The Icelandic government claims their legal bid against the British grocer is aimed at "protecting the country's identity," and reserving "the right of Icelandic companies to use the word "Iceland" in relation to their goods and services."
The British supermarket, specializing primarily is frozen-food retail, at this point owns the 'Iceland' trademark, and neither Icelandic or any other companies can use the word in their branding and marketing efforts.
"The government along with SA Business Iceland and Promote Iceland is taking this step because Iceland Foods has aggressively pursued and won multiple cases against Icelandic companies which use 'ICELAND' in their representation or as part of their trademark, even in cases when the products and services do not compete," the statement issued by the Icelandic Ministry for Foreign Affairs (MFA) reads.
The British company’s registered trademark 'Iceland Foods' has been in the market for 46 years, and throughout this period, Icelandic enterprises, including Iceland Gold and Clean Iceland, have unsuccessfully attempted to register their trademarks with the EU because of the British grocer.
"The Government of Iceland is concerned that our country's businesses are unable to promote themselves across Europe in association with their place of origin—a place of which we are rightly proud and enjoy a very positive national branding," the MFA said in the statement.
On their part, Iceland Foods, the British retailer, said they do not see a conflict of interest or any major issue stemming from the confusion in names and trademarks. The chain store said it is determined to "vigorously defend Iceland Foods' established rights where there is any risk of confusion between our business and Iceland the country." The grocer also rebuffed any allegations that it had put forth "unrealistic and unacceptable demands" when approached to settle the matter.
Moreover, the British retailer mocked Reykjavik's legal action on Twitter, saying: "If you're wondering about our stance on this court case, we're firmly on the side of Iceland."
If you're wondering about our stance on this court case, we're firmly on the side of Iceland #IcelandvIceland— Iceland Foods ❄️ (@IcelandFoods) November 25, 2016
Iceland Foods operates retail facilities all across Europe, and in other circumstances, Iceland's bid would be a losing game. Now, however, the positioning of the UK businesses in continental Europe is vulnerable due to the painful Brexit process, and Iceland Foods trademark might be a casualty in the standoff between London and Brussels.
However, Iceland Foods also addressed the nation of Iceland, saying: "We hope that the government will contact us directly so that we may address their concerns."
Iceland Foods is not just, as one might assume, a made-up branding effort, aimed to reflect the frozen state of the company’s main merchandise. The UK-based retailer once had close ties to the nation of Iceland. The Icelandic retailer Baugur Group was the company's major stakeholder until the financial collapse of 2008 causing the liquidation of assets in many Icelandic businesses.
This is part of the reason that in Iceland Foods' 46-year history, the government of Iceland has only now become somewhat concerned, attempting to re-emerge from the crushing consequences of the recent global recession.