By Sepal Bonni

Trademarks Registered as Official Marks by Charities May Soon be ‘Inactivated’

As discussed  in previous Charity & NFP Law Updates, significant amendments were introduced into Canada’s Trademarks Act in 2019. While many of these amendments have already come into force, perhaps the most significant amendment to impact charities will  likely come into force at the end of 2023.

In the past, charities have obtained official marks on the basis of being a “public authority”. However,  in 2002, the Federal Court made it clear that status as a registered charity alone is insufficient to qualify as a public authority for the purpose of obtaining an official mark, and that the test to determine if an organization qualifies as a public authority requires that: (1) a significant degree of control is exercised by the appropriate government over the activities of the body; and (2) the activities of the body benefit the public. Given the Federal Court’s strict test for what constitutes a public authority, most charities that may have formerly qualified as a public authority for registration purposes no longer do.

However, even though these charities no longer qualify, their official marks still remain active. Even if the charities that own the official marks no longer exist, the official marks continue to remain active. This is because with the current official mark regime, once an official mark is approved, it remains on the trademarks register until it is either voluntarily withdrawn by the owner or struck from the register by a successful Federal Court action for judicial review. Both of these circumstances are very rare and, as a result, once an official mark is on the register, it is often perpetual in duration. Even though the charities’ official mark cannot technically be enforced against third parties, the current regime is of benefit to these organizations given that their official marks continue to exist on the registry and therefore block applicants of confusingly similar trademarks. This then often creates an issue for new applicants who wish to register trademarks that are blocked by official marks.

The amendments to the Trademarks Act that will likely come into effect at the end of 2023 will provide a new mechanism for the Trademarks Registrar to declare an official mark invalid where the official mark holder is not a public authority or no longer exists. This will catch many charities that currently hold official marks.

The Canadian Intellectual Property Office has released a draft Practice Notice setting out the procedure for how this may occur. According to the draft Practice Notice, any party will be able to submit a request to the Trademark Office requesting that the official mark be inactivated because the holder is not a public authority, or the holder no longer exists. If the Trademarks Office is satisfied with the request, it will send a notice to the official mark holder requesting evidence of its public authority status. If the official mark holder does not respond or if the evidence is insufficient to satisfy the two-part public authority test, then the official mark will be inactivated.

Although there are advantages to this new mechanism, it will negatively impact many charities that hold official marks. Given that these amendments will likely come into force this year, charities that hold official marks should act now to apply for regular trademarks for any marks that they have as official marks in order to protect them in the future.

​Read the March 2023 Charity & NFP Law Update