Existence of an economic link should be assessed with a methodological approach

C-736/18 P


Trade marks: Scope of protection

23 Apr 2020

The matter at hand

On 25 August 2003, Gugler GmbH, Mr Gugler’s predecessor in title, filed an application for registration of a Community figurative mark consisting of the word element ‘Gugler’ in Classes 6, 17, 19, 22, 37, 39 and 42. The mark consists of a rectangle whose upper half is black, in which Gugler is written in white letters. On 17 November 2010, Gugler France lodged an application for a declaration of invalidity, which was first upheld by the Cancellation Division of EUIPO. The application was subsequently annulled by the Fourth Board of Appeal of EUIPO.

Gugler France then filed proceedings before the General Court, which, by judgment of 28 January 2016, annulled the decision of the Fourth Board of Appeal of EUIPO. By the decision at issue, the First Board of Appeal dismissed the appeal against the decision of the Cancellation Division and found that the application for a declaration that the contested mark was invalid should be upheld based on Article 53(1)(c) of Trade Mark Regulation, read in conjunction with Article 8(4) of that regulation.

In the judgment under appeal, the General Court held that the First Board of Appeal of EUIPO erred in finding that there was a likelihood of confusion, since, in essence, the economic link between Gugler France and Gugler GmbH on the date on which the application for registration of the contested mark was filed precluded any finding that there was such a likelihood. Gugler France argued that the General Court erred in its assessment of the economic link between itself and Gugler GmbH and, therefore, erred in finding that there was no likelihood of confusion.  

The judgment of the ECJ

The ECJ first notes that the General Court found that, in the present case, the goods covered by the contested mark are manufactured by Gugler GmbH and distributed by Gugler France. As a result, customers might believe that the goods and services in question come from economically linked undertakings. However, this does not constitute an error as to their origin. This argument is not vitiated by an error of law.The General Court simply found, based on its factual findings, that the economic link that existed between Gugler France and Gugler GmbH, on the filing date of the application for registration of the contested mark, precluded any finding of a likelihood of confusion. The case-law to which the appellant refers does not call that approach into question.

It is not apparent from Schweppes (C‑291/16), that, in order to establish the existence of a likelihood of confusion, the economic link should be assessed on the basis of the link of the proprietor of the earlier rights to the applicant for the trade mark in question. With reference to Schweppes (C‑291/16), the ECJ notes that “the concept of ‘economic links’, for the purposes of Directive 2008/95, refers to a substantive, rather than formal, criterion, which is in no way confined to situations in which the goods in question have been put into circulation by a licensee, by a parent company, by a subsidiary of the same group, or by an exclusive distributor” (paragraph 35). The ECJ continues that the criterion “in particular, is also fulfilled where, following the division of national parallel trade marks resulting from a territorially limited assignment, the proprietors of those marks coordinate their commercial policies or reach an agreement in order to exercise joint control over the use of those marks, so that it is possible for them to determine, directly or indirectly, the goods to which those marks are affixed and to control the quality of those goods” (paragraph 35).

The existence of an economic link does not presuppose a particular order between the undertakings concerned. The ECJ considers that “it may be sufficient in that regard that there is a single point of control within a group of operators in respect of the goods manufactured by one of them and distributed by another, thus ruling out any likelihood of confusion as to the commercial origin of those goods” (paragraph 36).

Furthermore, the ECJ notes, with reference to paragraph 51 of Schweppes (C‑291/16), that “the methodological approach of the General Court complies with the requirement that the examination of whether an economic link exists must be conducted globally, taking into account all the relevant circumstances, […] without there being any need to give priority in that connection to methodological principles such as those advocated by the appellant” (paragraph 37).

The ECJ concludes that the appeal must be dismissed in its entirety.

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