The European Court of Justice on Wednesday said Nestlé had to prove consumers could identify the wafer snack by its appearance alone — without markings or labels bearing the Kit Kat name.
It referred the case back for a final ruling to Britain's High Court, which had thrown out the trademark application in 2013, following an appeal by rival confectioner Cadbury.
“It is up to the British courts to decide, on the basis of this response, if the form of Kit Kat chocolate bars can be registered as a trademark or not,” the EU court said in a statement.
Nestlé had argued that the shape of the famous snack — which was first sold in 1935 and is marketed with the slogan “Have a Break, Have a Kit Kat” — was in itself distinctive.
The case has dragged on for five years after Nestlé filed the trademark application in 2010 and Cadbury appealed the following year.
The EU judges noted that the trademark Nestlé is seeking differs from the actual product because it shows only a picture of the bar and omits the embossed word “Kit Kat” and sections of its oval logo.
They also said that some of the features of the bar's shape resulted from technical processes, not design.
“The trade mark applicant must prove that the relevant class of persons perceive the goods or services designated exclusively by the mark applied for, as opposed to any other mark which might also be present, as originating from a particular company,” it said in its ruling.
There was no immediate reaction from Nestlé or Cadbury.
NESTLE
Euro court rules against Nestlé in Kit Kat flap
Swiss food giant Nestlé has failed to get the European Union's top court to let it trademark the shape of its four-fingered Kit Kat chocolate bar in Britain.
NESTLE
‘Unlimited resources’: Switzerland’s Nestle goes vegan
Swiss food giant Nestle, which has made billions with dairy products, said Monday it will host start-ups that want to develop vegetarian alternatives.
Nestle could thus find itself at the forefront of a sector that has strong growth potential, an analyst commented.
It plans to open its research and development (R&D) centre in Konolfingen, Switzerland to “start-ups, students and scientists” a statement said.
In addition to testing sustainable dairy products, the group plans to encourage work on plant-based dairy alternatives, it added.
Chief executive Mark Schneider was quoted as saying that “innovation in milk products and plant-based dairy alternatives is core to Nestle's portfolio strategy.”
The group unveiled a vegetable-based milk that had already been developed with the process, and technical director Stefan Palzer told AFP it planned to focus on 100-200 such projects a year.
Jon Cox, an analyst at Kepler Cheuvreux, noted that while Nestle had missed some consumer trends in the past, it has now “taken something of a lead in the plant-based alternative market for food”.
And “given its pretty much unlimited resources, Nestle is going to come out one of the winners in the space,” Cox forecast in an e-mail.
Nestle said that “internal, external and mixed teams” would work at the R&D centre over six-month periods.
Nestle would provide “expertise and key equipment such as small to medium-scale production equipment to facilitate the rapid upscaling of products for a test launch in a retail environment,” it added.
The Swiss food giant has long been known for its dairy products, but faced a boycott in the 1970s for allegedly discouraging mothers in developing countries from breastfeeding even though it was cheaper and more nutritious than powdered formula.
On Monday, the group's statement also underscored that the research initiative was part of its commitment to help fight global warming.
“As a company, we have set ambitious climate goals. This is part of our promise to develop products that are good for you and good for the planet,” it said.
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