/ New Grounds for Trademark Cancellation in the Short Industrial Property Law

The Short Industrial Property Law in Chile seeks to reinforce the harmonization of the protection of industrial property rights with the promotion of competition, favoring a balance of rules that benefits both trademark owners and consumers. The new cancellation actions for non-use and genericide are key tools to achieve these objectives and promote a healthy industrial property system.

Valentina Gutiérrez
Associate Attorney
Alessandri Abogados

Law No. 21,355, known as the Short Industrial Property Law, introduced important modifications to the industrial property system in Chile. One of the main changes refers to the cancellation actions incorporated by this law: cancellation due to lack of use and cancellation due to vulgarization or genericide. As we will review, these rules protect the interest of trademark owners and, equally, the interest of consumers.

Traditionally, the Chilean system has been eminently registry-based, which means that trademarks registered in Chile were not subject to use requirements. This changed with the introduction, in our regulations, of the cancellation of trademark registration for lack of use. Pursuant to this rule, a trademark registration will be declared cancelled if, after five years from the date of registration, the trademark has not been subject to real and effective use within the national territory. Likewise, cancellation for lack of use is also applicable if such use has been suspended uninterruptedly for the same period of time.

The concept of “paper marks” -those trademarks registered but not used in commercial practice- becomes particularly relevant in this context. By establishing the obligation of use to maintain the validity of a trademark, the requirement stands as a foundation for a healthy industrial property system, fostering competition and dynamism. In effect, the rule contributes to avoid the proliferation of monopolies on signs that are not fulfilling the function of a trademark: to distinguish, and as a consequence of its use, products and services in the market.

On the other hand, the legal amendment introduced the cancellation of trademark registration, also due to vulgarization or genericide, placing it in the scenario in which the sign no longer refers to specific products and services, but becomes a generic term commonly used in everyday language to indicate the product or services, which sought to distinguish.

In this context, the new rule not only seeks to safeguard the interests of trademark owners, but also those of consumers, encouraging trademark owners to maintain the distinctive character of a trademark, which ensures that buyers can assign a specific origin to the goods or services. In other words, this figure safeguards the primary function of trademarks, namely, to operate as reliable signals for consumers, allowing them to make informed decisions based on the quality or specific characteristics of the products. These cancellation actions can only be exercised by third parties, and Inapi does not have the power to cancel any trademark registration ex officio.