Part 4 Trade marks and service marks
Trade marks and service marks are signs, graphics (logos), words or shapes which are used to distinguish one trader’s goods or services from those of another trader. Trade marks are applied to tangible goods (e.g. a particular shape such as the Jif Lemon bottle) whereas service marks are applied to services such as banking or retailing where there is not always a physical product that can carry the trade mark.
31.10A.72 Unregistered trade marks
A business or individual does not have to register a trade mark, however enforcement of a right to use an unregistered trademark can only be protected under the common law legal action of “passing off” [note 1], where someone else uses your trade mark or represents the goods or services as their own. This action is usually difficult to prove and expensive to defend, as “passing off” relies on factual evidence proving:
These issues would be difficult to prove where a new business has created a new trade mark for example, so generally, registration of a trade mark is recommended. Part 5 Section B includes additional information on the tort of “ passing off”.
31.10A.73Trade mark registration
In the UK, trade marks can be registered at the Trade Marks Registry, which is a branch of the Intellectual Property Office, click HERE to access the UK Intellectual Property Office website.
31.10A.74Eligibility for trade mark registration
The Trade Marks Act 1994 [note 2] defines a trade mark as follows:
“A “trade mark” means any sign capable of being represented graphically which is capable of distinguishing goods or services of one undertaking from those of other undertakings. A trade mark may, in particular, consist of words (including personal names), designs, letters, numerals or the shape of goods or their packaging.”
Marks which are capable of graphical representation can be registered even if the mark itself is not a graphic or a word. This may include tunes, packaging shapes or, in some very limited cases, smells. A specific colour might also be considered a trade mark and can be registered as such, as was decided recently in the High Court ruling in the matter of Société des Produits Nestlé SA v Cadbury UK Limited  EWCH 2637 (Ch) [note 3] concerning the specific purple colour used by Cadbury UK Limited in marketing its chocolate products.
31.10A.75Trade marks which cannot be registered
Certain marks are not eligible for registration on absolute grounds [note 4]. These include marks which do not comply with Section 1 of the Trade Marks Act 1994 (see paragraph 31.10A.73) or marks which are not distinctive, or considered to be contrary to public policy or accepted principles of morality (e.g. in bad taste). Trade marks which consist exclusively of a sign which, in trade, designates specific characteristics of that trade are also not eligible, nor are trademarks which consist exclusively of the shape of the goods or which represent signs or indications common to the business (although there are some exceptions to this). Marks which are protected emblems (such as flags or state arms) cannot be registered [note 5], nor can marks which are deceptive (for example, suggesting that a product is from a particular geographical location when, in fact, it is not). If the use of a mark is prohibited by UK or EU law it also cannot be registered. Other marks are not eligible for registration on relative grounds such as conflict or potential conflict with an existing mark – even if it is not a registered mark [note 6].
31.10A.76 Trade mark classificationsTrade marks are registered under a classification system [note 7]. Goods and services are numbered using 45 differently numbered classes, with goods being registered under classes 1 to 34 and services under classes 35 to 45. A full list of all the trade mark classifications and the goods or services they relate to can be accessed on the intellectual property office website HERE.
31.10A.77Protection afforded by trade mark registration
The proprietor, or owner, of a registered trade mark has exclusive rights to use the trade mark in the United Kingdom and his/her right is infringed if it is used without his/her consent [note 8].
31.10A.78International conventions and protection relating to trade marks
Registration of a trade mark with the UK Intellectual Property Office affords protection only in the UK. Apart from making separate applications in each country in which protection is required, there are two methods by which a trader can protect a mark in more than one country using a single application:
(a) Apply for a European Community trade mark with the Office for Harmonisation of the Internal Market (OHIM) which gives protection in all European Union countries.
(b) Apply for registration in countries that have signed the Madrid Protocol through the World Intellectual Property Office (WIPO). This can be effectively joined with an application to the OHIM and extended to other nominated countries.
Applications to the OHIM or the WIPO can be channelled through the UK Intellectual Property Office.
The contact details of these international registration authorities are as follows:
The Office for the Harmonisation of the Internal Market (Trade Marks and Designs)
Avenida de Europa, 4
World Intellectual Property Organization
34, Chemin des Colombettes
Tel: + 41 22 338 9111
Fax: + 41 22 733 5428
31.10A.79Duration of registered trade mark
The initial period of registration is for a period of 10 years, and can be renewed every ten years thereafter indefinitely [note 9]. The first ever registered trade mark, the Bass red triangle, was registered in 1875 and is still a live registration. If the mark is not renewed it will lapse and the protection will cease. If a mark is mistakenly allowed to lapse it can be renewed, for an additional fee, within six months of the date that it lapsed.
