When starting out a new business, one of the things that people tend to overlook or become confused about is the difference between registering a business name and registering a trade mark. The confusion usually lies in not knowing the difference between the rights that attach to a registered business name and the rights that attach to a registered trade mark.
Business Names
A business name is comprised of words and numbers only and there are no proprietary rights given to the owner of a business name. Registration of a business name is compulsory if you carry on business in Australia under a name other than your own name. The requirement to register a business name is not a method of protecting your intellectual property but rather a legal obligation under theBusiness Names Registration Act 2011 (Cth). Business Names are registered through the Australian Securities and Investments Commission (ASIC). Having a registered business name does not give you ownership of the name or the exclusive right to use the name. Most importantly, the owner of a registered business name:
- cannot prevent another person from registering a similar name;
- cannot stop another person from registering that name as a trade mark;
- cannot prevent the name being used by someone that has already registered it as a trade mark;
- does not protect you from legal action if the name of your business infringes the intellectual property rights of another.
Trade Marks
A trade mark can be a product name, phrase, letter, number, a logo, sounds, product colour, scent or any other distinctive mark. The owner of a registered trade mark has the right to sell, licence and use the trade mark and, in contrast to the requirement to register a business name, if you are carrying on business in Australia, there is no legal requirement to register a trade mark(s).
If you choose to register your trade mark, an application is made through IP Australia. Trade mark registration requires you to nominate the relevant ‘class’ of goods or services within which your trade mark falls into. The list of classes of goods and services is provided by IP Australia and there are 45 classes in total. In terms of the colour of your trade mark, the general rule is that your trade mark is registered to cover all colours unless you have indicated a particular colour in your application.
As the owner of a registered trade mark, you have a monopoly over that mark, thereby giving you an exclusive right to use it as well as the right to prevent others from using your trade mark (within the same class) or registering the same or similar trade mark (in the same class). The only exception is where another’s trade mark relates to a distinctively different type of service or goods within the same class.
A successful trade mark application must be able to demonstrate:
- That it is distinctive;
- That it is not substantially identical or similar to a mark with priority over it;
- That it is not scandalous; or
- Likely to cause deception.
The ‘distinctive’ component means that your trade mark needs to be ‘capable of being distinguished’. This means that your trade mark, when used in relation to the goods or services which it covers, must be capable of being distinguished from goods or services that are provided by another person.
Once registered, the trade mark is protected in all Australian states and territories for an initial period of 10 years. If you need protection in other countries, you will need to register the trade mark in each country. This is particularly important for those who operate a business on the internet. If your trade mark is only registered in Australia, although you are protected under the Trade Marks Act 1995 (Cth), the fact that you are using your trade mark in cyberspace does not give you any rights overseas. An example is where you offer goods or services for sale on the internet, and by doing so, you infringe someone else’s registered trade mark because you are providing goods or services of a similar nature to a country where you do not have a registered trade mark. To avoid this, it would be prudent to conduct a thorough investigation of your proposed trade mark to see where it is being used around the world (with respect to the same goods or services which you intend to register it under), and if need be, refrain from offering services or selling goods to that country.
Having a registered trade mark will give you the legal right to take action against another party and prevent unauthorised use of it. It does not, however, give you the right to prevent someone else from using a domain name that contains the same or similar name as your registered trade mark. If you find that a domain name that is the same or similar to your registered trade mark is licensed to someone else thereby preventing you from using that domain name, you may need to consider an offer to purchase the domain name license from them.
Once you have registered your trade mark it is your responsibility to make sure your trade mark is kept current by paying the appropriate renewal fees and any changes to your trade mark are notified to IP Australia. As a registered trade mark owner, continual protection of your trade mark from infringement by a third party is required. There is a presumption that once you have a registered trade mark, that IP Australia will take on the responsibility of protecting your trade mark from infringement. This is not the case, as you are responsible for taking action to protect it. One way to do this is to monitor the market by keeping an eye on new and existing trade marks that are relevant to your industry so that you can take steps to enforce your rights against someone that is infringing your trade mark. An ideal starting point for enforcing your rights could simply be a letter of demand setting out the details of your ownership of the trade mark and the rights that you have as the owner of a registered trade mark.
Conclusion
Before you register your business name or engage a professional to design your brand, make sure you conduct a thorough search of the name you propose to use and the industry within which you want to use that name to see whether it is being used by someone else or not. This will save you time and money because you don’t want to find yourself in a situation where you’re found to be infringing someone else’s intellectual property rights.
For further information, please contact the author.
This article is posted in Adelaide, South Australia by Tri-meridian Corporate & Commercial Law and is intended to be used as a guide only. It is not, and is not intended to be, advice on any specific matter. We do not accept responsibility for any acts or omissions resulting from reliance upon the content of this article. Before acting on the basis of any material in this article, we recommend that you consult your professional adviser.
