What is an Honest Concurrent Use trademark?

Scenario: Party A has been trading for a number of years under a particular brand. The director decides that it may be a good idea to obtain a trademark registration for the brand. A search reveals a registered trademark for Party B, which is very similar to Party A’s brand and which has been registered in classes deemed similar to the goods and services which Party A offers. What can Party A do?

The examination of trademarks by the South African Trade Marks Office is done in order of filing. Thus, if two marks are deemed confusingly similar, the trademark with the earlier application date should be accepted whilst the latter should be provisionally refused. This would be bad news for Party A.

Luckily, the Trade Marks Act has a section which deals with this – in terms of Section 14, an applicant may file a trademark on the basis of “honest concurrent use”. This section allows a trademark to be registered even when it offends against sections 10(6), 10(14), 10(15) or 10(17). These sections would ordinarily preclude the registration of a trademark.

Simply put, the applicant needs to prove that the adoption of his trademark was honest and concurrent and needs to submit evidence (in the form of an affidavit) showing five years’ worth of honest and concurrent use prior to the date of application. The affidavit needs to address the following points (as set out in Alex Pirie & Sons Limited (1933) 50 RPC 147):

• the degree of confusion likely;
• the fact that the choice of the Applicant’s trademark was honestly made;
• the extent of the honest concurrent use;
• whether or not there has been actual confusion; and
• the nature of the respective trades.

The Trade Marks Office will consider the evidence submitted and, if satisfied, accept the trademark as a Section 14 application. The formalities associated with a section 14 application will then need to be adhered to in order to progress the mark to registration. It must be borne in mind that the trademark can still be opposed by the prior applicant (or any other party for that matter).

Given that an application for honest concurrent use needs to be made at the time of filing, it is very important to conduct a search prior to filing to try identify any potential issues and to determine whether an HCU application is necessary.

Whilst the cost involved in an honest concurrent use application will be higher than an ‘ordinary’ application (due to the preparation of evidence and the additional formalities involved), it is an effective way of registering trademarks which ordinarily wouldn’t be capable of registration.