Consulting

Russian IP Sanctions

By Evgeny Rudakov, A.D.E Professional Solutions

On 13 April Russian State Duma submitted draft bill #441399-7 ‘About measures of influence (counteraction) on unfriendly actions of the United States of America and (or) other foreign states’. Faction leaders and State Duma Speaker Vyacheslav Volodin have initiated a bill that spells out Moscow’s retaliatory measures against Washington’s anti-Russian policy. As Volodin told reporters on Friday, 13th April, ‘The bill was drafted as a tit-for-tat measure against the challenges mounted by the United States and its officials in the form of unfriendly and non-constructive actions, as well as the introduction of sanctions against the Russian Federation in general, its citizens and legal entities’.

The Draft Bill

The bill envisages, among other things, restrictions or a complete ban on the import of alcohol, cigarettes and medicines from the U.S. and other countries participating in anti-Russian sanctions. If approved, the measure would also ban the sale of titanium and other rare metals, such as scandium, gallium, bismuth and antimony to the U.S. and other countries.

Usually, sanctions never concern intellectual property rights. The bill would give the Russian government the authority to waive the trademark restrictions on selected foreign products. Thus, the Russian enterprises will produce those goods without trademark holder consent and\or to register the trademark to the name of a Russian company.

The exhaustion of exclusive rights could be used against the U.S. and other states that imposed sanctions against Russia. The Russian subsidiaries, or otherwise under control of those foreign entities, shall equate to the foreign entity. We assume that all EC countries shall be concerned.

The exhaustion of the exclusive rights will certainly leave pharma, FMCG, banking, software, digital and other markets vulnerable.

We expect Russian patent trolls to file trademark applications to register most popular U.S. brands in Russia at this very moment. Thus, the trademarks holders are vulnerable to such exhaustion.

How to anticipate a rotective solution

ADE Professional Solutions has tenyears’ experience in IP and has a trained team that manages, registers and enforces the IP portfolio for prominent Russian corporations.

Considering a solution for our foreign clients, we believe that any of the following strategies can be put into place:

Nominee trademark holder service (the preliminary trademark assignment agreement can be signed to preserve the exclusive rights that are vested back to the beneficiary holder when the sanction’s battles are over).

The following scenario is possible: the U.S. holder keeps the trademark; the Russian entity files the new application for the trademark; the assignment agreement for the future trademark is signed; and when the exhaustion is released the assignment agreement is registered with Rospatent (Russian Patent Office). This will work if trolls don’t file first.

An additional guarantee can be provided by a Russian company to return a mark to a beneficiary holder.

We understand that the right-holders might not feel comfortable with such propositions. We will be considering this further.

We remain at your disposal and are developing other action plans, and we will keep the readers posted on how the bill becomes law.


Evgeny Rudakov

Evgeny Rudakov

A.D.E Professional Solutions, Moscow, Russia
T: +7 495 984 7590
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Published: May 2018 l Photo: NGYNA - Fotolia.com

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