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Trademarks

Trademark Registration: Why is it Crucial?

Filing a trademark is crucial for businesses seeking to protect their brand identity in the market. It not only grants exclusive rights to use a particular sign, logo, or name but also establishes a brand's distinctiveness. Trademarks are pivotal in communicating brand value, ensuring legal protection, and building trust among consumers.

The single biggest investment in a business is undeniably its brand name. A brand speaks for itself and makes the business knowable, likable and trustable among the customers. In short, a great business starts with a great trade name. Brands, therefore, are most often worth millions of dollars. Sometimes even small brands could be of great value. Like every business asset, the brand name should also be dearly protected. Unfortunately, like every business asset, a brand name is always under constant threat of getting stolen. But the good news is that it can be kept safe and sound and well protected by registering it as a trademark. Although it is not mandatory to have it protected, it is very much advisable to have the trademark registration. It is just like how one locks and protects one’s valuables in their own house. It isn’t mandatory. However, it is best to keep the valuables safe. Is it not better to be safe than sorry? The same inference can be extended to filing trademark protection as well.

A trademark is a graphic symbol that might be a word, name, device, label, or number that is used by a company to identify its products or services from those offered by other companies that have trademarks on similar goods or services. An asset that is subject to protection under Indian law is a trademark.

The brand name of a business can be protected through the Trademarks Act, 1999.  The trade name of successful businesses is often misappropriated by other market players. Sadly, in the absence of trademark registration, the only recourse available for the business owner is a painful court proceeding that could take years to resolve. But having a trademark registration in place could be a game changer in this scenario. 

The trademark infringement could be dealt with in a much easier way and the business owner could get a befitting remedy in no time. Thus, although registration is not mandatory, it is always prudent to go ahead and get the trademark registered. Having a registered trademark makes it effortless for the business owner to establish the rights vested in the brand name in the court, thus saving an enormous amount of money and endless hours of legal battles.

Why Should a Trademark Be Registered?

A trademark is any phrase, word, symbol, or insignia that refers to a particular product in such a way that it is considerably differentiated from the other products existing in the market. A trademark solely isolates, identifies, and recognises a particular company’s ownership with respect to the specific product or class of products. A trademark includes not only the brand name but also logos, slogans, and taglines associated with the respective brand name. For instance, the brand ‘Nike’ has trademarked the brand name, the ü marks, and tagline ‘Just Do It’. None of this can be used solely or together by any other brand in the market that deals with the same products as Nike.  

Despite the advantages a trademark has to offer, it is not mandatory that a company should register its brand name as a trademark under the Trademarks Act, 1999. Nevertheless, taking this lightly, and having an unregistered trademark could put the business under severe threats and the business owner would have to face the repercussions. It would be very unreflective of a business owner to spend all the time, energy, and money in building the establishment from the scratch and leaving the business wide open for a competitor to walk in and take away the brand name comfortably.

It is therefore always encouraged to get the trademark registered for the following reasons:

The Legal Right to Use the Trademark

Registering the trade name under the Trademark Act, 1999 gives the owner of the trademark the exclusive right to use it and prevent any other party from using the same trademark for their business. Unregistered trademarks can also claim protection under common law, but if such trademarks are infringed, the owner has to be geared up to fight long and complicated legal battles. In the case of registered trademarks, the registered proprietor could get tangible remedies in a shorter span of time, when faced with infringement.

Risk of Infringing Other Registered Trademarks

Another perspective on trademark registration is that, when a business owner comes up with a brand name and chooses not to register it, there is a risk of this name infringing the other existing trademarks. In such cases, the business owner would be taken for a task and would be dragged into infringement suits. This would also result in the business relinquishing the chosen brand name.  The best possible way to avoid this is to do a trademark search of the brand name, and after ensuring that the name is unique, the business owner should get it registered.  

To Prevent Trademark Infringement

When a trademark is not registered, it gives way for other businesses to use the same or a deceptively similar brand name for their business. Although the business owner could claim protection under common law, the business owner has to gather substantial proof to show that the trade name has been in use for a considerable period of time and that it has built a worthy reputation. This could be overwhelming to new businesses. Undoubtedly, registering a trademark is the best way to hold the brand name and the goodwill associated with it safe from being infringed by other traders in the market.

To Avoid Confusion Among Customers

When businesses fail to register their trademarks, there lies a possibility of several businesses having the same or similar brand names. This could create confusion in the minds of the consumers and dilute the brand presence. The market would lack a sense of healthy competition and this would create nothing but chaos and unfair competition. For instance, Satyam Infoway Ltd managed to get the courts to disallow Siffynet Solutions Pvt Ltd on the grounds that it would confuse consumers. 

Trademark Is a Valuable Asset

Once a trademark is registered, the owner can not only use the trademark exclusively but also has the right to license or sell it. The registered owner can authorise another trader to use the registered trademark without assigning the ownership of the mark. Most often, the registered proprietor lays certain restrictions on the licensee while granting the license.

For instance, the licensee is allowed to use the trademark only for a certain class of products. There are no such regulations over unregistered trademarks, although such marks can be licensed. This might hamper the rights of the registered proprietor.  The licensing of registered trademarks is regulated by the Trademarks Act, 1999. Further, unregistered trademarks cannot be sold separately from the business, unlike registered trademarks.

Cyber Squatting

Cybersquatting has become one of the most common forms of Intellectual property thefts in recent times. Cybersquatting or domain name squatting refers to the act of registering a domain name using a third party’s registered trademark fraudulently. This has become so common that there is even a regulation for this known as Uniform Domain Name Resolution Policy (UDRP). In the absence of a registered trademark, it’s a bit harder to prove to the UDRP or the courts that the various domain combinations (emample.co.uk or example.biz) should be disallowed on the grounds that they affect the rights of the business. For instance, Marks & Spencer, which runs under marks-and-spencer.co.uk, even managed to block the sale of marksandspencer.com by a domain registrar.

Thus, the above circumstances clearly reflect that failing to register trademarks might bring several repercussions to the business. A business should never push or avoid something as crucial as trademark registration. There could be infringement issues even after a trademark is registered, but it would be much simpler to solve in that case. Registering a trademark might be hard work, but when it is entrusted to professionals it can be accomplished in a jiffy. 

At Vakilsearch we handle trademark registrations in the most professional way possible and ensure we place your brand name in your hands safely at the earliest possible. Remember, you are just one call away from getting your trademark registered!

FAQs on Trademark Importance and Necessity

What is the importance of trademark and brand?

Trademarks solidify brand identity, offering legal protection against infringements. They differentiate products/services, fostering loyalty and trust among consumers.

Is registration of trademark necessary?

While not mandatory, registering a trademark ensures exclusive rights, legal protections, and a competitive edge in the market.

Why are trademarks important to customers?

Trademarks assure customers of consistent quality and authenticity, helping them make informed purchasing decisions and trust the brand.

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