Trademarks

Non-Use Cancellation in Chile: Is Registering a Trademark Enough to Maintain its Protection?

By Fernanda Chamorro & Sofía Covarrubias, Covarrubias

What happens when a company registers a trademark, renews it for years, but never uses it in the market? Until recently, in Chile, such a trademark could remain in force indefinitely. However, the introduction of cancellation for non-use has changed the rules of the game and poses new challenges for those seeking to protect and manage their trademark assets.

Chile was one of the last jurisdictions to incorporate trademark cancellation for lack of use. Accession to the Madrid Protocol, together with the growing importance trademarks have acquired as strategic assets for companies, made it necessary to equip the system with mechanisms to clear out idle registrations and facilitate access to new distinctive signs. In this context, the reform became a long-awaited measure within the Chilean trademark system.

Law No. 21,355, which modernized the Industrial Property Law, introduced the action for cancellation for non-use, changing one of the historical characteristics of the Chilean system. Until then, a trademark could remain in force indefinitely through successive renewals, even if it was not used in the market. As of this reform, owners must take a much more active role in managing and maintaining their portfolios.

The regulations provide that a trademark may be declared cancelled, in whole or in part, if it has not been put to genuine and effective use in Chile for five years from the grant of the registration, or if such use has been suspended without interruption for the same period. Cancellation may affect only those goods or services for which no use has been proven, while the registration remains in force for the rest of its coverage.

This change requires rethinking how trademark portfolios are built and managed. More than ever, it is important to file carefully delimited applications aligned with the actual or projected activity of the business. Overly broad protection strategies, common in our country for years, now entail an additional risk by exposing the registration to partial cancellation actions.

Along with this, the systematic preservation of evidence of use takes on particular importance. Although there are not yet any rulings that make it possible to anticipate precisely the evidentiary standards the authority will apply, it is reasonable to expect that documents such as invoices, contracts, advertising material, catalogs, websites and other contemporaneous commercial records will be especially relevant. What will be essential is to clearly demonstrate the effective use of the trademark, the date of such use, and its connection to the goods or services protected.

The law also establishes that the burden of proving use rests on the registration holder. Companies should therefore begin implementing document retention policies now that allow them to respond adequately to any eventual challenge.

Another particularly relevant aspect for corporate groups and holding companies is that use must take place in Chilean territory by the owner or by a third party acting with its consent. Consequently, it will be essential to keep the relationships between the entity that owns the trademark and the related companies that actually use the signs in the market properly documented. In practice, it will not be enough to show that the trademark is used; it must also be proven that such use is made with the corresponding authorization.

Likewise, the law allows cancellation to be raised as a counterclaim, turning it into a defensive tool that will likely become increasingly relevant in future trademark litigation.

Finally, it is important to remember that the first registrations subject to this regime will begin to reach the five-year statutory period on May 9, 2027. Although that date may seem distant, now is the right time to review trademark portfolios, identify potentially vulnerable registrations, and adopt measures to properly prove their use.

In short, the incorporation of cancellation for non-use brings Chile closer to international standards and promotes a more efficient trademark system. However, it also demands a change of approach: it will no longer be enough to obtain and renew registrations. It will be necessary to demonstrate that trademarks effectively fulfill their essential function in the market.