Russia’s Presence in Montenegro: What It Means for Trademark Owners

Sep 25 2012 - 12:07

Considering Russia’s growing economic presence in Montenegro, when obtaining trademark protection in Russia, it may be wise to do the same in the small Balkan country on the Adriatic Sea.

Following its independence from the union with Serbia in 2006, Montenegro experienced a real estate boom, with foreigners, mostly of Russian origin, buying land and investing into houses, hotels and tourist resorts in some of the most beautiful spots in the country. While the figures on the Russian-owned real estate in Montenegro vary, several major hotels are in the Russian ownership, the number of Russians visiting and residing in Montenegro has been continuously increasing and the large-scale Russian presence is evident.

Spoken Russian can be heard along the Montenegrin coast throughout the year, even out of the summer season. Advertisements in the Russian language are displayed everywhere, there are Russian restaurants, all sorts of small businesses, even a Russian radio station. A new settlement right above the gem of the Montenegrin coast, the luxury peninsula of Sveti Stefan, is called the Russian Village. It is clear that a number of Russians are permanently settling in Montenegro. Most of them are living in the coastal towns of Budva, Bar and Herceg Novi. Last year the first Russian-language school was opened in Budva.

There is a growing presence of Russian companies in sectors other than tourism. A recent Statistical Office of Montenegro report showed that Russians own 32 percent of business entities in Montenegro. A major Montenegrin exporter, Aluminum Plant Podgorica (Montenegrin: Kombinat Aluminijuma Podgorica – KAP), is in the Russian ownership.

It is expected that Russian businesses will bring their customs and policies along with the investments. This change is likely to affect trademark owners as well.

As a general rule, in Russia only registered trademarks enjoy legal protection, so it has been common for local firms to take advantage of unregistered trademarks. Furthermore, the Cyrillic alphabet poses challenges for trademark owners as some letters that look identical to those in the Latin alphabet are pronounced completely differently. It is therefore considered safer to register both variations. These are the main reasons why Russia experienced major growth in trademark registrations during the last decade.

In Montenegro, an unregistered trademark enjoys protection under certain circumstances, but it is still recommended to apply for registration for a couple of reasons. Namely, intellectual property (IP) laws in Montenegro have only been recently harmonized with the EU legislation. The IP practitioners are still inexperienced and the trademark practice is not well developed as the infrastructure that addresses enforcement of IP rights was established only after Montenegro gained independence. Therefore, having a valid trademark registration remains the most efficient and cost-effective way to protect the rights in this jurisdiction. Finally, Cyrillic alphabet is used along with the Latin alphabet in Montenegro, so a registration in both alphabets may be of interest for the most important marks.

By: Jasna Jusic

For more information, please contact Jasna Jusic at our Montenegro office.

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