Google's new rules under fire in Europe

15 September 2010

BRUSSELS: Google, the search giant, has relaxed rules governing the purchase of trademarks via its AdWords system in Europe, a move that could make it harder for brands to protect their integrity.

Earlier this year, the European Court of Justice ruled that AdWords - through which marketers pay to buy keywords, including brand names, for use in sponsored links - did not infringe on trademark regulations.

Louis Vuitton, the luxury goods group, brought one of three cases regarding this issue, because it might allow rivals, or counterfeiters, to divert consumers away from manufacturers' actual websites.

Retailers may also exploit the cachet of leading assets, like Nike or Adidas, to attract shoppers without recompensing the company concerned.

After initially outlawing such activity, Google revised restrictions for North America in 2004 and the UK and Ireland in 2008.

It will now "no longer prevent advertisers from selecting a third party's trademark as a keyword" in several European markets, where they are not "confusing as to the origin of the advertised goods and services".

Links employing brand names in a "descriptive or generic way", representing "competing products or services", supporting specialist independent sites and flagging up portals reselling items would all be valid.

"Google's goal is to provide our users with the most relevant information, whether from search results or advertisements, and we believe that users benefit from having more choice," Google said.

"Our policy aims to balance the interests of users, advertisers, and trademark owners."

The World Federation of Advertisers, the industry body, suggested the fact no formal consultation about this matter had taken place was regrettable.

"Google has become a valuable partner for brand owners worldwide, many of whom are major users of AdWords," said Stephan Loerke, the WFA's managing director.

"This new trademark policy applying across the European region is unhelpful. It could significantly raise the cost for brand owners to effectively protect and promote their brands online."

These sentiments were echoed by AIM, the European Brands Association, which boasts members such as Danone, Cadbury, Kraft, Mars and Reckitt Benckiser.

"Google has chosen not to speak with brand owners to find a solution that would protect all interests," the organisation argued.

Interflora, the flower delivery network, sued Marks & Spencer and Flowers Direct for bidding on "Interflora", and related terms, via AdWords in late 2008.

The price of Interflora's name climbed more than ten-fold when Google modified its UK rules, meaning expenses leapt by $750,000.

"The Interflora brand is extremely valuable and we will not tolerate competitors taking advantage of it and infringing our rights," Michael Barringer, Interflora's marketing director, said at the time.

"Throughout its history, Interflora has been forced to use legal means to prevent infringement of its valuable trademarks.

"This action represents only the beginning of a broader strategy to defend the Interflora mark against infringers."

Data sourced from World Federation of Advertisers, Reuters, World Trademark Review; additional content by Warc staff