: January 30, 2023

Scope: On April 20, 2022, Japan officially enacted a law that revokes Russia’s most favored nation status. The law, which is expected to take in effect in May, and remain in effect until March of 2023 imposes higher duties on most imports from Russia. This change, however, will not impact imports of oil and liquefied natural gas.

Furthermore, Japan has imposed limited transactions with Russian banks, including denying access to SWIFT in the country.

Japan has also frozen assets of specific Russian individuals and financial institutions, including banks, and banned exports to Russia’s military. The Japanese government designated an additional 22 individuals and three entities related to the Russian Federation and 14 individuals who were judged to be directly related with the “annexation” of the Autonomous Republic of Crimea and Sevastopol or the destabilization of the eastern part of Ukraine or who are connected with the eastern and southern part of Ukraine and were judged to be directly related with the “incorporation” act by the Russian Federation and subjected them to the following sanctions.

The Japanese government introduced an export ban to the 49 entities of the Russian Federation, which were designated by the Notice of the Ministry of Foreign Affairs dated January 27, 2023.

Sources:

• Japan introduces further sanctions against Russia (Baker Mckenzie, January 30, 2023)
• Japan Actions on Russia and Russia-related Sanctions (Squire Patton Boggs, April 29, 2022)
• The list of global sanctions on Russia for the war in Ukraine (CNN, February 28, 2022)

Jurisdiction: New Zealand
Date: February 23, 2023
Scope: On March 9, 2022, the New Zealand Parliament passed the Russia Sanctions Act 2022, which allows for sanctions to be placed on individuals connected to Russia’s invasion of Ukraine and targets their assets including certain financial assets, planes, and ships. These sanctions operate independently of the United Nations framework and cover military actions by Russia as well as countries or persons who may be assisting Russia.

The New Zealand government also announced the introduction of a 35 percent tariff on all imports from Russia and that it will be extending existing export prohibitions to industrial products closely connected to strategic Russian industries, namely the information and computer technology industry. As of May 3, 2022, these sanctions are being imposed.

The Government has announced another suite of sanctions against Russia, targeting individuals with strategic relevance to Russia and proximity to Vladimir Putin. Foreign Affairs Minister of New Zealand, Nanaia Mahuta, said it was the second largest round of sanctions yet and, as with other sanctions, these would automatically extend to relatives and associates. Since passing the Russia Sanctions Act in March 2022, New Zealand has sanctioned more than 1000 individuals, 300 entities, and implemented a number of trade measures.

Sources:

• Russia-Ukraine war: NZ Government announces further sanctions on one year anniversary of invasion (New Zealand Herald, February 23, 2023)
• Details of Designations made under the Russia Sanctions Regulations 2022 (New Zealand Government, Foreign Affairs & Trade, May 3, 2022)
• New Zealand introduces new sanctions, tariffs on Russian imports (Reuters, April 6, 2022)
• New Zealand unveils new trade sanctions against Russia (Anadolu Agency, April 6, 2022)

Jurisdiction: Switzerland
Date: February 1, 2023
Scope: On January 25 2023, Switzerland implemented the EU’s 9th sanctions package adopted on December 16, 2022, and is now again by and large in alignment with EU sanctions against Russia. Switzerland thereby also introduced new measures, consisting, among others, of the following:

Extension of the scope of prohibitions:

• The sale, transport, and transit of petroleum products of customs tariff number 2710 obtained from crude oil from or originating in the Russian Federation imported into Bulgaria after December 5, 2022 are prohibited. The respective EU rules in this respect are more detailed and also cover Croatia.
• Inclusion of the mining sector in the existing prohibition concerning enterprises in the energy sector.
• The direct and indirect provision of services in the fields of market and opinion research, technical, physical and chemical examination, and advertising for the Government of the Russian Federation or legal persons, enterprises, or organizations established in the Russian Federation is prohibited.
• Addition of 166 entities to the list of sanctioned individuals and entities.

