Trade marks – Absolute grounds for refusal to register

In the above-mentioned judgement, the European Court of Justice (the “ECJ”) set aside the judgement of the Court of First Instance of the European Communities (the “CFI”), in which the CFI found that the Office for Harmonisation of the Internal Market (Trade Marks and Designs) (the “OHIM”) had not infringed Article 7(1)(b) of Council Regulation (EC) No. 40/94 of 20 December 1993 on the Community Trade Mark (the “Regulation”) by refusing to register as a community trade mark the term “SAT.2” in respect of services which are connected with satellite broadcasting.

Article 7(1)(b) of the Regulation states that trade marks which are devoid of any distinctive character shall not be registered as a community trade marks (the equivalent of Article 3(1)(b) of the First Council Directive 89/104/EEC of 21 December 1988 to approximate the laws of the Member States relating to trade marks). OHIM refused to register trade mark “SAT.2” claiming that both parts of the expression, a word part “SAT”, as well as the digit “2”, are devoid of distinctive character, therefore, such expression is as a whole devoid of distinctive character and cannot be registered as a trade mark.

The ECJ mentions in compliance with its previous case-law that the essential function of a trade mark is to enable the consumer to distinguish the goods or services of one individual or undertaking from the goods or services of other individuals or undertakings. In order to determine whether a certain sign is capable to fulfil such function, it is appropriate to take the viewpoint of the relevant public, which must be deemed to be composed of the average consumer, reasonably well informed and reasonably observant and circumspect. In addition, each of the grounds for refusal to register mentioned in the Regulation is independent from the others and must be interpreted separately and in the light of the general interest which underlies each of them.

In case of a trade mark composed of different words or of words and digits, each part of such trade mark may be assessed separately, but must in any case be also appraised as the whole. The mere fact that each of the elements forming a trade mark is devoid of distinctive character when considered separately does not mean that their combination cannot present a distinctive character.

The CFI assessed the sign “SAT.2” essentially by means of a separate analysis of each of its elements, instead of basing its assessment on the overall perception of that word as a whole by the average consumer.

The CFI further based its judgement on a criterion according to which trade marks which are capable of being commonly used in trade for the presentation of goods and services in question cannot be registered. That criterion is relevant in the context of Article 7(1)(c) of the Regulation (stating that 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 rendering of the services, or other characteristics of the goods or services, cannot be registered), however, it is not relevant in assessment according to Article 7(1)(b).

Finally, the ECJ concludes that although the way in which the term “SAT.2” is made up is not unusual and combination of word “SAT” with a digit “2” separated by a “.” does not reflect a particularly high degree of inventiveness, those facts are not sufficient to establish that such a word is devoid of distinctive character. Registration of a sign as a trade mark is not subject to a finding of a specific level of linguistic or artistic creativity or imaginativeness on the part of the proprietor of the trade mark. It is sufficient that the trade mark is capable for the relevant public to identify the origin of the goods and services protected by it and to distinguish them from those of other undertakings.