A blog post by Alexandra Tasev, Junior Associate 

On February 24, 2022, Russia invaded Ukraine, marking the beginning of the Russian-Ukrainian War.^[1] The biggest war in Europe since World War II,^[2] the invasion has resulted in catastrophic consequences for the entire world. As expected, there have been significant impacts on the mobility of people and goods in Europe as airspace restrictions and regulations were put into place and as fuel prices increased due to limited supplies.^[3] However, in addition to “expected” consequences, the Russian-Ukrainian War also brought unanticipated implications for international trademark and intellectual property law.

Trademark law combines protection of intangible property and business interests.^[4] After the start of the Russian-Ukrainian War, many global organizations took their products off of the Russian market in response to the threat of sanctions imposed by the United States and as a way to “protect their brands from losing value” in case they ever return to doing business in Russia.^[5] However, in response to more and more companies pulling out of the Russian market because they did not want to face sanctions by the United States or risk showing support to Russia in any way, Russia deemed the United States an “unfriendly nation,” and signed a decree to address the “unfriendly actions of the United States of America and [the] foreign states and international organizations that have joined them.”^[6]

The decree has significantly restricted payments to foreign intellectual property right holders, which opened the door for Russian copycat products to take over the market.^[7] Upon its signing, the decree gave Russian businesses permission to use intellectual property from countries deemed “unfriendly” without having to pay the owner for using and infringing on their mark.^[8] In the several months since the signing of the decree, multiple countries, including Japan, New Zealand, and those in the European Union, among others, have been added to the list of “unfriendly nations” for imposing sanctions against Russia.^[9] Thus, when global brands like Starbucks, McDonalds, and Coca-Cola removed their products from the Russian market because they did not want to risk sanctions by the United States, copycat brands quickly began making their way into the market, since the decree strictly prohibited “Russian residents from making license payments to foreign bank accounts of rights holders residing in ‘unfriendly states.’”^[10] With almost identical logos and brand names, Stars Coffee, Makdonalds, and Cool Cola are just a few examples of the many Russian brands that are taking advantage of the product exodus in the Russian market and the new decree.

 

^[1] Jeffrey Mankoff, Russia’s War in Ukraine: Identity, History, and Conflict, Cᴇɴᴛᴇʀ Fᴏʀ Sᴛʀᴀᴛᴇɢɪᴄ Aɴᴅ Iɴᴛᴇʀɴᴀᴛɪᴏɴᴀʟ Sᴛᴜᴅɪᴇs, https://www.csis.org/analysis/russias-war-ukraine-identity-history-and-conflict.

^[2] Paul Kirby, Why has Russia invaded Ukraine and what does Putin want?, BBC Nᴇᴡs, https://www.bbc.com/news/world-europe-56720589.

^[3] Impact of Russia’s invasion of Ukraine on the markets: EU response, Cᴏᴜɴᴄɪʟ Oғ Tʜᴇ EU, https://www.consilium.europa.eu/en/policies/eu-response-ukraine-invasion/impact-of-russia-s-invasion-of-ukraine-on-the-markets-eu-response/#:~:text=The%20invasion%20of%20Ukraine%20has,border%20crossings%20and%20airspace%20restrictions.

^[4] See What is Intellectual Property?, Wᴏʀʟᴅ Iɴᴛᴇʟʟᴇᴄᴛᴜᴀʟ Pʀᴏᴘᴇʀᴛʏ Oʀɢᴀɴɪᴢᴀᴛɪᴏɴ, https://www.wipo.int/about-ip/en/ (defining intellectual property as “creations of the mind, such as inventions; literary and artistic works; designs; and symbols, names and images used in commerce”).

^[5] Jessica DiNapoli and Alexander Marrow, Coca-Cola and McDonald’s left Russia. Their brands stayed behind, Rᴇᴜᴛᴇʀs,  https://www.reuters.com/markets/europe/coca-cola-mcdonalds-left-russia-their-brands-stayed-behind-2022-08-17/.

^[6] УКАЗ ПРЕЗИДЕНТА РОССИЙСКОЙ ФЕДЕРАЦИИ О временном порядке исполнения обязательств перед некоторыми правообладателями [DECREE PRESIDENT OF THE RUSSIAN FEDERATION On the temporary procedure for fulfilling obligations to certain right holders] http://actual.pravo.gov.ru/text.html#pnum=0001202205270016.

^[7] The Status of Intellectual Property in Russia and Ukraine, Iɴᴛᴇʀɴᴀᴛɪᴏɴᴀʟ Tʀᴀᴅᴇᴍᴀʀᴋ Assᴏᴄɪᴀᴛɪᴏɴ, https://www.inta.org/resources/the-status-of-intellectual-property-in-russia-and-ukraine/.

^[8] Id.

^[9] Russian government approves list of unfriendly countries and territories, TASS Rᴜssɪᴀɴ Nᴇᴡs Aɢᴇɴᴄʏ, https://tass.com/politics/1418197.

^[10] Supra note 7.