On March 1st, 2022, Costa Rica legalized cannabis for medicinal use and commercialization of non-psychoactive hemp, under license. The law approved by the legislature excludes cultivation for personal and recreational use.
The country joins many other countries seeking to incentivize the booming industry of medical cannabis, and an influx of IP owners seeking trademark protection in this changing landscape is expected.
What are the implications for trademark owners?
There are no explicit guidelines by the Costa Rican Industrial Property Registry (“RPI“) for handling cannabis-related trademark applications. As of this writing, about 150 trademark applications have been filed for goods and services including “hemp”, “cannabis”, “THC”, “CBD” and related terms across the various classes encompassing the Nice Classification. Of these applications, 37 have been rejected and about two dozen others are currently pending. Most of the applications in this later category have faced misdescriptiveness, genericness or descriptiveness issues.
There are surely a fair number of other applications for trademarks that are meant to cover hemp or cannabis related items, but they do not explicitly include them in the specification. Traditionally, Costa Rican authorities have allowed broad descriptions of goods and services (often, the heading of the respective Nice class is allowed). However, even if allowed, such strategy is not without risks. A lot will depend on how directly related the good or service is to the plant or its psychoactive component. For instance, a trademark registration meant for consultancy services in the field, or for plant fertilizers, will not be as vulnerable as a registration for goods directly related to the substance.
In the specific case of pharmaceuticals, the Administrative Appeal Board (“Tribunal Registral Administrativo“) has ruled that broad descriptions, such as use of the class heading, are unenforceable for failure to identify the actual goods meant to be commercialized under the mark. While this interpretation has questionable legal grounding, it means that marks under these conditions may fail to be cited against a junior application for a similar mark that covers specific items. The trademark owner will not be notified under this particular scenario, leaving the onus on the IP owner to actively monitor filings.
This interpretation has also began seeping into other classes, as well. In particular, the Registry inconsistently requires applicants to specify the nature of goods or services commercialized under Class 35 to allow the registration to move forward. One can also imagine analogous cases for goods of different nature (for instance, chemicals for use in industry). With time, it is likely that the requirement of specificity will continue becoming more enshrined.
Trademarks related to hemp-based textile goods or clothing are unlikely to be scrutinized as zealously as, say, marks covering cosmetics or pharmaceuticals. A refusal based on the nature of the goods or services cannot be discarded, even despite the law. Examiners have considerable leeway in their examination powers. However, in these cases, an applicant may take shelter in Article 7 of the Paris Convention for the Protection of Industrial Property:
The nature of the goods to which a trademark is to be applied shall in no case form an obstacle to the registration of the mark.
This rule is mirrored in Article 15(4) of the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS). The international nature of these instruments grant them it hierarchical superiority to even national law.
The law will come into effect once sanctioned by the Executive Body and published in the official Gazette.