Key Takeaways

• The proposed amendment to the Charter’s trademark exemption is part of a much larger 100-page omnibus reform Bill, other parts of which may be seen as controversial and which could either be subject to challenges that delay or derail the Bill or alternatively, see the trademark proposals adopted with minimal scrutiny. The legislative progress of the Bill should be closely followed.
• If the Bill is passed:
  • Organizations would only be able to rely on the Charter's trademark exemption from French translation on signage, posters and in commercial advertising if their trademark is a "registered trademark", as defined by the Trademarks Act.
  • Organizations would no longer be able to rely on the broader category of "recognized" trademarks, which traditionally included a trademark, defined in the Trademarks Act as "a sign or combination of signs that is used or proposed to be used by a person for the purpose of distinguishing or so as to distinguish their goods or services from those of others, or a certification mark".
  • Marks that traditionally fell within the broader definition of trademarks, such as pending trademarks and common law trademarks, would no longer be able to benefit from the trademark exemption.
• Given current lead times to obtain full trademark registration in Canada, organizations seeking to rely on the exemption may need to significantly reorient their trademark strategy.
• Organizations would have a three-year transition period to align their trademark practices with the proposed requirement.

Background

Within the province of Quebec, the Charter, which is currently administered and enforced by the Office québécois de la langue française (“OQLF”), imposes wide-ranging French language requirements along with rules requiring that French be used in a manner that is equivalent in prominence to, or in some cases “markedly predominant” over, other languages such as English.  The requirements under the Charter are broadly applicable to products sold in Quebec as well as a range of marketing and commercial materials used in connection with the provision of products or services, which includes packaging and labelling and product inscriptions as defined in the Charter.

Existing Trademark Exemption

Presently, the Charter (through the Regulation respecting the language of commerce and business Charter of the French language) provides an express exemption for non-French recognized trademarks to be used without translation provided that a French version of the mark has not been registered in Canada.  In practice, this means that any trademark content on various materials, including signage, posters and commercial advertising, as well as a product, its packaging, labelling or marketing material, need not be in French.

The Charter defines a “recognized trademark” as having the same meaning as that found in the Canadian Trademarks Act. While the term “recognized trademark” is not defined in the Trademarks Act, the term is understood to capture both a “trademark” and a “registered trademark”.

Accordingly, a trademark for purposes of the Charter could currently include a registered trademark, a trademark application, and a mark in which common law trademark rights are asserted, with the latter point having been confirmed by a Quebec Court.[1]  

Proposed More Limited Trademark Exemption

The Bill proposes to limit the trademark exemption on signage, posters and in commercial advertising to just registered trademarks, i.e., a trademark that is on the Canadian Registrar of Trademarks. This narrower language suggests that pending applications would no longer be able to rely on the Charter’s trademark exemption. Similarly, case law which has previously upheld that common law trademarks are subject to the trademark exemption would likely no longer be applicable. Although the proposed amendments are limited at this time to trademarks used in signage, posters and commercial advertising, this change may have consequences for the enforcement of the trademark exemption in other areas of application of the Charter.

To become law, Bill 96 will need to advance through a number of legislative stages before it receives formal approval, which could potentially take several weeks or months.

 While omnibus amendments can result in the implementation of major legislative changes without the degree of scrutiny that accompanies stand-alone legislation, the Bill includes very far-reaching reforms, some of which could be expected to attract controversy, with the result that the Bill, and with it the proposed changes to the trademark exemption, could be delayed or not enacted at all. As currently drafted, the Bill provides a three-year transition period from enactment to afford businesses time to align trademark practices with the proposed new requirement.

Potential Implications for Organizations doing Business in Quebec

Should the Bill be enacted in its current form, businesses may need to rethink their trademark strategy in Quebec. Practically speaking, it may be difficult to obtain a full trademark registration prior to a product and/or service launch, as it currently usually takes three years or more for a trademark application to become a registered trademark.

In the event the proposed Bill is enacted, businesses will want to consider:

• developing a trademark filing strategy well in advance, i.e., allowing at least three years from trademark filing to registration where possible; 
• filing trademark applications for any common law trademarks; and
• creating and using unique and inherently registrable trademarks and logos in order to increase the chances of getting trademark applications "quickly" through to registration (for example, due to less possibility of confusion and/or descriptiveness/non-distinctiveness objections from  Examiners).

If the Bill is passed, there is currently no indication as to the level of potential enforcement by the OQLF. However, in September 2020, the OQLF received additional government funding sufficient to double the size of its enforcement team, which suggests a renewed interest in enforcement generally.

• While the Bill will likely have to overcome hurdles, changes to the trademark exemption amendment are likely a real possibility, and organizations should monitor the Bill and take immediate steps if it is passed into legislation.

[1] In 2015, a Quebec Court confirmed that the absence of a trademark registration is not an impediment to the application of the trademark exemption, which currently also recognizes common law trademarks.