Why register your trade mark?
Trade mark registration protects ‘signs’ and/ or brand names that distinguish the goods and services of one trader from those of another. Unlike some other forms of intellectual property (IP), trade mark protection can last for centuries. The oldest registered mark – ‘Bass’ – was registered in 1876, and is still valid and enforceable today.
What are registered trade marks?
Registered trade marks are the most prevalent form of registered IP and, when managed and carefully protected, can become the most valuable asset of any business. To achieve this, it is vital that not only is the brand name registered, but also all trading names. As such, registered trade marks are likely to become one of the most valuable aspects of your intellectual property portfolio. Without the protection of registration, trade mark owners have to rely on ‘passing off’ law to protect their trading names; this is very problematic, requires extensive evidence of use, and can be very expensive (see passing off). Trade marks are registered according to the types of “classes” of goods/ services to which they apply.
This includes not only the historic brand, but also all the names currently being used in the business and market place. Evidence of trade mark registration may be vital in disputes against third parties, and as evidence against claims that the trade mark has not been sufficiently used.
The ‘classes’ trade mark classification system
Almost every country in the world subscribes to a largely uniform trade mark classification system where all goods and services are categorised into 45 classes. Although efforts have been made to group goods and services of a similar nature together, at times the system can appear arbitrary. For example, perfume can be found in the same class as make-up, but hamburgers do not fall into the same class as buns and ketchup! It is vital that when trade marks are registered the correct classes are selected, otherwise the trade mark may not have the appropriate protection. Incorrectly classified goods or services my be refused by the the trade mark registry. Click here for a list of the classes.
Choosing a trade mark name
Registration protects your trade mark so that it can stand out from other brand names in your market sector, and be protected against copycats. Although, in general, anything can be registered as a trade mark, there are some that will not be allowed without the consent of the owner (e.g. the Olympic symbol, certain royal ciphers etc.).
There are advantages to the choice of one name over another. Generally, the more descriptive a name or mark is of the goods and/or services to which it is to be applied, the less education of the consumer (and marketing communications) needs to be undertaken, but the more difficult it may be to register the trade mark. However, the cost of choosing a less descriptive trade mark is that marketing effort will need to be expended on educating the customer that this trade mark identifies goods as coming from one particular enterprise.
Searching for identical or similar trade mark names
Once the potential names have been chosen, a search of the UK trade mark register will identify identical marks that are already registered or pending in the product classes in which you wish to use it. This type of search is sometimes called a “knock-out” search. It helps “knock-out” marks for which there are immediate and obvious obstacles to your use or registration, so you can decide whether to go on to the next level of search for that mark or choose a new one.
Brand Protect will undertake a free ‘knock-out’ search for you, in order to be able to advise you whether it is worth while proceeding to the next stage. That next stage is a comprehensive search. This involves the identification of identical and confusingly earlier trade marks that have already been registered. The aim of such a search is to identify further – potentially expensive – obstacles to registering your trade mark.
The advantages of registration
After selecting your trade mark for use, it is important to protect the mark by registering it. There are several practical business advantages of registration and also several important legal advantages. One of the business advantages is that trade mark registrations can be used as negotiating tools in business deals. They facilitate licensing, franchising and transfer of ownership. That said, without a registration proving the existence and ownership of the mark, a lawyer (acting on behalf of the other party) would be hard pressed to recommend to his client that any transaction to purchase that mark should proceed.
Another important business advantage of trade mark registration is that it can actually increase the value of a business for potential investors, lenders, public offerings, etc. This is because registration renders a company’s trade marks as “quantifiable” assets of the business. A registration enables the owner to show, as part of the value of his business, the goodwill resulting from advertising and promotional expenditures. Accountants have criteria they use to quantify the goodwill of a trade mark resulting from its use and promotion. Thus, expenses associated with advertising and promoting a mark translate not only into increased sales, but also into increased worth of the company; all for the minimal investment in the cost of filing a trade mark application and obtaining a registration.
Furthermore, a registered trade mark can serve as security for financial transactions. They are recognised by banks as security interests and may be mortgaged or secured.
The legal benefits of registration are substantial. Registration provides good evidence of ownership and, perhaps, the exclusive right to use the registered trade mark throughout the United Kingdom. The registration allows the trademark owner to pursue infringers in the courts. This puts the trademark owner in the strongest position by placing a heavy burden on the other party to overcome this presumption. This presumption is not offered to owners of unregistered trade marks.
A registration also expands the geographic scope of protection of trade mark right. Without a UK registration, trade mark rights extend only to the geographical area in which a company has established a market presence by making sufficient sales under the mark. A UK registration provides a presumption of exclusive rights throughout the entire United Kingdom. The same principle applies to European or US trade marks. Trade marks can be registered for use in also all other parts of the world.
The UK trade mark registration process
The cost (in terms of government fees) of making a UK trade mark application is £170 per application, which includes 1 class, plus £50 per additional class (all the goods and services offered in commerce are divided into 45 classes). In addition to this cost there is a fee of €350 charged by this firm to make the application in one class (this is a considerably lower fee than our competition charges).
When an application is made it will then be examined by the UK Intellectual Property Office (IPO). They will check whether or not the application is capable of being a UK trade mark. The more distinctive the mark to be applied for is, the fewer the number of objections this application will receive from the IPO. The IPO then checks whether or not other companies or individuals have registered identical or similar marks (conceptual, aural and visual similarities). The IPO does not block your application if they find “earlier marks” that are similar to your application, they just advise those earlier rights owners. If the IPO’s objections can be overcome, then the application is published in the “Official Journal”. This allows the public to oppose the application for a period of 2 months. If your mark is challenged by way of opposition, then there will be an official administrative process, (called “Opposition Proceedings”). Most oppositions are settled before they become confrontational.