Sources:

• Suiza implementa el noveno paquete de sanciones de la UE contra Rusia (Baker McKenzie, February 1, 2023)
• Switzerland imposes further sanctions on Russia (Baker McKensie, April 1, 2022)
• The list of global sanctions on Russia for the war in Ukraine (CNN, February 28, 2022)

Jurisdiction: United Kingdom
Date: July 17, 2022
Scope: The Executive Director has issued Decision EX-23-6 granting a further extension of deadlines to all parties to proceedings before the Office that have a residence or registered office in Ukraine.

The extension came into force on May 25, 2023, and extends until September 15, 2023, all deadlines that expire between June 5, 2023, and September 14.

Existing UK government sanctions are targeting Russian banks, with the goal of freezing all Russian banking assets in the UK. Specifically, Russia’s largest bank, Sberbank, is prohibited from clearing payments in Sterling, along with full asset freezing. The UK government was one of the first to propose blocking Russia from using SWIFT.

Along with the United States, the UK is also targeting specific individuals and entities that have ties with the Russian government, such as the Russian airline AEROFLOT.

The UK is imposing a ban on the export of dual goods (goods which can be used for both a military and civil purpose, such as electronics, chemicals, or lasers), a direct hit to Russian manufacturers, and has suspended publicly funded research and innovation collaborations with Russian universities and companies of strategic benefit to the Russian state.

The UK Parliament passed legislation on March 30, 2022, aiming to prohibit maintenance on aircraft or ships belonging to specific sanctioned Russian oligarchs and/or their businesses. The legislation also extended earlier sanctions imposed on Crimea to the territories of Donetsk and Luhansk.

On May 4, 2022, Foreign Secretary Liz Truss announced a ban on services exports to Russia, preventing Russian businesses from doing business with UK services deemed critical to the Russian economy. The new measures mean Russia’s businesses can no longer benefit from the UK’s accountancy, management consultancy, and PR services, which account for 10 percent of Russian imports in these sectors.

On June 23, 2022, the UK introduced a further set of amendments to the Russia Sanctions. This amendment (The Russia (Sanctions)    (EU Exit) (Amendment) (No. 10) Regulations 2022 (Amendment No. 10) enhances the existing restrictions on exports to Russia and the non-government controlled territories of Ukraine. These additional controls include restrictions on goods and technology relating to the following categories:

• Internal repression
• Interception and monitoring
• Defense and security
• Chemical and biological weapons
• Maritime
• Jet fuel or fuel additives

Amendment No. 10 also introduced restrictions on the export to or for use in Russia, of banknotes denominated in Sterling or an official currency of the EU, and prohibits making available, supplying, or delivering such banknotes to a person connected with Russia or for use in Russia. These prohibitions are subject to limited exceptions, for example, for personal use.

In addition, Amendment No. 10 implemented a prohibition on the import, acquisition, supply, or delivery of various “revenue generating” goods, as well as the provision of related technical assistance, financial services, funds, and brokering services.

Sources:

• IP in Russia and Ukraine (CITMA, July 17, 2023)
• Russia cut off from UK services (GOV.UK, May 4, 2022)
• New sanctions targeting Putin’s war leaders (GOV.UK, April 21, 2022)
• Oligarchs’ aircraft and ships targeted through new legal powers (GOV.UK, March 30, 2022)
• Research and innovation sanctions on Russia and support for Ukraine (GOV.UK, March 27, 2022)
• Evolving US, UK and EU Sanctions and Export Controls Target Russia for Ukraine Invasion (cooley.com, March 4, 2022)
• S. follows Canada, Europe on Russian aircraft ban (Reuters, March 1, 2022)
• Ukraine conflict: UK sanctions target Russian banks and oligarchs (BBC, February 24, 2022)
• UK support for Ukraine following Russia’s invasion: Foreign Secretary’s statement 28 February 2022 (GOV.UK, February 28, 2022)
• The list of global sanctions on Russia for the war in Ukraine (CNN, February 28, 2022)

Jurisdiction: United States
Date: April 7, 2022
Scope:
The United States Patent and Trademark Office (USPTO): On March 4, 2022, the USPTO announced that it will no longer engage with officials from either Rospatent or the Eurasian Patent Office.

