Upholding the Court of Appeal, the UK Supreme Court yesterday ruled that a trade mark “POST MILK GENERATION”, registered for food and drink products, was invalid due to prohibitions on use of the word “milk” as a ‘designation’ of regulated dairy products under Regulation (EU) 1308/2013. The prohibition applied where a designation was used for a relevant product, regardless of whether it was used as the name of the product (Dairy UK Ltd v Oatly AB [2026] UKSC 4 (11 February 2026)).

Background

Under section 3 of the Trade Marks Act 1994 (“TMA”), a trade mark will not be registered (or can later be found invalidly registered) if, among other grounds:

• The trade mark is of such nature as to deceive the public (such as to the nature, quality or origin of the goods or services) (s3(3)(b)); or
• The trade mark’s use is prohibited in the UK by any enactment or rule of law (s3(4)).

Regulation (EU) 1308/2013 (the “Regulation”) provides for marketing standards to promote fair and consistent presentation of agricultural products. The Regulation continues to have effect in the UK as assimilated EU law. 

Article 78(2) of the Regulation requires various terms to be used exclusively in relation to agricultural products when used as “definitions, designations or sales descriptions” to market those products. 

The term “milk”, when used as a ‘designation’, is restricted only to “normal mammary secretions”, products derived from animal milk, and composite products in which milk is an essential part (Regulation, Annex VII, Part III). The Regulation prohibits its use to describe other products (Point 5 of Part III).

However, Point 5 also contains a proviso, permitting designations where:

• their exact nature is “clear from traditional usage”; and/or
• they are “clearly used to describe a characteristic quality of the product” 

(the “Point 5 Proviso”).

Facts

Oatly, a manufacturer of oat-based dairy substitute products, owned a trade mark registration for “POST MILK GENERATION” (the “Mark”) in classes 29, 30 and 32 (relating to various oat-based food and drink products) and class 25 (relating to t-shirts). 

Dairy UK, the UK’s dairy industry trade association, applied to invalidate the Mark against all of the registered goods under s3(3)(b) and 3(4) TMA.

After a UKIPO Hearing Officer found the Mark invalid under s3(4) only and for oat-based food and drink products, the High Court allowed Oatly’s appeal, finding the Hearing Officer had misconstrued the term “designation” in the Regulation. (The Mark was ruled not to be deceptive under s3(3)(b) at first instance, a finding which was not appealed.)

However, in November 2024, the Court of Appeal allowed Dairy UK’s appeal. In the Court’s view, the Mark was a prohibited designation under the Regulation and so fell foul of s3(4) TMA. Further, the Mark’s use was not permitted under the Point 5 Proviso, as it did not “clearly” describe a characteristic quality of the goods; it only referred to potential consumers of the goods and merely alluded to those goods being non-dairy products. 

Oatly appealed to the UK Supreme Court (“UKSC”). 

The UKSC’s judgment

The UKSC unanimously dismissed Oatly’s appeal. The appeal raised two issues as to the validity of the Mark when used in relation to oat-based food and drink products:

• Whether the term ‘POST MILK GENERATION’ was a “designation” under the Regulation, preventing its registrability as a trade mark; and
• If yes, is it saved by the Point 5 Proviso on the basis that it is being used to describe a characteristic quality of the products for which the trade mark is registered?

1. Meaning of “Designation”

The UKSC rejected Oatly’s argument that “designation” meant only the name of a product and thereby allowed the use of “milk” when not used as a product name. Other provisions of the Regulation had explicitly referred to the “names” of a product, suggesting that “designation” did not have the same meaning as the name of a product. 

Rather, the natural meaning of “designation” was broader, and referred to use of a term in respect of that product. The prohibition applied where the designation was used for a relevant product, without it being necessary that it had been used as the name of the product. For “milk”, Part III of the Regulation stated that it may not be “used for” any product other than those referred to in Part III. As oat-based food or drink was not referred to, the use of “milk” to refer to such food and drink was prohibited. 

The UKSC also considered this interpretation was also in line with the purpose of Point 5 of Part III which, regarding milk as a product, was to set out fair conditions of competition.

2. “Characteristic quality of the product”

The UKSC then considered whether the use of “POST MILK GENERATION” to refer to oat-based food or drink could be saved by the Point 5 Proviso. 

The UKSC’s answer was no, as it was not “clearly” being used to describe a characteristic quality of the product, i.e. that it was milk-free. In the Court’s view, it was far from “clear” that the Mark did so – instead, the Mark on its face described the targeted consumers of Oatly’s products, including those of a younger generation with widespread concerns about the production and consumption of milk. 

The UKSC held that if “POST MILK GENERATION” was in any way describing a characteristic quality of the product, it did so obliquely and obscurely, not “clearly”. For example, it was unclear whether the product being described by the Mark was entirely milk-free or simply had low milk content – by analogy, a hypothetical trade mark for “POST ALCOHOL GENERATION”, when used to designate a drink, would not “clearly” indicate whether the drink was low-alcohol or no-alcohol.

Comment

The UKSC’s judgment offers some specific, albeit important, guidance for brand owners active in the ever-growing industry of innovative plant-based substitute products. 

The continuing applicability of the Regulation in the UK means that those who apply for UK trade marks in respect of food and drink products should consider the risk of refusal (or later invalidation) where that mark uses a word prohibited by law as a controlled “designation”. 

The main implication of the UKSC’s judgment is that it does not matter that a term is not used as the name of a product: the prohibition will apply simply by that term being used for or in respect of a product. The application of exceptions will also be scrutinised. In this regard, it is worth noting that the prohibitions and exceptions differ across the agricultural products regulated (for example, the “clearly describes a characteristic quality” proviso only applies in relation to milk products and spreadable fats, not other products).

In obiter comments, the UKSC opined that a mark containing the word “MILK-FREE” would not fall foul of the Regulation because, while it used a prohibited designation, it was “clearly” describing that the relevant product did not contain milk (and therefore was saved by the Point 5 Proviso).