The Trade Marks Act 1999 was amended to suit advancing trade practices and to abolish unfair competition among brands. The Act is enacted with an intention to protect the rights of a proprietor who invests money, time and work into his trademark and building its reputation in the market, and the consumer should get equal protection from being cheated into buying a product of a sub-standard quality, just because it was displayed with either the same mark by a person who is not the proprietor or authorized user of the mark, or a mark that is deceptively similar to the proprietor’s mark.
The Act allows a registered proprietor to assign or license out the use of his trademark. The assignment and licensing can be made with or without the goodwill of the business concerned. A trademark need not be registered to be assigned or licensed.
Assignment of a trademark
Section 2(b) of the Trade Marks Act 1999 describes “assignment” as an assignment in writing by an act of the parties concerned. Assignment is the transfer of proprietary rights. Proprietary rights over a few goods or services, or over all the goods or services registered by the proprietor may be assigned, unless it is an associated trade mark. It can also be in favour of more than one person if they operate in different countries.
An assignment thus should be made in writing, where rights are transferred legally, but a trademark cannot be assigned or transmitted if such an assignment creates multiple rights in more than one person as it could deceive or create confusion in the general public.
The assignment of a trademark has to be registered with the Registrar of Trademarks within a period of six (6) months from the date of assignment (or with a permitted extension of three more months). The Registrar will then advertise the assignment so as to inform the public of such assignment. Though the registration of an assignment is not mandatory, it is better to get it registered since an assignment that is not registered will not be a valid proof of the assignment.
Licensing:
Licensing occurs where the owner or authorized user of a trademark, allows a licensee to use his trademark for a royalty paid to him for a particular term.
Licensing is done by a licensing agreement containing the terms and conditions of use of the trademark by the licensee. The terms must include – names of the parties, terms of sub-licensing, duration of the license, territory for usage of the trademark, specification of the goods and services to be manufactured under the mark, royalty to be paid and term for such payments, terms for quality control, security terms, and termination of the license among others.
Licensing can be done through-
Assignment and Licensing of trademarks help the proprietor to generate more revenue, enact broader and easier territorial expansion, enjoy protection from illegal use of one’s marks, develop easy advertisement across different places, increase consumer recognition and popularity among other benefits.
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