Classification of Non-Fungible Tokens (NFTs), Virtual Goods and Services Provided in the Metaverse
The UK Intellectual Property Office (UKIPO) has recently issued a new Practice Amendment Notice (PAN 2/23) that provides guidance on the classification of non-fungible tokens (NFTs), virtual goods and services delivered in the metaverse. This is much welcomed given that there is significant jurisdictional variation in registering such goods.
The UKIPO has published this guidance in light of an increasing number of applications for trade mark specifications containing NFTs, virtual goods and services in the metaverse.
Non-Fungible Tokens
The UKIPO quotes the Cambridge Dictionary definition of an NFT as “a unique unit of data (the only one existing of its type) that links to a particular piece of digital art, music, video etc. and that can be bought and sold.”
The 12th edition of the Nice Classification includes in Class 9, “downloadable digital files authenticated by non-fungible tokens”.
In this PAN, the UKIPO has confirmed that “NFTs” will not be accepted as a classification term alone as it is insufficiently precise. It will, however, accept terminology that includes an indication of the asset to which the NFT relates. Examples that will be accepted in Class 9 are:
- Digital art authenticated by NFTs;
- Downloadable graphics authenticated by non-fungible tokens;
- Downloadable software, namely, [list the type of goods], authenticated by NFTs;
- Digital audio files authenticated by NFTs; and
- Downloadable digital files authenticated by NFTs.
It is possible that NFTs can be used to authenticate goods other than digital assets, including physical goods. Therefore, the UKIPO has confirmed that physical goods clearly defined as being authenticated by NFTs will also be accepted in the appropriate goods class. An example is “handbags, authenticated by NFTs”, which would still fall within Class 18.
Since NFTs can be retailed via online marketplaces, retail services relating to the sale of NFTs will also be accepted in Class 35. In line with the current practice on registration of retail services in Class 35, it will be necessary to specify the type of goods being retailed that are authenticated by NFTs.
Furthermore, the UKIPO has indicated that, similar to non-digital goods, other services authenticated by NFTs will also be registerable in their usual service class.
Virtual Goods
Unlike physical goods, virtual goods are essentially digital assets and therefore all virtual goods will fall within Class 9 of the Nice Classification system. In the PAN, the UKIPO has confirmed that it will only accept virtual goods in Class 9 that are clearly defined, for example “downloadable virtual clothing, footwear or headgear.”
Virtual Services
The UKIPO will also accept applications for services that are capable of being delivered by virtual means. Unlike virtual goods, such services are not digital assets. They are still a service whether delivered face-to-face or online. Therefore, the classification of virtual services will be the same as the corresponding face-to-face services. For example, “education and training services delivered by virtual means” will still fall within Class 41 and “conducting interactive virtual auctions” will remain within Cass 35.
The UKIPO defines the metaverse as “a form of digital reality, where people can access virtual worlds and interact with others.” Furthermore, services capable of being delivered by virtual means, can also be delivered in the metaverse. Therefore, the UKIPO has confirmed that it will also accept virtual services delivered through the metaverse in the same class as the corresponding service provided face-to-face in the real world. An example of an acceptable classification is “education and training services provided via the metaverse” within Class 41.
The UKIPO, however, then highlights that some services in the metaverse may not fall in the same class as their real-world equivalents. Where provision via the metaverse is mentioned in an application, but it is not immediately apparent to the Examiner that the service can be provided in the metaverse, they will seek clarification before allowing the application.
It is possible that services that cannot be provided in the metaverse in the same way as the real-world provision of those services, can be covered in a more general way, for example “entertainment services, namely, provision of a virtual reality or metaverse based simulation gaming service.”
Clients are advised that particular thought should be given to the correct wording for protecting NFTs, virtual goods and services in the metaverse when preparing an application for filing.
Mathisen & Macara can advise you on the implications of PAN 2/23 and guide you on the correct wording for protecting NFTs, virtual goods and services in the metaverse.