This week brings you a quick dive into developments in relevant legislation in the European Union and California, with the European Council adopting the EU Design Legislative Reform Package (which includes the Recast Directive on the legal protection of designs and the Amending Regulation on community designs) and California’s governor signing a bill that maintains impending climate reporting requirements for companiesoperating in the state but changes the timeline for reporting Scope 3 emissions.
First things first, on Oct. 10, the EU Commission adopted the Design Legislative Reform Package, which is “the last step in the decision-making procedure” before the law comes into force. Aimed at “strengthening, simplifying, and standardizing existing design protection across the EU, while also aligning design protection with trademark rules,” the Commission says that the reform “should also enhance predictability and harmonize EU design protection with Member States’ national laws, benefitting designers, SMEs and businesses alike.”
At a high level, key elements of the reform (EU Regulation 2022/0391 and EU Directive 2022/0392) include …
– Updated terminology for EU-wide design rights: Registered Community Designs (“RCDs”) will be known as Registered European Union Designs (“REUDs”), for example, and Unregistered Community Designs (“UCDs”) will become Unregistered European Union Designs (“UEUDs”).
– Expanded Definitions of “Design” and “Product”: The definition of “design” will be expanded to include features like lines, contours, colors, shape, texture, and materials, among other things. Meanwhile, products will now include non-physical and digital products.
– Repairs clause: As a restriction to the REUD holder’s scope of protection, the reform adds a “repair clause” to the directive on the legal protection of designs. It denies design protection for “component parts of complex products where the design of the component part is dependent on the appearance of the complex product, and where the component part is used for the sole purpose of the repair of the complex product so as to restore its original appearance.”
Accordingly, “it will no longer be possible for design owners to use EU designs to claim a monopoly in the appearance of spare parts where those spare parts are used to restore the appearance of the original product,” Mark & Clerk stated in a note. “In order to benefit from this restriction, the manufacturer or seller of the spare part must clearly inform the consumer of the origin of the spare part, so that the consumer may make an informed choice between competing products that can be used for the repair.”
Car parts come to mind here but watches (a type of product where repairs/service and in turn, spare parts, are a contentious issue when it comes to luxury brands) might not be a million miles away.
> The overall timeline here: From the date of publication, the two texts will enter into force in 20 days and start applying after four months.
In California, after a year of back and forth, Governor Gavin Newsom as signed SB 219, which paves the way for SB 253 and 261 – which create climate reporting obligations for U.S. companies doing business in California – to go into effect … albeit with some changes, namely, in terms of timing.
A few points worth noting …
Timing: As a result of SB219, the California Air Resources Board (“CARB”) has until July 1, 2025 to adopt Scope 1, 2, and 3 emissions reporting regulations for companies – this is a delay of six months from the original Jan. 1, 2025, requirement under SB 253.
– Annual reporting for Scope 1 and Scope 2 emissions will commence in 2026 or on on another date as determined by CARB.
– Scope 3 emissions annual reporting will commence in 2027 on a schedule to be established by CARB – rather than within 180 days after disclosure of Scope 1 and 2 emissions.
Consolidated reporting: At the same time, SB219 makes it so that subsidiary companies will not need to file separate reports and instead, climate reporting will be consolidated at the parent-company level.
Legal challenges: Katten notes that SB 253 and SB 261 are currently facing litigation that “could result in delaying, modifying or even eliminating the climate-related reporting requirements under the bills.” Nonetheless, reporting companies are encouraged “to prepare for the rapidly approaching 2025 compliance period by ensuring they have robust GHG emissions monitoring, accounting and auditing programs in place, in addition to consulting legal counsel and industry advisors to prepare their first climate-related data reports.”
* Also, in case you missed it, Gov. Newsom signed an Extended Producer Responsibility bill into law in California last month. You can find a dive into that right here.