Is Trade Mark Registration Necessary? – Part 2

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In our blog post last week  Is a Trademark necessary for your business? we mentioned how some people are confused about trademarks.

We explored the relevance of trademarks for SMEs, the potential danger of a DIY approach and when a trademark may not be capable of registration.

This week, among other things, we look at international registrations, name searching, and risk management.

International registrations

International registrations which involve extending an existing trademark registration to other countries, such as under the system known as the Madrid Protocol, make it very important to have a well drafted UK trademark registration.

If your initial trademark registration is not adequate to cover your business activities it will be worthless.  To then invest in wider international trademarking on the basis of that application would be misguided.

So, if you have registered your own trademark, it’s worth getting professional help from a trademark lawyer before extending the registration to other countries.  It may well be necessary to file a fresh base application – that is, a UK trademark, at the same time with your Madrid Protocol application.

Otherwise, if you base a Madrid protocol application on an inadequate registration you will be transferring those inadequacies across to the registrations in other countries.

Businesses that just want to get going

Some people use a new name not because they are particularly attached to it but because they need a name in order to get going with their business.

If you fall into this category then trademarking would not be appropriate for you.  Instead check the trademark registers to ensure your use of the name will not cause problems by infringing on others’ rights, and then just proceed to use the name.  There is no requirement to have a trademark in order to use a name.

The 3 registrations: company, domain and trademark.

The simple road map for choosing names for an online business is to check 3 registers: trademark, domain and company.

The order is significant and it is best to start with the trademark registers, as trademarks are the most legally effective way to stake out claims in a name.  If the name is already registered on the trademark registers for your category, then choose another one.  There is no point even looking at available domain or company names.

But we have noticed people often confuse the rights granted by each type of registration.  It is widely believed that a domain and company registration give conclusive rights in a name.  Often the trademark registers are completely neglected.

Although the law of passing off gives you some rights over a business name you have used, and in which you have built up rights, the scope of your protection is, in practice, limited to the rights you can prove you’ve generated.  This requires evidence of use, confusion and more resources to enforce than small businesses can afford.  It also has all the uncertainties inherent in litigation.

It is, in practice, easier to enforce rights in a name you have registered as a trademark, than in a name you have simply been using. A registered trademark is on the public registers, and as such notifies the world of your rights in the name.

If you have a domain name dispute, it is easier to pursue your claim by attaching a trademark certificate.  Without a registration, you would need to produce volumnious information about your rights in the name, and your domain name ownership may be more vulnerable to attack by other trademark owners.

A trademark is also indispensable if you have any user name disputes relating to social media sites.

We have seen instances of clients registering a domain without doing a trademark search, and then finding themselves on the defensive when a trademark owner considers the domain name to be confusing, and applies to have it transferred.

Therefore, in practice, not having a trademark registration could mean building your brand on a house of cards.

Risk management

If you have been in business for a long time, you may wonder (like many it seems) whether registering a trademark is really worth the expense.  One reason it might be, is when it comes to exiting the business.  Anyone taking over the  business will expect to see a registered trademark in the name you have been using for the business.

A prudent businessperson should constantly seek to pre-emptively reduce their exposure to risk.  So, risk  management is another important reason for protecting the brand with a trademark and other IPRs.

While acquiring a trademark may seem costly to a start-up which is inherently conscious of cashflow, it is inexpensive relative to the potential cost of litigation further down the line. 

The fact that you can build up rights to a name without registering it as a trademark does not mean there is no value in registering a trademark, and so it should not dissuade you from registering a trademark.  Whether you would be able to prevail in future litigation to reclaim the name from someone else who may beat you to it by registering the name first is uncertain.  So why set yourself up for litigation, when it is so easy to register the name when it’s available?

There is a place for DIY registrations provided you take the time to learn to do it well.  But do get professional help later if your business takes off.  Professional guidance will check that your registration is adequate, and is particularly important when you want to apply for wider protection internationally.