After several years of negotiations between the Kosovo government and the European Commission, the Stabilization and Association Agreement (SAA) entered into force on April 1, 2016. The entry into force of the SAA is an important development for Kosovo since this constitutes the first contractual relationship between Kosovo and the European Union. The SAA includes several chapters on various political and economic issues as well as provisions aiming to promote EU standards in many areas, including intellectual property. I will first highlight the main provisions of the SAA concerning IP rights and compare them with the respective provisions in a few other SAAs that the EU signed with other countries in the region. I will then analyze what the entry into force of the SAA means for the Kosovo government in terms of IP protection and how this development will positively affect trademark holders and IP practitioners.
SAA IP-related provisions
The SAA includes several provisions on IP-related rights. Apart from the standardization provisions, it includes obligations that the Kosovo government must fulfill concerning the protection of geographical indications, the most favored nation principle, promotion of audio-visual industry, as well as research and technological development.
Under Chapter II provisions, Kosovo is obligated to provide protection not only to GIs for wines and spirits but also to GIs for other agricultural and fishery products and foodstuffs. These provisions are detailed and include a long list of GIs, which are protected in the EU and to which Kosovo should grant the same level of protection. Most of these provisions are of substantive nature and cover the type of protection that should be granted to GIs and on how a possible conflict between registered trademarks and the listed GIs should be solved. In most such bilateral agreements, the EU has insisted on including provisions on GI protection only for wines and spirits. In the case of Kosovo, the EU added the provisions on protection of GIs for agricultural and fishery products and foodstuffs. This is one difference between the SAA signed with Kosovo and the SAA signed with other countries in the region such as Albania or Macedonia.
Provisions concerning the standardization requirement, which are of utmost importance, are similar to all respective chapters in bilateral agreements that the EU signed with countries aspiring to EU membership. Generally, the EU has imposed stricter standards on countries aspiring to become EU members than on its trading partners that have no intention of joining the EU, namely it was enough for non-EU-aspiring countries to provide protection in accordance with international standards arising from international agreements such as the TRIPS Agreement. Candidate or potential candidate countries were, however, required to provide the level of protection similar to that existing in the EU, including effective means of enforcing IPRs. What varies in most of these agreements is only the time period given to accomplish this obligation. For instance, Croatia was given three years, Albania four years, and Kosovo five. This means April 2021 for Kosovo, which may not be an attainable objective.
In line with this, Kosovo also agrees to abide by a number of multilateral conventions. Appendix VII contains a detailed list of treaties or international conventions serving different purposes. The standardization provision also contains the so-called “development clause” by which the EU can oblige Kosovo to respect other conventions in this field. However, unlike the SAAs with other countries, the SAA with Kosovo does not include the time limit for Kosovo to accede to any of these treaties or international conventions, just an obligation to abide by international standards.
The SAA implications and impact
A legitimate question that one would raise would be: given the current state of play, is Kosovo ready to undertake these obligations and what are the benefits of creating a stronger IPR protection system?
There has already been a significant progress in terms of the harmonization of local legislation with that of the EU. For instance, in September 2015, the amendments to the Law on Trademarks and the Law on Patents entered into force. Late in 2015, a completely new Law on Industrial Design was approved, followed by the entry into force of the new Law on Geographical Indications and Designations of Origins. The legal framework should be completed with the entry into force of the Amendments to the Law on Copyright and Related Rights, currently under discussion, and the Law on Customs Measures, currently being drafted.
Although formal laws exist in Kosovo, the obligations deriving from the SAA are not only limited to the harmonization of legislation, but also to achieving higher standards in the field of IPR enforcement. Strengthening administrative capacities is the main challenge ahead in terms of the SAA implementation, as it entails increasing the number of permanent employees in key state institutions, including the judiciary, as well as organizing proper trainings. Intellectual property is a new field in this part of the world, and it is a challenge to hire or appoint people who have a background or experience in IP issues. The hiring and training of competent professionals implies costs that the government should have foreseen when it agreed to create a stronger IPR protection environment. Moreover, a public-private cooperation can come into play here, namely the main state institutions can cooperate with and seek assistance from their private-sector partners such as the rights holders, who are more than likely willing to help and thus accelerate the implementation of the legislation. Consolidation of the IPR system is also expected to attract foreign direct investments (FDI).
However, what particular impact will the implementation of the SAA have on trademark holders?
In terms of substantive trademark rights, trademark holders should not expect any major changes in the near future, as the trademark law currently in force, last amended in 2015, was drafted to comply with TRIPS-Plus standards. For instance, in order to harmonize the law with the EU Enforcement Directive, significant changes have been introduced to the remedies available in case of trademark infringement. Namely, in addition to requesting the removal, confiscation and destruction of infringing goods, the plaintiff can now request the destruction of the materials and tools used in the production of infringing goods, thus helping reduce the amount of counterfeit goods on the market. The amendments further clarified or revised, in certain circumstances, the criteria that the plaintiff needs to establish when claiming some of those remedies, thus creating a more predictable IP system.
There will be changes in terms of the customs enforcement of intellectual property rights. The new law is currently being drafted and not available to the public, but this law, expected to enter into force by the end of 2016, will introduce important changes aimed to align the prescribed procedure with Regulation (EU) No. 608/2013. The highlight of the law will certainly be the introduction of the accelerated procedure for the destruction of small consignments as well as the abolishment of the annual fee imposed on IP rights holders when filing customs watch applications. To ensure legal clarity, the law will also clarify the obligations of IP rights holders, including the sanctions against them, and the use of information by the IP holders.
Yet, changes that will most affect trademark holders and IP practitioners relate to the implementation and enforcement of the laws. The implementation of the SAA IP chapter will improve bilateral trade between the EU and Kosovo and create a more predictable and stable IPR environment, not only in terms of having a solid formal legal framework, but also in the sense of orienting the judiciary and the administration towards the best European and international practices, all of which ultimately benefits IP rights holders and IP practitioners. The relatively long list of international treaties that Kosovo undertakes to abide by also shows the willingness of the Kosovo government to accept and apply the best international practices in the prosecution and enforcement of IP rights.