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Can You “Sit On” a Trade Mark? Use It or Lose It Under Australian Trade Mark Non‑Use Law
Registering a great brand name and parking it sounds clever – but Australian trade mark non‑use rules mean there are many shades of grey.
n business, it is very tempting to have a lightbulb moment, come up with a great brand name, and rush to file a trade mark application in Australia “just in case”. You might not have a clear launch date or even a full business plan yet, but you want to keep the name away from competitors. The question many clients ask is: can you just sit on a trade mark, or will you lose it if you do not use it under Australian trade mark non‑use rules?
To answer that properly, it helps to start with what the Australian registered trade mark system is actually for, and then look at the non‑use provisions – the rules that say, in effect, “use your trade mark or risk losing it”. There is no simple black‑and‑white rule here; there are many shades of grey, and getting tailored legal advice is essential.
What is a registered trade mark really for?
A trade mark is a sign – usually a word, logo or phrase – that distinguishes your goods or services from someone else’s. It is the badge that tells consumers “this product or service comes from you, not from another trader”. Registering a trade mark with IP Australia gives you exclusive rights to use that sign for certain goods and services, and to stop others using confusingly similar marks. The core purpose of the Australian trade mark system is to protect real brands and help consumers identify the source of goods and services.
Importantly, registration is not meant to reward the best idea on paper. It is there to support real trade mark use in the marketplace. In other words, trade marks are meant to sit on packaging, websites, labels and marketing materials, not just on a register. That is why Australian trade mark law is built around use “in the course of trade” – real commercial activity, not just a dream you never act on.
How the Australian trade mark system works
When you apply for a registered trade mark in Australia, you:
Choose your trade mark (e.g. a word or logo).
Select your classes of goods and services (such as class 25 for clothing, class 41 for entertainment).
File a trade mark application with IP Australia.
If the application passes examination (for example, no earlier conflicting marks, not purely descriptive, correct owner details), it is advertised for opposition. If no one successfully opposes it, the mark becomes registered. From that point, you hold strong trade mark rights: you can stop others using a confusingly similar sign for the same or closely related goods/services, and you can license or assign the mark.
However – and this is crucial if you want to “sit on” a trade mark – those rights can later be attacked if the mark is not used. The Trade Marks Act 1995 (Cth) includes a “safety valve”: trade mark removal for non‑use. This is where the “use it or lose it” principle comes in.
Trade mark non‑use in Australia
Trade mark non‑use is dealt with in section 92 of the Trade Marks Act. A third party (for example, a competitor or someone blocked by your mark) can apply to have your trade mark removed from the Register on two main grounds. These are often referred to by practitioners as the “no intention to use” ground and the “three‑year non‑use” ground.
No good‑faith intention at filing – s 92(4)(a)
Under section 92(4)(a), a person can apply to remove your trade mark if, as at the filing date, you had no intention in good faith to:
- use the trade mark in Australia; or
- authorise someone else to use it in Australia; or
- assign it to a company to use it;
for the goods or services in question, and the mark has not been used up to shortly before the non‑use application. In simple terms: did you ever genuinely plan to use or license this trade mark in real business, or was it just a paper grab?
No use for three years
Under section 92(4)(b), a person can seek removal if:
- the trade mark has been registered for at least three years; and
- for a continuous three‑year period ending one month before the removal application, the owner has not used the mark in Australia (or has not used it in good faith) for the relevant goods/services.
This is the famous “three‑year non‑use period”. If there is a continuous block of three years where your trade mark is not used at all for the registered goods/services, it becomes vulnerable to removal for non‑use.
What counts as “use” of a trade mark – and how much is enough?
The law talks about use of a trade mark in good faith in the course of trade. This can sound technical, but it is actually very practical. Use will usually count for Australian trade mark non‑use purposes if:
- The mark appears on products, packaging, websites or advertising for goods/services you are genuinely selling or supplying in Australia.
- The mark is acting as a brand (a badge of origin), not just as part of descriptive or decorative text.
- The use is either by you as the registered owner, or by a licensee you control (this is called authorised use).
Crucially, you do not need constant or massive use to keep a registration alive. Australian decisions and IP Australia guidance recognise that even modest, genuine use can be enough to defeat a non‑use application. The key points are:
The three‑year non‑use ground in s 92(4)(b) looks for a complete three‑year block of no use at all. If you can show even one bona fide act of commercial use of your trade mark in that window, the non‑use ground can fail.
