Use it or lose it – what happens if you do not use your Trade Mark?

Sharon Givoni Consulting Consumer Law, Intellectual Property, Packaging, Retail and fashion Law, Trade marks

If you are a small business and looking to restructure, this article is a must-read to ensure you do not inadvertently put your trade marks at risk.

Key points:

  • Even if you have a registered trade mark this may not be fool proof
  • A registered trade mark can be potentially removed by a third party, if they submit a non-use application and you have not used it for a period of three continuous years 
  • If you are not using your trade mark for all the goods and services covered your mark can be vulnerable
  • You need to ensure that the entity that owns the trade mark is in control of the trade mark

Ok, so where do we begin…?

If you own a registered trade mark there is a policy called use it or lose it.

Usually the registration of a trade mark lasts for ten years, and this can be renewed indefinitely upon the payment of renewal fees. In Australia, there is no need to provide regular evidence that the trade mark is being used. However, if a trade mark is not being used, then any other person can apply to have the trade mark removed from the Trade Marks Register.

Why? Why would someone do such a thing?

If the Trade Marks Register is full of unused trade marks, then it will be like a stereotypical teenager’s bedroom – chaotic, messy and impossible to search through. If you have a trade mark that you are not using, this prevents anyone else from using the trade mark. If someone else wants to use your unused trade mark, they can submit a removal application to IP Australia.

How can they do this to me?

According to trade marks law, a registered trade mark may be removed if it has not been used in the 3-year period leading up to one month before the application for removal is filed. A removal application will only be considered if 5 years have elapsed since the application for the registered trade mark was filed.

If someone wishes to have your trade mark removed from the Register, they must submit the required application to IP Australia.

But it’s mine! What can I do?

If someone has submitted a removal application to have your trade mark removed, all is not lost. You can defend the registration of your trade mark by providing the appropriate documents to oppose the removal and evidence of your use. The catch is that you need to show use.

Alternatively, if you only need your trade mark for some goods or services and not all, you may be able to negotiate with the other party. Be sure to get legal advice first though as you do not want to agree to giving up something when you don’t need to.

Alright, ok, that’s good. But wait – how do I prove I’m using it?

This is the tricky part, and it is advisable to consider the idea of ‘use’ when registering your trade mark. You must show that your trade mark has been used in the course of trade in relation to the relevant goods and services associated with your trade mark.

Put another way, if you select a class of goods and services when registering your trade mark, and you do not use this class in the course of trade, then your trade mark might be liable for full or partial removal.

Cool. Now, what if I have more than one company? Will there be a problem?

If you have a group of companies, such as an IP ‘holding’ company and a trading company, it is essential that the right documentation is in place and that the owner of the trade mark is exercising sufficient ‘control’ over the other companies.

There is a special type of document called an ‘authorised user’ agreement which must be put in place. This document will show that the owner of the trade mark has quality control or financial control over the trade mark, even if the owner has licensed another company to use it.

Wow. Lots to think about….

Yes. You should be careful when registering your trade mark, and ensure you are selecting the right classes of goods and services. You should also consider reviewing your trade mark portfolio as regularly as possible, to ensure your trade marks are aligned with the correct classes of goods and services, and that the appropriate agreements are in place.

Can I get some advice?

Absolutely. If you have a trade mark, or are thinking of obtaining a trade mark, please contact us for any advice on trade mark registration.

Further, if you have a group of companies, we can assist with drafting the appropriate agreements in place so that you don’t have any problem with using it then losing it.

Disclaimer: This article is of a general nature and not to be replaced with tailored legal advice.