Benefits of a Trade Mark Registration

When starting a business, the registration of your brand name, logo or other unique branding element is a vital consideration. Trade mark registration provides many important advantages compared with unregistered trade marks. Outlined below are several of the benefits of owning a registered trade mark.

Intellectual property ownership

A registered trade mark grants the owner exclusive rights to use the trade mark as a badge of origin of the goods or services the sign is used to brand. A trade mark is a form of intangible property and as such has a corresponding value. As your businesses’ product or services build recognition and notoriety, does the value of your trade mark.

Leveraging your registered trade mark

Trade marks can be registered in relation to logos, words or other signs associated with branding a business or its products or services, for example distinctive packaging. As with any other form of property, trade mark rights can be sold, transferred or licensed and the rights assigning the right on a permanent or temporary basis.

Buying and selling trade marks

A trade mark can be bought or sold through transfer of business ownership. The ownership of a trade mark can be transferred in the event of sale of a business as part of the inventory.

The party to whom the trade mark will be transferred is called the assignee, and the ownership of the registered trade mark is transferred to the assignee through a trade mark assignment agreement.

The conditions under which the registered trade mark is purchased dictate the terms and obligations included in the assignment agreement. In the case that the assignee will not use the trade mark directly, a supplementary agreement is needed to ensure that the trade mark will not be subjected to non-use disputes or removal.

Importantly, the transfer should be reflected on the trade marks Registry, otherwise, the assignee may not be able to claim the benefits of trade mark ownership, such as initiating legal action against infringing parties.

Licensing trade marks

Trade marks can also be licensed by a legal agreement that gives a third party the right to use the trade mark. For the licensor, licensing agreements can provide access to new and broader markets, distribution of workload and responsibilities, and partnerships. The licensee, in turn, is able to benefit from the goodwill and reputation that the trade mark has already gained in the market. For example, Subway, which is one of the world's largest single-brand restaurant chain franchises licences its trade-mark to its franchisees.

Typically, as per the terms of a licence agreement, the licensee must ensure that the quality of the goods or services associated with the trade mark remains unchanged and up-to-standard.

Valuing trade marks

Several aspects should be considered in determining the value of a trade mark. A base consideration is the cost of applying for the trade mark and successfully registering it. The most important consideration is the investment made in establishing the brand. Market research can show how much others would be willing to pay for comparable products. The impact of the use of the trade mark in increasing sales is also a consideration.

National protection

A registered Australian trade mark is enforceable throughout Australia. The trade mark owner is advantageously positioned to stop another party from unauthorised use of the trade mark in relation to the goods and services in respect of which the trade mark is registered. Registration means that the owner of the trade mark does not have to provide proof of business reputation of the owner or deception by the infringing party. In addition, the trade mark owner can have the Australian Customs Service issue a seizure notice to the infringing party. Enforcement of trade mark rights can be carried out in the Federal Circuit Court or the Federal Court.

Label

In Australia the ® symbol is used to indicate that a trade mark is registered, and can only be displayed where the user is the owner of a valid trade mark certification. The use of ® on unregistered trade marks is illegal.

The ™ symbol, is also used to indicate the use of a trade mark but does not necessarily indicate that a mark is subject to formal registration. The ® label is a useful means of notifying others of your rights in a brand and can be an effective deterrent to other parties who may be considering using a similar trade mark.

Registered trade marks

A trade mark is a sign consisting of text, graphic elements, slogans, colours, sounds, movements or a combination of these elements.

To obtain a registered trade mark, the owner has to lodge an application to the trade mark office of the pertinent jurisdiction. The application is examined fro suitability under the relevant rules governing trade mark ownership.

Following examination and acceptance in principle, the trade mark is accepted and published. The publication period, of around two months in most countries although this varies, is the window in which a third party, who does not believe the application ought to be accepted, can oppose the registration of the trade mark.

Where no successful opposition is lodged the application will proceed to full registration. Upon registration, a registered trade mark is retroactively enforced as of its priority date. The rights to the trade mark may then be renewed every 10 years, in perpetuity. In Australia, the enforcement of registered trade marks is governed by the Trade Marks Act 1995.

Unregistered trade mark

An unregistered trade mark, also known as a common law trade mark, is subject to the same principles of validity as a registered trade mark.. However the ability of an unregistered owner to claim the rights to their mark are far more onerous and the rights granted far more precarious.

The means of protection afforded through unregistered use are strongly reliant on the reputation developed through consistent use.Where evidence is lacking or invalid the rights to the brand name or other type of mark may be rejected and the brand user left without the recourse to action that protects owners of registered trade marks.

An unregistered trade mark may be enforced through the common law tort of “\’passing off’ and deceptive conduct as stated in the Australian Consumer Law. To enforce an unregistered trade mark, three things must be established:

1. That the trade mark has acquired considerable reputation in the market;
2. That the offending party deliberately sought to mislead customers as to the origin of their goods and/or services;
3. That the owner of the unregistered mark has sustained damages and losses as a result of the actions of the offending party.