WHAT IS A TRADE MARK?

It is a sign used by a person in the course of trade or business to distinguish his goods or services from those of other traders.

It functions as a badge of origin of those goods or services. If the consumers or purchasers see a trade mark, they will know that the goods or services originate from that particular person and no one else.

A trade mark can be letters, words, names, signatures, numerals, devices, brands, labels, tickets, shapes, colours, aspects of packaging or any combination of these.

WHAT IS A REGISTRABLE MARK?

For a trade mark to be registered, it must be distinctive and capable of distinguishing the goods or services of the owner from other similar goods or services.

WHY REGISTER A TRADE MARK?

It was reported that Singapore companies filed a total of 23,000 trade mark applications in 2004 and 27,000 in 2005. Are these companies on to something? Yes! They know the value of branding and creating a distinct identity for their businesses.

Although it is not compulsory to register a trade mark in order to use it in the course of trade or business, registration is valuable to a business in the following ways:-

·                    Exclusive rights over the trade mark

·                    Generates higher returns

·                    Strengthens the market position

·                    Enhances the worth of the business

All of which establishes a valuable brand for your business.

1.         Exclusive rights over the trade mark

By registering for a trade mark, the owner of the mark obtains an exclusive right of ownership over the mark.

The exclusive rights conferred by registration extend throughout the country of registration and enables the owner to commercially exploit the trade mark for the purpose of branding his products or services.

These rights include the right to prevent others from using a similar or identical mark in relation to the same goods or services without his prior permission in the country of registration.

A registered trade mark can last indefinitely, subject to renewals every 10 years.

2.         Generates higher returns

A registered trade mark is a form of property. It can help to generate higher returns for a business in the following ways by:-

·                    Licensing another party to use the mark in relation to the goods or services in exchange for royalty payments.

·                    Leasing the business’ commercial identity to another company to market the goods or services under the business’ trade mark.

·                    Franchising others to manufacture or sell the business’ goods or services in accordance to its guidelines.

·                    Selling the trade mark outright for a specified value, particularly during a company acquisition.

3.         Strengthens the market position

When a trade mark is associated with a particular business, it helps to promote the business. This is particularly so when consumers or purchasers identify the trade mark as a symbol of quality, reliability, money’s worth and/or excellence coming from that particular business. It increases the desirability of the products or services in the eyes of the public.

The business can further grow by exporting its goods or services. When the trade mark is being used and registered in the countries where the goods or services are exported to, it creates a brand name and generates sales for the business.

The business can produce the goods domestically and export the said goods, knowing that no company will be able to legally manufacture, sell, or export the said goods in the selected countries without its prior permission.

The business can license the use of the trade mark to a foreign company that will manufacture the goods in that country in exchange for royalties or lump sum licence fees.

The business can set up a joint venture with other companies to commercialize the goods or services in the selected countries.

4.         Enhances the worth of the business

In order to grow the business, there may be a need to attract investors to invest in the business’ ventures.

There may also be the need to persuade bankers or financiers to loan money to the business for its expansion plans.

Hence, if the business has a valuable registered trade mark, this may be used as a collateral or security for debt financing. Being the owner of an exclusive and recognisable trade mark, you have better negotiating power and leverage in any commercial transaction.

The registered trade mark may also be used as an additional or alternative basis for seeking equity from private investors or venture capitalists for the business undertakings.

You too can be the owner of a valuable trade mark. Act today!