This article first appeared in WTR Daily, part of World Trademark Review, in January 2025. For further information, please go to www.worldtrademarkreview.com.
- The dispute involved two Belarusian companies engaged in the online retail of women’s clothing
- The anti-monopoly authority found that the respondent’s actions were aimed at acquiring advantages in
entrepreneurial activities - The respondent’s registration of the mark SAFFONOV was made in bad faith with the aim of preventing and restricting
the claimant’s use of that mark
In the dynamic world of online retail, the interplay between competition, branding and trademark rights plays a crucial role in
shaping business success. As companies seek to establish their identities in crowded marketplaces, conflicts over trademark use
and registration often arise. This update explores the implications of such disputes, focusing on competition law and trademark
protection in the Belarusian retail sector.
Background
The dispute involved two Belarusian companies engaged in the retail trade of women’s clothing and operating on the local marketplace: the claimant, Safonov Group LLC, was founded in 2023 by an individual with the surname Safonov; the respondent, Fends Group LLC, was established in 2022.
In September 2023 the respondent applied to register the trademark SAFFONOV “due to its pleasant sound and with the aim of increasing the recognition of the produced goods and their demand in the market”. Following this, the respondent began using the trademark on product labels and in advertising. Notably, the respondent’s founder had registered the domain name ‘saffonov.by’ in April 2018. However, the website under this domain name was used by individual entrepreneur Mr Safonov from July 2019 to March 2024, with Mr Safonov also covering the hosting costs. The mark SAFFONOV was developed by Mr Safonov in November 2019 and had been used on clothing labels, hangers and in advertising since then. Additionally, the respondent tried to prevent the claimant from using the trademark or similar marks, and claimed trademark infringement via the marketplace’s personal account.
Decision
In early October the Belarusian anti-monopoly authority found the respondent responsible for unfair competition practices. Whendeciding on such cases, the anti-monopoly authority considers a range of criteria based on competition law, which can be regardedas an unfair competition test. All criteria should be met to establish unfair competition.
First criterion: competitive relations in the commodity market
The authority affirmed that the claimant and the respondent were competitors. They were both engaged in the retail trade ofwomen’s clothing via the Internet and competed in the same markets (ie, the EAEU member states, the Republic of Uzbekistan andthe People’s Republic of China). The authority concluded that the claimant and Mr Safonov (its affiliate) constituted a single groupfor the purposes of competition law, affirming that they were direct competitors with the respondent.
Second criterion: acquiring advantages in entrepreneurial activities
The authority determined that the respondent’s actions were aimed at acquiring such advantages. Specifically, the claimant hadbeen using the mark SAFFONOV since 2019, while the respondent only began using it in January 2023 and registered thetrademark in September 2023. The timing and nature of these actions led the authority to conclude that they were designed toundermine the claimant’s established market position and could have led to an increase of the respondent’s profits with lowerpromotion expenses, considering the recognition of the mark SAFFONOV.
Third criterion: violation of Belarusian law or of the requirements of good faith and reasonableness
The authority found that the respondent’s registration of the trademark was made in bad faith with the aim of preventing andrestricting the use of that mark by the claimant. The respondent was aware that the claimant had not registered the trademark, buthad used it consistently since 2019. The authority ruled that this deliberate action contradicted the principles of good faith and wasintended to restrict the claimant’s ability to use the mark.
Fourth criterion: causing loss/damage to the business reputation of competitors
The authority established that the respondent’s actions could harm the claimant’s reputation and market share. By registering thetrademark and distributing goods under it, the respondent could confuse consumers and mislead them as to the source of theproducts. This could lead to a redistribution of demand that adversely affected the claimant’s profitability, confirming the potentialfor causing losses to the claimant.