Decision: Dairy UK Ltd v Oatly AB [2026] UKSC 4
Court: Supreme Court
Judges: Hamblen L, Burrows, L, Hodge, L, Briggs L, Stephens L
Judgment: Here
Issue: S 3(4) of the Trade Marks Act 1994

Published: 25 February 2026
Author: Irem Alici

Background

The Supreme Court’s decision in Dairy UK Ltd v Oatly AB brings a long running trade mark dispute to an end and is an important ruling for the fast growing alternative food and drinks sector.

The dispute arose from Oatly’s registration in April 2021 of the trade mark “POST MILK GENERATION”. The mark was registered for oat‑based food and drink products in classes 29, 30 and 32, as well as for T‑shirts in class 25.

Dairy UK, the trade association representing the UK dairy industry, applied to invalidate the mark under section 3(4) of the Trade Marks Act 1994 which states that:

“A trade mark shall not be registered if or to the extent that its use is prohibited in the United Kingdom by any enactment or rule of law other than law relating to trade marks.”

It argued that use of the mark was prohibited by Regulation (EU) No 1308/2013, legislation designed to help harmonise the market in agricultural products. In particular, Art 78 of the Regulation explains that certain “designations” should only be used for certain products. These “designations” are listed in Annex VII which includes (subject to certain exceptions) the “designation” MILK for milk and milk products intended for human consumption.

The United Kingdom Intellectual Property Office Hearing Officer agreed with Dairy UK in relation to the oat‑based food and drink products, but not the T‑shirts. That decision was overturned by the High Court, which held that the mark did not “designate” milk because it was not used as the name of a product. The Court of Appeal disagreed, finding that the use of “milk” within the mark fell within the regulatory prohibition. Oatly then appealed to the Supreme Court.

Issues

The appeal raised two main questions of statutory interpretation.

The first concerned the meaning of “designation” in Art. 78. Oatly argued that “designation” referred only to the name of a product. On that basis, “POST MILK GENERATION” did not infringe the prohibition, because it did not describe or name oat‑based food or drink as “milk”. Dairy UK argued for a broader interpretation, submitting that “designation” covers any use of a protected dairy term in relation to a product, whether or not it is used as the product name.

The second issue concerned the exception in Annex VII, which allows otherwise prohibited designations where they are “clearly used to describe a characteristic quality of the product”. Oatly argued that “POST MILK GENERATION” clearly conveyed that the products were milk‑free. Dairy UK disagreed, contending that the phrase was ambiguous and consumer‑focused, referring to a group of consumers rather than a characteristic of the products themselves.

In addressing both issues, the Supreme Court applied ordinary principles of domestic statutory interpretation, while recognising the EU origin and purpose of the legislation. The Court stressed that the regulatory regime is concerned not only with avoiding consumer confusion, but also with maintaining fair conditions of competition in agricultural markets.

Decision

The Supreme Court unanimously dismissed Oatly’s appeal.

On the first issue, the Court rejected the narrow interpretation of “designation”. It held that, in context, the term is deliberately broader than “name” or “sales description” and covers the use of protected dairy terms in relation to products generally. As a result, the inclusion of the word “milk” within the composite mark “POST MILK GENERATION” amounted to the use of a prohibited designation in relation to non‑dairy food and drink.

The Court also confirmed that the prohibition applies regardless of whether consumers are likely to be misled. The aim of the legislation is not limited to preventing confusion, but also includes protecting dairy terms and preserving the competitive framework established by the Regulation.

On the second issue, the Court found that the mark was not saved by the exception for designations describing a characteristic quality. “POST MILK GENERATION” was held to convey a generational or ideological message directed at consumers, rather than clearly describing a product attribute such as being milk‑free. Even if some consumers might draw that inference, it was indirect and insufficiently clear to meet the statutory test.

The appeal was therefore dismissed. The trade mark remains invalid for oat‑based food and drink products, but valid for T‑shirts.

Commentary

While ostensibly a narrow trade mark issue, this could have wider implications for the alternative food and drinks sector. In particular, Regulation (EU) No 1308/2013 also applies to certain “designations” for: beef and veal; wine; poultry; spreadable fats; olive oils and table oils. Those businesses supplying alternatives for these products may expect increased scrutiny on their trade mark filings.