How to classify virtual goods and NFTs in Benelux trademark applications – Commentary

Background
What are NFTs?
BOIP guidance
Examples
Comment

The Benelux Office of Intellectual Property (BOIP) recently issued a communication on the subject of trademark applications with terms relating to virtual goods and non-fungible tokens (NFT).

Background

Trademark applicants must choose within the Nice Classification – an international classification of 45 goods and services – for which (class) of goods and services the sign is used.

The communication from BOIP was released because BOIP is increasingly receiving trademark applications involving goods and services related to virtual goods and NFTs. BOIP has also indicated that it regularly receives inquiries from applicants about how to classify virtual goods and NFTs.

What are NFTs?

An NFT is a unique digital identifier that cannot be copied, replaced or subdivided. It is registered in a blockchain and is used to certify authenticity and ownership. The ownership of an NFT is recorded in the blockchain and can be transferred by the owner, so that NFTs can be sold and traded. NFTs typically contain references to (and authenticate) digital files such as images, videos, and audio. But while they authenticate digital items, they are separate from them.

BOIP guidance

BOIP has clarified that it will approach the classification of NFTs and virtual goods as follows:

• Virtual goods are not classified in the same class as corresponding physical goods. Rather, they are always classified in Class 9, along with other digital and/or downloadable goods. “Digital clothing” is therefore not classified in class 25, but in class 9.
• The term “virtual goods” in itself will not be considered by BOIP to be sufficiently clear and precise. More specification is needed regarding the content to which these goods are linked – for example “downloadable virtual goods, namely virtual clothing”.
• The same applies to NFTs – the term “NFT” itself is not acceptable under the BOIP and must be accompanied by an explanation.

Services linked to virtual goods and NFTs are classified according to the established principles for the classification of goods and services. The practice of BOIP is in line with that of the European Union Intellectual Property Office in this regard.

Examples

BOIP has provided the following examples of acceptable terms relating to virtual goods and NFTs.

Virtual goods
In grade 9:

Virtual goods visualization software, namely . . .

Digital downloadable goods, namely, avatars for use in video games.

In class 35:

Retail services in the field of virtual goods, such as . . .

In class 41:

Entertainment using virtual goods.

Entertainment by proposing virtual games where services can also be offered, for example . . .

In class 42:

IT services to create an online virtual environment.

NFTs
In grade 9:

Digital ownership certificates (NFT).

Non-downloadable digital certificates of ownership in the form of NFTs.

Non-fungible tokens (NFT), which are digital certificates of ownership that represent virtual goods.

In class 35:

Retail services in virtual goods, for which an NFT has been issued.

In class 36:

Exchange services for non-fungible tokens of value (NFTs).

In class 41:

Entertainment using virtual goods for which an NFT has been issued.

Comment

The communication from BOIP is a welcome clarification. It was particularly uncertain whether an application claiming only “virtual goods” as such would be sufficient or whether it would also have to specify them further. The latter has now been confirmed as best practice.

Now that the first trademark applications relating to virtual goods and NFTs have been granted, it will be interesting to see how the trademark offices and the judiciary will treat such trademarks in light of revocation actions due to non-use. What amount of use and/or sale of virtual goods is sufficient, and how can it be determined whether sales that took place in, say, the metaverse also took place in the Benelux territory?

Undoubtedly, interesting legal issues will continue to arise regarding trademarks associated with virtual goods and NFTs.

For more information on this topic, please contact Bram Woltering at AKD by phone (+31 88 253 50 00) or e-mail ([email protected]). AKD’s website can be accessed at www.akd.nl.