Effective March 11, 2022, the USPTO will no longer grant requests to participate in the Global Patent Prosecution Highway (GPPH) when such requests are based on work performed by Rospatent as an Office of Earlier Examination under the GPPH. In addition, for pending cases—prior to March 11, 2022, the USPTO granted special status under the GPPH to applications based on work performed by Rospatent—the USPTO will remove that status and return those applications to the regular processing and examination queue, meaning that they will no longer be treated as GPPH applications at the USPTO.

The USPTO also warns that applicants filing international applications under the Patent Cooperation Treaty should be aware that selecting Rospatent as an International Searching Authority or International Preliminary Examining Authority, may not result in the successful processing of international applications under PCT, with relation to possible problems with the transmittal of fees through financial institutions.

It will also be necessary to obtain a foreign filing license from the USPTO before filing any patent applications in Russia and/or Belarus.

On March 22, 2022, the USPTO announced the termination of engagement with Russian officials (Rospatent), the Eurasian Patent Office, and the Belarus IP office.

OFAC: In terms of financial sanctions related to IP rights, the Office of Foreign Assets Control (OFAC) has imposed a total embargo on the Donetsk and Luhansk territories. U.S. persons are prohibited from directly or indirectly engaging in any activities with persons or entities that are located, organized, or resident in these regions.

OFAC also has imposed a blockage on persons and entities with ties to the Russian government. This means cutting Russia’s largest banks and financial institutions from processing payments through the US financial system. Sberbank, Russia’s largest bank, is now subject to direct sanctions, with OFAC requiring all U.S. institutions to close all accounts and to reject any future transactions with the bank. Further, there are also restrictions on accessing financial markets, loans, and transactions with Russian agencies. It is therefore difficult to send payments for transactions in Russia. The goal of the sanctions is to further isolate Russia and to impose obstacles to Russia’s access of foreign capital.

Furthermore, on March 2, 2022, OFAC issued General License No. 13 which permits certain administrative transactions prohibited under Executive Order 14024 (issued on April of 2021, prior to the conflict), “provided such transactions are ordinarily incident and necessary to such persons’ day-to-day operations in the Russian Federation.” General License No.13 also states that this permit has a deadline, for all payments must be made before June 24, 2022. Later, President Biden issued on March 11, 2022, Executive Order 14068 effectually prohibiting almost all transactions with Russia.

Therefore, it remains to be determined whether General License No. 13 is still applicable or whether Executive Order 14068 supersedes it and, if so, whether Executive Order 14068 prevents U.S. IP owners from making payments to Russia to maintain their IP rights.

On May 5, 2022, OFAC published General License No. 31, which finally clears up the confusion regarding the applicability of General License No. 13. The new license authorizes certain IP-related transactions in Russia, including the filing and prosecution of any application to obtain a copyright, patent, or trademark, as well as the payment of renewal and maintenance fees.

OFAC is continuing to impose sanctions, pursuant to Executive Order 14024, on:

• The Russian technology sector, to prevent it from evading unprecedented multilateral sanctions and procure critical western technology, as well as expanding sanctions on 21 entities and 13 individuals to prevent Russia from evading earlier sanctions and acquiring foreign technology.
• The Joint Stock Company United Shipbuilding Corporation, which is the shipbuilding company that develops and constructs Russian warships that have bombarded Ukrainian coastal cities. OFAC is expanding sanctions on 29 entities and 8 individuals related to this activity.
• Sanction against diamond mining enterprises, including against Alrosa, a Russian state-owned enterprise and the world’s largest diamond mining company.

