The Intellectual Property community has been quick to condemn the Russian invasion of Ukraine and the devastating events that have followed. Although intellectual property (IP) is clearly not a top priority at the moment, the crisis is having its impact in the IP world too.
We set out below some of the IP headlines that have emerged over the past month. These include the changes to Russia’s compulsory licensing rules, brands pulling their services out of Russia and patent offices severing ties with their Russian counterparts. We also consider Russia’s banning of Instagram, as well as the measures which were contemplated by The Ministry of Economic Development of Russia to suspend IP rights for certain goods.
Changes to Russia’s compulsory licensing rules
On 6 March 2022, the Russian government issued a decree making changes to its compulsory licensing rules. Previously, Russian law allowed the government to permit the use of an invention or industrial design without the consent of the patent holder in cases of extreme necessity relating to national security or protecting health and life, provided that the patent owner was paid reasonable compensation. However, the new decree removes the patent holder’s right to receive remuneration if they are associated with an “unfriendly country”. Russia’s list of such countries includes the UK, USA, all EU member states, Australia and Japan.
This new measure could have an impact on companies who own valuable patents in Russia in the pharmaceutical or defence industries. It is now theoretically possible for the Russian government to allow these inventions to be copied without any compensation being payable. However, it remains to be seen whether the Russian government will actually use this change in the rules when new compulsory licences are issued.
Brands pulling their services out of Russia
Many brands and IP owners have withdrawn from Russia in response to the humanitarian crisis in Ukraine. For example, Starbucks and Coca-Cola have suspended their operations in Russia, while McDonald’s has temporarily closed all of its restaurants in the country.
In the entertainment sector, Disney, Sony Pictures and Warner Bros have all delayed the release of films in Russia. Pink Floyd have removed their works from 1987 onwards from all digital music providers in Russia and Belarus, and other musicians have cancelled upcoming concerts in these countries.
Temporary suspensions of IP rights for certain goods?
According to the Russian news agency TASS, at the beginning of March, Russia considered measures to temporarily lift restrictions on IP rights associated with certain goods. The measures would only have applied to brands who had pulled their services out of Russia, in order to give Russia a means of retaliation. The Russian government would have made the decisions on the goods and groups of goods to have their IP rights lifted.
So far, these measures have only been contemplated and have not been brought into force. However, if this should change, brands that had their IP rights lifted would not be able to take enforcement action against anyone using their trade marks in Russia. If the goods were of poor quality or unsafe, this could lead to reputational damage to these brands in Russia. Further, because the measures would apply to IP owners who had pulled their services out of Russia, Russian entities could effectively take over these brands in the country without the consent of the brand owners or having to pay any compensation.
It has also been reported that a Russian court refused to enforce the IP rights in Peppa Pig because the owners of the rights were based in a country which had imposed sanctions on Russia.
Russia’s banning of Instagram
Instagram was one of the most popular social networks in Russia. The ban on Instagram will therefore have an adverse effect on many small businesses who operated through this platform or relied on it for their advertising. Instagram users were only given 48 hours’ notice to sign off from their accounts, so businesses may lose income while they try to build up new profiles on other social media networks that have not been blocked. The ban may also affect brands who were using Instagram influencers to promote themselves in Russia.
Various alternative platforms are springing up in Russia, including “Rossgram” which launched at the end of March and promotes itself as an Instagram alternative. However, it seems unlikely that advertisers and rights holders will rush to sign up to content deals with so much uncertainty surrounding the future.
Patent office severing ties
In response to Russia’s invasion of Ukraine, the European Intellectual Property Office (EUIPO), European Patent Office (EPO) and United States Patent and Trademark Office (USPTO) have all halted their co-operation activities with the Russian patent offices.
The UK Intellectual Property Office (UKIPO) has confirmed that it will not be providing services to those on the UK’s sanctions list. It has also announced that it will support Ukrainian customers by providing the maximum flexibility available in law to consider requests for extensions of time, as well as requests for reinstatements and restorations of IP rights where deadlines have been missed.
Other organisations are also severing ties with Russia, including some societies that represent authors and deal with the licensing of their works. For example, UK-based PRS for Music (made up of the Performing Right Society and Mechanical Copyright Protection Society) has suspended its rights representation relationships with its Russian counterpart. The agreements between authors’ societies in different countries can help authors to license their works globally, so Russian authors may now find it more difficult to license their works outside of Russia. By contrast, CISAC, a network of 228 authors’ societies in 120 countries, has condemned the Russian invasion but decided not to expel its Russian member societies to avoid punishing them for the actions of their government.
The duration of these changes is of course unknown, but it does seem clear that in a world where harmonisation of IP rights has been the trend for many years, events in Ukraine have caused a disconnect, the effects of which will be felt for some time.
Tom Lingard