Israel’s IP Commissioner on the Changing Landscape and Promoting Entrepreneurship

ILPO Commissioner Ofir Alon

The Israel Intellectual Property Office (ILPO) has crafted an approach to trademarks that fits its size, international clientele, and the entrepreneurial spirit of its users. Ofir Alon, Executive Director, Commissioner of Patents, Trademarks and Designs, Israel Patent Office, describes the approach tied to practical but productive goals, offering a landscape of trademark activity and insights into the operations of the Office.

Commissioner Alon took office more than two years ago, after a career in private practice in various intellectual property (IP)-related roles. He previously served as chief IP officer at Technion Research and Development Foundation, and earlier as an IP manager, legal advisor, and attorney at other firms. He studied at the University of Haifa, Israel.

In an interview with the INTA Bulletin, ILPO Commissioner Ofir Alon describes the approach, which is tied to practical but productive goals, as well as offers insights into trademark activity in the country and the Office’s operations.

Please provide a snapshot of trademark filings in Israel today.
Each year around 10,000 trademark applications are being filed in more than 20,000 classes. The increase in the number of classes filed in Israel occurred when Israel joined the Madrid Protocol in September 2010. Since then we can see a moderate increase every year. 2019 was a record year, with almost 24,000 classes.

Prior to the accession to the Madrid Protocol, one-third of the applications were filed by Israeli residents. Following the accession to the Madrid System, only one-quarter of the applications have been filed by Israeli residents and one-fifth of the classes originated in Israel. This trend is different from many countries in the world where most of the classes filed for registration are by residents of that country (for example, Italy, the United Kingdom, the United States, China, Brazil, and Egypt). One-fifth of the applications in Israel are filed by U.S. residents. The next leading countries with a large number of applications in Israel are China and Germany.

Class 9 is the most specified class in the last decade. The current pendency time for first examination is four months and it is expected to be reduced even more. The Israel Patent Office (ILPO) is paperless and works with a full online filing system, with 99 percent of the applications filed online. Under regulations, only private individuals can file in paper.

What are some of the trends that you’re seeing in terms of trademark filings?
Among the trends being seen are: An increase in the number of applications and classes, and an increase in nontraditional trademark applications. For example, in the past five years, about 300 applications have been filed for registration of 3D trademarks, whereas in the previous five years, only 186 applications were filed. Another trend has been an increase in trademark applications including the word “cannabis.”

Looking abroad, what trends are you seeing in terms of Israeli brand owners and trademark filings overseas?
Brand owners in Israel are mostly operating in the U.S. and European Union markets. About 50 percent of the filings are made through the Madrid Protocol.

The rest choose to protect their trademarks abroad directly rather than use the Madrid Protocol for a number of reasons:

In cases where only one country is designated, direct filing will be cheaper.
Many Israelis register their trademark in Israel in Hebrew, and abroad use a Latin character trademark. Therefore, the Israeli application/registration cannot be used as a basic registration for an international application under the Madrid Protocol.
The examination process in Israel is based on absolute and relative grounds. In addition, the Israel trademark examination is known to be strict and therefore there is some reluctance to file an international application based on a national application.

How does the ILPO conduct legal proceedings?
Opposition and invalidations proceedings are conducted at the ILPO, as in other offices.

In 2019, 120 new opposition proceeding were initiated, with 31 invalidations and 9 competitions. Competition proceedings are, however, unique, and to the best of our knowledge do not exist elsewhere.

Competition proceedings are conducted in order to decide between two applications made by different applicants for identical or similar trademarks, with respect to the same goods or description of goods. This proceeding is decided based on the use of the marks by each party, the good faith in using the marks, and the date each application was filed with the office. An agreement between both parties will not be approved automatically. The registrar will consider the agreement only if he believes that the public will not be confused.

Can you offer some data on IP enforcement in the country with regard to trademarks?
Infringement actions are conducted in the district court. There is no available data on how many actions are filed each year.

With regards to customs inquiries, the number of customs inquiries by IP owners ranges from 700 to 1,000 cases per year. The infringing goods are being held and stored until given a court’s decision regarding the infringement. According to the Customs Ordinance, storage expenses will be paid by the rightful owner, which can claim the costs in return by a court decision.

Looking ahead, what are the future goals of the ILPO?

To raise public awareness with regards to the importance of registering trademarks (cooperation between government offices, providing educational programs in schools and universities, and providing training for small businesses).
To encourage the use of the Madrid Protocol by Israeli residents who wish to protect their rights abroad.
Incorporating new artificial intelligence technologies into the examination process, to increase capacity and quality, and to provide access to such a tool to the public.
To simplify and improve the online filing of new applications and other requests. Also avoiding unnecessary rejections during examination by identifying possible errors and guiding the applicant to correct the application during the filing process.

What actions has the Office taken in response to the COVID-19 pandemic and what advice does the Office have for users in this regard?
I am proud to note that the ILPO was able to provide its services to the public during the COVID-19 pandemic with almost no change, even during the lockdown. This is a result of the fact that all services in the ILPO can be provided online, and the Office is used to remote working. We understand the difficulties that applicants had in meeting deadlines because of COVID-19, and like other offices, we granted extensions to perform actions before the Office. We did not see any decline in the number of filings during the first six months of the year, which is encouraging, and we hope that businesses will be able to continue protecting their IP even during these difficult times. Regarding legal proceedings, the deadlines for filing legal documents and the hearings have been postponed. Currently, we are working to promote remote hearings via, for example, videoconferences.

