Trademarking – to do or not to do, that is the question

What is a trade mark?

A trade mark is a ‘sign’ used to distinguish a good/service from similar goods/services of other traders. It could be a business name, a product brand name, a logo, a slogan or a combination of these things. It could even be a colour, shape, sound or smell.

A trade mark exists whether legally registered or not. There is no legal requirement to register a trade mark, but there are advantages in registration.

The more unique and distinctive (the less descriptive or generic) the trade mark, the more likely it can be registered. If your proposed trade mark is descriptive/generic, or is confusingly similar to an earlier filed trade mark, registration may be more difficult.

Why should I register my trade mark?

A registered trade mark provides legal benefits to the owner, including:

  1. The exclusive right to use the trade mark for the goods/services you nominate. Registration of a business, company or domain name does not provide an exclusive right to use.
  2. A statutory defence to a claim of trade mark infringement from another trade mark owner.
  3. The right to demand that others cease to use confusingly similar brands, names, logos etc.
  4. The right to authorise (e.g. license) others to use your trade mark for the goods/services it covers.

Trade marks are assets and so can be sold, or licensed for a fee. A registered trade mark will usually have a higher monetary value than an unregistered one.

When should I register my trade mark?

A trade mark can be registered at any time. However, registration is a lengthy process (minimum 7.5 months in Australia), so if you can afford it (see cost below), you should file a trade mark registration application as soon as you start a new business or brand a new product. If you can’t afford it, then at least conduct a trade mark search as soon as you think of a new business name, company name, or product brand, to ensure that it’s not likely to infringe an existing trade mark registration.

But sometimes it’s good to delay trade mark registration. For example, if your trade mark is fairly descriptive/generic and therefore your registration application seems unlikely to succeed, it can help to use the trade mark for a while before filing your application to increase your chance of overcoming objections.

You might also choose to delay registering your business logo. Your business name should usually be registered first, being the more important asset, followed by a trade mark registration application for the logo when you can afford it. ‘Artworks’, including images and symbols used in logos, attract automatic copyright, which will give your logo some protection until you are in a position to file that second trade mark application.

Copyright ownership usually defaults to the creator of the artwork. If you engage a graphic designer to create your logo, ensure that they transfer copyright ownership to you, in writing. Copyright ownership will not prevent someone else registering the same image/logo as a trade mark. There are options to explore if a competitor registers a trade mark based on your copyrighted logo, but they can be costly, so register your logo as a trade mark as soon as you are able to.

How much does it cost?

The cost of registering a trade mark depends on the product or service you are branding with your trade mark. The trade mark system divides goods/services into 45 classes (this system is followed in Australia and most countries). A clothing brand would be registered in a single class. The trade mark of a company involved in business consultations as well as IT support needs to be registered in two classes.

A single-class, Australia-wide trade mark registration through Mark My Words costs $895.00 including all fees and charges, assuming a smooth process. Objections or oppositions can mean further fees. Registration lasts for 10 years (after which you must pay for renewal to maintain your rights), so this works out to less than $100 per year for a single-class trade mark.

Think of it as insurance for your brand. The cost of not registering can be far higher. Imagine that you spend lots of money investing in a new business or new product brand, only to discover that your chosen name/logo infringes someone else’s trade mark rights and they demand that you cease use. Not only do you have costs involved in obtaining legal advice and responding to correspondence, but also the costs of re-branding: new logo design, packaging, marketing materials, etc. And it can detrimentally affect your relationships with clients or customers when your business or brand name changes. So the costs are significant even if you settle out of court. If you have to defend infringement claims in court, the costs skyrocket.

Quick tips

  • If you can’t afford to register a trade mark immediately when launching a new business or brand, at least conduct a trade mark search and avoid creating a trade mark similar to existing, registered ones.
  • If you are in a financial position to register your trade mark immediately, do so for peace of mind.
  • If you export (or intend to export) products, or promote your business or brand outside of Australia, conduct early trade mark searches in the relevant countries, and understand the process and costs involved to protect your trade mark there, as well as in Australia.
  • The goods/services covered by a trade mark registration application can’t be changed or expanded retrospectively, so include as much as possible of your future plans at the initial filing to save time and money by avoiding additional applications.
  • Registration takes a minimum 7.5 months in Australia. Some countries take longer. Factor this into your plans.
  • In most countries, registration lasts for 10 years.
  • Once your trade mark is registered, monitoring the marketplace for infringements is your responsibility. If you suspect an infringement, seek legal advice before acting, because trade mark law is complex and you may mistakenly assume your rights have been infringed, when they haven’t.
  • Learn more about trade marks from IP Australia

About the Author

Jacqui Pryor is a Registered Trade Marks Attorney. Before establishing Mark My Words Trademark Services in 2011, she worked as a senior consultant and business manager with other trade mark companies for more than a decade.