Intellectual Property rights in wartime

By Cici Cui, Eirene Vlahogiannis
Intellectual Property Patents & Trade Marks

Russian companies may seek to profit from the IP assets of foreign owned companies 3 min read

As Russia's war on Ukraine continues to cause mass devastation to the country and its people, the response of much of the Western world, including Australia, has been to impose a series of economic sanctions against the Kremlin. Russia has reacted by imposing a series of its own countermeasures against the West, including Australia, which it has deemed 'unfriendly'. Somewhat unexpectedly, Russia's new strike back laws are also having a direct impact on the Intellectual Property (IP) rights of owners from these 'unfriendly countries'. We discuss what this surprising attack on Intellectual Property rights means for Australian businesses below.

Key takeaways

  • Like much of the Western world, Australia has imposed sanctions against Russia in response to the situation in Ukraine.
  • Russia has sought to strike back by refusing to recognise and enforce registered patents, utility models or industrial designs, if the owners of these IP assets are from countries it lists as 'unfriendly'.
  • This leaves Australian businesses seeking to enforce their IP rights in Russia in a powerless position.

Who in your organisation needs to know about this?

IP teams; patent and trade mark attorneys; legal counsel.

What sanctions has Australia imposed?

In early March 2022, the Australian Government announced that new autonomous sanctions have been imposed against Russia and certain areas of Ukraine. Reflecting Australia's foreign policy position, these  sanctions came into effect on 28 March 2022, essentially restricting:

  • the export or supply of certain goods;
  • the import, purchase or transport of certain goods;
  • certain commercial activities;
  • the provision of certain services or assets to designated persons or entities; and
  • travel bans on designated persons.

How has Russia responded?

On 6 March 2022, the Kremlin implemented its first pay back measure against 'unfriendly countries' who have issued economic sanctions and restricted Russia's trade privileges. The Decree issued by the Russian Government effectively removes any obligation previously imposed upon Russian companies or individuals to compensate an IP owner for unauthorised use of their patents, utility models or industrial designs, if that IP asset owner is based in a country which Russia identifies as being 'unfriendly'. On 7 March 2022, Australia was added to this list.

How may this affect Australian businesses?

For Australian businesses seeking to enforce their IP rights in Russia, the implications of this Decree are  significant. As Russia continues to be cut off from the Western world, it's predicted that Russian companies may seek to utilise and profit from the IP assets of foreign owned companies who are choosing to no longer operate in Russia.

The problem for these Australian and other foreign owned businesses, is that while the Russian IP Office (Rosptatent) and the Eurasian Patent Office continue to operate as usual and enforce the rights of their own nationals, it's unlikely they will recognise the rights of any IP owners based in 'unfriendly countries', including Australia. The recent refusal of a Russian court to enforce the rights of the Peppa Pig trade mark due to 'unfriendly actions' of the United States and United Kingdom indicates Russia's new approach, as do the various news reports that Russian businesses are already filing trade mark applications which are confusingly similar to famous brands like McDonalds or Starbucks.

Whilst the Russia-Ukraine situation continues to evolve, the actions taken by any member of the international community may change at any moment. In the meantime, Australian businesses seeking to enforce their IP rights in Russia may find themselves in a very powerless position, as it seems their IP rights are no longer recognised and protected by the IP system in Russia.