Sources:

• Executive Order 14024 (U.S. Department of the Treasury, April 19, 2021)
• Additional State Department Designations Targeting Russian State-Owned Defense Shipbuilding Enterprise (OFAC, April 7, 2022)
• Treasury Targets Sanctions Evasion Networks and Russian Technology Companies Enabling Putin’s War (OFAC, March 31, 2022)
• USPTO statement on engagement with Russia, the Eurasian Patent Organization, and Belarus (USPTO, March 22, 2022)
• Intellectual Property Update Regarding Russia, Belarus and Ukraine (mondaq.com, March 22, 2022)
• Executive Order 14068 (U.S. Department of the Treasury, March 15, 2022)
• S. Department of Treasury. General License No. 13 (OFAC, March 2, 2022)
• U.S. follows Canada, Europe on Russian aircraft ban (Reuters, March 1, 2022)
• S. Treasury Announces Unprecedented & Expansive Sanctions Against Russia, Imposing Swift and Severe Economic Costs (U.S. Department of the Treasury, February 24, 2022)

Main Question: What international treaties may be violated if, as reported in the news, the Russian Government fulfils threats of expropriating assets of foreign-owned companies or fails to enforce their intellectual property rights?

1. Violation of The European Convention of Human Rights (ECHR)

i. Right to property
European human rights law recognizes the right to peaceful enjoyment of property, makes deprivation of possession subject to certain conditions, and recognizes that States can balance the right to peaceful possession of property against the public interest, according to Article 1 of Protocol 1 to the ECHR.

• The ECHR has interpreted the right to property to include intellectual property:
  • App No 73049/01 Anheuser Busch Inc. V Portugal, 11 Oct 2005: “…intellectual property as such undeniably attracts the protection of Art. 1 of Protocol No. 1.”

Source: Vadi, Valentina. (2009). Trade Mark Protection, Public Health and International Investment Law: Strains and Paradoxes. European journal of international law = Journal europeen de droit international, ISSN 0938-5428, Vol. 20, Nº 3, 2009, p. 773–803. 20. 10.1093/ejil/chp058.

ii. Freedom of Expression
European human rights law recognizes the right to freedom of expression, subject to certain public policy exceptions, according to Article 10 of ECHR.

iii. Interim Measures
Interim measures are applied only where there is an imminent risk of irreparable harm.

• The European Court of Human Rights applied interim measures in the case of the Russian daily newspaper Novaya Gazeta. Applicants asked that the Court indicate to the Russian Government not to interfere with lawful activity of Russian mass media, including Novaya Gazeta, covering the armed conflict in Ukraine, in particular to refrain from blocking content expressing opinions different from the official point of view of the Russian authorities. ECHR084 (2022) 10.03.2022

The Court indicated to the Government of Russia that it should abstain until further notice from actions and decisions aimed at fully blocking and termination of the activities of Novaya Gazeta, and from other actions that, in the current circumstances, could deprive Novaya Gazeta of the enjoyment of its rights guaranteed by Article 10 of the Convention.

iv. Limitations of Fundamental Rights

• According to Article 1 of Protocol 1 to the ECHR, the limitation to these arguments would be that the rights to freedom of property and freedom of expression are subject to public policy considerations.
• The question is whether the Russian Government has a legitimate reason to justify the contravention of the rights to freedom of property and expression, based on what it considers to be the Russian public interest.

2. Contravention of International Treaties (TRIPS Agreement, Paris Convention)

i. Paris Convention

The Paris Convention contains provisions of international public law regulating the rights and obligations of member States. Article 2 includes the general principle of “National Treatment.”

As to dispute resolution, Article 28 regulates disputes between member States concerning the interpretation or application of the Convention. If no resolution is reached, any one of the countries concerned may bring the case before the International Court of Justice.

ii. TRIPS Agreement

The TRIPS Agreement requires WTO Members—Russia is a WTO Member—to provide no less than favorable treatment to other Members regarding the protection of IP, including treating other Members on a Most Favored Nation basis.

Question 1: Rospatent is not enforcing famous marks of “unfriendly countries.” Does this trigger a violation of the “national treatment” clause? See Chapter III Article 41 of TRIPS. What are the arguments?

Rospatent claims it has not materially changed its stance regarding allowing applications for identical or similar marks to mature to registration, though it remains to be seen whether Rospatent will act in alignment with these statements as the state of the hostilities remains highly variable. For example, it has been reported that one particular individual of Russian nationality has filed nearly 100 applications to register famous marks. Rospatent’s handling of these applications will be telling with regard to its stated commitment of upholding its pre-sanctions relative refusal examination. A July 2023 review of applications filed since February 24, 2022, in Russia for several famous marks (e.g., GUINNESS, SMIRNOFF) shows applications largely remain pending further examination. Despite Rospatent’s comments about not changing its examination standards post-sanctions, seemingly nefarious applications continue to be filed. For example, in March 2023 an applicant filed to register EFAC ICCUG, which appears to be GUCCI CAFÉ in reverse.

