Unused trade marks: a new era begins for trade mark registrations in Chile

Act No. 21,355, known as the “Short Act on Industrial Property”, introduced a significant change to the Chilean trade mark system: owners of registered trade marks must prove their actual and effective use if they wish to prevent their registrations from being subject to revocation proceedings on the grounds of non-use.

The reform came into force on 9 May 2022, but its effects in this area will become particularly apparent from 2027 onwards. The reason lies in the transitional provisions of the Act, which set out how the five-year period required to bring such an action in respect of older registrations is to be calculated.

Five years without use: a trade mark may lose its protection

The new Article 27 bis A of the Industrial Property Act provides that a trade mark registration shall be subject to total or partial revocation where, five years after its grant, the trade mark has not been put to genuine and effective use in Chile by its proprietor or by a third party with the proprietor’s consent, to distinguish the goods or services for which it was registered.

The same consequence may arise where use of the trade mark has been interrupted for five consecutive years. Revocation does not take effect automatically, nor can it be declared ex officio by INAPI: it must be requested by a party with a legitimate interest.

There is also a particularly important point: revocation may be partial. If a company has registered a trade mark for a wide variety of goods or services, but in practice uses it only for some of them, protection may be maintained in respect of those goods or services actually covered by the use and lost in respect of the remainder.

What happens to trade marks registered before the reform?

Transitional Provision No. 5 of Law No. 21.355 is of particular importance here. The reform does not stipulate that all trade marks registered before 2022 are immediately subject to a revocation action once five years have elapsed since their original registration. For these registrations, the five-year period begins to run from the first renewal taking place after the reform comes into force.

Therefore, the date of grant or renewal of each registration will be decisive in determining when it may become subject to a potential revocation action on the grounds of non-use. Under this transitional regime, 9 May 2027 will mark an important milestone, as from that date proceedings may be brought against certain trade marks that have completed the statutory five-year period.

The burden of proof lies with the proprietor

The reform also introduces a significant change from a procedural perspective. Should a revocation action be brought on the grounds of non-use, it will be the trade mark owner who must prove that the trade mark has been genuinely and effectively used in Chile. The law permits the use of evidence admissible under the legislation and stipulates that evidence of use submitted shall have the same legal weight as an affidavit.

It is therefore not sufficient to demonstrate that the trade mark remains registered or that there is an intention to use it in the future. What matters is proving actual use in the market and in relation to the goods or services for which protection is sought.

The law does, however, provide for an exception where there are valid reasons explaining the lack of use, provided that these stem from circumstances beyond the owner’s control and constitute an obstacle to the use of the trade mark.

A shift in approach to trade mark management

The introduction of this requirement represents a significant change in the way companies should manage their trade mark portfolios. For years, the Chilean system allowed registrations to be maintained without effective use of the trade mark being a condition for retaining the right indefinitely. In some cases, this encouraged the accumulation of registrations intended to cover future projects, trademark variants or products that ultimately never reached the market. The new regulation introduces a different approach: registration protection must be linked to the actual use of the trademark.

This makes it particularly advisable to review trademark portfolios and check whether there is a correspondence between the registered goods and services and those in respect of which the trademark is actually being used in Chile.

It will also be important to keep proper records of such use: advertising material, invoices, catalogues, websites, publications, contracts, packaging, commercial documents and any other evidence that can demonstrate how, when and in relation to which goods or services the trade mark has been used.

A tool to revitalise the trade mark system

The aim of this reform goes beyond penalising those who do not use their trade marks. From an economic perspective, the revocation procedure frees up space within the register that may be occupied by trade marks which no longer fulfil a distinctive function in the market. This reduces the possibility of maintaining rights solely for defensive purposes or to block third parties.

The introduction of this mechanism therefore presents a challenge both for trademark owners and for those seeking to register new trademarks. For the former, it will be necessary to actively manage their portfolio and document use. For the latter, the existence of old registrations that appear to block a particular trade mark may no longer necessarily be a permanent obstacle if the requirements for applying for their revocation are met.

From 2027 onwards, this new reality will begin to have an increasingly significant impact on the strategy for the protection and management of trade marks in Chile.