Business Names v Trade Marks

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Business Names v Trade Marks

One of the first questions we ask when speaking to a new client, is if they have a trade mark to protect their brand. A lot of our clients say they know they should get one but just haven’t got around to it or they have put it in the ‘too hard basket’. Just as often though we notice people think their brand is already adequately protected, when really, it’s not.

“All good, Bruz. I’ve registered my business name!”– Bob from Bondi.

“Unfortunately, Bob – it’s not…” – Progressive Legal.

Business names won’t offer you the protection you need to ensure your brand is adequately protected. It might sound strange, but just because you have a business name, it doesn’t necessarily give you the legal right to use it.

[inlinetweet prefix=”” tweeter=”progressivelegal” suffix=””]Your business name isn’t necessarily enough to protect your brand.[/inlinetweet]

What’s a business name?

A business name is really just the name your business trades under – a nickname if you will. The law requires you to register your business name if it is different to the legal owner of the business. The reason ASIC requires you to register your business name is so that people can identify who the legal owner of a business is.

What’s a trade mark?

A trade mark is a way of identifying your unique product or service. It’s your brand. It helps your customers recognise your product or service. It can be a word, phrase, letter, number, sound, smell, shape, logo, picture, aspect of packaging or a combination of these. Anything to distinguish you from your competition.

Most importantly, a registered trade mark gives you the exclusive right to use, licence or sell the trade mark within Australia for the goods and services for which it is registered.

Why do I need to know the difference?

As you can see from Bob’s comment, it’s common for people to think a business name (or company name for that matter) gives you a proprietary right in that name like that of a registered trade mark when in fact, it doesn’t.

There are some statutory and common law remedies available if someone is blatantly copying your brand and you don’t have a registered trade mark (e.g. “passing off”) but enforcing your rights could be difficult and therefore costlier. If you register your trade however, you’ll get maximum protection. You’ll be able to stop others from coming along and confusing the market.

By registering your trade mark, there will be a record of the date you registered your trade mark (the “priority date”), the exact mark you have registered, the classes in which you have obtained registration and relevant activities within those classes.

If another business starts using your trade mark to promote the same or similar product or service, then you’ll be much better placed in protecting your brand. It also prevents other businesses from registering a trade mark that is similar to yours. IP Australia reviews all applications and determines whether or not they are too close for comfort. i.e. your competition can’t come along and register their mark if you were there first.

“OK great, I better get cracking on that trade mark application, hey?!” – Bob from Bondi.
“Yes, Bob. The sooner the better.” – Progressive Legal.

Unfortunately, Bob didn’t know this and found himself to be in a bit of a pickle.

When Bob initially registered his business name, he didn’t search the trade mark register to identify potentially conflicting trade marks. Without even knowing, Bob was actually infringing on someone else’s registered trade mark that was registered before Bob started trading. If the owner of the registered trade mark demands Bob to stop trading under that name, he would likely have to and that means re-branding. That’s a scary and costly thought for any business owner. Think about the signs, banners, promotional materials, domains, social media accounts, bank accounts, subscriptions – all that goodwill, gone! Our wallets hurt just thinking about it.

In summary, registered trade marks trump registered business names (unless they were there first to register). Registering a trade mark however is not always simple and can be quite technical.

We strongly recommend getting in touch with us sooner rather than later so that we can guide you through the entire process. Please don’t be a Bob.


About the Author

Written by Alex Beagley, Lawyer at Progressive Legal.

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