*One To Cure Them All? – Is The ECJ Using The Very Same Formula To Answer All Questions Related To Keyword Advertising?

Disclaimer: This is a 100% geeky trademark law post. Some readers might find it a bit difficult to understand…😉

When analysing the ECJ’s most recent keyword advertising decision Portakabin I was surprised to see that the very same formula the court first used in Google France to define if the function of indicating origin got adversely affected in respect to Art 5 (1) lit. a

84: The function of indicating the origin of the mark is adversely affected if the ad does not enable normally informed and reasonably attentive internet users, or enables them only with difficulty, to ascertain whether the goods or services referred to by the ad originate from the proprietor of the trade mark or an undertaking economically connected to it or, on the contrary, originate from a third party.


… and which was also used in BergSpechte to define likelihood of confusion in respect to Art 5 (1) lit b

39: It follows that, should the rule set out in Article 5(1)(b) of Directive 89/104 be applicable to the dispute in the main proceedings, it will be for the national court to hold whether there is a likelihood of confusion when internet users are shown, on the basis of a keyword similar to a mark, a third party’s ad which does not enable normally informed and reasonably attentive internet users, or enable them only with difficulty, to ascertain whether the goods or services referred to by the ad originate from the proprietor of the trade mark or an undertaking economically connected to it or, on the contrary, originate from a third party.


… also got used in Portakabin in respect to Art 6 (1) lit. b, c to answer the questions whether the booking of a keyword that is similar or identical with a third parts trademark shall be seen as a honest practices in industrial or commercial matters.

71: Taking account of those factors, it must be concluded that, in the situation described in paragraphs 54 and 68 above, the advertiser cannot, in principle, claim to have acted in accordance with honest practices in industrial or commercial matters.

54: In the light of all of the foregoing, the answer to the first and fourth questions is that Article 5(1) of Directive 89/104 must be interpreted as meaning that a trade mark proprietor is entitled to prohibit an advertiser from advertising, on the basis of a keyword identical with, or similar to, that mark, which that advertiser has selected for an internet referencing service without the consent of the proprietor, in relation to goods or services identical to those in respect of which the mark is registered, where that advertising does not enable average internet users, or enables them only with difficulty, to ascertain whether the goods or services referred to by the ad originate from the proprietor of the trade mark or from an undertaking economically linked to it or, on the contrary, originate from a third party.

68: As has been pointed out in reply to the first and fourth questions, however, use by an advertiser of a sign identical with, or similar to, a trade mark for an internet referencing service comes within Article 5(1) of Directive 89/104 where that use does not enable normally informed and reasonably attentive internet users, or enables them only with difficulty, to ascertain whether the goods or services referred to by the ad originate from the trade mark proprietor or from an undertaking economically linked to it or, on the contrary, originate from a third party.


In Portakabin the ECJ found also that a legitimate reason in respect to Art 7 (2) exists if the use by the advertiser seriously damages the reputation of the TM an/or  if the use infringes the function of indicating origin:

81: It follows that the circumstances, referred to in paragraph 54 above, in which a trade mark proprietor is, pursuant to Article 5(1) of Directive 89/104, entitled to prohibit use by an advertiser of a sign identical with, or similar to, that trade mark as a keyword – that is to say, circumstances in which use of that sign by the advertiser does not enable normally informed and reasonably attentive internet users, or enables them only with difficulty, to ascertain whether the goods or services referred to by the ad originate from the proprietor of that mark or from an undertaking economically linked to it or, on the contrary, originate from a third party – correspond to a situation in which Article 7(2) of that directive applies and in which, accordingly, the advertiser cannot rely on the exhaustion rule laid down in Article 7(1) of Directive 89/104.


Thus summing it all up, an keyword ad that does not satisfy the formula will (bluntly speaking) violate Art 5, 6 and 7 of the TMD.


The reason why I have come across this issue is however that I am currently (still) working on the Law-of-Unfair-Competition part of my thesis and I was wondering if the ratio used by the ECJ to define “honest practices in industrial or commercial matters” (Art 6 (1) lit. b, c)  and “legitimate reason” (Art 7 (2)) could also be seen as guiding principle for national courts when judging about the question whether keyword advertising is violating national unfair competition law.

Thus the formula above would be the ultimate test for any keyword ad. If an ad was found to comply, it would be cleared at the same time from an trademark and an Law of Unfair Competition point of view.

Anyone (dis)agreeing?


During the last couple of weeks I’ve closely analysed the Austrian Law of Unfair Competition and after find that keyword advertising usually can not be seen as intercepting a competitor’s potential customers (ger: Einringen in den Kundenkreis eines Mitbewerbers) and also does not constitute an act of passing off (ger: Rufausbeutung), due to clear labelling also not misleading as to the nature of the content (ger: Irreführung, Rechtsbruch) and finally not a misrepresentation of a third party’s sign (ger: Kennzeichenmissbrauch).

If one national court however finds that an ad is not fulfilling the formula and thus does not constitute a honest practices in industrial or commercial matters I wonder if this would/should influence my just cited findings😦

2 Responses to “*One To Cure Them All? – Is The ECJ Using The Very Same Formula To Answer All Questions Related To Keyword Advertising?”


  1. 1 Stefan 26/08/2010 at 20:20

    I wonder whether the court in Bergspechte is really defining likelihood of confusion. In the fragment you posted, isn’t the court just saying that it’s up to national courts to see if there’s a likelihood of confusion in the case when “internet users are shown, on the basis of a keyword similar to a mark, a third party’s ad which does not enable […] etc”?

    What are your thoughts about this?

    p.s. Thank you for writing on this great blog!


  1. 1 *Liberalisation of Google AdWords Trademark Policy: A Self Confident Step Forward « Austrotrabant's Blog Trackback on 05/08/2010 at 11:04

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