On October 1, 2014, Federal Law No.35-FZ “On Introduction of amendments to parts one, two and four of the Civil Code of the Russian Federation and certain legislative acts of the Russian Federation” March 3, 2014 (hereafter the “Law”) came into effect.

These changes were aimed at improving the legislation on intellectual property (IP). The amendments largely affect all the chapters of part four of the Civil Code of the Russian Federation. The majority of the amendments came into effect on October 1, 2014, but some of the changes will take effect on January 1, 2015. The updates should promote better and more reliable protection of exclusive rights to intellectual property.

Here we offer an overview of the most significant changes, reflected in the Law.

One of the most fundamental changes affected contracts in the field of IP and the disposal over intellectual rights:

• Firstly, the registration of contracts on the disposal over exclusive rights provides for registration of the transfer of rights based on an application of the parties under contract, not the contract itself. The given procedure should expedite the registration process and the disposal over rights.  However, this applies only to certain IP rights, namely, trademarks, patents and topographies of integrated circuits (Art. 1232 of the Civil Code).
• Secondly, a ban has been established on the gratuitous alienation or granting of exclusive rights in relations between commercial organizations (Art. 1234 and 1235 of the Civil Code).
• Thirdly, the licensor has the right to unilaterally refuse to fulfill its duties if the licensee breaks the conditions of paying compensation (Art. 1237 of the Civil Code).
• Fourthly, a new mandatory condition of the license agreement was introduced as regards granting the right to use a trademark – a list of goods and services (Art. 1489 of the Civil Code).

Patent Law

The most significant change is the opportunity to choose how to receive compensation – either by claiming damages pertaining to the violation of patent rights or through a penalty for violating these rights in the form of compensation ranging from 10,000 to 5,000,000 rubles or the equivalent of twice the value of the right of use (effective January 1, 2015).

Trademark Law

New grounds were introduced for denying trademark registration. Specifically, a ban on the registration of designations containing as their elements the means of individualization of other persons or which are confusingly similar to them. This also applies to the names of famous Russian works of science, literature or art, characters or quotations from such a work, a work of art, or a fragment thereof, or a name, nickname or a derivative of their designation, a portrait or a facsimile of a famous Russian person (Art.1483 Civil Code) .

With regard to letters of consent, some revisions were introduced. According to these revisions, the submission of a letter of consent from an owner of a collective or well-known trademark is not allowed. The existence of a consent does not guarantee registration of a similar designation if the agency believes that such registration could mislead the consumer. A ban was introduced on the withdrawal of consent (Cl.6 Art. 1483 of the Civil Code).

Other Changes

The notion of trade secrets (know-how) has been clarified.  In accordance with amendments to the Civil Code of the Russian Federation concerning production secrets, amendments were introduced to the Commercial Secrets Law. As a result of this, the application of the trade secret regime became possible not only with respect to the production secrets, but also to the data that has commercial value due to the fact that it is unknown to third parties.

The approach to calculation of time limits has been changed. Now the time limits are calculated starting from the date the document is sent by the agency, and not on the date the applicant receives it.  At the same time, all deadlines have been extended by one month.

The principle of seniority is applied in the case of conflict between industrial designs and trademarks (Art. 1252 of the Civil Code).

Now all intellectual property rightholders are required to notify Rospatent of any changes in their information.

Additional notes

Should any questions arise in connection with the above or if you need any additional materials, please contact Irina Onikienko, St. Petersburg Office of Capital Legal Services or Ekaterina Ustinova, Moscow Office of Capital Legal Services.

This Information letter keeps the clients of Capital Legal Services and other interested parties abreast of information that may, to any extent, affect their activity or cater to their particular interests. The opinions and commentaries expressed in this information letter shall not be deemed as legal opinions and do not cancel the need to obtain legal advice or legal opinion on separate issues.