The top filers and agility in action: inside EUIPO operations

Every year World Trademark Review (WTR) runs an used on the EUIPO, analysing the evolution of office operations and updates on key projects. This year, however, things are inevitably different. The impact of covid-19 means that it has not been business as usual – in Alicante or anywhere else. How the office responded to the unprecedented crisis is therefore a natural starting point for a review of EUIPO processes and performance.

In early June, the office announced that the exceptional extensions granted to users by two decisions of EUIPO executive director Christian Archambeau (Decisions EX-20-3 and EX-20-4) had come to an end. The extensions were designed to support users and covered all procedural deadlines, irrespective of whether they had been set by the office or were stipulated in the regulations.

However, on their expiration, the office provided users with further guidance on coping with time limits stipulated in the applicable regulations, recognising that many will still face operational difficulties arising from measures taken by public authorities to tackle the pandemic, as well as sickness among parties or their representatives. The end of the extensions represented a partial return to normality, albeit one with increased flexibility and relying on a remote workforce. It has been an unprecedented few months to say the least.

Dealing with the unexpected

On 14 March the Spanish government activated a ‘state of alarm’ following the spread of covid-19 across the country, limiting movement among all Spanish citizens and residents. As a result, the EUIPO instantly initiated its business continuity protocol, with all Alicante-based employees instructed to work from home. The same day, the first of the two deadline extensions was announced – all registrations expiring between 9 March and 30 April were extended to 1 May.

In mid-April, Archambeau provided users with an operational update, explaining that – despite the teleworking requirement – production at the office had been continuing at almost normal levels, with cooperation activities with national and regional IP offices, as well as other stakeholders, transitioning to virtual format. However further extensions were needed and at the end of the month Decision EX-20-4 extended all deadlines expiring between 1 and 17 May to 18 May.

Speaking to WTR in June, Archambeau reflects: “The challenges were huge, but we needed to do this in order to help our customers, who have really been suffering. Information about the extensions was provided on our website, and through our Information Centre. Dealing with phone and email inquiries from users went well, with interactions at, or even higher than, normal levels. After the end of the extension of time limits, the first line dealt with almost 1,000 calls in a single day, which is double what we usually expect. We also organised an online webinar and gave guidance on how to request further extensions under ‘exceptional circumstances’. Remember, our staff were all working from home at this time.”

Despite the turmoil affecting operations in March across the first quarter, the service charter results revealed that the office had still succeeded in meeting its timeliness, quality and accessibility commitments. In fact, certain timeliness indicators – namely, direct EU trademark filings and registered Community design registrations – actually improved during this period. Only the timeliness in cancellation decisions remained in the ‘actions needed’ category.

A “tsunami” of applications adds pressure

However, the second-quarter results will likely portray a slightly different picture. Continuing our conversation in early June, Archambeau notes: “Of course, extensions eventually must come to an end. From 18 May onwards the office has been coping with a ‘tsunami’ of 21,000 registered trademarks that needed to be published over a period of weeks to avoid technical issues. This, combined with the publication of almost 5,000 international registrations, delayed re-examination tasks due to the extensions, and a large accumulation of new opposition, cancellation and invalidity requests created a huge increase in the examination workload. Unfortunately, this has had an unavoidable impact on the timeliness of registrations of direct and international trademarks, putting them into the red in terms of our Service Charter.”

He expands: “In all other areas we expect to maintain the timeliness standards in ‘compliance’ or even ‘excellence’ and, given the exceptional efforts being made by our examiners, we should get back on track for trademark registrations towards the end of the summer.”

The critical response to covid-19 has created significant challenges for both management and communication across the office. “There have been more meetings of the top management of the office – up to three online meetings a week instead of once a month,” Archambeau explains. “There has also been a need to communicate, with weekly emails and video messages from me to keep staff at home informed. Deputy executive director Andrea Di Carlo and I also made between us more than 300 individual telephone calls to staff members in order to keep our fingers on the pulse and understand how they were coping.” But these efforts have not gone unappreciated. “This increase in communication appears to have been very well received,” he continues. “We will have to make sure that the atmosphere of flexibility and trust created, which has produced such good results, is not lost, and is factored into our future plans.”

Positively, then, the wheels have kept turning and the services offered to users have continued without interruption. Moreover, Archambeau does not expect to have to dip into the office’s reserve funds to finance operations, despite an anticipated revenue fall this year. He expands: “At present, the office expects to take a hit in terms of budgeted income this year of around 10%. However, since that budget also anticipated a surplus, this may be enough to cover our expenditure. If the outcome is worse than currently foreseen, we will be able to call upon the provision for unforeseen events and use a small part of the surplus accumulated in previous years. We will not need to call on the reserve funds themselves, which is a part of the surplus that is kept aside for an even more serious eventuality. We are also talking to the Commission about how part of the accumulated surplus might be used to help SMEs in the current crisis.”

Permanent changes to working habits?

While the EUIPO was pivoting to continue its work in new ways, surprisingly, it had to contend with continued application levels. Although applications were expected to drop dramatically as the pandemic bit down across Europe, data supplied to WTR by CompuMark suggests otherwise (see Figure 1).

