What lies in store for trademarks in 2024?

Recent years have seen a high level of volatility in trademark filing activity around the world. The number of trademark applications filed each year has been increasing annually since 2010, with total filing volume more than trebling from 3.4 million to 11.8 million in a decade.

Despite the economic disruption caused by the COVID-19 outbreak, 2020 was another record year with 13.6 million applications globally, followed by 14 million applications in 2021. But 2022 saw the run of growth come to an abrupt end as many major trademark registries saw a significant fall in filing volume—just 11.7 million trademark applications were filed around the world, a fall of over 17%.

As 2023 drew to a close, the numbers suggest that filing volume has stabilised—2023 wasn’t a record year but will be roughly in line with 2022 at most registers, with the exception of China which may see a small fall.

Global trademark filing activity will be stable

Based on filing trends in the second half of 2023, our first prediction for 2024 is that we will see a third consecutive year of minimal growth in filing activity. Trademark registers are likely to see growth in one area though: renewals. A trademark generally requires renewal action every ten years (the term can be longer or shorter, depending on the jurisdiction). Twelve years of increased filing activity from 2010 means 10 years of renewal activity growth from 2020 (a decade later).

2024 is also likely to see growth at the World Intellectual Property Organization ( WIPO) as several important trademark offices have joined the Madrid system of International Registration managed by WIPO in recent years and there will be an increasing trend to switch from filing national applications to filing centrally via WIPO.

A significant proportion of applications filed at WIPO designate just a single country, so the addition of a single new member generates new converts as well as ‘subsequent designations’ as owners of existing registrations pay more to add the new members as they join.

One important register to watch in 2024 will be China, which accounts for over 60% of all global trademark filing activity. Chinese applicants also file large numbers of applications abroad—accounting for over 10% of all new applications filed in the UK, US and the EU in recent years. The number of new applications filed in China fell by 17% in 2022 and declined again in 2023 by around 9% (based on current data). With the economic situation in China looking mixed—particularly in the housing, construction and financial sectors—2024 could be another challenging year, with major implications globally.

Official fees to increase

Obtaining official trademark registrations comes with a cost attached. Even if you choose to prepare and file an application yourself, there are official filing fees that need to be paid when the application is submitted. Official fees are usually set by governments, and they rarely change. For example, the UK Intellectual Property Office ( UKIPO) last changed the official fee for filing a trademark application in October 2009—more than 14 years ago.

And the change was a decrease, offering a £30 reduction from £200 to £170 for applications filed online. With cost of living increases and high inflation, trademark registries, like other businesses with budgets and targets, are under increasing pressure to cover rising costs.

As already noted, the consistent annual growth in trademark filing volume has generated increased revenue, but just as costs started to rise more sharply this volume fell in 2022. There will be a slight offset from increasing renewal fees, but we predict that offices will be reviewing their fee schedules in 2024 and increases would make sense.

Even though the UKIPO and the EU Intellectual Property Office saw filing volume increase slightly in 2023, applicants showed signs of tightening their belts. The average number of classes covered by an application at the UKIPO fell from 2.13 in 2022 to 2.05 in 2023 (EUIPO saw a fall from 2.58 to 2.39) which means that revenue from filing fees is essentially flat.

Offices may also be tempted by previous experience—when official fees increase filing volume falls but by a smaller proportion than the fee increase. For the IP office this means less work for more revenue. In November, Canada announced a 32% increase in official filing fees as of January 1 2024—other offices are likely to follow.

Chinese applicants to receive closer attention

China based applicants have filed over 650,000 trademark applications at the US Patent and Trademark Office ( USPTO) since 2019—more than 21% of the nearly three million applications received over the past four years. A significant number of issues have been identified by the USPTO in relation to this activity.

More than a dozen US qualified attorneys have been disciplined, including multi year suspensions, for abrogating representation responsibilities and allowing their details and online USPTO accounts to be “borrowed” by non-qualified foreign based agencies. In recent months the USPTO has announced the outcome of lengthy internal investigations into two major filing networks that have together filed over 60,000 US trademark applications (around 10% of all applications from China).

The USPTO has indicated that these applications may be cancelled completely for violations of representation and document rules and it is likely that additional networks are already under investigation. The records already identified cover over $15 million in official filing fees that would be forfeited by the applicants and their agent if the records are cancelled—such an outcome could have a serious negative impact on trademark activity from China into the US.

AI will make things worse (before making things better)

The USPTO currently receives around 800 trademark applications a month that include the term ‘artificial intelligence’ (AI) in the specification of goods/services. From an overall monthly total of over 40,000 applications, AI related applications account for a small (around 2%) but growing trend. The numbers will undoubtedly grow in 2024 and exponential growth is possible—but even if volume doubles or triples it won’t make a significant impact on overall filing volume in the near future.

However, where AI might make an impact in 2024 is on the quality of applications. Commercial chatbot tools currently do an impressive job of answering questions and appearing to be intelligent and creative. However, this apparent capability and confidence in the output may lead applicants astray.

Although we tend to think of trademarks as being the domain of large companies, the vast majority of trademark applications filed each year belong to individuals and small businesses, often filed without the assistance of a trademark professional. These applicants are likely to rely on online tools and resources, and using a chatbot to draft specifications will become increasingly common.

These tools currently are not always capable of generating precise and accurate specifications with the appropriate language and Nice Classes. No doubt they will improve over time—with use and increased training and learning—but examiners should expect to see increasing numbers of applications in 2024 that will require redrafting.

Robert Reading is director, government and content strategy, IP group at Clarivate. He can be contacted at Robert.reading@clarivate.com