31.10A.80Considerations when seeking to restore and sell a trademark
If the official receiver is considering making an application to restore a trade mark registration in order to sell it, the Intellectual Property Office should be asked to confirm that the time-limit for restoration of the trade-mark has not expired. They are unable, though, to give advice on the likely success of such an application. The costs of the application should be taken into account in the negotiations relating to the sale and should not exceed the potential sale proceeds.
31.10A.81Revocation of a trade mark registration
A trade mark can be revoked (removed from the register) where it has not been put to genuine use within five years of being registered, or has become the generic name (that commonly used for a product or service in a particular trade) in consequence of the activity or inactivity of the trade mark owner. It can also be removed where its usage is likely to mislead the public as to the nature, quality or geographical origin of the goods or service with which it is associated. A third party can apply for a registered trade mark to be revoked if it can be demonstrated that any of these revocation criteria apply [note 10].
31.10A.82Ascertaining a trade mark owner
The owner of a trade mark is known as a proprietor for the purposes of the registration process. The Intellectual Property Office maintains a database of trade marks which covers marks for which an application for registration has been made, are currently registered or where registration has ceased. The search facility to find trademarks by proprietor is available on the Intellectual Property Office website HERE. The information available includes a reproduction of the mark, the status of the mark (registered, lapsed, etc.) the classes of goods for which it is registered, relevant dates (application, renewal, etc.), the name and address of the proprietor and details of any agents acting.
31.10A.83Trade marks as assets
A registered trade mark is an item of personal property [note 11] and [note 12] as is an application for a trade mark [note 13]. Trade marks can be assigned, pass under a will or by operation of law as property separate from the goodwill of the business [note 14]. A registered trade mark may be used as security for a loan or other finance by way of a charge or other mortgage [note 15]. A registered trade mark or application for a registered trade mark held by an insolvent forms part of the estate of a company in liquidation and also vests in the trustee of a bankruptcy estate.
31.10A.84Sale of a registered trade mark
Where a registered trade mark (including a trade mark assigned to a company in liquidation or a bankrupt ) has vested in the liquidation estate or bankruptcy trustee, the trade mark registration may be sold, with any assignment being signed by the liquidator or trustee of the bankruptcy estate as assignor [note 16]. The Intellectual Property Office must be informed of the assignment for it to be valid [note 17].
31.10A.85Royalties due for use of trade mark by a third party
In addition, royalties may be paid by a third party to the owner of a registered trade in exchange for exploiting that trade mark. The royalties may be payable under the terms of a licence, with the owner retaining the trade mark [note 18]. In circumstances where a winding-up order or bankruptcy order is made against the owner of a trade mark, the Official Receiver should make contact with the third party paying the royalties and ask them to pay any royalties due to the liquidator or trustee.
31.10A.86Royalties due to a bankrupt following sale of the trade mark
It may be the case that a bankrupt is in receipt of royalties as a condition of the sale of a registered trade mark. In this case the royalties cannot be claimed as an asset as the trade mark does not vest in the estate. Instead, the royalties should be treated as income and can be claimed under an income payments agreement or an income payments order.
A licence of a trade mark may also be sold. The assignment should be in writing and signed by the parties. The Intellectual Property Office should be informed of the transfer [note 19].
31.10A.87Protecting a registered trade mark
Any person who becomes entitled to a trade mark by virtue of the making of a court order (including winding-up and bankruptcy orders) is obliged to inform the Intellectual Property Office of his/her interest in the mark [note 20] and [note 21].
Where an insolvent owns a registered trade mark, the Intellectual Property Office should be informed of the winding-up order or bankruptcy order and asked to note the Official Receiver’s interest in the trade mark. Enquiries should be made to establish whether there are any licensees or mortgages of the patent in order that they can be informed of the making of the insolvency order and asked to note the Official Receiver’s interest.
The address of the UK Intellectual Property Office is:
Intellectual Property Office
Tel: 0300 300 2000
Tel from outside the UK: +44 (0)1633 814000
Minicom (text phone): 0300 0200 015
Fax: +44 (0)1633 817777
31.10A.88 Valuation of trade marks
(amended April 2014)
The valuation of intellectual property is a complicated and sometimes controversial area and the value will very much depend on circumstances. It is unlikely that the official receiver’s local agents will have experience in this field and consideration should be given to the employment of specialist agents. A specialist in trade marks may be contacted through:
The Institute of Trade Mark Attorneys
Tel: 0207 101 6090
Fax: 0207 101 6099
31.10A.89Joint ownership of a trade mark
A registered trade mark may be granted to two or more persons jointly and, subject to agreement to the contrary, each of them is entitled to an equal, undivided share in the mark. Each proprietor is allowed to use the mark without the consent of any of the joint owners, but the mark may not be licensed or assigned without the consent of the joint owner(s) [note 22].