Google's New Adwording Policy in Europe

As of yesterday, Google’s new policy concerning registration of trademarks as keywords for triggering contextual advertisement in many European countries went into effect. The new policy, which strongly relies on the recent ECJ decision on Google’s potential liability for TM infringement via its adwords practice, demonstrates a notable shift in Google’s approach.

From now on, registration of TM adwords by third parties will not be restricted, causing the ad to appear next to the organic results list when users enter the keyword as a search term. Angry TM holders are invited to submit their reservations to Google, which, on its part, will then conduct a “limited investigation” to determine whether “a keyword in combination with particular ad text is confusing as to the origin of the advertised goods and services.” That investigation will take into consideration the following factors for allowing registration:

• ads using a trademarked term in a descriptive or generic way, such as not in reference to the term as a trademark;

• ads for competing products or services;

• ads for informational sites about a product or service corresponding to the trademark;

• ads for resale of the trademarked goods or services;

• ads for the sale of components, replacement parts, or compatible products corresponding to a trademark.

It appears that this policy applies only in cases in which the advertiser does not use the mark in the body of the adword. In case Google finds the text of the ad, in combination with the (invisible, TM-related) keyword, confusing as to the source, it will remove the ad but in any case not prevent the registration of the relevant keyword.

There is a number of interesting aspects to the new policy, one of which is the fact that the open list of factors is remarkably similar to exceptions in TM law that could apply where the mark, through the activity of the defendant, becomes perceptible to consumers. For example, generic use of the mark normally will have to mention it. The same applies to the other factors (comparative advertising, informational texts, resale etc.) Therefore, applying these criteria where the mark is invisible to consumers seems a bit odd.

By extension, it is unlikely one of these criteria (or any other criterion that Google may choose to apply) will not provide basis for the conclusion that source confusion is too remote. In addition, the new policy does not take into consideration questions of dilution, in which confusion as to the source is generally irrelevant.

European mark holders who are unsatisfied with the result of Google’s limited investigation can of course go to court, and in that case, Google will almost certainly lose its potential benefits as a passive conduit under the European E-Commerce Directive.