November 9, 2012
In my October column, we considered some of the issues involved in selecting and clearing a new brand name for use in the United States. Here, we will explore challenges involved in expanding a brand beyond the United States and into foreign markets.
Trademark rights are territorial. This means that trademark protection is specific to the country in which it was acquired and does not extend past those borders.
For example, the owner of a registered trademark in the United States doesn’t have protection in Canada, unless the owner takes affirmative steps to protect it there.
In the absence of a Canadian trademark registration, the original owner can do little to prevent a Canadian company from registering and acquiring rights to an identical mark in that country.
To avoid this risk, trademark owners who believe that they can extend their brand equity outside the United States must evaluate where they are likely to expand and take steps to protect at least their most important trademarks in these targeted countries.
When expanding brand protection internationally, trademark owners should consider:
• Cost: Because trademark protection is, for the most part, a country-by-country process, it can be prohibitively expensive to protect a brand on a worldwide basis. Consequently, it is important for a brand owner to carefully consider where it is most likely to expand internationally and pursue protection in those countries.
One cost-saving exception to the rule is the Community Trade Mark Registration. Trademark owners who do not wish to pursue protection of their marks on a country-by-country basis throughout Europe can pursue a single Community Trade Mark Registration that will provide trademark protection in all 27 countries that are members of the European Community.
• Time: Although many countries outside the United States allow registration of trademarks without any certification of use in that country, they often require that the trademark owner commence use of the mark in that country within some period of time (usually three to five years) to prevent the registration from becoming susceptible to cancellation by a third party for non-use.
• Counsel: It is always prudent to consult advisers in your target country to confirm that an English word trademark does not have negative connotations when it is translated into the local language.
Failing to consider international protection for your trademarks at an early stage may result in the loss of trademark rights in some countries and restrictions on your ability to expand your products and services outside the United States.
The opinions expressed in this article are intended for general guidance only and are not intended as recommendations for specific situations. Readers should consult a qualified attorney for specific legal guidance.
Bob Felber leads the Intellectual Property Practice Group at Waller Lansden in Nashville, Tenn. For more than 25 years, he has counseled clients on IP matters with an emphasis in the areas of domestic and international brand clearance and protection, domain name disputes, product distribution and franchising.
Email: Bob.Felber at wallerlaw.com
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