Before examining the Protocol further, it is important to appreciate the thrust of those agreements that preceded the Protocol, and why they did not gain wide acceptance outside of Europe. The Madrid Agreement Concerning the International Registration of Marks (also referenced as the “Agreement”), which became effective on July 13, 1892, is a special arrangement within the scope of Article 19 of the Paris Convention and only countries party to the Paris Convention may join the Madrid Agreement. The Agreement entered into force with only five member countries - France, Spain, Switzerland, Tunisia and Belgium. Today, over 100 years later, numerous countries [3] are members of the Madrid Agreement.

The Agreement provides for the possibility of obtaining protection of a trademark in several jurisdictions by a single registration called the international registration. The application for such registration is filed at the central registration bureau located in Geneva, Switzerland and administered by the IPO, an agency of the United Nations, through the intermediary of the Trademarks Office of the country of origin. The working language of the International Bureau is French.

Any person or legal entity with a mark registered in his country of origin or domicile may obtain protection for that mark in all the other contracting countries by submitting a single application, filed in one language, such registration having a uniform duration of 20 years, renewable for subsequent 20 year terms, in all the contracting countries. The total fee established by the Regulations governing the Agreement is less than the sum of the national fees which would be required to be paid if a national filing was made in each of the countries party to the Agreement.

The application is entered on the International Register and pro forma applications are transmitted by the Bureau to all member countries designated by the applicant. Those countries then have a period of 12 months in which to reject the application. In the absence of a rejection or a "provisional objection," the mark is deemed registered in the designated countries.

Before being registered internationally, a mark must have been registered nationally with the national office of the applicant's country of origin. [4] Merely filing a national application in the country of origin is insufficient.

The International registration can be obtained for those goods and services covered by the national registration in the country of origin or for a part of those goods and services, but not for any expansion of coverage beyond the "home" or "basic" registration. The Agreement provides that the country of origin is the member country of the Agreement where the applicant has a real and effective industrial or commercial establishment. [5] If no such establishment in a member country of the Agreement exists, the country of origin can be the member country in which the applicant has his domicile (or headquarters). If the applicant satisfies neither of these criteria in a member country, the country of origin is deemed to be the country of which the applicant is a national, provided that country is a member of the Agreement. International registration has no effect in the country of origin. [6] The mark is protected in that country under the general provisions of the national law.

The publication of an International registration is made in the periodical WIPO Gazette (formerly, "Les Marques Internationales"), which is issued by the International Bureau.

The protection resulting from International registration remains dependent on the protection afforded the "home" or "basic" registration for a period of five years from the date of International registration. Therefore, if the home registration terminates for any reason within that period, all registrations based on it also cease, regardless of whether the reason for the home registration's elimination exists in the third country. A challenge to the International registration based on this provision is referred to as "central attack." After the five-year dependency period has expired, the International registration may be attacked only under the individual national laws where the International registration has been extended. However, renewal, changes in proprietorship details and the like, may still be effected in all designated countries by a single filing at the International Bureau.

The fee schedule may be changed by the competent bodies of the Madrid Agreement. [7] The required fees are expressed in Swiss Francs and must be paid in that currency.

The designated countries are entitled to refuse protection in whole or in part. Once a notice of refusal has issued in any of the national offices, the applicant must then proceed with the case under national law and practice. Responses to decisions of refusal should be prepared by the owner of the mark or his local agent, and addressed to the refusing national authority within the time limit and under the conditions indicated in the refusal notice.

Changes affecting the International registration of a mark such as assignment, partial or total cancellation must be notified to the International Bureau for recording in the International Register.

The Agreement originally intended to provide for an International registration, but fell far short of that goal in two respects: the lack of international acceptance, particularly as many non-member countries, including the United Kingdom, the United States, and Central American, South American and Asian countries, such as Japan, were not adherents, which thwarted any attempt at a truly "international" registration; and the International Bureau's mere forwarding of a uniform application to the various member countries rather than registering them in national trademark registers precludes this from being an actual "registration" system. It was because of the necessity for a valid home registration and the possibility of "central attack," whereby cancellation of a basic registration in the first five years causes the entire International registration to fall, and the Agreement's time limit of twelve months within which a National Office must notify WIPO if an International registration is unacceptable in its country, that many of the commercially important non-member nations like the United States, Japan, and Canada, which have a large number of filings at the national level, did not adhere to the Madrid Agreement. The United Kingdom, then and perhaps even now in some circles, did not consider itself part of "Europe" and was not in favor of the Agreement due to the foregoing reasons.