The data compares the weekly number of applications across the first 20 weeks of the year (ie, until 17 May 2020). It was not until week 11 (mid-March) that 2019 application levels started to outpace the 2020 figures, coinciding with the period in which the EUIPO initiated its business continuity plan. However, fast forward one month and the disparity was over, with 2020 filings generally at higher levels than the 2019 weekly equivalent.

Overall, 49,109 applications were filed in the first 20 weeks of 2020, compared to 50,147 in the same period last year. That may represent a 2.1% drop, but it is hardly a dramatic one. Of course, whether that trend continues remains to be seen, but by the end of the extension period, the “tsunami” seems to have been in full flow.

Archambeau reflects:

There was certainly enough work to keep us busy, even though there were some dramatic falls in demand at the beginning of the crisis and this will, most probably, not be completely recovered in the current year. [However,] the office is fortunate to have superb equipment, designed to promote mobile and flexible working, and a great staff who have pulled out all the stops in order to keep everything running smoothly on our side.

From the moment of lockdown in mid-March, when we moved to almost universal teleworking, until the end of May, we examined more than 30,000 new EU trademark applications and more than 15,000 new designs. This production was at near normal levels. In the area of trademark applications and cancellations, the decisions were even 3% above normal levels.

As we will discuss later, the registration workload is just one aspect of the EUIPO’s mission, but Archambeau adds: “Cooperation activities in the European Union and internationally, the work of the Observatory, and preparations for the next strategic plan, SP2025, have also all gone ahead. We have adapted and are very happy with the progress being made given the circumstances.”

One question that all of this begs – and one that many law firms and corporate trademark teams will be asking themselves – is whether any aspects of teleworking will remain in place once employees can return to the office environment.

Quite possibly, says Archambeau: “In terms of what we have learned, while videoconferencing is not ideal for everything, it is certainly very efficient and accessible. Combined with other online and digital tools, video has encouraged a level of interaction that probably would not be possible otherwise, even if things go back to ‘normal’. We will certainly be factoring this into our exchanges with users, and the meetings we have both internally and externally. Video participation has proven itself during this crisis, and the message we get is that users and other stakeholders will want to hold onto that as an option for the future.”

He continues: “The office has had to acquire new software licences to restore phone access to examiners who do not normally telework and allow the call-back service to resume as well as the existing system of scheduling calls with the information centre. We are also looking at extending the possibility of scheduling calls directly with examiners.”

In June, however, the focus is on a possible return to the Alicante HQ: “The office started almost universal teleworking in mid-March. That means around 1,400 of us logged in every day from home. We are planning to return to the office in two phases, with the first wave made up of volunteers, apart from a very small number whose work cannot be done remotely. Around 60 volunteers went back from 8 June onwards, after having been tested to make sure they were free of the covid-19 virus. They are wearing masks, except when at their desks, working at a safe distance, and continue to use videoconferencing for meetings. These volunteers have agreed to spend at least four hours a day at the headquarters in order to test our systems for a full return in September.”

Ultimately, he acknowledges: “We will have to see what the medical advice is at that time, but it may be occupancy of the headquarters will continue to be limited for safety reasons. That could mean that staff work one week on campus followed by one week teleworking. Our plan is to get back, by the end of the year at the latest, to a situation where working in the office is the norm. Teleworking will continue to be an option, but it should be the result of personal choice and based on an assessment of the needs of the office.”

Implementing a new strategic plan

Thus, attention can now turn to the future. On 20 November 2019 SP2025 was approved by the EUIPO management board with the unanimous support of the member states and, at the time of writing, the Commission is set to begin on 1 July 2020. SP2025 has at its core the delivery of “IP value for businesses and citizens in Europe” through three strategic drivers:

• to further develop an interconnected, efficient and reliable IP system for the internal market;
• to focus on more customer-centric services; and
• to move the office towards a more innovative workplace while developing the organisational skill sets required to do so.

With these as the backdrop the EUIPO will now launch related schemes through its annual work initiatives, with a new set of European Cooperation projects (ECPs) also being approved to run alongside the SP2025. The first strategic driver sets out how the office intends to build upon the networks created in order to improve the IP system and includes goals such as matching tools and practices with user needs, stepping up IP enforcement efforts and developing IP knowledge. The second guides the actions that will be taken to provide EUIPO customers with tools and guidance, including new services and those designed for SMEs. Finally, the third driver is predicated on the belief (continues on page 113) that the office has to evolve its skill sets and working practices in line with the digital age.

SME support

The focus on SMEs has long been baked into the office’s plans and activities, but Archambeau highlights the heightened need to help smaller organisations during the pandemic. “We are bringing forward a number of projects that we think can help businesses in this time of crisis,” he states. “We looked for ‘quick wins’ arising from SP2025 that could help SMEs in particular. This involves introducing, this summer, effective dispute resolution, the encouragement of pro bono services to help SMEs if they have issues, and a special SME corner on our website. In addition, an SME ‘easy filing’ service will be delivered by the end of this year. On top of that, we have been discussing with the European Commission how the office’s accumulated surplus, which is in addition to our reserve, could be used for other SME projects that support the European Union’s new industry strategy. It is too early to give details, but we would hope to start this year.”

