Kathmandu. The Supreme Court’s verdict has been implemented to give a message that registering a trademark with a name similar to an established brand in the market does not get legal protection.
The Department of Industry (DoI) has revoked the trademark registration of ‘Perfect Center Feels’ sold in Nepal after it was found to be deceptively similar to the popular chewing gum brand ‘Center Fruit’. The Department of Industry (DoI) has revoked the trademark registration of Perfect Center Filz on the basis of a Supreme Court ruling that the trademark ‘Center Fruit’ was used in violation of the trademark of Italy’s multinational confectionery company Perfect Van Meili S. p. A. According to the records of the Department of Industry, the trademark registered in the name of Perfect Foods Pvt. Ltd., Duhabi, Sunsari, has been revoked by the departmental decision. Perfect Foods had initiated the trademark registration process for chewing gum products through application number 061822 under class 30.
In this dispute reached the Supreme Court, the main basis is not the similarity between the words of the two trademarks, but the impact of them on the general consumer.
In Case No. 077-CI-0301, the Supreme Court concluded that there is a substantial similarity between ‘perfect center fruit’ and ‘center fruit’ which can confuse the general consumer.
The Court has held that a mere comparison of names or letters is not sufficient to test the similarity of a trademark.
The legal analysis of the judgment states that the pronunciation of the trademark, the visual appearance, the nature of the product, the place of sale, the attention given by the consumer during the purchase and the overall impact of the market should also be evaluated.
The overall effect on the trademark is more important than the word
During the controversy, Perfect Foods claimed that the name of its company, the packaging of the product, and other words used in the trademark were different. The company had also argued that since words like ‘center’ and ‘fruit’ are in common use, their use does not create confusion among consumers.
However, the Supreme Court has given priority to the impact of the mark on consumers rather than analyzing the words used in the trademark separately, according to the legal analysis. “Centre Fruit, which has been used in the market for a long time and has established its identity among consumers, has acquired a unique business identity,” the court said in its verdict.
In such a situation, the inclusion of additional words such as ‘perfect’ or ‘feel’ in the trademark does not automatically eliminate the possibility of confusion among consumers.
Nirav Gyawali, a lawyer who has been advocating in the business sector, said that this decision has set an important precedent to discourage the trend of misleading consumers by using symbols similar to established brands. According to him, it is legally important to approach a trademark dispute in terms of the overall impact on the consumer, not just the similarity of words or names.
This decision is also seen in connection with the protection of intellectual property in Nepal and the environment for foreign investment.
Amir Raj Thapa, General Manager of the American Chamber of Commerce (MCHAM), said that policy stability along with effective legal protection of brand and intellectual property is necessary to attract foreign direct investment in Nepal. He expressed the view that such steps will help in creating an environment that ensures the commercial interests of investors and the legal protection of established brands. According to Thapa, the court’s verdicts on the protection of established brands and intellectual property and their effective implementation can further strengthen the confidence of international investors in Nepal. For multinational and foreign companies investing in Nepal, the legal protection of the brand is considered an important aspect of investment protection.
“A sign that is too similar to an established brand cannot be considered legally protected just because it has a certificate of registration,” the judgment said.
The Patent, Design and Trademark Act of Nepal, 2022 provides for the cancellation of registered trademarks.
According to Section 18(3) of the Act, the Department of Industry has the power to cancel the registration of the trademark in the prescribed circumstances.
Similarly, Section 19 states that if the transaction is done using a voided trademark, it can be fined and confiscated as per the law.
On this basis, it seems that continuing the business using the registered trademark may be subject to legal risk.
Perfetti Van Meili Nepal said it is continuously monitoring the market situation. The company has also made it clear that it will take necessary legal steps to protect its trademark and the interests of consumers.
According to the company, the original ‘Center Fruit’ product has not been affected by this decision regarding the cancellation of the trademark registration. This decision assumes significance in the context of the increasing controversy in Nepal in recent years regarding the use of established brand names, logos, packaging and trademarks that resemble the overall business identity.
Just because a trademark is registered does not mean that any mark will always get legal protection. This case has given the message that if there is a similarity with the identity of an established brand and it can create confusion among the consumer, then the registered trademark can also be void.
International intellectual property law also gives importance to the protection of established trademarks and the possibility of consumer confusion. Nepal’s trademark law also gives priority to the protection of established brands.
The Supreme Court’s judgment in the dispute between ‘Center Fruit’ and ‘Perfect Center Feels’ and its implementation have pointed out the need to take into account not only the difference in name and word while registering a trademark, but also the identity of the established brand in the market, the impact on consumers and the possibility of confusion.
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