The head of Rospatent informed the Council on Intellectual Property Issues in April 2023 that trademarks are the fastest growing object of intellectual property in Russia. Applications from Russian applicants are up 15–18 percent year over year. With many companies ceasing operations in Russia and avoiding new filings, the increase might point to Russian applications that aim to fill the void, including by seeking to establish rights over third-party marks.

A reversal by the Intellectual Property Court in October 2022 provides some hope that IP rights will ultimately be recognized and protected. Prior to the hostilities in Ukraine, Coca-Cola objected to Rospatent allowing an application for FANTOLA to register in connection with beverages. Coca-Cola alleged FANTOLA is confusingly similar to its FANTA mark. Rospatent refused Coca-Cola’s objection. On October 11, 2022, well after sanctions were in place in Russia, the Intellectual Property Court reversed Rospatent’s decision and invalidated the FANTOLA registration.

While continued observation of Rospatent’s treatment of newly filed applications will provide clarity as to their examination procedures in practice, the fact that bad actors continue to file applications that would otherwise be refused and the long delay in examining these applications encourages watchers to consider these questions over the long term.

And new challenges continue to arise. As with post-February 2022 nefarious filings, third parties have sought to cancel famous marks for non-use, seemingly with an eye toward then obtaining rights to those famous marks for themselves. For example, hearings on non-use of Disney’s PIRATES OF THE CARIBBEAN and DEAD MAN’S CHEST marks are reportedly scheduled for August 2023. As more and more companies have ceased operations in Russia, the issue of non-use will continue to ripen and could place many famous marks in peril.

The United States continues to view the treatment of intellectual property rights as highly concerning. The Office of the United States Trade Representative identified Russia as a country on its Priority Watch List regarding infringement and mismanagement of intellectual property rights. Special Report 301 found that in 2022, “[t]he overall IP situation in Russia remains extremely challenging. The lack of robust enforcement of IP rights is a persistent problem, compounded by burdensome court procedures.”

Western companies that have been pulling out of Russia have faced significant government interference. In April 2023, the Russian government issued a decree allowing for the state to take “temporary control” over foreign companies’ assets in Russia. The move is described as “urgent action in response to the unfriendly and contrary to international law actions of the United States and its foreign associates.” Under this scheme, the Russian government has applied punitive measures to French food company Danone and Danish brewer Carlsberg as conditions of the cessation of their operations, namely, selling Russia-based assets for half their value and making a “voluntary contribution” to Russia’s war fund in the amount of 5–10% percent of the asset sale price. Any agreement regarding the assets must be approved by the Russian government. While the decree does not include trademarks among a company’s assets, the aggressive move by the Russian government could be extended to intellectual property rights, resulting in a nightmare scenario for brands.

Sources:

• Side Effects in Intellectual Property (The Trademark Lawyer, June 22, 2023)
• Office of the US Trade Representative – Special 301 Report for 2022 (US Govt, April 26 2023)
• Rospatent is Preparing to Launch an Open Trademark Search Service (AK&M April 25, 2023)
• Explanatory Note of Rospatent Concerning the Examination of Recent Trademark Applications Confusingly Similar to Foreign Trademarks Registered in Russia (Rospatent, April 1, 2022)
• Coca-Cola Company won a lawsuit against Rospatent in Russia (Interfax, October 12, 2022)
• Explanatory Note of Rospatent Concerning the Examination of Recent Trademark Applications Confusingly Similar to Foreign Trademarks Registered in Russia (Rospatent, April 1, 2022)

Article 4: Most Favored Nations

With regard to the protection of intellectual property, any advantage, favor, privilege, or immunity granted by a Member to the nationals of any other country shall be accorded immediately and unconditionally to the nationals of all other Members.

