Attorney-at-Law Michael Horak, graduate engineer (Electrical Engineering), LL.M. (European Law)
 


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Trademarks:

    • What is a trademark?
    • How does a trademark come into being?
    • How much does a trademark registration cost?
    • Who prevails when two parties have chosen the same trademark?
    • Is it possible to “reserve” a trademark before actually exploiting it?
    • Need trademarks to be registered?
    • What are the advantages of a trademark registration?
    • When should a trademark be registered?
    • Is a trademark search necessary prior to applying for a trademark?
    • Are there any possible hindrances to entry?
    • What is trademark licensing?
    • How is a trademark registered?
    • What does the German Patent and Trademark Office examine?
    • How much does it cost to maintain a registered trademark?
    • What is the value of a trademark?
    • What information do we need to register a trademark?

Information about ideas, services or products spread increasingly faster and simpler. A company can maintain its hold on the market by means of a name, which influences the way the company is perceived. Moreover, a company or a product name expressed by a succinct term used for many years constitutes an independent value in the form of a trademark. It is usually recommended to register a trademark as early as possible. Trademark protection usually pays – a regular trademark registration including ten years of trademark protection, which can be prolonged for any period, requires an official fee of € 300 as of now.

What is a trademark?

A trademark is a name, a company name, a term, a logo or a combination of these that identifies a company, its goods or services. The purpose of a trademark is to symbolise an origin that you associate with certain contents, such as quality, price merits and others.

A trademark constitutes a monopolist right; like the owner of an article of property, the trademark owner can proceed with his trademark as he pleases, which means that he can for instance exploit the trademark himself, he can sell it or license it to a single or multiple third parties.

How does a trademark come into being?

German trademarks are usually created by entering them in the trademark register kept at the German Patent and Trademark Office. This is not, however, the only possibility. In certain cases, trademark protection can come into being by means of exploitation of a name, namely in that moment when this name becomes so popular that it is recognised by a considerable number of people in an addressed target group who see the name as a trademark of a certain enterprise.

How much does a trademark registration cost?

The German Patent and Trademark Office presently charges € 300 for the application for a trademark and the entry in the trademark register. The official registration fee includes trademark protection for 10 years. This sum does not, however, include pre-application costs, such as possible research costs, as well as post-registration costs, such as European and international registration.

Who prevails when two parties have chosen the same trademark?

Generally speaking, the party that has first filed an application for registration has “better rights”. The day of application is decisive here. From the day a trademark is registered, its owner has the exclusive right to exploit the name for the indicated goods or services within the whole territory of the Federal Republic of Germany.

Is it possible to “reserve” a trademark before actually exploiting it?

It is not obligatory to exploit a trademark immediately; it can therefore be “reserved” by means of registration. It is only when five years have passed that a third party can object to the so called “non-exploitation”. The same rights can be derived in the first five years of such a “reservation” as in the case of immediate exploitation.

Need trademarks to be registered?

In most cases, it is necessary to register a trademark in order to assert the rights to a name and to exploit other advantages of a trademark. It is not obligatory, though.

What are the advantages of a trademark registration?

A registered trademark is attested in the form of a certificate for the trademark owner and results in an almost monopolist trademark protection in favour of the owner in the area applied for. The existence of a trademark right can be proven to a large degree by means of a certificate.

A registered trademark can turn out to be extremely important when registering or preserving a domain name in the internet. Contrary to trademark registration, domain registration under private law does not guarantee any exclusive rights.

Moreover, a trademark means delimitation from competitors. Usually, the trademark register is consulted when looking for a new name in order to avoid a name similar to one that has already been registered. Furthermore, a trademark can safeguard a company name. At entering a company name the commercial register examines merely locally whether such a name has already been entered. Even an enquiry directed to a local Chamber of Trade and Industry does not result in an examination on a nationwide level. It can therefore be sensible to secure a company name by means of a trademark.

Apart from these protective and informative functions, trademarks also offer protection against counterfeit merchandise concerning services and goods.

When should a trademark be registered?

You should apply for a trademark as soon as possible since the day of the application decides when trademark protection begins.

Is a trademark search necessary prior to applying for a trademark?

The filing of an application for entry in the register of trademarks is only recommended after performing a trademark search. If there already is a similar or identical trademark for similar goods or services, a later application would usually be futile. In addition, the original owner of a trademark can demand the release of a trademark by means of a caution at a fine.

A simple search among trademarks effective in Germany (German trademarks, European Community trademarks and international trademarks with Germany being the country of destination) brings about costs – in case of a similarity search – amounting to approx. € 200. Not only do results of such a search answer the question if a similar trademark has already been registered, they also offer an overview of similar registered trademarks.

A trademark search is usually conducted by specialised companies, such as ideahelp or Compumark NV.

Are there any possible hindrances to entry?

The Trademark Act specifies a number of entry hindrances. For instance, descriptive names and generic concepts (such as “computer”) cannot be registered. The same applies to certain general names, since they must be kept available or because they cannot be distinguished from one another. For example, “company consulting” for the service known in German as “Unternehmensberatung” would have to be kept available.

What is trademark licensing?

The owner of a trademark can “lease” his trademark, i.e. “license” it for a licence fee. Contrary to e.g. a rented flat, a trademark can be licensed as a right to as many interested parties as the owner wishes. Being a monopolist, the trademark owner can place numerous conditions, which would normally not be allowed. This results from the fact that a trademark is intended to be a monopoly.

How is a trademark registered?

Filling in and handing in an application for a trademark registration to the German Patent and Trademark Office leads to entering a trademark in the trademark registry following the examination of the application. The German Trademark Act describes a number of reasons for the rejection of trademark applications. Therefore, it is important to make every possible effort to approach a trademark application professionally.

What does the German Patent and Trademark Office examine?

The Patent and Trademark Office examines first of all absolute and relative grounds for refusal, apart from the formal examination of the application, i.e. whether all statements comply with the legal requirements and whether all fees have been paid. If no hindrances have been stated and if the formal examination has been successfully completed, a trademark is entered into the trademark registry and published in the official journal. Within a three months’ period, third parties can raise an “objection” to the trademark entry. Usually three to twelve months pass from filing an application until the trademark is registered. The examination is completed within six months in the case of a so called summary examination, requiring additional fees.

How much does it cost to maintain a registered trademark?

A registered trademark is protected for a period of ten years starting from the day of registration without any additional charges. Trademark protection can successively be extended by further ten year periods. If it turns out after ten years that a trademark should be maintained, a renewal fee has to be paid to the Patent and Trademark Office.

What is the value of a trademark?

The value of a trademark cannot be estimated generally. Basically, the more established a registered trademark is within the market target group, the more valuable it is. Newly registered trademarks can be included as an asset in the financial statement, but initially only to the amount of the registration fees including all additional costs. There are no limits to the value of a trademark.

What information do we need to register a trademark?

Name and address of the party wishing to register a trademark who will later be the trademark owner. In the case of foreign enterprises we also need to know under which jurisdiction the enterprise was founded.

The exact sign, logo, etc., which is to be registered (a single word, a combination of word and picture or other – as soon as the application has been forwarded to the Trademark Office no alterations can be made, therefore it is necessary to indicate the sign exactly).

The goods or services which are or could be associated with the trademark.

Nomen est omen – a registered trademark offers much more than merely the encircled R sign (for “Registered”). Sometimes international – e.g. including all German-speaking countries – or Europe-wide trademark protection provides for additional protection of a German trademark in the future.

 

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