WASHINGTON–The World Trade Organization (WTO) issued a report today upholding key aspects of a U.S. law concerning the ownership of U.S. trademarks associated with businesses confiscated in Cuba.
Today's WTO report confirms the longstanding U.S. position that WTO intellectual property rights rules leave WTO Members free to protect trademarks by establishing their own trademark ownership criteria. The ruling does not call into question the distinction that the U.S. law in question (section 211 of the FY1999 Omnibus Appropriations Act) draws between original trademark owners and companies that acquire a trademark as part of a government confiscation.
In another key finding requested by the United States, the WTO report, issued by the Appellate Body, also overturned an earlier WTO panel report finding that section 211 denied parties fair and equitable judicial procedures to enforce trademark rights. It found, however, that the law's treatment of U.S. and Cuban companies is contrary to the national treatment and most-favored-nation obligations under WTO rules.
Today's report suggests that in the absence of discrimination a law along the lines of section 211 would be consistent with WTO rules, and therefore those trademark owners who currently enjoy protection under section 211 could continue to enjoy that protection.
At issue is a European Union (EU) challenge to a provision of U.S. law, section 211, that limits the ability of Cuban entities or their successors to claim ownership of trademarks and trade names that they have confiscated, unless the original owner has consented. The EU's complaint, claiming a violation of international trade law, specifically the Agreement on Trade-Related Intellectual Property Rights (TRIPs), was prompted in part by a dispute over a trademark for a Cuban rum.
The Appellate Body's findings cannot be appealed, and will be final when the WTO Dispute Settlement Body adopts the report. The USTR will consult closely with Congressional committees and interested Members in considering an appropriate response to today's report.
The EU requested consultations on section 211 in July 1999, and a WTO panel, composed in October 2000 to consider the EU's complaint, circulated its report on August 6, 2001. The panel found in favor of the United States on most grounds, but said that section 211 breached TRIPs Agreement obligations to make fair and equitable procedures available to right holders. The EU appealed most of the issues it lost to the WTO Appellate Body, and the United States cross-appealed on the one issue it lost. This Appellate Body report resolves those appeals.
The Appellate Body and panel reports are posted on the WTO website. Click here to access USTR's briefs submitted to the panel and the Appellate Body in the dispute.