During 1966-67 attempts were made to change this situation by establishing a treaty that would reflect the need of the times rather than the world of the 1890's when the Agreement was adopted. This led to the drafting of the Trademark Registration Treaty (TRT) which was adopted in Vienna in 1973 and entered into effect in 1980 with five contracting states, namely, Burkina Faso, Congo, Gabon, Soviet Union and Togo. In the absence of more accessions to the TRT and the low number of registrations since its inception, it was clear that the TRT was unlikely to supplant, or even stand beside, the Madrid Agreement.

In the mid-1980's WIPO endeavored to draft a new treaty which would ameliorate the "objectionable" provisions of the Madrid Agreement. This was after it was realized that the effort of many years to bring about acceptance by those nations that had refused to adhere to the Madrid Agreement was not likely to bear fruit even after the failure of the TRT. As an entirely new treaty of revolutionary scope was not at all desired by the European nations, the new treaty was to contain some new provisions while simultaneously maintaining the tenets of the existing treaty to accommodate the present Madrid members, particularly the Europeans.

As the actuality of the European Community Trade Mark (CTM) approached, the pressure increased on WIPO to strengthen the Agreement by increasing membership, or by bringing about some amendment and thereby broadening its membership. The pressure was caused by the fear of WIPO that the alternative would have been the decline of the Agreement's importance. This led to several meetings of the Committee of Experts on the international registration of marks in the mid-1980's which resulted in the drafting of two Protocols. Protocol A was intended to amend the Agreement to make it acceptable to more countries while not alienating its present members and Protocol B which in addition to the same amendments, was designed to provide a link between the Madrid System and the CTM in which the CTM office could be designated as another pays intéressé, or designated jurisdiction, of the Agreement, and furthermore a CTM registration could be a "basic" registration on which a Madrid International registration would be based. This proposition is referred to as the "linking provision."

This proposal was closer to the mark, particularly as the United Kingdom indicated its interest. Dr. Arpad Bogsch, then Director General of WIPO, left a mid-1989 United States Trademark Association (USTA) meeting with the understanding that the United States, at least as represented by the membership of USTA, might accept this proposal upon further serious consideration.

In December 1988, the notion of a single Protocol, similar to Protocol B, providing for a link with the CTM, was proposed as the best means of proceeding in lieu of the two Protocols. This "multiple choice" was becoming more confusing to the non-Madrid Agreement nations and resulted in many nations not giving the issue sufficient attention. A meeting of the Diplomatic Conference scheduled for June 1989 resulted in the adoption of a treaty titled "Protocol Relating to the Madrid Agreement Concerning the International Registration of Marks" (Protocol). [8] This Protocol would apply the amendments only to the present non-member countries who chose to adhere. However, it would not apply to the present Madrid members who expressed such satisfaction with the present Agreement that they, at least initially, were not inclined to accept changes. Some delegates from Europe at WIPO meetings and less august gatherings expressed clear disdain for any modification or new Protocols just to bring in the non-European "heretics!" (Those who see no light shall grope in darkness?).

The objectives of the Protocol were to make the Madrid system more attractive to more countries, especially the four EC non-members [9]. Certainly timing was in WIPO's favor. The Community was solidifying, and the United Kingdom politically was moving closer to Europe. Non-member countries, e.g. Canada, Japan, the United States, were still sought by some Madrid Agreement nations. The creation of a link with other intergovernmental trade mark systems, especially the proposed CTM, would be the temptress to many and would also serve to safeguard the continuation and the relevance of WIPO.

Each article in the Protocol covers the same subject matter as the Agreement. Parts of the Protocol even adopted the wording of the Agreement mutatis mutandis. [10] The Protocol however did finally present some important changes.

The Protocol, after a significant propaganda "blitz," has been signed by many countries, [11] including most of the present members of the Madrid Agreement, and some countries that are members of the European Communities, but not of the Madrid Agreement. [12] The Protocol entered into force on December 1, 1995 and became operative on April 1, 1996, according to the Common Regulations under the Madrid Agreement and the Protocol adopted in January 1996.

