AMSTERDAM (CN) - A British supermarket has lost its long legal fight to keep the word "Iceland" as a registered trademark in the European Union after the EU's General Court said the name can't be trademarked by a single company.

The General Court backed Iceland's national trademark office, agreeing that UK-based supermarket chain Iceland Foods shouldn't have exclusive rights to the word "Iceland." The judges said using the country's name as a brand could mislead shoppers into thinking the products come from Iceland - even when they don't.

This dispute traces back to 2018, when Icelandic Trademark Holding, a company supported by the Icelandic government, formally challenged the supermarket's EU trademark. At its heart is a simple question: Can a company claim exclusive rights over the name of a whole country, especially one that consumers might associate with origin?

That logic, the court said, applied especially to everyday food products. Iceland Foods, which first applied for the trademark in 2013, had used the mark for a variety of food and retail services. The court pointed out that many of these goods - from frozen vegetables to yogurt to breakfast cereals - were the kinds of products that consumers might reasonably associate with a country like Iceland, making the trademark potentially misleading.

Iceland Foods argued that there is no EU rule explicitly banning trademarks that use country names. But the court was not convinced. What matters, it said, is whether the public sees the name as describing the products or services, not whether the name is officially off-limits. EU trademark rules prohibit registration of terms that describe key characteristics of a product, including its geographic origin - even if the name isn't on a formal blacklist.

Under EU trademark law, signs that consist exclusively of descriptive terms, such as those indicating geographic origin, are generally barred from registration.

The company also pointed to its red, orange and yellow rectangular logo as proof that the trademark was distinctive. Again, the court disagreed. It found the design to be purely decorative.

"The figurative elements of the mark at issue served only to highlight the word element of that mark and did not alter in any way the descriptive content conveyed by the latter element," the General Court noted.

Iceland Foods even tried to back up its case with a consumer survey to show that most people don't associate the name with the country. But the court dismissed it, finding it too weak to outweigh the risk of geographic confusion.

By keeping geographic terms free for public use, the judges said, businesses are better able to describe the true origin of their products. Country names, they added, can suggest certain qualities or characteristics, even if the place isn't widely known for a specific item.

With that reasoning, the court rejected all of Iceland Foods' claims and upheld the decision to cancel the trademark. The company was ordered to cover legal costs.

Gordian Hasselblatt, a trademark attorney based in Cologne and partner at CMS, said the ruling helps clarify how geographical names, particularly country names, are treated under EU trademark law.

"The central legal question was whether and when a geographical name can be registered as a trademark, particularly for goods tied to origin," he said. "This judgment helps clarify how direct that connection must be for the name to be considered descriptive and therefore ineligible for protection. Geographical terms should remain available to all economic operators, because they often indicate qualities or characteristics that matter to consumers."

While today's ruling closes the case at the General Court, Iceland Foods still has two months to file an appeal to the Court of Justice of the EU. It has not yet indicated whether it will do so.

Source: Courthouse News Service