Loo Wai Hoong analyses the impending legislative amendments impacting the enforcement of trademarks in Malaysia

The Malaysian Parliament has recently passed the much anticipated Trademarks Bill 2019 (“TMB”) and the Trade Descriptions (Amendment) Bill 2019 (“TDB”). These Bills, which are expected to come into force in early 2020, are primed to bring about substantial legislative changes to the Malaysian trademarks landscape by repealing the current Trade Marks Act 1976 (“TMA”) and amending the Trade Descriptions Act 2011 (“TDA”). While the impending laws would bring about great waves of change, this article will only delve into important amendments relating to the enforcement of trademark rights.  

Administrative Actions

• Several existing offences scattered across the existing TMA have been consolidated under Part XV of the TMB along with, amongst others, the following new offences:
• Trademark counterfeiting. The unauthorised creation of a mark which is identical or similar to a registered trademark or the falsifying of a genuine registered trademark will constitute an offence.
• False application of registered trademarks to goods or services. Unlike its predecessor in the TDA, the scope of this provision is not only confined to the unauthorised application of registered trademarks onto goods but also encompasses such application to services.
• Making or possession of article for the commission of offence. It will soon be an offence for any person to make or be in possession, custody or control of an article that is specifically designed or adapted for making unauthorised copies of registered trademarks.
• Registered proprietors intending to initiate administrative actions in relation to marks which are not identical but similar to their registered trademarks may obtain verification from the Registrar of Trade Marks (“Registrar’s verification”) prior to lodging a complaint with the Enforcement Division of the Ministry of Domestic Trade and Consumer Affairs (“ED”). This will replace the need to obtain a Trade Description Order from the courts in instances whereby the marks are not identical.
• Part XVI of the TMB will confer the ED with the necessary investigative and enforcement powers, similar to those provided under the TDA

Civil Actions for Trademark Infringement

• The scope of trademark infringement will be expanded to include the use of a mark that is identical or confusingly similar to the registered trademark in respect of similar goods or services. At present, an action for trademark infringement is only available against offending marks that are used in relation to identical goods or services covered by a registration.
• The unauthorised application of registered trademarks to merely labelling, packaging material or any document will be tantamount to trademark infringement in the event that the persons applying the marks are aware or have reason to believe that such use is unauthorised.
• The TMB expressly provides that the use of registered trademarks for non-commercial, news reporting or commentary purposes will be exempted from infringement.
• Actions for “impending” trademark infringement may be instituted against persons who perform acts which give rise to the likelihood of ensuing infringements.
• Successful claimants in an infringement action may be entitled to statutory reliefs such as injunctions, damages, account of profits and also other additional damages. Interestingly, in a claim for trademark infringement involving counterfeit trademarks, claimants will be entitled to claim for damages along with an account of profits arising from the infringement, which is a departure from the current common law position whereby claimants are only entitled to either damages or account of profits but not both. Further, the courts may also grant orders for seizures and production of documentary evidence relevant to such infringement upon an application for interim injunction by the claimants.
• Aggrieved persons threatened with groundless threats for trademark infringement will soon be able to bring an action against their accusers if such threats are made without basis. These provisions do not apply to manufacturers, importers of goods or the provision of services. The reliefs that the courts may grant include declarations that the threats are not justifiable, injunctions to prohibit the threats from continuing or damages in respect of the losses sustained due to such threats.

Conclusion

The introduction of the aforementioned provisions in the TMB marks a huge step in the right direction towards taking Malaysia’s trademark enforcement landscape to greater heights. In particular, the inclusion of statutory reliefs for trademark infringement under the TMB provides a higher form of certainty to successful claimants compared to the remedies provided under common law. Further, the newly introduced offences which provide for harsher penalties upon conviction should act as strong deterrence and send a stern message to infringers. However, with the introduction of groundless threats provisions, it is advisable that potential claimants exercise caution before issuing cease and desist letters or making allegations against alleged infringers to avoid being held liable for making groundless threats.