Precious Metals Markings And Trademarks

The dealing of jewellery, including precious metals, consists of an important source of trade[1] and, in Canada, jewelers are obligated to comply with numerous laws[2] and international initiatives[3], including but not limited to the Canadian Trademarks Act[4] (“TMA”), the Precious Metals Marking Act[5] (“PMMA”), the Weights and Measures Act[6], and their corresponding regulations, as applicable.

One manner in which the two aforementioned Acts overlap relates to the affixing of a quality mark on an article. According to the PMMA, a “quality mark” means “a mark indicating or purporting to indicate the quality, quantity, fineness, weight, thickness, proportion or kind of precious metal in an article”[7]. An “article” is also defined as per the PMMA as “any article of merchandise, and includes any portion of any article of merchandise, whether a distinct part thereof or not, other than an article or a part thereof designated by the regulations”[8]. It is worth noting that quality marks are also referred to as “hallmarks” in other jurisdictions, such as in the United Kingdom[9]. Lastly, a “mark” is defined to include “[…] any mark, sign, device, imprint, stamp, brand, label, ticket, letter, word or figure”[10].

The intersection of the TMA and the PMMA can be observed explicitly through subsection 4(3) of the PMMA which states that where a quality mark has been or is to be applied onto precious metal[11], it must also bear a trademark that has either been applied for or registered with the Registrar of Trademarks in Canada[12].

It should be noted, however, pursuant to subsection 4(4) of the PMMA, that subsection 4(3) of the PMMA does not apply if the article “is hallmarked in accordance with the laws of the United Kingdom” or if the article “has applied to it by the government of any foreign country a mark authorized to be applied thereto under the laws of that country that truly and correctly indicates the quality of the precious metal of which the article is in whole or in part composed”[13].

In addition, subsection 5(2) of the Precious Metals Marking Regulations further indicates that where a quality mark is stamped, branded, engraved or imprinted on a precious metal article, the trademark must be applied in the same way as the quality mark[14].

In 2006, the Canadian Competition Bureau published the Guide to the Precious Metals Marking Act and Regulations(hereinafter the “Guide”) to be read in conjunction with the PMMA and corresponding Regulations. The Guide outlines the dealer’s responsibilities and their duties to ensure that a quality mark applied onto an article is done in a manner consistent with the Regulations.

For further clarity on markings, section 14 of the Guide indicates the following:

“EXAMPLES OF MARKINGS

14.1 The use of dual markings such as “14K – 18K” or “10K – STERLING” are only permitted on articles where the quality difference is discernible by colour. The quality making up the greater proportion in the article must appear first.

14.2 When the base metal is required to be marked on an article (hollow ware, flatware), the only permissible abbreviations allowed are “N.S.”, “B.M.”, “W.M.”. Abbreviations such as “COP”, “Br.”, “Z” are not allowed”[15].

Any dealer who does not adhere to the PMMA and corresponding regulations is, pursuant to section 10 PMMA, guilty of an offence and liable on summary conviction to a fine not exceeding five hundred dollars ($500.00 CAD)[16].

Trademarks Used in Association with Jewellery

First, it should be noted, as it pertains to trademarks, that precious metals and their alloys, as well as jewellery, including, for example, bracelets, rings, watches, etc., form part of class 14 goods of the Nice Classification[17].

The relevancy of the present discussion is heightened by the fact that the Federal Court of Canada recently rendered a decision pertaining to trademarks used in association with gold and silver jewellery[18]. The trademarks concerned by this decision, FORGET-ME-KNOT (TMA599,853) and LOVE-KNOT (TMA631,952), were contested on the basis of a section 45 expungement proceeding[19]. The Federal Court was tasked with deciding whether or not the trademark owner provided proof of use, pursuant to subsection 4 (1) of the TMA, of the trademark in question during the relevant period[20]. In order to satisfy this requirement, three criteria must be satisfied:

1. the mark must be a trademark as defined in section 2 of the TMA;

2. the trademark must be used in association with the goods in question; and lastly

3. the transfer of property or possession must occur in the normal course of trade.[21]

In this instance, the Federal Court was only tasked with determining if the transfer of property occurred in the normal course of trade[22]. However, due to the fact that the registered owner failed to provide evidence of such use, the Court ordered the trademark registrations be expunged.[23]

Take-aways - Conclusion

The objectives set forth by the PMMA are similar to those set forth by the TMA. We must not forget that the Supreme Court of Canada once classified the TMA as “consumer protection legislation”[24]. In fact, according to the Supreme Court, trademarks are a “guarantee of origin and inferentially, an assurance to the consumer that the quality will be what he or she has come to associate with a particular trade-mark”[25]. Likewise, the PMMA seeks to protect the consumer by ensuring that the quality marks affixed on the articles represent a true and accurate description of the quality and characteristics of the article. Therefore, it is only logical that two Acts with such similar goals would intersect with one another.

[1] https://www.ic.gc.ca/app/scr/app/cis/summary-sommaire/33991 (updated March 11, 2020). [2] Including the Proceeds of Crime (Money Laundering) and Terrorist Financing Act, S.C. 2000, c. 17. [3] Kimberley process with respect to diamonds, available at: https://www.nrcan.gc.ca/mining-materials/resources/kimberley-process-rough-diamonds/8222. [4] R.S.C. 1985, c. T-13. [5] R.S.C. 1985, c. P-19. [6] R.S.C. 1985, c. W-6. [7] Id., s. 2. [8] Id. [9] https://www.assayofficelondon.co.uk/hallmarking/what-is-a-hallmark. [10] R.S.C. 1985, c. P-19, s. 2. [11] A “precious metal” is defined pursuant to section 2 of the PMMA “gold, palladium, platinum and silver and an alloy of any of those metals and any other metal and an allow thereof that is designated by the regulations as a precious metal for the purposes of this Act”. [12] PMMA, s. 4 (3). [13] PMMA, s. 4 (4). [14] Precious Metals Marking Regulations, C.R.C., c. 1303, s. 5 (2). [15] Competition Bureau of Canada, Guide to the Precious Metals Marking Act and Regulations, Gatineau, Competition Bureau, 2006, p. 19, online: <https://www.competitionbureau.gc.ca/eic/site/cb-bc.nsf/vwapj/guide-precious-metals-2006-07-04-e.pdf/$file/guide-precious-metals-2006-07-04-e.pdf>. [16] PMMA, s. 10. [17]https://www.wipo.int/classifications/nice/nclpub/en/fr/?basic_numbers=show&class_number=14&explanatory_notes=show&lang=en&menulang=en&mode=flat&notion=&pagination=no&version=20200101. [18] Sim & McBurney v. Gordon, 2020 FC 710, par. 2. [19] Id., par. 1-2. [20] Id., par. 18. [21] Id., par. 19. [22] Id., par. 20. [23] Id., par. 28 and 32. [24] Mattel, Inc. v. 3894207 Canada Inc., 2006 SCC 22, par. 2. [25] Id.