In order to adhere to the Protocol, many countries have recently modified or contemplated modifying their trademark laws, in addition to the modifications required by GATT-TRIPS/WTO. The United States amended its law to accept trademark applications on the basis of a bona fide intent to use which was a major change and was accomplished after extensive debate and only after some initial resentment at being "pushed around by Europe". Japan revised its trademark law with the official introduction of the International Classification system and service marks. The members of the European Communities have amended their laws to conform to the European Community Harmonization Directive. Trademark laws in several other non-European countries, e.g. India, New Zealand, Malaysia and the Republic of South Africa have also been amended or are also poised for amendment.

Modifications in trademark law usually result in an increased number of trademark/service mark applications at the Trademark Office. It was feared that the onslaught of Protocol applications would produce additional backlog at many already overburdened Trademark Offices where it currently takes over three years to examine applications. It could become considerably worse. The excess workload, coupled with the Protocol time limitations for provisional refusals provides a disincentive for adherence by such countries and could result in granting priority of examination to Protocol applications over national applications. This may result in continuous delays in processing domestic applications, additional risk of citations or objections based on prioritized Madrid registrations or applications. With more marks registered, there could be a decreasing availability of marks for small entities solely for domestic use. Currently, Canada, with an excellent law and practice, fears that the Protocol may result in serious compromise of their examination practice.

The Trademark Offices may also require additional staffing, which will increase the costs of filing domestic applications that are already discouragingly high in some jurisdictions. In the Middle East, e.g. Saudi Arabia or the United Arab Emirates, the fees are best payable by multi-nationals or at least those with the "deepest of pockets."

The major revision of the Agreement in the Protocol is the basis for an International registration. [13] A "home" application instead of a granted registration can be used as a "basis" for an international registration. This clearly results in a treaty for international application, not registration.

If the eventual basic application fails, either within the first five years of the International registration or thereafter, provided the reason for such failure was initiated within the initial five year term, the applicant has the opportunity to reapply in each foreign jurisdiction individually and retain the priority date of the original application as filed in Geneva at WIPO. This proposal was suggested by the Netherlands' delegation and has come to be known as the "Dutch proposal." This only mitigates the procedure of central attack, while not removing it, and was clearly a compromise to bring the members and the non-member nations closer to what it was hoped they could all agree.

It is more difficult in countries with strict examination procedures, including citation of prior possible anticipations, e.g. Canada, Japan, Mexico, Republic of South Africa and the United States to obtain a home registration than in many Madrid member countries. Accordingly, the change in the basis of an international registration is not likely to make a significant difference in these jurisdictions. It should be noted that the anomalous possibility exists where the prosecution of the basic application exceeds the five-year dependency period, after which it makes no difference as to the eventual outcome of the basis on which the International registration was obtained, provided that the outcome was not a result of an action initiated before the dependency period expired. The time limit for notifying refusals being viewed as an impediment to the non-member countries, was also modified: the time limit may be extended under the Protocol. [14] The period in which a national office may issue a provisional refusal is twelve months, unless a contracting party makes a declaration that an 18-month period is required. Before the 18 months expire the national office may be required to notify the International Bureau that oppositions may be filed against the extension and to provide notification of refusal based on an opposition no later than seven months from the date on which the opposition period began. If an application is not refused within this time, the mark is deemed registered. As stated above, in several South American, African and Asian jurisdictions, even the 18-month term would be unrealistic as a trademark is usually examined years beyond this term limit. These time limitations will greatly increase the burden on these Trademark Offices should their countries join.

With respect to fees [15], the applicant for an International registration is required to file one application, pay one fee in local currency, and is not required at least initially, to submit foreign powers of attorney. Renewals, assignment recordals, changes of name and/or address of an International registration may be effected by filing one document with the International Bureau. The payment of a single filing fee and preparation of a single application should result in savings in legal service fees, at least in the initial stages of the application process. It is in this area that many nations come together in recognizing the distinct advantage to their nationals. This provision is a major attraction for adherence. However, it is feared by many "new comers" to the system that the increased numbers of initial applications may prompt designated country trademark examiners to issue a provisional refusal for every reason available, if only to avoid automatic registration and their, initial at least, inability to meet even the 18-month examination term. This may cause additional difficulty and expense for the applicant, who may then be required to prove even obvious points in order to prosecute the application.