The escalation of SME-focused activities is not the only example of how the SP2025 plans have been revisited in the current circumstances. Archambeau explains: “As a result of the crisis we did a prioritisation exercise, which has now been completed, to see how we could best move forward with SP2025. The aim was not to reduce the ambition of the strategic plan, but to make sure we were getting the most out of it, particularly with regard to responding to needs arising from covid-19.”

Looking ahead, there are a number of strategic priorities that Archambeau emphasises. One is the adaptation of the IP Enforcement Portal to cater to the new EU applications for action form, due to be implemented this summer, in preparation for the full management of e-applications for action in 2021.

“The Out of Commerce works portal will also be launched this time next year,” he reveals. “There are two important digital transformation projects – the extension of IP tool to ex parte designs and the Boards of Appeal IP tool. There are also several important customer projects, plus supportive instruments for SMEs and the SME website.”

“As already mentioned, the easy SME e-filing project is also being brought forward before the end of the year,” Archambeau continues. “We will also work on a number of projects related to AI, big data, blockchain and the important Enterprise Resources Planning project, which will bring together HR and finance information and assist in future management and planning.”

Brexit’s “incomprehensible and unfortunate” consequences

This all represents a significant workload, which must be managed alongside continued cooperation activities. “As regards the European Cooperation Projects, the indication from our partners in the member state IP offices is that the appetite for developing more and better tools, and continuing the process of convergence in a networking environment, continues,” notes Archambeau. “In addition, supporting SMEs and helping combat IP infringements are both even more urgent given the current context.”

There is also the small matter of Brexit to be navigated. At the time of writing, the transition period is due to end on 31 December 2020 and negotiations on the future economic and political relationship between the United Kingdom and European Union continue.

In this respect, the office is in the same ‘wait and see’ position as everyone else. Nevertheless, there is work to be done. “The office’s position is that we had a contingency plan for the hardest of hard Brexits in place before the signing of the Withdrawal Agreement and we also continue to work with the European Commission on the latter’s implementation,” Archambeau states. “We hope to be in a position to have our preparedness plan for the end of the transition made public before the end of the summer. I think you can therefore say that we are prepared for Brexit. We will deal with whatever happens. As the situation stands now, the United Kingdom’s worldclass IP lawyers will face the toughest challenges as they will lose their rights to representation before the office. For me, the situation is both incomprehensible and unfortunate, but it is out of our hands and we will all just have to deal with it.”

A picture of growth

Brexit was one of the factors identified by the office’s latest annual report as contributing to volatility in the demand for trademarks and designs. Published in June, the report notes that 2019 was an “exceptionally busy year”, not least because it was the one in which the EUIPO celebrated its 25th anniversary and received its 2 millionth EU trademark application.

EUIPO trademark filings grew 5.2% year on year in 2019, with design filings up 3.5%. The use of e-filing continued at its current high level, representing 99.8% of all direct EU trademark applications and 97.9% of direct design filings.

The average time taken to publish an EU trademark via fast track was 4.3 working days and less than two weeks for regular track, with registration being completed in close to four months in both cases. What is more, the examination of new EU trademark filings increased by over 10% compared to 2018.

Work on user tools and cooperation projects also remained a primary focus. For instance, the 2019 annual report records an 83% user satisfaction rating for the TMview and DesignView tools, both of which have continued to expand and develop.

In April 2020 the office launched improved versions of the world’s largest free trademark and design search engines. The refreshed offerings, released after a beta testing period which involved garnering user feedback to guide further enhancement, offered a wider search criteria and the ability to set alerts for when changes are made to particular marks or designs.

The data set drawn upon has also been steadily built up – as of early June, after trademark data from IP Australia was added, TMview contained information on almost 60 million trademarks across 74 participating offices. Although DesignView does not contain the same degree of data, around the same time, it boasted searchable data on almost 16 million designs from more than 70 offices.

The EUIPO’s next annual report will reflect continued efforts on the latest strategic plan, as well as providing deeper insight into how covid-19 and Brexit have affected the office’s operations and workloads. For the EUIPO, it will be a year in which the canny use of online tools proves to be key. However, tracking change and supporting innovation is precisely the office’s role.

Asked whether there are any other issues that he wishes to highlight to WTR readers, Archambeau reflects: “The EUIPO, and I think all of us, are experiencing a closeup and personal view of a world in which online tools and interactions will increasingly be the first choice for customers and stakeholders. This will accelerate as the promise of fourth industrial revolution technologies is fulfilled. Out of 20 new courses for staff introduced on the EUIPO Academy Learning Portal recently, 10 dealt with AI or big data. We need to be ready for the changes ahead and also ready to embrace them. This means getting the best out of the technology and the best out of our people. I have said at several conferences recently that things in the future will probably not be the same – when have they ever been? We must keep moving forward and try to shape a future that, in some respects at least, will be better.”