A trademark is a form of intellectual property, much like physical assets such as land. Similar to how a landowner possesses the right to sell or transfer their property, the owner of a trademark also holds the authority to do the same with their trademark. Any individual looking to transfer their trademark rights can do so through either trademark licensing or trademark assignment, governed by the Trademark Act of 1999. In this article, we will delve into how a trademark owner can transfer ownership to another party through the process of trademark assignment.
Defining Trademark Assignment
Simplified, trademark assignment encompasses shifting both ownership and rights of a trademark to a different individual, formalized via a legal contract called a Trademark Assignment Agreement. Linked to this is the notion of partial trademark assignment, recognized as trademark licensing. As stipulated by Section 37 of the Trademark Act, 1999, trademark assignment signifies the transference of an owner’s rights, title, and stake in a trademark or brand symbol. Should the trademark be registered, its assignment necessitates recording in the trademark registry.
Types of Trademark Assignment
Let’s explore the various forms of trademark assignment:
In this type of assignment, all rights pertaining to a registered trademark are transferred to the second party. The original owner relinquishes all rights, allowing the second party to earn royalties from the trademark. After the transfer, the original owner no longer retains any rights over the trademark. For instance, if Mohit, the owner of “ABC,” transfers ownership to Karan, Mohit will have no rights associated with “ABC” thereafter.
In a partial assignment, ownership of the trademark is only transferred for specific products or services agreed upon in the Trademark Assignment Agreement. The original owner can retain some rights and limit the transfer of the trademark to certain products and services. For example, if Mohit owns the brand for both bread and butter, he might transfer rights for the bread and retain rights for the butter. This practice is referred to as a partial assignment.
Assignment with Goodwill
This type of trademark assignment includes the transfer of both the trademark’s rights and the value associated with the trademark. When an assignment with goodwill occurs, the second party receives the rights and value of the trademark to use in relation to specific products and services. For instance, if the owner of the “Amul” brand sells it to “X,” “X” can use the brand for dairy products and other manufactured goods.
Assignment without Goodwill (Gross Assignment)
In this category, the original brand owner restricts the buyer’s use of the brand for products already in use by the original owner. Any goodwill attached to the brand for products sold under it isn’t transferred to the buyer. For example, if the owner of the “SAMSUNG” trademark assigns it to another party without goodwill, the second party can use the trademark for products other than mobile phones.
Benefits of Trademark Assignment
Trademark assignment offers several benefits, including:
Security for Both Parties
A Trademark Assignment Agreement secures the rights of both the assignor and the assignee. This legal agreement stands as evidence in case of disputes.
Trademark assignment supports business expansion, allowing both parties to associate the brand with their respective businesses.
Utilizing Established Brands
Acquiring the rights to an established brand through trademark assignment eliminates the need for creating and marketing a new brand, saving time, money, and effort.
Prerequisites for Trademark Assignment
To validate trademark assignment in India, specific requirements must be met:
- The assignor/owner of the trademark must intend and consent to the assignment.
- The assignment must be in writing.
- Both the assignor and assignee must be identifiable parties.
- Valid identification documents for both parties are required.
- A valid Trademark Assignment Agreement must be executed.
- The marks must be properly identified.
- Proper consideration for the assignment must be included.
- For a successful trademark assignment process in India, these requirements must be fulfilled.
Procedure of Trademark Assignment in India
To initiate trademark assignment, follow these steps:
Submit the Application
The assignor, assignee, or both parties can submit an application for trademark assignment.
File the TM-P Form
Fill out the TM-P form with the necessary transfer details.
Submit Required Documents
Provide all necessary documents to the Registrar of the Trademark within six months of obtaining ownership.
Once the assignment application and documents are submitted, they are processed.
Advertisement of Assignment
Advertise the assignment as directed by the Registrar and provide relevant copies.
Approval and Registration
If the Registrar approves the application after verification, the assignee becomes the registered proprietor of the trademark. Registrar records the details in the register.
Trademark assignment requires careful planning from both the assignor and assignee. It provides numerous opportunities, enabling the assignee to access an established brand with the consent of the original owner. Through trademark assignment, brands can continue to thrive.