Guidelines on Trade Mark Classification of Virtual Goods and NFTs in Australia
Daniel Wilson and Chelsea Peters, Spruson & Ferguson (Australia)
There has been heavy speculation over the last two years on how intellectual property will operate in the emerging virtual arena that is the Metaverse and similar digital spaces. The MetaBirkins case in the United States gave brand owners some comfort that existing trade mark rights for physical goods may extend some protections to unauthorised use of virtual equivalents, while the Juventus decision in the European Union highlighted the value of extending trade mark protections to virtual goods, and we looked to the European Union and United Kingdom for insights into how the registration of trade marks for virtual goods might be treated in Australia.
On 10 August 2023, IP Australia released welcome guidance on trade mark classification of emerging technologies, including NFTs and virtual goods. In terms of seeking trade mark registration for virtual goods, NFTs and blockchain technology, IP Australia has provided the following guidelines:
Virtual goods and services
• Trade marks relating to virtual goods are properly classified in Class 9. The terms “virtual goods” and “downloadable goods” lack specificity and are unacceptable. The nature of the virtual goods must be specified, for example, “downloadable virtual clothing”.
• Trade marks relating to virtual services fall under the relevant service class, taking into account the real world impact of the service. For example, IP Australia considers that restaurant services provided in a virtual environment is a Class 41 entertainment service, rather than a Class 43 restaurant service.
• While the terms “metaverse” and “web3” are considered acceptable, the term “virtual environments” is preferred for its broad application. For example, “entertainment services provided in virtual environments”.
Non-fungible tokens (NFTs)
• NFTs are not considered a good or service, but a means of certification. The terms “non-fungible tokens” or “NFT” lack specificity and are unacceptable. The exact nature of the goods being authenticated by the NFT must be specified.
• NFTs which are linked to digital assets will fall under Class 9, such as “downloadable digital image files authenticated by non-fungible tokens”.
• Where the NFT is linked to a physical good, the claim should sit in the relevant physical good class. For example, shoes authenticated by NFTs would fall in Class 25; artworks authenticated by NFTs would fall in Class 16. This is consistent with the approach taken by the UKIPO.
• Blockchain technology is not considered a good or service, but a feature of goods or the means through which services are provided. The term “blockchain” on its own lacks specificity and is unacceptable. The nature of the goods or services which the blockchain technology relates to must be specified, for example, “downloadable computer software for blockchain technology” in Class 9.
• Trade marks relating to blockchain technology fall under the relevant good or service class, taking into account the application of the blockchain technology. For example, “electronic funds transfer provided via blockchain technology” in Class 36 and “computer programming of smart contracts on a blockchain” in Class 42.
Trade mark practitioners and applicants are welcoming this update to IP Australia’s Trade Marks Practice and Procedure as it provides much needed clarity on how the trade marks office intends to treat applications for emerging technologies.
In terms of trade mark searching and monitoring, the classification of virtual goods and services means that consideration will need to be given to Class 9 (for virtual equivalents of real world goods) and/or Class 41 (for services provided in virtual environments).
Brand owners with rights for physical goods are advised to extend their trade mark protection to the corresponding virtual goods to ensure sufficient coverage and enforcement strategies should be reviewed to ensure that use of trade marks in relation to virtual goods and services is being actively considered.