Is a flagship store a shop?

13 April 2022

This blog takes a closer look at the world of flagship stores and retail services.

And that of trademark law too, of course, as it is possible to register a trademark for retail services, which are defined as ‘the bringing together, for the benefit of others, of a variety of goods (excluding the transport thereof), enabling customers to conveniently view and purchase those goods’.

Or in other words, doing exactly what you would expect of a shop. It all seems clear until you are asked whether or not a flagship store really is a shop according to trademark law.

Bringing together and selling

De Bijenkorf (the Netherlands’ leading department store), the average supermarket and (a web shop) all fit neatly within this definition. They bring together various products, display them and sell them to consumers ‘for the benefit of others’ as stated in the original definition. The ‘others’ referred to here are other manufacturers and producers.

But according to EUIPO, the European Union Intellectual Property Office, a flagship store’s trademark cannot be registered for retail services because these stores only sell their own products and the exclusive sale of one’s own products is not an independent service. The reasoning goes that manufacturers with a shop containing just their own products are only competing in the market for those particular types of products, and not in the retail market as such. Trademark protection for a flagship store only applies to the actual products sold, not to the services it provides. This legal distinction is not immediately obvious.

EUIPO bases their stance on rulings issued by the European Court of Justice. These rulings, however, only deal indirectly with the distinction between ordinary stores and stores that exclusively sell their own brand. In a ruling on trademark protection for the lay-out of an Apple flagship store, for example, the Court of Justice held that the trademark could only be registered for retail services if – to sum it up succinctly – the store also conducts "activities" that are not necessarily related to selling products, such as demonstrations and workshops. Yet another distinction that is not exactly crystal clear.

Not an ordinary shop

It is possible to say that a flagship store is not an ordinary shop, but does this mean that HEMA and IKEA, both of which exclusively sell their own products, are not ordinary shops according to trademark law? And is the distinction between different types of shop even relevant? Opinions are divided.

This is why it would be so convenient if the European Court of Justice were to issue an explicit ruling on the scope of the concept of retail services. But until then, another EUIPO statement is highly relevant: ‘Retail services in general is an unclear or imprecise term and should be treated accordingly.’

When registering a trademark, it is crucial to be precise when describing goods and/or services. Do you have any questions about goods and/or services that you wish to register or trademark? Our attorneys will be happy to help you with this.

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