Iceland V Iceland: Cold War Between Sovereignty and Grocery Chain

A sovereign state is taking legal action against a grocery and frozen food shop over a trademark dispute. Iceland will follow up on its previous statements and initiate a lawsuit against Iceland Foods over the use of the European trademark “Iceland”.

The Icelandic Government justifies this legal proceeding with the need to safeguard the right to use the word “ICELAND” by Icelandic companies. According to a government’s press release, the legal approach is the only possible means due to “…unrealistic and unacceptable demands by the supermarket chain”. Furthermore, the same source declares that “…Iceland Foods has aggressively pursued and won multiple cases against Icelandic companies which use ‘ICELAND' in their representation or as part of their trademark, even in cases when the products and services do not compete.” Iceland Foods’ European trademark is registered in classes 7, 11, 16, 29, 30, 31, 32, 35 and it served as the basis for opposing Icelandic companies’ EU trademarks, such as “INSPIRED BY ICELAND” of Íslandsstofa and “ICELANDIC IBÉRICA SA” of Icelandic Trademark Holding ehf.

Iceland Foods denies the Government’s statement, saying that "We very much regret that the government of Iceland has apparently decided to take legal action over the use of the name Iceland," and concluding with "Contrary to their assertion we have received no recent approaches to achieve an amicable resolution of this issue, which would be our preferred approach”.

A formal registration cancelation based on invalidity legal proceeding has been filed by the Government of Iceland, on the 24th of November. This invalidity application pursues the argument that the trademark “ICELAND” constitutes a violation of the article 7, no. 1, line b) and c) of the European Council Regulation No. 207/2009, because not only is the brand not distinctive, it also prohibits any other brand to use the same word, even if it symbolizes the origin of their products or services. Finally, the Icelandic Government is entitled to file the action of invalidity according to article 52, no. 1, line a) of the same Regulation.

The owner of a trademark, while benefitting from exclusivity on the exploration of the registered name in regards to the registered products or services may not, according to article 12, no. 1, line b) of the aforementioned EC Regulation, prohibit another to explore signs that indicate the geographical origin, among others, of the products or services.

The main question in this situation is one of the oldest ones in Intellectual Property matters. What can be defined as a distinctive trademark and which method and requirements can we use to make sure that any given trademark has acquired distinctive capacity.