New Croatian IP Legislation Abolishes Appeal Boards

Five Acts amending the Laws on Patents, Trademarks, Industrial Designs, Topographies of Semiconductor Products, and Geographical Indications and Designations of Origin entered into force in Croatia on May 18, 2018. The main change was brought by the Act Amending the Law on Patents, which abolished the Croatian Intellectual Property Office Appeal Boards (one dedicated to patent matters and one to all other IP rights matters) as bodies of second instance in all industrial property registration proceedings under the jurisdiction of the IPO. The new law provides for the possibility to file a lawsuit against the first instance IPO decision before the Administrative Court of the Republic of Croatia in Zagreb, as was the case prior to the introduction of Appeal Boards in 2008.

The Appeal Boards will continue to function until all disputes in cases initiated under the previous legislation are finalized, while all cases initiated after May 18, 2018 will be handled according to the new law.

Amendments to the Law on Patents abolish Appeal Boards for all IPO proceedings since the patent law regulated the appeal process and the establishment and functioning of Appeal Boards for all IP rights.

Appeal Boards Background

Prior to 2008, any complaints against first instance decisions of administrative bodies, including the IPO, were filed before the Administrative Court in the second instance. The Administrative Court had to issue decisions in numerous and multiple administrative areas, which slowed down the process, while the judgments only questioned the legality of first instance decisions and did not really examine cases on their merits. This is why Appeal Boards were introduced in 2008. However, several issues emerged after their introduction, including the following:

• According to the 2012 amendments to the Law on General Administrative Procedure, administrative matters in administrative proceedings should be handled by public bodies, so the Appeal Boards’ authority to issue second instance decisions was questionable due to their legal status.

• There was a lack of IP experts interested in being part of Appeal Boards.

• Indirect conflict of interest often existed among Appeal Board members because most IP experts were indirectly involved in some aspect of the first instance proceeding. IP experts were exempt from participating in case of a direct conflict of interest, that is if they directly participated in the first instance proceeding, but indirect conflicts of interest remained unresolved.

Additionally, the introduction of Appeal Boards created three instances that questioned the IPO’s decisions, the third instance being the High Administrative Court, for a relatively low number of disputes. The necessity of maintaining Appeal Boards as second instance bodies was brought into question, particularly due to the issue of economic sustainability of the state administration and legal systems.

Implications of Abolishing Appeal Boards

The new legislation ensures compliance with the Croatian legislative framework, most of all with the Law on the State Administration System and the Law on General Administrative Procedure as lex generalis in all administrative procedures.

The new legislation is also likely to contribute to independent and efficient decision-making in IP cases. It is expected that the Administrative Court will start processing IP cases in an emergency procedure, but it remains to be seen whether this will really happen. Although the legislation provides that all IP cases should be processed in an emergency procedure in court, this has never been the case in practice.

Finally, there are no longer two instances deciding on the merit of IP cases, but two instances deciding on the legality of IPO’s decisions, so it can be expected that the IPO decisions will in fact be final in the great majority of cases.

By: Anamarija Stančić-Petrović

For more information, please contact Anamarija Stančić-Petrović.