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Would the following Hike in Intellectual Property Fees in GCC story have anything to do with the fall in the price of oil and gas or as put forward here due to GCC’s new internal as well as interstates coordination ?  This article written by a team of BQ discussing with Katie Montazeri, partner at DLA Piper Middle East LLP who expertised the trend in the domain was published on October 23, 2016. It clearly shows that there is indeed some sort of inverted proportionality relationship between the two segments of these countries’ economies.

Hike in IP fees in GCC – who’s gaining?

As the fees for protecting one’s brand rises, small businesses opting for non-registration of trademarks could face risk from unscrupulous competitors

Intellectual property fees spiked recently all across the GCC, in some countries as much as 6,200 percent, making the registration of patents, trademarks or design among the most expensive in the world.

In the last couple of months Bahrain and Kuwait raised their intellectual property fees more than just significantly, while Saudi Arabia and the UAE did the same last year. According to the local media reports, in Kuwait, the official cost for registering a trademark is due to increase this year from the USD 25 to USD 1,586, while in Bahrain registration fees will be raised by 728 percent from USD 160 to USD 1,325.

In Saudi Arabia, since last year fees for renewing trademarks jumped from USD 80 to USD 800. Last March, in the UAE the same fee has gone up by 99.9 percent and now is USD 2,725.

katie-montazeriExplaining the consequences of those decisions, Katie Montazeri, partner at DLA Piper Middle East LLP, says that last year’s unexpected 100 percent rise in many of the official fees charged by the UAE trademark office meant that the UAE was now among the most expensive countries in the world in terms of filing a national trademark application. DLA Piper is a global law firm with lawyers located in more than 30 countries throughout the Americas, Europe, the Middle East, Africa and Asia Pacific.

THE IMPACT IS PARTICULARLY SIGNIFICANT BECAUSE THE UAE ALSO HAS A MONOCLASS SYSTEM, MEANING THAT A SEPARATE APPLICATION MUST BE FILED (AND PAID FOR) IN EACH RELEVANT CLASS. NOT SURPRISINGLY, IT APPEARS THAT THE FEE INCREASE HAS LED TO A DECREASE IN THE NUMBER OF TRADEMARK FILINGS RECEIVED PER MONTH BY THE OFFICE

“The impact is particularly significant because the UAE also has a monoclass system, meaning that a separate application must be filed (and paid for) in each relevant class. Not surprisingly, it appears that the fee increase has led to a decrease in the number of trademark filings received per month by the office. In my experience, businesses are continuing to file trademark applications in the UAE, but they are taking a more conservative approach to the number of classes to be covered. It remains to be seen whether this will have an impact on enforcement in the longer term,” stated Montazeri.

The Qatari office of Abu Ghazaleh Intellectual Property (AGIP) had something similar to say. “The number of applications that will be filed at the trademark offices in each country of the GCC will be reduced,” their Doha-based agents said and added that small businesses, law firms and ministries of trade will be the most affected by such high fees for intellectual property registration and renewal.

According to Montazeri, many international brand owners would simply absorb the additional filing and renewal fees as the cost of doing business in the region. “For them, the need for brand protection is greater than the deterrent effect of high costs. SMEs are most likely to find the increases prohibitive and may defer registration or even decide that trademark registration is not affordable, potentially placing their brands at risk,” he said.

“Interestingly, the IPO (intellectual property owners) in the European Union recently reduced their fees as a means of making the EUTM (European Union Trading Mission) more attractive to SMEs. It would benefit SMEs in the GCC if a discounted rate would apply for applicants whose turnover or number of employees (for example) falls below a certain threshold. This would also help to support national initiatives to encourage inventors and innovators in line with the UAE’s emphasis on innovation and the knowledge economy,” Montazeri added.

Others will follow

In Qatar, according to the web pages of Ministry of Economy and Commerce, a total fee of QR 1,000 (USD 274) should be paid upon submission of the application and another fee amounting to QR 325 (USD 89) is collected after the application is accepted and the registration of trademark is announced in the official gazette.

If a four-month period starting from the date of publication, elapses without an objection being raised, a trademark registration certificate is granted upon payment of a total of QR 2,025 (USD 556). So the total cost of trademark registration in Qatar would be QR 3,350 (USD 920), which is, at least for now, less than in Kuwait or Bahrain. The trademark certificate is valid within Qatar for 10 years from the issuance date and can be renewed for another 10 years.

SOME COMMENTATORS HAVE SUGGESTED THAT THE INCREASE IN FEES IS LINKED TO THE INTRODUCTION OF THE UNIFIED GCC TRADEMARK LAW AND THE NEED TO FUND IMPROVED TECHNOLOGY SUCH AS PUBLICLY ACCESSIBLE IP (INTELLECTUAL PROPERTY) DATABASES

But, Montazeri feels the remaining GCC member states (Oman and Qatar), too might follow the example of their neighbors, in preparation for the introduction of long-awaited unified GCC trademark law. “There have been corresponding increases in the fees charged by the trademark offices in both Kuwait and KSA, and it seems likely that other GCC countries will follow suit. Some commentators have suggested that the increase in fees is linked to the introduction of the unified GCC trademark law and the need to fund improved technology such as publicly accessible IP (intellectual property) databases,” she told BQ.

“If so, then the longer-term effect on the GCC economies is likely to be positive because digitalization and ease of search facilities is an area where the GCC is less sophisticated than other regions and businesses would benefit from more advanced filing and search technology. However, the short-term impact of these increases (particularly on SMEs) combined with the monoclass system, which requires multiple filings, is significant. It will be interesting to assess what (if any) impact the increases have on the UAE trademark office’s revenue and on the number of filings from businesses within and outside the UAE,” Montazeri added.

Read more in the original document at the above mentioned address

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