The United Arab Emirates (UAE) continues to be an attractive market for businesses to expand to as it acts as a gateway to the broader Middle East and remains the pivotal hub connecting East and West. This article looks at the key considerations for one’s Intellectual Property (IP) when entering the UAE, from the preparatory research to the registration and enforcement of IP rights (IPRs).
Assessment of existing IPRs in the UAE and the risk they pose
Before expanding to the UAE, one should conduct an official trademark search. Virtually all recently filed and registered trademarks can be detected, allowing an expert to advise on the possible risk to the registration and use of the entering trademark. If identical or similar marks are found, further intelligence needs to be gathered to define defence options. For instance, if the owner of a conflicting mark is holding that trademark illegitimately, this needs to be contested. In some cases, coexistence agreements can be negotiated, or a variation of the proposed mark can be enough to overcome the obstacle.
The technical features of a product can be checked through a patent search; including an expert’s advice to assess if and how the product may need to be adapted (employing a so-called “workaround”), whether a negotiation with a prior patent owner is advisable or if a prior title might be successfully challenged.
Market investigations are commonly carried out when a potential infringement is already expected, but can also be done preventively.
Registration of IPRs
As soon as the decision to begin commercial activities in the UAE is made, it is imperative to register one’s IPRs without delay.
Regarding trademarks, the UAE follows the first-to-file principle, meaning the one who first files is presumed to be the rightful owner. However, new UAE trademark law stipulates that the first person to use a trademark may request to cancel its registration by another party within five years from the date of registration.
Marks can be filed in Latin or Arabic scripts, but it is advisable to register a combination of both. There are usually several possible transliterations for a mark and to prevent third parties from obtaining the registration of a slightly different permutation of one’s mark, it is prudent to have the dual version registered in one’s name.
Compared to many of the large markets worldwide, more registration formalities are required in the UAE, incurring additional costs. A foreign applicant must appoint a local trademark agent via a notarized Power of Attorney, legalized by the UAE embassy in the applicant’s home country and then super-legalized by the Ministry of Foreign Affairs in the UAE.
An alternative to this procedure is available via the Madrid System of the World Intellectual Property Organization. This enables foreign applicants from one of the Member States to extend their home registration to the UAE without the need for the above-mentioned local agent, unless a refusal or opposition is raised.
As for patents, the UAE recently announced the introduction of a 12-month grace period for applications published before filing. It will, however, be limited to the UAE, so applicants are well advised to continue securing their inventions via the national or Patent Cooperation Treaty route before going public. Gulf Cooperation Council patent applications remain suspended and are not expected to become available again.
Moreover, rather than opening their own establishments or branches, foreign companies often opt to collaborate with agents in the UAE, an action which carries with it specific IP issues. The most pressing task is to register your IPRs in your own name. Leaving this to the local partner jeopardizes your business interests should the relationship break off. Although recovering your IPRs is generally possible in the end, it may entail an expensive, years-long court action.
Post-registration uses and enforcement of IPRs
Once a trademark is registered, one needs to actually use it, as continued non-use for more than five years makes it vulnerable to cancellation actions brought by third parties. Accordingly, the use should be well documented to have watertight legal proof in case of any disputes about the ownership and validity of your trademarks.
The use of IPRs through third parties (agents, importers, distributors) needs to be done via written contracts, unambiguously setting out their ownership. The local distributor may be given a license to use the IPRs, but all goodwill must accrue to the owner.
Similarly, non-disclosure agreements should be in place with (prospective) business partners to safeguard confidential information concerning IPRs. This is of particular importance in relation to patents as premature disclosure can result in failure to meet the novelty requirement in a later filing.
All changes in IPR ownership – such as the address or name of the owner and the assignment of IPRs – should be recorded with the IP office without delay for clarity and so as not to interrupt the possibility of immediate enforcement actions.
In addition, it is strongly recommended to instruct a trademark watch service to monitor new filings in the country so that one can oppose infringing trademark applications in good time.
Finally, an effective anti-counterfeiting strategy is essential. In five of the seven Emirates, brand owners can record their registered trademarks with the customs authorities to screen incoming shipments for products that infringe their rights. In the Emirate of Dubai, trademarks can also be recorded with the Department of Economic Development, who will then monitor the Dubai market for any items in violation.
As we have seen, there are many specific IP challenges when entering the attractive UAE market. Still, with the right strategy from the get-go, and with robust protection mechanisms in place, IP owners can be confident that their rights are safe.
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