There are several exceptions, pursuant to:

• certain international agreements;
• certain provisions of the Berne or Paris conventions; and
• certain rights of performers, producers of phonograms, and broadcasting organizations.

Earlier in 2022, in the Peppa Pig case, a Russian court refused to enforce Peppa Pig’s rights in Russia due to what it referred to as the unfriendly actions of the UK against Russia. Unequal treatment of marks owned by such “unfriendly countries” appears to be a violation of Article 4 and was recognized as such in a reversal by an appellate court in June 2022. However, a Moscow City Court dismissed a case filed by the owners of Peppa Pig claiming copyright infringement by a competing animated series in August 2022. How the appellate courts handle another high-profile case involving IP originating from a country participating in sanctions against Russia might be informative.

Additionally, Russia has been legalizing parallel imports, including a June 2022 vote in its lower house of parliament to advance a bill that removes legal liability for such actions. In effect, Russia’s maneuvers allow Russian businesses to obtain genuine products—most notably those produced by Western nations—without the permission of the trademark owners. As the Trade Ministry issues the list of approved products, rather than blanket permission covering all products, it seems likely that Western nations engaged in sanctions against Russia will be treated differently from those aligned with or otherwise neutral with regard to Russian sanctions.

As discussed above, the Russian government’s seizure of assets from countries it deems unfriendly does not yet involve intellectual property rights but could very easily become a situation where brands from several countries are given disparate treatment by the Russian government.

Sources:

• Temporary Seizure of Danone and Carlsberg Assets Raises Fresh IP Worries for Brands Exiting Russia (World Trademark Review, July 24, 2023)
• Putin Allows Seizure of Unfriendly Foreign Assets (The Moscow Times, April 26, 2023)
• Coca-Cola Company won a lawsuit against Rospatent in Russia (Interfax, October 12, 2022)
• ‘Peppa Pig’ Stuffed in Russia: eOne Lose Intellectual Property Infringement Case Against Vietnamese YouTube Channel Sconnect (Variety, August 12, 2022)
• “The original court decision was an aberration”: Peppa Pig appeal succeeds in Russia (WTR, June 29, 2022)
• Russian parliament votes to scrap parallel import penalties (Reuters, June 7, 2022)
• Explanatory Note of Rospatent Concerning the Examination of Recent Trademark Applications Confusingly Similar to Foreign Trademarks Registered in Russia (Rospatent, April 1, 2022)
• Explanatory Note of Rospatent Concerning the Examination of Recent Trademark Applications Confusingly Similar to Foreign Trademarks Registered in Russia (Rospatent, April 1, 2022)

Article 3: National Treatment

1. Each Member shall accord to the nationals of other Members treatment no less favorable than that it accords to its own nationals with regard to the protection (3) of intellectual property, subject to the exceptions already provided in, respectively, the Paris Convention (1967), the Berne Convention (1971), the Rome Convention or the Treaty on Intellectual Property in Respect of Integrated Circuits. In respect of performers, producers of phonograms and broadcasting organizations, this obligation only applies in respect of the rights provided under this Agreement. Any Member availing itself of the possibilities provided in Article 6 of the Berne Convention (1971) or paragraph 1(b) of Article 16 of the Rome Convention shall make a notification as foreseen in those provisions to the Council for TRIPS.
2. Members may avail themselves of the exceptions permitted under paragraph 1 in relation to judicial and administrative procedures, including the designation of an address for service or the appointment of an agent within the jurisdiction of a Member, only where such exceptions are necessary to secure compliance with laws and regulations which are not inconsistent with the provisions of this Agreement and where such practices are not applied in a manner which would constitute a disguised restriction on trade.

On the other hand, Article 41 relates to specific acts of infringement. The argument here would be that Russia’s failure to enforce trademark rights when dealing with “unfriendly countries” appears to violate the requirement in Article 41 that all procedures be “fair and equitable.” Moreover, this unequal treatment under the law based on a designation of “unfriendly nation” appears to violate the requirement of Article 41 that infringement proceedings “avoid the creation of barriers to legitimate trade” and “provide for safeguards against their abuse.”