We recommend undertaking a search of the UK and EU trade marks database prior to make an application for registering a trade mark, in order to analyse any registered marks which may oppose your application. Doing so may save much time, and therefore cost, later in the course of the application if an opposition against your application is made by the owner of a mark with prior rights. The process of application usually takes 6-8 months. Once the mark has been registered, a UK trade mark acts as a “shield” (in the sense that one UK registered trade mark cannot infringe another). It also acts as a “sword” as you can prevent others from using “similar” brands and marks (see above for the meaning of this). Most potential emulators back down when the registration is brought to their attention. This saves you a great deal of time and money compared to the costs of relying on the common law.
Furthermore, should you decide to sell the trade mark in the future, potential purchasers are more likely to pay more for a registered trade mark.
Accountants have different ways of valuing IP rights but one of the best is to add up all the costs associated with promoting that brand over the years and give this figure. All this is quite complicated. At BRAND PROTECT we won’t charge you the earth for our services, but we offer great value for money!
Trade marks are purely territorial in nature. There is no such thing as “international trademarks” (a single registration that is valid in every country of the world). Generally, if you want or need the advantages and benefits brought about by the registration of a trade mark in a particular territory or country, you need to register the trade mark in that territory (the major exception to this is a European Union trade mark)
There are two ways of obtaining a trade mark in other countries:
- making an individual application in each of the countries; or
- using the Madrid system (WIPO) of international registration of trade marks.
Trade Mark Registration in the European Union
European Union trade marks are valid in all the member states of the European Union. Applications for European Union trade marks are made to the European Union Intellectual Property Office (EUIPO), which is based in Spain. The cost (in terms of government fees) of making a European Union trade mark application is €850.00 per application for the first class, plus €50.00 for the second class and €150.00 for each additional class over two. In addition to these government fees, this firm charges €500.00 to make the application (in any number of classes).
The EUIPO assesses the mark to ensure that it is capable of being a trade mark. The application is then published, for opposition purposes, in the “Official Journal”. This means that any “person” (an undertaking as well as a real person) who believes that it has prior rights to the application can file an “opposition” to the application. If such an opposition is made against the application (unless the opposition is settled amicably), the rights of the applicant and the opponent’s “prior rights” are assessed in an administrative procedure called opposition proceedings”. In the opposition proceedings, the opponent could be challenged to prove that he has used his trade mark in the EU in the last 5 years. Although the EUIPO allows oral arguments, in practice, most arguments are made in writing. If all the oppositions can be overcome, the European trade mark is registered for a renewable period of 10 years, and it will be valid in all of the countries of the European Union.
We recommend undertaking a search of the European Union trade marks and national trade mark databases prior to making an application for registering a trade mark. However, whether to undertake a search or not is your decision. A search will allow you to analyse any registered marks which may oppose your application and adds considerably to your market knowledge. Undertaking such a search is likely to save considerable time in making an application – and therefore its cost – later in the course of the application, if the owner of a mark with prior rights opposes your application.
All this is complicated. At BRAND PROTECT we won’t charge you the earth for our services. Give us a call on + 353 (0) 15394211 to discuss your concerns, and find out how BRAND PROTECT can help you.
The international system of registration
The Madrid system of international registration of marks is applicable among the countries party to the Madrid Agreement and the Madrid Protocol. However, this system is not a direct registration system. In order to use the system, an applicant must have a registered trade mark or a trade mark application (the “basic application”) in one of the countries party to the Agreement or party to the Protocol, and an effective place of business there too. In other words, the objective of the international system is to extend the protection of an existing trade mark, to other countries in which the applicant desires to protect the trade mark. This system does not extend to all countries recognised by the United Nations. A list of the countries party to the Agreement or the Protocol can be found at the WIPO site.
This system gives a trade mark owner the opportunity to have his/her mark protected in several countries by simply filing one application with a single Office, in one language, with one set of fees in one currency (Swiss francs). The international application is handled – at the first stage – by the so called “Office of Origin”, which is the trade mark office of the Contracting Party in which the “basic application” (as described above) has been applied for or registered. The Office of Origin sends the application to the WIPO. As such this streamlining of the red tape cuts down on the costs to our clients for such applications. The basic fee (for the first 3 classes) for making an international application is 653.00 Swiss Francs (SF903.00 in the case of colour marks). A supplementary fee of SF100.00 is added for each additional class (in addition to 3 classes). To these figures one needs to add a complementary fee of SF100.00 for the designation of each contracting party. The complementary fee of SF100.00 may be replaced by the so called “individual fee”, which is only applicable in certain countries (and it is different in each country where that individual fee exists). BRAND PROTECT charges €500.00 (plus €50.00 for each class in addition to the first 3 classes) to prepare and file an application. It should be noted that registration may incur further costs to be charged by either, or both, Brand Protect and WIPO, and this figure depends on the number of classes and the selected countries.
All applications for international marks have to be made in either English, French or Spanish.
An international registration produces the similar end results as an application for registration of the mark made in each of the countries designated by the applicant. If the trade mark offices of the designated countries do not refuse the registration within a specified period (usually 12 or 18 months), the protection afforded to the mark will be at the same, or similar level, to an application for registration of a local mark in that country. The Madrid System also simplifies the subsequent management of the mark, since it is possible to record subsequent changes (such as a change in ownership or a change in the name or address of the holder) or to renew the registration through a simple single procedural step with the International Bureau of WIPO. Further countries may be designated subsequently.
A major drawback of the international system is that the international mark remains open to “central attack” for the first 5 years of its registration in its home country. “Central attack” means that if the mark used as a “basic application” is revoked or cancelled in its home territory, then the international registration is revoked or cancelled to that extent.
All this is complicated. At BRAND PROTECT we won’t charge you the earth for our services.