With the exception of well-known marks, trademark rights in Nicaragua arise with registration. Registration entitles the registrant the exclusive right to use a mark, and to exercise court actions to prevent third parties from using confusingly similar marks; however, the Nicaraguan Trademark Law (Law No. 380 of 2001, as amended by Law No. 580 of 2006) does provide for limited rights to unregistered or so called common law trademarks users.
The most important right conferred by the Trademark Law on the users of unregistered marks is the right to oppose the registration of an application for a mark confusingly similar to one that has been in use in good faith in Nicaragua, for the same goods or services (Article 8, subparagraph i). As noted, users of unregistered marks can only oppose on the basis of the same goods or services, contrary to registered trademark owners, who can also oppose on the basis of different goods or services, provided there is a risk of confusion or association with the registered mark.
The Regulation to the Trademark Law provides that in order to exercise the right to file an opposition, the user of an unregistered mark must file an application prior to lodging a notice of opposition, and must show that the unregistered mark has been in use for at least six months in Nicaragua (Article 27, paragraph 4, of Regulation 83-2001 of 2001, and article 8 subparagraph i) of Law No. 380).
Even though, users of unregistered marks are barred from exercising the action of infringement, which is the most important tool available to trademark owners to defend their rights, they can still exercise the action of unfair competition, albeit with limited options, and little chances of success if the other party is the title holder of a trademark registration.
The Trademark Law deems to be unfair any act carried out in the exercise of a commercial activity, which is contrary to honest practices in commercial matters. Acts of unfair competition include, among other, those acts likely to create a likelihood of confusion or association with respect to the goods, services, business or establishment of others; the use of false indications or allegations capable of denigrating or discrediting the goods, services, business or establishment of others; the use of false indications, or omission of true information, liable to mislead with regard to the origin, nature, mode of manufacture, suitability for use or consumption, quantity or other characteristics of the goods or services; the use of descriptive or generic signs as a mark; the use of signs that may cause likelihood of confusion with a registered mark or a prior application; and the use of false or misleading appellations about the true origin of goods, even if expressions such as “type”, “class” or “imitation” are used.
An unfair competition action must be initiated before a court of law. The period prescribed by the statute of limitations is of two years counted from the date the interested party became aware of the act of unfair competition, or five years counted from the last time the act was committed.
Since protection of unregistered marks is very limited in Nicaragua, trademark users are advised to protect their right by obtaining a trademark registration.
Please contact us for additional information.
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