The argument that the simplified procedure reduces fees expended by the applicants may not remain true, therefore, where the national applications encounter any objections on the national level due to strict examination practice systems which are prevalent in several jurisdictions e.g. Australia, Hong Kong, New Zealand and Singapore, to name a few. Where a provisional refusal is issued, local trademark agents or attorneys must still be engaged to prosecute the application in the jurisdiction where this "refusal" issues.

It is to be expected that local attorneys and agents once engaged in national filing practice as well as prosecution will charge significantly higher prosecution fees when objections arise in a Protocol application. These fees may then be equal to what would have been expended had the application initially been processed through the local agent; any financial savings thereby evaporating. Local agents will thus recoup the loss of not having filed the national application. It is hard to fault these practitioners as the high prosecution fees will be a result of something of perversion of ordinary economics; supply and demand. The Protocol lowers the supply of cases for the private practitioner but once an Official Action issues the result is the demand for the service of the private practitioner who must charge enough to assure continued existence until called upon to serve again!

In the United States, approximately 80% of trademark applications are initially rejected by the U.S.P.T.O., which means that even though foreign applicants using the Protocol to obtain registration in the United States need not appoint a domestic representative initially, chances are quite high that they will encounter an Official Action which will necessitate the appointment of a domestic representative or attorney.

The trademark law and practice in jurisdictions like Brazil, Canada, Japan and Hong Kong may disadvantage those basing their International registration on a home or basic application particularly as these jurisdictions have lengthy opposition procedures and a successful opposition to the home or basic application would then necessitate the filing of national applications resulting in additional costs.

The basic concept of central attack [16] still exists with what is only a slight modification. An International registration will fail if the basic home application or registration on which it is based is canceled in the first five years of its life. This applies whether cancellation is the result of a successful action by a third party or done voluntarily by the owner of the mark. One major drawback to basing an International registration on a home application, in view of the possibility of central attack under the Protocol, arises in some countries in conjunction with common law rights or rights based upon prior use which is the case in most British law countries, e.g. India, Pakistan, Sri Lanka, Singapore and Australia. Applicants from countries recognizing such rights are more susceptible to attack from common law claims of priority. Such common law attacks thereby increase the likelihood of successful central attacks.

The concept of central attack was modified to allow for the possible transformation [17] of an International registration into a series of national applications in the designated countries in the event of a successful central attack on the basic home registration upon which the International registration is based. The good point is that at least the applicant may claim the priority date of the original International registration. These transformed national applications would have to be filed within three months from the date on which the International registration was canceled, and the goods and services listed in the application must have been covered by the list of goods or services contained in the original International registration. The specter of then starting all over again from the financial point of view is daunting to the applicant and dampens the ardor of many filers and potential adhering nations.

The term of registration [18] of a mark is reduced from 20 years to 10 years. There is a similar movement under the Trademark Law Treaty which provides for 10-year registration and renewal terms. This would require an amendment in the laws of several non-member jurisdictions which currently follow different registration terms.

The Protocol establishes a link with the European Community Trade Mark [19] by providing that any inter-governmental organization, such as the EU, may become party to the Protocol. To do so, the organization must have a regional office for the registration of marks in the territory of the organization, or at least one of the member states of that organization must be a party to the Paris Convention. Once the Protocol is ratified by the European Union, it will be possible for the European Community Trademark Office to be designated in an application for an International registration and, likewise, for a European Community Trademark application or registration to serve as the basis for an International registration.

To those non-member nations not previously party to filing/registration treaties, and without the experience of having choices of filing routes, the parallel existence of the Madrid Agreement and the Madrid Protocol along with national registration and the Community Trademark causes confusion and a question as to whether it is all worth the bother. Under this proliferation of treaties, the practitioner will need to be cognizant of which marks are purely national, Agreement, Protocol or Community registrations, as the rights for renewal, cancellation and transfer recordal will vary. There are also significant economic consequences of the choices that must be compared.

Trademark Offices will need to develop a system for distinguishing International registrations from national registrations. This will result in added record keeping, requiring more personnel and work hours and computerized data bases which do not yet exist in India, Pakistan, Sri Lanka and several other jurisdictions.

Clearing marks for trademark applicants will also be complicated. The rise in registrations under the Madrid Agreement, many with broad goods specifications, has made it increasingly difficult to interpret search results with any reliable degree of certainty.

