• IN THE UK OFFICE

    Up in Smoke: Tobacco Promotion After the New Brandsharing Regulations

    Tobacco companies face a yet bleaker future for the advertising of their products in the United Kingdom, following new legislation designed to further curb tobacco promotion. The breadth of the new rules is such that non-tobacco companies, too, must take notice or risk criminal penalties.

     

    The Tobacco Advertising and Promotion (Brandsharing) Regulations 2004

    The Tobacco Advertising and Promotion (Brandsharing) Regulations 2004 came into force on 31 July 2005. Under Rule 3 (1), the use of any name, emblem or other feature which is the same as, similar to or likely to be mistaken for such a feature connected with a tobacco brand is prohibited in respect of non-tobacco products or services, if the purpose or effect is to promote a tobacco product in the United Kingdom.

    Likewise, under Rule 3 (2), the use of such features which are the same as, similar to or likely to be mistaken for features connected with non-tobacco products or services is prohibited in respect of tobacco products or services, if the purpose or effect is to promote a tobacco product in the United Kingdom through the association it has with any non-tobacco product or service.

     

    Impact of the New Rules

    The anticipated effect of the Regulations is to hamstring tobacco companies’ traditional advertising, which has long relied on associations with non-tobacco products or services that increase the “feel-good” factor associated with their brands and thus boost sales. For the tobacco companies, the opportunities for sporting event sponsorships, distribution of promotional items such as keychains and lighters, and the sale of complementary clothing lines, all of which keep tobacco brands in the public consciousness, are fading fast.

    Non-tobacco companies who have ridden on the backs of the tobacco brands’ reputations by producing t-shirts, caps and other memorabilia bearing tobacco brands, or features closely resembling them, will be similarly curtailed, or face fines and other penalties under the Tobacco Advertising and Promotion Act 2002.

    Businesses who have nothing to do with Big Tobacco but who inadvertently adopt and use a brand feature associated with tobacco in the United Kingdom could similarly face penalties, if the unintended consequence or likely consequence of their use is to promote a tobacco product here.

    The Regulations are not intended to trap the unwary, however, even if that might ultimately be their effect. Under Rule 4, such a non-tobacco business will have a defence if it can show:

    • that it was not its purpose to promote a tobacco product, and

    • that it either could not reasonably have foreseen such an effect, or

    • that the brand feature in question was first used in connection with a non-tobacco product or service on or before 1 September 2002 in an area which was then or has subsequently become part of the EEA, and

    • the presentation of the feature does not make it appear that it belongs to the same brand as any tobacco product.

     

    Businesses including those in the tobacco industry are likewise afforded some grace in respect of the use of brand features not associated with tobacco in respect of tobacco products, where:

    • that it either could not reasonably have foreseen such an effect, or

    • that it either could not reasonably have foreseen such an effect,

    • that the brand feature in question was first used in connection with a tobacco product or service on or before 1 September 2002 in an area which was then or has subsequently become part of the EEA, and

    • the presentation of the feature does not make it appear that it belongs to the same brand as any non-tobacco product; alternatively,

    • the business in question does not know that the purpose or effect of the use is, or is likely to be, to promote a tobacco product, and

    • the use does not make it appear that the same source is responsible for the branding of both the tobacco product and the non-tobacco product or service (regardless whether that is in fact the case).

     

    The onus of making out a defence is on the business using the brand feature, however, and some of the concepts set out in the defences are cloaked in ambiguity. It remains to be seen just how much foresight is reasonable, for example, when the unintended consequence of the use of a new brand is to promote a tobacco product, and how much similarity will tip the balance toward the appearance of being in the same brand family.

     

    Impact on Trade mark Registration

    Although the Regulations are concerned with use rather than registration, they are still likely to have an impact on trade mark registrability in the U.K.

    Under Section 3 (4) of the Trade Marks Act 1994, marks whose use is prohibited by law are not registrable. The Patent Office has not finalised its approach to the new Regulations, but it is open to it to raise a S. 3 (4) objection against an application for a mark if it considers that the use of that mark for the goods or services claimed would be likely to contravene the Regulations. The Patent Office has signalled that it is likely to

    cross-search applications for non-tobacco products or services against Class 34, which covers tobacco, and to search Class 34 applications against non-tobacco products and services of the type most commonly used in the past for the promotion of tobacco.

    A S. 3 (4) objection seems most likely to be raised in the case of multi-class applications, or simultaneously co-pending applications, which cover both tobacco products and non-tobacco products or services. In cases where an identical or similar tobacco or non-tobacco mark is already registered, the Patent Office may take the more restrained approach of simply warning applicants that their use could contravene the Regulations.

     

    Comment

    Whatever approach the Patent Office adopts, the onus is firmly on businesses to ensure compliance with the new Regulations. They alone bear the risks if they fail to do so.

    The tobacco industry is likely to have followed the shaping of this law closely, and to be fully aware of the limitations it places on their activities.

    It is the non-tobacco companies with newer brands, and particularly those based abroad, who are most likely to need to take unaccustomed precautions against the effect of the new Regulations. Companies based outside the U.K. are less likely to be familiar with the range of tobacco brands available here, and may be unaware that a brand introduced into the EEA after 1 September 2002 poses a legal risk. A positive result in a trade mark availability search conducted before the Regulations entered into force may not assist if that search was not conducted with an eye on the Regulations, thus including Class 34.

    Although defences are available to such companies, an ounce of prevention is worth a pound of cure and advisors to those launching new non-tobacco brands in the U.K. are likely to recommend searching in Class 34, as well as, in some cases, conducting common law searches to identify tobacco brands in current or recent use in the U.K. but not registered here.

    In the case of non-tobacco brands already in use here but only introduced in the EEA after 1 September 2002, a portfolio review may help to identify unknown risks. The level of risk might often be low, but in other cases modifications to logos or stylisation may be advisable to avoid the unintended appearance of a link with a tobacco brand. The advisability and recommended extent of such a review will depend on the circumstances, but it is likely to be particularly relevant to commercially significant brands. The higher the brand profile, the more likely it is that a breach of the Regulations, however unintended, will be detected.

    The Trade marks Department at Jenkins will be pleased to discuss the Regulations and their impact on your business with you. Please contact us for more information.