AJPark

Registration is not a rubber-stamping exercise. The rights gained through registration are exclusive to the owner. A well-thought out strategy will pay dividends downstream.

Many businesses think that registering their trade marks is a luxury that they can ill afford. This is often the catch-cry of small to medium businesses like retail businesses. However, looking at the benefits of registration from a viewpoint of investment in your business, instead of a cost, should show that registration is not a luxury but a necessity.

Trade mark rights are enduring. A trade mark registration can last forever, yes forever, if renewed periodically. The investment made in registering your trade mark will pay you back again, and again.

There are many and varied reasons registration should be considered.  We outline some of these reasons below:

1.  An important reason for registration is to preserve your rights in your trade mark. Not all countries recognise use rights. For example, New Zealand does but Japan does not. This means that unless you have registered your trade mark you have no rights in it. A third party can misappropriate your trade mark and get ownership rights by registering your trade mark before you do. Although there are many countries that provide certain rights to trade mark users, asserting those rights is expensive and time consuming, not to mention the fact that you may fail if your use is not sufficient.

2.  Registration grants you the exclusive right to use your trade mark on the goods and services covered by the registration. Those rights extend throughout all the country in which rights are sought, not just the regional area where use occurs.

3.  Registration provides public notice of your rights in your trade mark and acts as a deterrent to any intended users of the trade mark. Your registration is searchable on a publicly available register so other businesses can check and ensure that they do not unintentionally trample on your rights.  Registration establishes a presumption of ownership.

4.  Owning a registration for your trade mark prevents the registration of the identical or a confusingly similar trade mark for the same or similar goods or services.

5.  Registration also gives its owner a statutory right to sue for infringement without the need to prove that they have a reputation in the trade mark.

6.  Buyers of your business will look closely at what assets they are buying.  Trade marks can be a key driver to the valuation of a business.  Many buyers look at a seller’s trade mark protection when conducting their due diligence. A lack of trade mark registrations may reduce the value of your business because it increases the buyer’s risk that a competing mark will limit its plans for the business.

7.  Domain name disputes can be more easily resolved if you own a trade mark registration. The ICANN domain name dispute resolution system sets up an administrative proceeding to settle most claims about the right to use a domain name. The process requires the complainant to show that they have rights to the trade mark.  Proving that a name is a registered trade mark is easy.  It can be difficult to prove common law rights which may prevent you from making use of a dispute resolution process.

8.  Trade marks must be properly marked and used.  Before registration trade mark should be marked by use of the ™ symbol. After registration you can change the symbol ®.  But care needs to be exercised. It can be an offence of fair trading legislation to represent that your trade mark is registered when it is not.  It is also dangerous to use the symbol ™ on a term which turns out not to be your trade mark.

9.  Besides being a property right which can be sold or collateralised, a trade mark can be licensed.  Businesses can enjoy substantial revenue in royalties from licensing their trade marks. It is important not only to register your trade marks but also to consider recording licensees as users.  In some countries it is compulsory to record licensees. 

10.   A registered trade mark gives its owner the ability to file Customs Notices with appropriate Customs departments to prevent and respond to the importation of infringing foreign goods. 

11.   A growing trend is for businesses to register with Google the trade marks of competitors as adwords and thus leverage of the reputation and investment that business has made in its trade mark. Google has a process that you can use if your trade mark has been adopted by a competitor as an adword. Showing the adword you are complaining about is your registered trade mark enables you to easily deal with this misuse of your trade mark in an efficient and cost effective manner.

12.  Holding a trade mark registration can enable you to object to the incorporation of a company with a name the same or similar to your trade mark if you both operate in the same or similar business area.

These are just some of the reasons registration should be considered.

As trade marks become increasingly valuable for most businesss, the greater importance trade mark registrations will have for protecting rights in a name.

An edited version of this article waas published in NZ Retail magazine, May 09

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  Corinne Blumsky

  Partner