Treatment of nonfungible tokens (NFT) at the UK Trade Marks Registry

The UK trade marks office practice note is PAN 02 2023, concerning virtual goods and services provided within virtual worlds created electronically by computers, for example Metaverse®, Second Life ® and the like.

A non-fungible token [NFT] is similar to an electronic label of authenticity, showing that whatever it is attached to is an authentic article. It can be attached to a digital product, or it can be provided as a separate electronic product for sale with a physical object, or attached with a service.

According to the practice note, the UK Trade Marks Registry do not recognise a non-fungible token itself as being the goods themselves but rather the underlying goods or service or electronic product which is protected by the non-fungible token NFT is registered in the same class as if were not protected by an NFT. In other words, sticking an electronic NFT to whatever it is that is being registered, doesn’t change the class in which it is registered.

Examples:

• Digital art authenticated by non-fungible tokens [NFT’s] – [class 09] – the class for electronic art;

Physical goods which are authenticated by an NFT are treated in the same way as the physical goods which are not authenticated by an NFT, and remain in the same class (application of an NFT to the goods does not change the class for the physical goods)

• Handbags, authenticated by nonfungible tokens [NFT] – [class 18]

So for example for a physical handbag (dress accessories) this is currently in class 18 according to the Nice international classification of goods and services. A physical handbag authenticated by a non-fungible token would also fall within class 18, which is consistent since it is the same physical goods, except it also comes with a certificate of authentication (NFT).

However for the virtual world equivalent-buying an electronic handbag to use within a game in or in a virtual world, either with or without an NFT attached to it, the handbag is simply a digital representation of the physical handbag, providing entertainment within a game and is registrable in class 41 as an entertainment service.

Registration of a mark for an online marketplace for nonfungible tokens/authenticated goods is acceptable:

• Retail services connected with the sale of [e.g. virtual clothing, digital art, audio files] authenticated by non-fungible tokens – [class 35]

An existing service which is now being provided online or otherwise virtually, remains in the same class as that service provided face-to-face or online, but without an accompanying NFT:

• Education and training services delivered by virtual means – [class 41]

Existing services now carried out entirely within a virtual world remain in the same class as for the same services carried out in the real world:

• Conducting interactive auctions via the (specify virtual world / worlds) – [class 35]

If a particular goods or services cannot be provided entirely within a virtual world, then the trade mark registry will take advice on a case-by-case basis. For example, the provision of virtual food and drink does not result in actual sustenance being delivered to a customer and is therefore not the provision of real food and drink in class 43. It is provision of something else, i.e. provision of an electronic representation of food and drink, and therefore more likely to be an electronic entertainment service in class 41.

The Registry suggest that for difficult to classify or define services being provided electronically, a more generic specification of services may be more appropriate such as:

• Entertainment services, namely, provision of a virtual reality orbit of the space simulation gaming service [class 41]

Summary:

• The UK trade Marks Registry will not accept an NFT itself as being goods that can be protected. Instead, the applicant has to specify what is being authenticated with the NFT, and those are the goods or services which are registered.
• Physical goods e.g. handbag are registrable in the same Nice class either with or without authentication by an NFT;
• Virtual goods e.g. an electronic representation of a handbag in a game or in a virtual world are not the same as the physical goods which they represent, and are registered in the class for electronic representations, class 09, irrespective of whether they have authentication by an NFT or not.
• Virtual services protected by an NFT are registered in the same class as those virtual services would be registered if they were not protected by an NFT.

Please contact one of our Chartered Trade Mark Attorneys or European Trademark Attorneys for further information, quoting “NFT practice note”

franksco@franksco.com