The Three-Year Non-Use Vulnerability Under Section 66 in New Zealand

1. What is the Section 66 non-use vulnerability?

Under Section 66(1)(a) of the Trade Marks Act 2002, a registered New Zealand trademark may be revoked if, for a continuous period of 3 years or more, the mark was not put to genuine use in the course of trade in New Zealand by the owner, in relation to the goods or services for which it is registered, and there are no proper reasons for the non-use.

This is New Zealand's "use it or lose it" rule. Registration confers exclusive rights, but those rights are conditional on real commercial use. A mark that sits unused on the register becomes vulnerable to removal by anyone who wants the mark — or simply wants it out of the way.

2. Three years, not five: shorter than most jurisdictions

Many major jurisdictions — including the European Union and the United Kingdom — apply a 5-year non-use period. New Zealand (like Australia) applies only 3 years. Brand owners accustomed to the international norm are often caught out: a New Zealand registration can become vulnerable two full years earlier than an equivalent EU registration.

For international portfolios, this means New Zealand designations and national registrations need earlier commercialization plans than other markets.

3. How the 3-year period is calculated

The mechanics matter, and they are frequently misunderstood:

• The continuous 3-year period starts after the actual date of registration — the date the mark was in fact entered on the register — not the application or deemed registration date.
• The period must end at least 1 month before the date of the revocation application. Use commenced (or resumed) within that final month is disregarded for that purpose.
• Revocation can be partial — if the mark has been used for some goods but not others, it may be revoked only for the unused goods or services, narrowing the specification.

4. What counts as "genuine use"?

Use must be genuine use in the course of trade in New Zealand. Token, internal, or purely defensive use does not qualify. Indicators of genuine use include:

• Actual sales of the goods or supply of the services in New Zealand under the mark,
• Marketing and offers to New Zealand customers under the mark,
• Use of the mark on goods, packaging, invoices, websites, or advertising directed at the New Zealand market, and
• Use by a licensee or authorized user with the owner's consent, which counts as use by the owner.

Points that commonly trip up owners:

• A website accessible from New Zealand is not automatically "use in New Zealand" — the offering must target New Zealand consumers.
• Use of the mark in a materially altered form may not protect the registration; use in a form differing in elements that do not alter the distinctive character generally does.
• Use on only part of the specification protects only that part — broad legacy specifications shrink under partial revocation.

5. Who can apply for revocation, and how the burden works

A revocation application may be filed by an aggrieved person — in practice, this is interpreted broadly and typically includes anyone whose application is blocked by the registration or who trades (or intends to trade) in the relevant field.

Once non-use is put in issue, the practical burden falls on the owner to prove genuine use during the relevant period. This is a deliberate policy choice: the owner is the party with access to its own trading records. Owners who cannot produce dated, New Zealand-specific evidence of use are at serious risk.

6. Defences: proper reasons and special circumstances

A registration will not be revoked for non-use where:

• The non-use is due to special circumstances outside the owner's control — for example, regulatory approval delays or import restrictions. Ordinary commercial difficulties or the owner's own business decisions generally do not qualify.
• Genuine use commenced or resumed after the 3-year period but more than 1 month before the revocation application was filed — although resumption made merely because the owner became aware a challenge was imminent will be scrutinized.

The Commissioner also retains a degree of discretion in revocation proceedings, but owners should not rely on discretion as a strategy — evidence of real use is the only reliable defence.

7. Non-use revocation as a sword: clearing blocking marks

Section 66 is not only a risk — it is a strategic tool. When IPONZ cites a prior mark against your application under Section 25, and the cited mark appears dormant, you can:

• Commission use investigations to establish whether the cited mark has been genuinely used in New Zealand in the last 3 years,
• File a revocation application (full or partial) to remove the blocking registration or narrow its specification, or
• Use the credible prospect of revocation as negotiating leverage to obtain a letter of consent or an assignment on favourable terms.

8. Best practices for New Zealand trademark owners

• Start using the mark in New Zealand promptly after registration — the 3-year clock runs from actual registration.
• Keep dated evidence of use: invoices to New Zealand customers, New Zealand advertising, packaging, screenshots of NZ-targeted web pages, and sales summaries by year.
• Document licensee use — ensure licences are in writing and that use by distributors or related companies is traceable to the owner's consent.
• Use the mark as registered — if the brand evolves materially, file for the new form rather than relying on the old registration.
• Audit specifications at renewal — consider whether broad claims are still supportable, and refile strategically where gaps exist.

9. Summary: the three-year rule in New Zealand

Key takeaways:

• A New Zealand registration becomes vulnerable to revocation after 3 continuous years of non-use — shorter than the 5-year norm in many jurisdictions.
• The period runs from the actual date of registration and must end at least 1 month before the revocation application.
• Only genuine commercial use in New Zealand protects the registration; the owner bears the practical burden of proving it.
• Partial revocation can cut back unused portions of broad specifications.
• For applicants, Section 66 doubles as a powerful tool for clearing dormant blocking marks cited under Section 25.

Treat the New Zealand register as a record of live commercial rights: use your mark, document that use, and review your portfolio regularly.