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The latest rules and regulations providing for the declaration of well-known marks in the Philippines prescribe 12 criteria, four of which are now mandatory. This is a significant change from the previous rules, which only required “any combination” of the listed criteria. The heightened standard may pose greater challenges for owners of well-known marks, particularly in meeting the mandatory requirement pertaining to market share.

Rule 5 of Memorandum Circular No. 2025-009, which took effect on 28 April 2025, enumerates the four mandatory criteria as follows: (1) the duration, extent and geographical area of any use and any promotion of the mark, including advertising or publicity and the presentation at fairs or exhibitions, of the goods and/or services to which the mark applies; (2) the market share, in the Philippines and in other countries, of the goods and/or services to which the mark applies; (3) the degree of the inherent or acquired distinction of the mark; and (4) the quality, image or reputation acquired by the mark.

The use of the conjunction “and” means that the claimant or applicant has to demonstrate that the brand has market share, not only in other countries but also within the Philippines. The market share is assessed in relation to the relevant sector of the public, rather than the general public at large.

The term “market share” is not explicitly defined in the Intellectual Property Code or in the implementing regulations. Likewise, Philippine jurisprudence does not provide a definitive meaning of market share for the purposes of declaring a mark well known. As defined in the dictionary and used in business context, market share refers to “the percentage of total sales or revenue that a company generates within a specific market or industry”.

The very notion of market share presupposes actual use of the mark in commerce. Further, the concept of market share is quantitative in nature. The rules, however, do not specify the required threshold, whether in quantitative or qualitative terms. It is unclear whether the mere market presence of the brand would suffice, or if a substantial market share must be demonstrated to satisfy this criterion.

Owners of famous marks may also be reluctant to disclose sales figures due to confidentiality concerns or broader business considerations. Substantiating market share may necessitate independent market surveys or industry research, which imposes additional burdens and financial costs on the part of the brand owner.

Another challenge involves bad-faith trademark filers who exploit the first-to-file or register system by preemptively registering well-known foreign marks before their legitimate owners can do so. Under the rules, brand owners are now required to demonstrate not only actual use but also market share in the Philippines at the time of seeking well-known status.

In contrast, under the previous framework, the brand owner could invoke section 123.1(e) of the IP Code without showing market share, and was afforded a three-year period from the date of filing within which to submit proof of use. In Fredco Manufacturing Corporation v President and Fellows of Harvard College (June 2011), the Supreme Court held that the respondent’s mark “Harvard” is well-known in the Philippines despite the absence of commercial use in the country.

In Sehwani v In-N-Out Burger, Inc (October 2007), the court ruled that the protection initially afforded by article 6bis of the Paris Convention was broadened in the 1999 Joint Recommendation Concerning Provisions on the Protection of Well-Known Marks, where the World Intellectual Property Organisation General Assembly and the Paris Union agreed to the proposal that a well-known mark be protected in a country even if such mark is neither registered nor used in that country.

Nonetheless, the said provision was non-binding. Article 6bis of the Paris Convention does not prohibit member countries from imposing stricter standards, such as requiring commercial use or evidence of market share in the Philippines, before well-known protection could be granted.

Article 6bis simply provides that a trademark must be well known in the country where protection is sought, and that the determination of such well-known status is vested with the competent authority, as defined by the laws of that country (Mirpuri v Court of Appeals, et al [November 1999]). This is reflected in section 123.1(e) of the IP Code.

While the current system significantly departs from the previous one, it is expected to strengthen the protection of well-known marks, particularly by providing a non-adversarial channel for brand owners to seek recognition. Further, the establishment of a register of well-known marks would facilitate the enforcement of rights arising from such marks.

Ernest Luigi A Manzanares is an associate at Federis & Associates Law Offices