Israel is known to be a technology hub. In addition to being a “start-up nation,” many international companies invest and operate in Israel in order to benefit from the creativity and innovation that characterizes Israel’s business culture. How does the ILPO see its role in fostering innovation and attracting foreign companies to Israel?
Fostering innovation in the country has many layers. Not all of them relate to the Intellectual Property Authority. Issues relating to technological infrastructure, taxation, governmental incentives, proper regulation, etc., are all important for fostering innovation. Creating a friendly environment for innovation is a joint mission for many governmental and other organizations, not only the Patent Office.

As for the Patent Office, a functioning IP system is crucial for innovation and has several building blocks—legislation, registration system, judicial system, and education and public awareness. We see it as our responsibility to make sure that Israel has a modern IP legislation and that Israel is a member of the major international IP treaties, and together with Ministry of Justice, we act to improve the current legislation. The ILPO is trying to make the registration process of IP rights in Israel simple, fast, and inexpensive so that protecting IP rights is also available for small and medium enterprises (SMEs) and individuals and not only for big enterprises. The judicial system is also an important factor. In this regard, a lot of the case laws relating to validity of IP rights start in proceedings before the Patent Office as a first instance, and we try to make our contribution to the development of case law.

Finally, raising awareness of IP rights in Israel is important. It is important that IP rights holders know about their IP rights and how they can help their business and be able to identify when they need to seek legal advice. And it is important to have a culture that respects and appreciates IP rights.

Israeli early-stage start-ups often prefer to file their trademarks in the United States or the EU rather than in Israel. Why is that the case and what can be done to convince these start-ups that their IP rights should also be protected in Israel?
This is a property of the Israeli market, which is small. Therefore, the main target markets of Israeli companies are usually the U.S. and the EU, and filing trends correspond to that. In my view, the ILPO’s purpose should not be convincing companies to file in Israel when it is not the best business decision for them. Many times, different decisions should be made for different types of IP.

We should help companies to make the best decision for them by providing them with the right information. For example, we are working with the Israel Innovation Authority—the main governmental funding agency for innovation—to provide start-ups with the relevant information relating to IP rights. If after making an informed decision they decide to file in Israel, it is our responsibility to make the process as simple, friendly, and inexpensive as possible.

If the best decision for them is filing only abroad, we should offer them tools that will make the registration aboard more predictive, simpler, and cheaper. For example, we offer an accelerated examination route for companies that use the ILPO as the first filing office for patents. Many companies use this option, even if they don’t wish to have an IP right in Israel. Those companies receive high quality examination in a short time, which can be used to evaluate the strength of their IP and accelerate the registration in other jurisdictions. During this process, they might also receive IP protection in Israel, even if it wasn’t their main goal.

Generally speaking, filing a trademark is not an expensive process and having a trademark in the home country is advisable. The consequences of not having a registered mark could be harsh. We try to communicate that to the SMEs.

What are most critical challenges facing the IPLO today? How is the ILPO preparing for the future?
In the short term, the ILPO is focused on shortening pendency times for patent applications and continuously improving examination quality to provide the market with the certainty it needs regarding IP validity. Using advanced technologies such as artificial intelligence and big data is a must to achieve these goals, and we are learning these systems, their advantages, and limitations.

In the long term, we are trying to join forces with others to understand the changes and impact of the Fourth Industrial Revolution on the IP regime and the operation of IP offices in the future.

Unlike many other jurisdictions, the ILPO (in its judicial capacity) cites foreign case law in its decisions and seriously considers decisions given by judicial instances in other countries. How does the ILPO balance local case law with foreign case law? Which jurisdictions are most influential upon the case law and working guidelines of the ILPO?
We indeed consider foreign case law in many cases, and maybe more than others. It is important to note that Israel is a relatively young country with a small market, and there is not a large amount of case laws in the IP area. Moreover, parts of Israeli IP legislation were influenced by foreign legislation. For example, the Israeli patent law has connections to the old UK patent law, and the new Designs law is similar to the EU designs law.

In addition, many concepts and principles of IP law are international and are similar between different countries. Therefore, considering foreign case law in ILPO decisions is natural. In a broader sense, I believe that considering solutions given in different jurisdictions to address similar questions is always helpful.

In the end, we make our own decisions based on the Israeli law and binding precedents, but this does not mean that we can’t learn from others’ experience. I think that mostly UK, European Patent Office, and EU decisions are cited, but also U.S. law.

With regard to guidelines, the ILPO has extensive working guidelines which are updated at least once a year. Each year, we choose several topics for the update and publish the list for the public. We also receive requests from the public to add or update our guidelines on specific issues that they wish us to consider. Following the decision on which topics to focus, the team that is working on the guidelines considers Israeli case law, other jurisdictions’ guidelines, and policies on the same issues, then develops the ILPO’s guidelines on the subject. The final result is again published for public comments, and then finalized and approved.

How can INTA support the work of the ILPO and brand owners in Israel?
The IP professionals’ community in Israel is very helpful and takes part in many initiatives of the ILPO. We see the benefit of working with stakeholders and professional organizations every day, as they bring to the table viewpoints and capabilities that the ILPO doesn’t have.

INTA has the access to the cumulative experience from so many practitioners and countries, and vast experience in campaigns for raising public awareness about trademarks. These could be invaluable for us.

Although every effort has been made to verify the accuracy of this article, readers are urged to check independently on matters of specific concern or interest.