Microsoft’s search engine Bing recently announced that, from today, it will allow businesses to use trade marks as keywords in various markets, including New Zealand and Australia. Choosing high-quality, relevant keywords is a crucial tool for advertisers to increase online business, and many businesses would see Bing’s shift in policy as an opportunity to gain a further competitive edge online by bidding on their competitors’ trade marks as keywords.

Keywords have been a hot controversy in the trade mark scene ever since Google Adwords allowed its customers to bid on trade marks of their competitors. In 2013, Google streamlined its trade mark policy worldwide and in doing so removed the prohibition on the use of rivals’ trade marks as keywords in Google Adwords advertising campaign. This created a whole new area of uncertainty in the law, namely as to what limits trade mark law places on the selection and use of competitor’s trade marks as keywords.

It was not until quite recently New Zealand and Australian courts had to rule directly on point about the use of a third party’s registered trade mark. In 2014, the High Court of New Zealand found that Nakedbus’ use of “intercity” and “inter city” as keywords in its Google Adwords campaign did not infringe InterCity’s trademark registration, breach the Fair Trading Act or amount to passing off. Key to this finding was the judge's acceptance of the argument that if the consumer could not “see” the trade mark in use, then it could not be “taken as being used as a trade mark”. Though the purchase of the keywords “intercity” and “inter city' did not in itself constitute an infringement, visible use of InterCity's trade mark in Nakedbus' online ads was found to be against the rules.

The Federal Court of Australia also held in Veda Advantage Limited v Malouf Group Enterprises Pty Limited (2016) that the purchase of a competitor’s trade mark as a keyword was not an infringement. Similar to the New Zealand decision, the Court relied on evidence that the keywords were invisible, inaudible and imperceptible to consumer. The keywords could not be understood to distinguish the services of one trader from those of another because the consumer is not aware of their involvement.

These decisions are consistent with how Google views use of third party trade marks. Google is clear that it won’t investigate or restrict the selection of trademarks as keywords, even if it receives a complaint. Although Bing has now lifted its ban on using trade marks as keywords, its policy notes that advertisers may not bid on any term whose use would infringe the trade mark of any third party or is otherwise unlawful, and that it will investigate complaints about trade mark infringement in keyword use. Based on the decisions so far, third party trade mark use as keywords does not appear to be an infringement or a practice that is unlawful in New Zealand and Australia. In light of this, it will be interesting to see how Bing deals with such complaints.