Iceland supermarkets frozen out of EU trade mark registrations for ICELAND

In a dispute between Iceland Foods and the Government of Iceland, the Grand Board of the EUIPO has ruled that the UK supermarket chain, Iceland Foods Ltd, may not register a trade mark for ICELAND in the EU. In two separate decisions (R-1613/2019-G and R-1238/2019-G) (together spanning over 60 pages!), the Grand Board confirmed that two contested EUTMs for ICELAND (word and figurative) must be cancelled on the basis that they are non-distinctive.

This case marks an important development in the law regarding the registrability of country names as trade marks in the EU and provides useful guidance on the criteria the EUIPO will apply in cases involving geographical names.
 
Background
 
The Grand Board's decisions are the tip of the iceberg in the long-running dispute between Iceland Foods and the Government of Iceland. The key events are set out below: 

• In 2002 and 2013, Iceland Foods applied to register the mark ICELAND (word) and ICELAND (figurative), respectively. Both EUTMs were registered for a wide range of goods and services in various classes.
• In separate actions filed in 2016 and 2018, the Government of Iceland applied to cancel the ICELAND marks. The EUIPO found that both marks were descriptive of the geographical origin of the goods and services and cancelled the marks pursuant to Article 7(1)(c) of EUTMR, which provides that: 

(1) The following shall not be registered: 
 
(c) trade marks which consist exclusively of signs or indications which may serve, in trade, to designate the kind, quality, quantity, intended purpose, value, geographical origin or the time of production of the goods or of rendering of the service, or other characteristics of the goods or service; 

• The EUIPO also rejected Iceland Foods' evidence that its brand name ICELAND had acquired distinctiveness in the EU. Iceland Foods appealed both decisions.
• Both appeals against the cancellation decisions were referred by the First Board of Appeal to the Grand Board of the EUIPO. For the first time in EUIPO history the appeals were heard before the Grand Board in person.

Decision
 
In great news for the country of Iceland, the Grand Board of the EUIPO dismissed Iceland Foods' appeals. In doing so, the Grand Board confirmed the general considerations that apply when considering geographical names under article 7(1)(c) of the EUTMR, namely:
 

• It is in the public interest that signs that may serve to designate the geographical origin of goods or services remain available for public use. 
• Pursuant to the established body of EUIPO case law, a geographical name is not registrable as a trade mark if it is "either already famous, or is known for the category of goods concerned, and is therefore associated with those goods or services in the mind of the relevant class of persons, or it is reasonable to assume that the term may, in view of the relevant public, designate the geographical origin of the category of goods and/or services concerned."
• If a geographical place is known to the relevant public, it may nevertheless not be associated with the geographical origin of the goods or services. For example, in some circumstances a consumer may not expect the goods or services to originate from the geographical place due to the particular features of the place like size, climate or location. A hypothetical example is the mark "ARCTIC" for tanning products. In these cases, the geographical name may be registrable. 

Applying the above considerations to the mark ICELAND, the Grand Board found that:
 

• The relevant public is familiar with the geographical name Iceland. In making this finding, the General Board placed great weight on the fact that Iceland, although not part of the EU, is an economic partner of the EU as a member state of the European Economic Area (EEA).
• The General Board also found that as at the filing dates, the country Iceland did in fact manufacture, produce and export some of the goods claimed in classes 16, 29, 30, 31 and 32 of the contested ICELAND marks.
• Furthermore, given the fame and reputation of Iceland (the country) it was also reasonable to assume that the relevant public would consider use of the sign ICELAND may indicate the geographical origin of the claimed goods and services.

For example, the General Board found that:​

• Mandatory country of origin labelling in the EU means that the relevant public is likely to perceive ICELAND in a descriptive sense when used on labelling of foodstuff and beverages.
• Iceland (the country) has a strong reputation for fishing, food processing and green energy. Accordingly, the public may perceive that electrical goods like freezers marked ICELAND may hail from Iceland (the country). 

Lastly, the Grand Board also upheld the first instance findings that the supermarket had failed to provide sufficient evidence to prove its marks had acquired distinctiveness in all relevant EU territories. While Iceland Foods owns supermarket franchises in countries within the EU (including three stores in the Reykjavik area of Iceland) and filed evidence showing extensive use of the ICELAND marks in the UK, this was nevertheless insufficient to prove acquired distinctiveness. In rejecting Iceland Foods' submissions, the General Board appeared to place heavy emphasis on the absence of evidence from Denmark, Finland, the Netherlands and Sweden (being places where the word ICELAND may be understood as the country).
 
Comment
 
While there have been a number of EUIPO cases concerning distinctiveness of geographical names (e.g. Chiemsee (1999), Oldenburger (2003) and Passionately Swiss (2011)), the ICELAND decisions indicate that:

• While there is no express prohibition against registering country names as trade marks, moving forward it will be extremely difficult to register the names of countries that belong to the EU or the EEA.
• EUIPO are inclined to accept hypothetical possibilities that goods and services may be perceived to originate from a geographical place indicated by a mark, particularly where the impugned geographical place is economically prosperous.
• Proving acquired distinctiveness for geographical names is a high bar in the EU. The EUIPO's analysis suggests that evidence of trade alone is insufficient. Parties must also prove public awareness of the mark in the relevant countries, for example through surveys, press articles, advertisements, expenditure on marketing and statements by third parties. Furthermore, while Brexit factors were not relevant to the assessment of the evidence in this case (as the trade mark filing dates / cancellation filing dates pre-date Brexit), in the post-Brexit era it may be difficult for businesses who mainly trade in the UK to rely on their reputation in the UK to prove acquired distinctiveness in the EU. 

While the decisions do not strictly prevent Iceland Foods from using the ICELAND trade mark in the EU, it may limit their ability to enforce their rights against third parties using the ICELAND trade mark in EU territories. It will be interesting to see whether Iceland Foods appeals the decision to the General Court.
 
Watch this space for further updates.