IP monitor: Trademark tussles just got spicier: Canada now offers costs awards

Costs awards in trademark opposition proceedings have been long anticipated in Canada. On April 1, 2025, the Registrar of Trademarks issued a practice notice detailing the procedures and criteria for awarding costs in trademark proceedings under sections 11.13, 38, and 45 of the Trademarks Act. 

Reasons for costs

Costs are intended to be awarded only in exceptional cases. The practice notice outlines the following circumstances:

• Bad Faith: If an application is refused on the ground of bad faith.
• Divisional Application: If a divisional application is filed after the original application is advertised. 
• Late Cancellation of Hearing: If a hearing request is withdrawn less than 14 days before the scheduled date. 
• Unreasonable Conduct: If a party engages in conduct causing undue delay or expense. 

However, unreasonable conduct is a broad category and includes pursuing a ground of opposition that has no reasonable chance of success. 

Procedure for requesting costs

Cost consequences are tied to a request for a hearing. A party may request costs within 14 days after a hearing ends or is cancelled, or within 14 days after the end of the period for filing a request for a hearing, if none is requested. If the opposition or application is withdrawn prior to a hearing request, the Registrar does not have authority to order costs. 

Award and enforcement

The amount of any costs award will be based on the prescribed fees for initiating the proceeding (current fees for initiating opposition proceedings in Canada are $1,085). The Registrar will provide reasons for the decision on costs in the final disposition of the proceeding. A certified copy of an order for costs may be filed in the Federal Court and enforced as an order of that court.

Consequences of costs awards

It remains to be seen whether potential cost consequences will affect trademark oppositions in Canada. Compared to the cost of opposition proceedings, the potential costs award is low, and the circumstances in which a costs award will be granted are limited. While potential costs award might deter some parties, and may check some unreasonable conduct, most cases will not likely be subject to a costs award. Even though costs may not always be awarded, the possibility may encourage parties to request them.