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Practice Notes

Tackling the increasing delay in Korean trademark examination

As anyone with recent experience of filing trademarks in Korea will already be painfully aware, the examination timeframe has been increasing significantly. In a recent paper published by the Korean Intellectual Property Office (KIPO) and Korea Institute of Intellectual Property (KIIP) (“상표심사처리기간 지연의 경제적 피해액 추정”, August 2024), this topic is discussed in relation to the economic impact caused by trademark examination delays. The majority of data in this article is taken from said paper. For business owners, delays in achieving trademark registration can have severe implications. With Korea being a first-to-file jurisdiction with rights largely based on registered trademarks, there is an inherent risk in using a trademark prior to registration. However, delaying product launches while waiting for examination results leads to lost potential sale opportunities, and if a trademark has to be changed due to a conflict this can also result in costs wasted on product development, marketing etc. Aside from these direct impacts, there are also knock-on effects such as job losses and reduced production while companies delay launching projects, as well as a more general reluctance to innovate and invest in new ventures due to brand uncertainty.  ▒  Causes for the increasing delay The annual number of trademark applications filed and average examination time (i.e. time between filing and examination result) over the last decade is shown in the below table, with the year-on-year percentage difference in brackets: (* Figures for 2024/2025 are estimates) While the number of trademark applications has steadily grown, the increase in examination time is disproportionate. Comparing the 2014 figures with estimated 2024 figures, the number of applications is expected to increase by 69.39% over the 10-year period, while the examination speed is projected to be 200% slower. The increasing delay is primarily attributable to two factors: (1) Lack of manpower The increase in the number of trademark applications was not matched by a corresponding increase in examiners, resulting in a larger caseload per examiner and bottlenecks in examination. The number of trademark examiners increased from 146 in 2019 (~1,500 cases per examiner), to 149 in 2021 (~1,900 cases per examiner), to 175 in 2024 (~1,550 cases per examiner). (Source: Seoul Economic Daily) While the number of examiners has increased, there is still a significant backlog of cases awaiting examination. (2) Increase in requests for accelerated examination A surge in accelerated examination requests diverted resources from general examination. The number of requests grew astronomically from 6,186 in 2018 to 46,744 in 2023 — a more than seven-fold increase over a five-year period. This is mainly attributable to requests for accelerated examination being accepted based on a senior trademark search report prepared by a KIPO-designated agency starting from July 2019. This greatly reduced the burden in requesting accelerated examination and made it easier for applicants to get their applications examined quickly, even if they had no clear intention to start using the mark.  ▒  What can be done? The paper proposes a number of measures aimed at improving the situation: (1) Increasing the number of examiners (2) Utilizing AI to strengthen pre-examination This could include easing examiner burden by implementing an AI-powered similar trademark search engine for use during examination, and improving applicant confidence by developing a pre-filing screening tool that can estimate the chances of a trademark achieving registration. (3) Improving applicant communication This includes increasing awareness of the designated goods/services list that is updated annually (applications only covering pre-approved goods/services are afforded lower official fees and are not likely to be refused based on vague/broad descriptions or misclassification), and alerting applicants of the estimated timeframe for examination. (4) Restricting accelerated examination In response to the surge in requests, KIPO has already stopped accepting accelerated examination requests based on trademark search reports as of January 2024. In order to request accelerated examination, applicants must now rely on other grounds such as (i) they are already using the mark or have evidence showing imminent use is planned; (ii) another party is already using the mark for identical/similar goods; (iii) the applicant received a warning letter concerning their application from another party with senior rights, etc. (5) Shortening the opposition period Even if an application passes examination (i.e. the examiner finds no grounds to provisionally refuse the application), it is still subject to a two-month “publication period” during which any party can file an opposition with the intention of preventing the application from achieving registration. It has been suggested that this period be reduced to 30 days, which would allow non-opposed applications to be registered faster. (In return, opponents may be afforded longer time extensions for preparing their opposition.)  ▒  Final thoughts As discussed, increasing delays in trademark examination can have significant economic impacts, hindering business growth and innovation. With KIPO intimately aware of this situation, we are hopeful that changes will be forthcoming to improve efficiency and bring about a return to a more predictable and business-friendly​ trademark examination system.   Written by Jonathan MASTERS

2024-10-18
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Practice Notes

Proposed law revision to tackle importation of ‘personal use’ counterfeit goods

A proposed amendment to the Korean Trademark Act has been announced which would address the issue of counterfeit goods being shipped into the country by foreign sellers. Currently, there is ambiguity in determining whether such shipments constitute trademark infringement, making it difficult for Customs authorities to block them under the provisions of the Customs Act dealing with intellectual property violations.      ▒  What is changing?   The revision introduces a new clause that defines the act of a foreign seller shipping goods marked with a trademark into Korea as a form of "trademark use". In doing so, "supply" by foreign sellers will be separated from the act of "import", typically carried out by domestic buyers, and this distinction will allow authorities to treat such imports as trademark infringement, even if the seller is overseas and the item is for personal use.       ▒  What is the expected effect?   With Customs authorities having a clear legal basis to seize and block counterfeit goods from entering the country, even if they are intended for personal use, border enforcement is expected to be considerably strengthened with enhanced protection for domestic trademark holders against overseas counterfeiters. At the same time, individual consumers importing goods for personal, non-commercial use will not be punished.       ▒  What is the timeline?    The public have been invited to submit opinions on the proposed changes by 14 October. In the absence of any unexpected developments, the amendments are expected to be promulgated before the end of the year and would take effect immediately.       Written by Jonathan MASTERS and Sang-eun SHIN

2024-09-12
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