The century-old Budweiser brand battle wages on

Image source: kingclub.budweiser.ca

A Portuguese court has recently ruled that the Czech beer company Budejovicky Budvar holds exclusive rights to the Budweiser name in its country, which restricts its multinational archrival Anheuser-Busch InBev (AB InBev) to using the trademark BUD in Portugal.

The two companies have been opposed to each other in one of the most famous cases of trademark litigation since 1907. They both lay claim to the name of a Czech city called České Budějovice, or Böhmisch Budweis in German, famous for brewing a particular type of beer which originated in the thirteenth century under the Kingdom of Bohemia. 

Image source: directwinecellars.com.au

While both have been marketing the Budweiser name since the late 1800s, the dispute was launched in 1907 when AB InBev officially filed a trademark for it. Then followed a series of court cases (over 100 to be exact), the most notable including the 1939 decision that AB InBev owns exclusive rights to the name in North America (North of Panama). As Time magazine notes, 1994 was another critical juncture where the Czechs decided not to conclude an comprehensive agreement  to divide the world territory up. This means that trademark rights for each country have to be decided by their own court case. 

According to an article on out-law.com, Ab InBev has so far been refused the EU-wide license for Budweiser because it was previously held by Budvar in Austria and Germany. It holds one for BUD, however, that it uses in places like Italy and now Portugal. It also uses the name Anheuser-Busch B in Germany where Budvar owns the exclusive rights to Budweiser. In America, Budvar markets its product under the brand name Czechvar. The UK is an interesting case because the court ruled that both companies are allowed to use the same name since consumers can supposedly make the difference between the two brands. This left AB InBev unhappy as it upset the wishes of a global giant used to getting its way. 

Indeed, Ab Inbev, the result of a merger between American, Brazilian and Belgian firms, it is now the largest brewery in the world. It is responsible for roughly 25 percent of global beer sales, employing 150 000 people and producing 400M hectoliters of beer a year (compared to 600 and 1.4M for Budvar in 2014). Budvar’s lack of comparative success can partly be explained by historical events such as Czechoslovakia’s subordination to Nazi Germany and then its Communist government which halted the state owned company’s expansion during the second half of the twentieth century. Nonetheless, Budvar‘s export-driven strategy and key court victories propelled the Czech company to its highest ever sales last year.

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