The Protocol also greatly affects the search of national Trademark Registers particularly in India, Pakistan and several other jurisdictions where searches are conducted manually. The increase in applications will, undoubtedly, result in an increased uncertainty period in search results, as more applications will require more time to enter them on the Register and further delay computerization.

When the United States does finally adhere to the Protocol it will mean that the renewal of International registrations in the U.S. will have to follow a two-track procedure, namely, the actual renewal fees may be paid through WIPO, although it will be necessary separately to file appropriate proof of use as required with all other U.S registrations. Those registrants who renew through WIPO but do not file appropriate proof of use will have the extensions of their international registrations in these jurisdictions canceled by the local trademark offices.

The United States will also retain its maintenance requirements known as the Section 8 and 15 Affidavits, namely, those declarations which must be filed between the fifth and sixth year of registration in order, with respect to the former, to establish that the mark is still in use in commerce in the United States and, with respect to the latter, to establish that the mark is in use and that there are no pending or completed actions affecting the claim of the registrant to exclusive rights in the mark, with the result that the mark will become incontestable. Thus, holders of International registrations which may be extended to the United States would need to comply with such requirements directly with the U.S.P.T.O.

An International application and any future communication pertaining thereto may be in English or in French. Any notification concerning the International application or International registration issued by the International Bureau to an Office or the applicant shall be in the language of the application unless the International Bureau has been asked to issue notifications in a language other than the language of the application. Recordals on the International Register and publication of an International registration in the gazette will be in English and in French. The result of the bi-lingual system necessitates the employment of additional multi-lingual staff at the national trademark offices. Many non-member nations are notoriously monolingual. It has been ever so claimed of the U.S. where it is said that they speak only English, and that hardly.

WIPO applications may not be as demanding as many national offices would like them to be as the application form makes no allowance for specific requirements that may be necessary under national law. Examples include the requirement that applications be verified and signed by the applicant; designation of a factory address as is required in Mexico; and designation of a domestic representative for service of notice or process. One significant exception, as a result of U.S. participation and in deference to the requirements under the U.S. trademark law and possible adherence by Canada, is that a statement of bona fide intention to use may be required by a national office.

The Regulations also provide for the registration of marks with color as a distinctive feature by submitting a color sample of the mark with the application. Some national trademark laws either do not allow for the registration of color marks or place restrictions on the content and method of application.

The Regulations do not regulate the specification of goods that may be defined in an International application, which is left to the requirements under the national law of the home country. As certain national trademark offices will not accord a priority filing date to an application whose specification of goods is too general, a country that demands a detailed description of goods and services may require that Protocol applicants identify goods and services in accordance with the national law, thereby leaving such applicants at a distinct disadvantage. The adoption of the Protocol thus necessitates the adoption of the Nice Classification in such countries where either national or no classification systems currently exists.

The Protocol does not expressly treat assigning a mark along with its goodwill, as required in some countries. Certain countries may permit the assignments of trademarks without the simultaneously conveyance of goodwill of the business subject to the compliance of additional formalities which is the case in most British Law countries. If such a country is a designated territory of an International registration, the question arises whether it must give effect to the assignment of that International registration which does not satisfy the requirements of transfer without goodwill.

Most South American countries by and large still remain very skeptical about adhering to the Protocol having lived for many years without being party to the Madrid Agreement and not believing they have suffered in any way as a result. Perhaps if the United States joins, unofficially it has been said in certain South American circles that if the United States requests certain South American countries to "seriously consider", the attitude might change.

United States accession to the Protocol had been stalled for years over a voting rights issue with the European Union in which the U.S. State Department issued a statement indicating that the United States decided against ratifying the Protocol on the ground that extension of voting rights in the Madrid Union to intergovernmental organizations, most notably the voting rights in the different treaties under the auspices of the European Union, constituted an unacceptable expansion of the role of intergovernmental organizations and would result in concurrent voting and double counting of the European vote and the vote of its member states.

The United States and the European Union finally agreed on a voting formula that is believed to be fair to all parties concerned, and, as noted above, the implementing legislation for the Protocol is now in the latter stages of the legislative approval process in the U.S.

In this era of internationalization and global practice an international treaty harmonizing trademark law and practice is timely. Although the Protocol is not the panacea to the problems of national practice, it is the best system presently available as it, to a certain extent, simplifies trademark filings and may reduce costs. The Protocol, therefore, appears to be worth joining and utilizing.