Though several companies based in the “unfriendly countries” have voluntarily ceased operations in Russia, some have not. The Russian government has continued to place burdensome requirements on companies from “unfriendly countries” as they seek to wind down their operations in Russia. If Russia’s temporary seizure of assets from unfriendly countries extends to trademark rights or if Rospatent or the IP Courts apply disparate treatment to rightsholders based on their country of origin, such conduct would create a barrier to legitimate trade and Russia would then be failing in its requirements to provide safeguards against their abuse.

Article 41: Enforcement of IP—General Obligations

1. Members shall ensure that enforcement procedures as specified in this Part are available under their law so as to permit effective action against any act of infringement of intellectual property rights covered by this Agreement, including expeditious remedies to prevent infringements and remedies which constitute a deterrent to further infringements. These procedures shall be applied in such a manner as to avoid the creation of barriers to legitimate trade and to provide for safeguards against their abuse.
2. Procedures concerning the enforcement of intellectual property rights shall be fair and equitable. They shall not be unnecessarily complicated or costly or entail unreasonable time-limits or unwarranted delays.

Question 2: What is the mechanism for initiating a claim for TRIPS violation? Is there any case law on this?

Disputes between nations regarding violations of TRIPS are handled by the WTO’s Dispute Settlement Body (DSB) of its General Council. The DSB has authority to establish dispute settlement panels; refer matters to arbitration; adopt panel, Appellate Body, and arbitration reports; maintain surveillance over the implementation of recommendations and rulings contained in such reports; and authorize suspension of concessions in the event of non-compliance with those recommendations and rulings.

A t matter published on February 18, 2022, by the DSB on the topic of trademarks and enforcement of IP rights is somewhat on point. A dispute was filed by the EU against China for introducing and maintaining “a policy which in the context of judicial procedures concerning the enforcement of intellectual property rights in China prohibits patent holders from asserting their rights in other jurisdictions by commencing, continuing or enforcing the results of legal proceedings before a non-Chinese court.” After seeking consultations with China in early 2022, the EU petitioned the DSB in December 2022 to establish a dispute settlement panel to hear the matter. The DSB established such a panel in late February 2023.

Additionally, there was a dispute between the U.S. and China, filed in 2007, regarding several issues, including violations of Article 41 of TRIPS, involving China’s censorship policies as they relate to denial of copyright protection for foreign works that are protected by the Berne Convention. The Dispute Settlement Board found that China’s policy provided unequal treatment and the parties agreed to resolve the issue cooperatively.

Question 3: Does TRIPS regulate expropriation of trademarks because it recognizes IP rights as private rights?

The TRIPS preamble recognizes IP rights as private rights:

“AGREEMENT ON TRADE-RELATED ASPECTS OF INTELLECTUAL PROPERTY RIGHTS AS AMENDED BY THE 2005 PROTOCOL AMENDING THE TRIPS AGREEMENT

Members,

(…) “Recognizing that intellectual property rights are private rights….”

3. Violation of Bilateral Investment Treaties

There are more than 80 Bilateral Investment Treaties (BITs) involving Russia (some are terminated, some are signed but not in force, and others are in force). Notable BITs include:

Generally speaking, the expropriation provisions appear to be that expropriation is not permitted, except if it is:

• In the public interest;
• Not discriminatory;
• Carried out under due process of law; and
• Accompanied by the payment of prompt, adequate, and effective compensation.

An investor has a right to a prompt review by a judicial or other independent authority of the contracting party making the expropriation, in relation to the expropriation and the valuation of the investment being expropriated.

There are also provisions in many of the BITs, in which it appears that, during times of war or armed conflict, there is an expectation of equal treatment by the contracting party looking to expropriate, against the other party, so that they are not treated differently from investors from other countries in terms of compensation for losses.

BITs usually have one or more articles regulating dispute resolution. The most recent treaties have two separate articles: a) one regarding dispute resolution between investors (nationals of one country) and a contracting party; and b) one regarding dispute resolution specifically between the two contracting parties. Also, for most of them, the first response to a conflict should be a diplomatic solution, but if the diplomatic approach does not succeed, then other solutions such as arbitration are next in line.