Domain Name as an Intellectual Property Right in Slovakia?
Although Slovak legislation does not classify domain names as special intellectual (industrial) property rights, the Supreme Court of the Slovak Republic has ruled that since domain names are comparable to industrial rights, namely the so-called rights of designation. The competent court for domain transfer cases is the District Court of Banská Bystrica which holds jurisdiction for intellectual property disputes in Slovakia.
Even though domain names are unique and may be valuable commercial assets, it is important to note that their registration alone does not confer any exclusive intellectual property rights, and the domain holder may still infringe upon the IP rights of third parties.
However, a domain name can be secured as an unregistered trademark or as an indication of commercial origin through its lawful usage. Since a domain name can serve branding purposes and represent a significant commercial asset for its owner, before registering a domain name, we always recommend checking that the domain name does not conflict with rights of third parties.
Potential conflicts may relate to a wide range of protected third party designations – from trademarks, trade names, first and last names, nicknames, unregistered designations (e.g. private labels), to copyrights in works or industrial rights (“Protected Designations”).
Alternative Domain Name Dispute Resolution (ADR) vs. legal action in Slovakia
Owners of protected designations from our practice often require both economical and prompt solutions, i.e. domain transfer (as soon as possible) and payment of connected costs from the unauthorized domain holder.
Domain holders (e.g. former distributors) may put forward a defence, claiming to have invested in the brand (even if it is someone else’s) and therefore will not transfer it for free. If the right holder does not reach an agreement with the domain holder, the right holder can base their defence on (i) court action (definitely not a quick solution), (ii) an application for a court injunction (risk of failing to demonstrate a compelling legal interest), (iii) arbitration (not applicable in the absence of a valid arbitration clause), or (iv) ADR (prompt resolution, but owners may be deterred by the fee or the fact that they can seek “only” cancellation and/or transfer of the domain name ending “.sk”, and not also for costs, damages or other harm).
Until the introduction of ADR, the legal options of the owners of protected designations were limited to court or dispute resolution by means of arbitration. Out-of-court (alternative) domain name dispute resolution was not introduced in Slovakia until 2017, initially with a slow start (in 2017 only one case was resolved through ADR). To date, however, there have been 55 decisions, of which 42 have been issued in favour of the owners of the protected designation, and this form is mainly used by foreign owners of intellectual property rights.
What are the requirements for a transfer or cancellation of a domain in Slovakia ?
- the domain is (i) identical or similar to the Protected Designations, and (ii) the complainant has exercised or is exercising a right to it (for example, if the complainant is merely a licensee, she would need to prove the right holder’s consent to transfer the domain to herself;),
- there is a likelihood of confusion between the holder’s domain name and the protected designations (this requirement must be proved unless the complainant establishes the existence of a reputation of the protected sign; then the likelihood of confusion will not be established as the distinctive character of the mark is very low and the classes of goods and services for which it is registered are dissimilar to the goods and services for which the domain name is used),
- the domain was registered or acquired without the current holder having any right or legitimate interest in the domain or Protected Designations (unless the domain holder proves otherwise); and
- the domain was not registered, acquired and used in good faith. Examples include:
- The unauthorized dealer or distributor or former distributor does not provide any or insufficient information on the domain about the relationship with the owner of the trademark (or if not all the criteria of the so-called “Oki Data Test” are met);
- The holder of the domain conflicting with an earlier protected designation(s) demands an amount for the transfer that is clearly in excess of the reasonable costs of registering and maintaining it.
- A third party registers a domain name that contains an identical or similar content to the right holder’s business name for the purpose of the domain name attracting users to the third party’s website and thereby generating profits through affiliate links, there is likely to be a lack of good faith.
ADR Centre fees to be paid by the Complainant:
- In case of 1-5 domains and a single expert, the ADR Centre’s fees are EUR 1,150;
- In case of 1-5 domains and a panel of experts (three experts), the ADR Centre’s fees amount to EUR 2,700.
Advantages of ADR
- Expertise: the ADR Centre provides access to more specialist knowledge in the field of domain name disputes.
- Speed of the procedure: the procedure is a one-step procedure, which considerably reduces the time needed to reach a decision.
- Fast-track procedure: possibility of a decision within 30 days, with only one expert making the decision.
- Linguistic flexibility: the proceedings can be conducted in another language than Slovak if both parties and the expert agree.
- Electronic communication: the whole process is electronic, without an oral hearing.
- Selection of experts: the parties can choose either one expert or a panel of three experts.
- Direct enforceability: the expert’s decision is directly enforceable by the domain authority SK-NIC.
- Flexibility in domain transfer: the possibility to transfer the domain not only to the Complainant but also to another person.
Limits and disadvantages of ADR
- Necessity to combine ADR with claiming injury, damages or compensation for ADR fees in court: ADR only allows the resolution of a claim for cancellation or transfer of a domain name. Any injury, damage or a compensation claim for costs must be claimed in court.
- Risk of overturning the decision by the court: there is a risk that the domain holder will try to overturn the decision of the expert in court, which may delay the enforceability of the decision.
Source:
- Decision of the Supreme Administrative Court of the Slovak Republic 1Ndob/6/2020 of 24 June 2020
- Published decisions of the ADR Centre: the Arbitration Centre for Alternative Domain Name Dispute Resolution (eisionline.org)
- WIPO Arbitration and Mediation Center, administrative panel decision, Oki Data Americas, Inc. v. ASD, Inc., Case No. D2001-0903