Evidence of trade mark use can include: photos of products bearing the mark, invoices, point‑of‑sale receipts, website screenshots, online store listings, social media promotions, licence agreements and distribution deals.
Use by an authorised licensee (for example, a distributor, franchisee or tribute band performing under your mark) counts as use by the owner, as long as there is proper control over the mark.
So, when it comes to how much trade mark use is enough, the law is strict about “dead” marks, but quite forgiving where there is at least some genuine, well‑documented commercial use.
Can you sit on a trade mark? Register now, use later?
This is the heart of the “can I sit on a trade mark?” question – and where there are many shades of grey.
On the positive side, it is absolutely normal in Australia to:
File a trade mark application before you launch a product or service.
Intend to use the mark later, once you have finished development or secured funding.
Use trade mark registration as part of a real business strategy.
Section 92(4)(a) only bites if you had no genuine intention to use or authorise use of the trade mark at filing. Courts have said that the test is whether there is a genuine commercial intent to use the mark as a brand, not whether your business plan is perfect or the timeline is locked in. You can have a staged or evolving plan and still be in good faith.
On the negative side, problems arise if you:
- File purely to park the name and block others.
- Have no credible business plan or realistic path to use the mark as a brand.
- Never get around to any real trade mark use at all, even years after registration.
In that situation, once your mark has been registered for at least three years, it becomes a prime target for a trade mark non‑use removal application. A competitor who wants to use a similar mark can say, “this registration has just been sitting there with no use – please remove it”. If they can show lack of good‑faith intention at filing and/or a three‑year period of no use, the registration can be lost.
So the real‑world answer to “can I sit on a trade mark?” in Australia is that you can register early and use later, provided you always had a genuine intention to use or license the mark in trade, but you cannot safely sit on it forever with no use at all because, if you never use your trade mark, you risk losing it under the non‑use provisions.
The “use it or lose it” approach in Australian trade mark law is a policy choice designed to balance the owner’s interest in locking down a valuable brand name early with the public interest in keeping the trade mark register clean, so it reflects marks that are actually used in the market rather than stockpiled ideas. Without non‑use rules, people could hoard trade marks, never build real brands, and still block honest traders from using similar marks; with overly harsh rules, it would be too risky to plan ahead, so the current system tries to sit in the middle by allowing early filing and evolving plans, but insisting on genuine intention plus some real use within a reasonable time.
Because of this balance, there is no clear black‑and‑white line. Each case turns on its own facts: what the owner intended at the time of filing, what they actually did afterwards, and what evidence they can produce of real commercial use or a concrete plan. If you are thinking of “sitting” on a trade mark in Australia even though you are not ready to launch, you should first have a genuine business plan; even if it is rough or staged, you need to be able to explain how and when you realistically expect to use or license the mark, because that supports a good‑faith intention at filing. You should then aim to start some genuine trade mark use as soon as it is practical, even on a small scale, since a single bona fide act of use in the three‑year non‑use period can make a real difference if someone later challenges the registration.
It is also important to document your trade mark use carefully by keeping dated examples of product packaging, website pages, invoices and promotions that show your mark in use in Australia, because these pieces of evidence can be vital if a non‑use application is filed against your mark. You should monitor the three‑year non‑use period once three years have passed from registration and ask yourself honestly whether there has been continuous use in that span; if not, it is sensible to take advice on how to strengthen your position before a problem arises.
Finally, because intention, ownership structures (for example, individuals versus companies versus bands) and evidentiary detail are all fact‑specific, there genuinely are many shades of grey, which means there is no one‑size‑fits‑all answer and no guaranteed “safe” way to sit on a trade mark indefinitely; if you are unsure whether your trade mark is at risk, or whether your plan to register now and use later will stand up, it is wise to get specific legal advice from lawyers who regularly deal with Australian trade mark non‑use and ownership issues.
At Sharon Givoni Consulting, trade mark strategy is a core part of what we do: from choosing and registering strong brands, to managing trade mark use, to defending non‑use removal applications and resolving disputes where there are overlapping interests in a name (such as band members, co‑founders or joint ventures).
Because trade mark non‑use, intention and ownership all involve fine distinctions and shades of grey, this article is general information only and not legal advice. If you need help with your own trade mark – whether you are about to file, worried you might lose a registration, or facing a non‑use application – please contact Sharon Givoni Consulting for tailored advice.
Please note the above article is general in nature and does not constitute legal advice.
Please email us info@iplegal.com.au if you need legal advice about your brand or another legal matter in this area generally.